Thinking about the managing of change has been occupying my mind in recent weeks. It will continue into the next few weeks as Jeffrey Phillips of OVO Innovation and I have co-authored a White Paper called “the critical interplay among innovation, business models and change” as it rolls out.
In this we provide a foundation document that highlights the important interplay between innovation, business models and change. To launch this, we have kicked off our thinking with a feature of the week on Innovation Excellence introducing the themes that have multiple interplays we often fail to exploit when it comes to innovation. The opening post is entitled “the interplay surrounding innovation”. Please take a read
Our opening argument resolves around the recognition of change as part of an interplay
We argue that we are failing to manage the different and multiple interplays that are constantly taking place when innovation occurs. We are often ignoring them and failing to extract the best or optimal value out of the innovation we are introducing. The change effect is often being ignored.
You can download this whitepaper on this site within my newly created “Insights and Thinking” tab on this site. In this paper we discuss the dynamics and focuses of its impact on all three constituents involved when innovation occurs; that of the customer, the market or industry itself and on the innovator itself. We used the “lens” of the three horizon model to demonstrate and frame the interplay between innovation, business models and change.
We are providing a series of posts on this through Innovation Excellence in the coming weeks which build from and on this White Paper. We both feel this has far more to explore in practices, frameworks and thinking and we hope you share this view, as it builds.
We initially chose change over transformation.
Clearly the emphasis is to encourage transformation to meet the unrelenting disruptions going on all around us makes sense. I certainly believe we have to become far more comfortable with change, before we attempt anything transformational and that in itself is not easy at all. We seem hard-wired to resist change until we are forced to accept it and that is a real pity and loss within ourselves. We need to see change in different ways, through the lens of discovery and learning, then we transform.
Change always feels painful.
Change is notoriously hard to achieve both within ourselves and especially in organizations. The reality is we want to resist change, it makes us feel uncomfortable, often raising the fear of the unknown. We form habits that we find hard to shake free of. Often we invested a fair amount of time in learning, it then becomes even tougher to start unlearning but that is what we must do, unlearn, to then open up our minds to relearn. We worry about are we losing something of value, is the change going to feel better or just increases our insecurity even further.
The level of failed change or transformations undertaken has been put at somewhere between 70 to 80% in failing short on their initial targets or aspirations that drove change. The value generated from change often falls below the expectancies visualized when the organization embarked on the change program. So why do we put ourselves through this level of pain, disruption, uncertainty and potential risk of failure?
We do get caught up in interchanging change and transformation and believe it is the same.
It is not! In my research on change I altered my own understanding with a range of thinking I explored.
Change tends to focus on making the existing system better.
You use this as your framing point and the level of efficiencies and improving effectiveness is judged as the success or not of the end result. You actually are ending up with a reconditioned model of your past as you have mainly dealt within the boundaries and constraints to make this (often) well-defined shift in the way things have worked.
Transformation is a different matter. You are attempting something far more radical and disruptive.
It is aiming to reinvent the organization, significantly challenge and change the practices that are in place. It places far more at a higher risk as it is more unpredictable, iterative and often a series of experiments to learn and adapt. It often feels you are entering the unknown as it can become a real process of discovery, experimentation and adjusting execution.
Transformation is far more dynamic and far-reacting. It is often looking to design for the future as you release the shackles of the past, bound up in existing processes, behaviors and thinking. You are looking to invent far more as you learn, clearly more radical new business models would have this ‘transformational’ effect.
Both change and transformation need to deeply understand the “as is” and those committing to make a change or transformation need to share the goals and understand the reasons for undergoing such a conversion from the existing state to a different one. There are considerable risks associated with both.
What might help flip the odds?
I would argue that most change or transformation initiatives attempted are far to piece meal, they address only certain known parts and fail to address the ‘whole’ that is actually affected by change.
Any change program needs a far more holistic approach than often we give this, we get caught up in the project management, we focus too much on one side of the change equation and either get caught up in the people side or favor the structural side of processes and functional design.
Undergoing any change required dramatically rethinking the reasons for this, the effects this will seem to have on the operating and business model. Will the effort yield a more positive result?
We are facing unprecedented disruption
Externally we are seeing increased volatility, complexity in regulations, the impact of geopolitics, constant pressures in public spending and shifts in demand, the digital disruptions and social media influences forcing a greater need to dialogue with stakeholders, customers and new entities and finally, our employee base is questioning and demanding in unprecedented ways. All of these are having a significant impact on our organizations and they have not responded and are often stuck in those past times where these forces of real change were simply not built into the system.
Equally most organizations are losing any significant competitive advantage as the competition has intensified, the design and adaptability of others to challenge the existing incumbent is being made easier through the internet, reducing global barriers and high level of mobility, operating often at much lower operating costs, free from legacy.
The final imperative for change comes from our present poor levels of growth and innovation.
Innovation requires managing differently, to function and yield those higher results we would like and this becomes part of the dilemma within organizations. Yet innovation is also badly constrained because change is not considered as having this symbiotic relationship with innovation. Innovation being designed and produced are mostly new to the world (or should be) and these confront customers, markets and the innovator themselves in making change.
The higher the scope of impact of innovation the more we do need to address change yet we can’t often grasp the nature and amount of change that the innovation unleashes. We should think about innovation and change together. This is where Jeffrey and I are focusing our thinking at present
Change is all around us as a constant- we need to simply get use to it
We can’t escape change; we can’t transform ourselves without a clear holistic model of its impact across the whole organization. Change and transformation requires us to be dynamic, constantly exploring, adapting and learning, it cannot be refrozen as was the thinking of the past. Nothing is stable; we need to build it as fluid, agile and constantly adapting through our learning.
We need to generate a far more highly dynamic environment, one where we are constantly being challenged and seeking out answers through discovery, experimentation and constant execution. We need to become excited about change, each of us becoming innovation change leaders.
Change today is about building a change capacity that is constant evolving. We need to see change as pursuing new opportunities, explore different horizons and thinking. We need to become far more energized in trying out new things, in experimenting or prototyping, to learn and advance.
We must retool ourselves as change not only leads to transformation but it will allow us to explore all the interplays we can find within and around innovation and those can lead to great things.
To obtain the White Paper you can go to my insights-thinking page, where you can download or view the paper “the critical interplay among innovation, business models and change”