Older structures and processes won’t do anymore. No matter how you tinker with your existing reality, change expert John P. Kotter insists it won’t be enough. If your current structure is flagging, the time for change is now.
Harvard Business School professor emeritus John P. Kotter, a noted leadership and change management expert, understands that intense, accelerating change defines today’s business world. While stable, clear hierarchies work in a steady environment of routine operations, he warns, they can’t perform the work that change requires. A hierarchy can’t identify emerging opportunities or threats.
More than anything, both today and throughout history, leadership has been associated with change.John P. Kotter
Almost all businesses start with a “network-like structure” in which relationships follow a solar system model. The founders are at the core, and everyone revolves around them and their vision, continually seeking opportunities and taking risks. Over time, these vibrant, fluid networks grow and shift to rational, reliable hierarchies.
Kotter recognizes that some people want to deal with change by trashing hierarchical structures. But, he points out, hierarchies are good at what they do, although they are complacent. They resist change and may not see the need for it. But instead of tearing down your structure, Kotter recommends adding a new organic network to it and creating a “dual operating system.” This means establishing a clear division, separating the hierarchy from the network, and then working with two systems.
The basic structure is self-explanatory, hierarchy on one side and network on the other. John P. Kotter
Utilizing this two-part operating system relies on five core principles: different people drive change; people “get to” do jobs they relish instead of jobs they “have to” do; both your heart and your head must be at work; you need solid managers to carry out change; and the network and the hierarchy must function as partners. Don’t make your new network just another department in the hierarchy. Don’t create two, insulated “super-silos.” Instead, Kotter advises, the network and the hierarchy must work as partners, so information flows freely between them. Then they can coordinate their actions for mutual benefit. Kotter seems undaunted by offering advice that is easier said than done. He offers examples of firms that use his dual system successfully and clearly wants you to get the big picture.
Kotter provides eight accelerators to help your network-plus-hierarchy structure function. First, use “urgency” to fire up your network and get people excited about your firm’s “Big Opportunity.” Then, build a “guiding coalition” of leaders. Third, develop your vision and strategic initiatives. Fourth, recruit volunteers who want a role in creating change. Fifth, plow down internal barriers so that everyone can contribute. Sixth, create and celebrate continual “short-term” wins. Seventh, “sustain acceleration.” Many people will take a step toward change, then stop and drift. To support your larger initiatives, carry out sub-initiatives to keep momentum going. And, finally, when you complete a win, integrate and replicate it in the existing hierarchy so the whole organization benefits.
Kotter highlights the places where the two systems – hierarchy and network – will align and where they will differ. The hierarchy’s function is to be reliable and efficient. It is good at its regular jobs and at small bits of ongoing change. By contrast, the network is fast, agile and innovative.
Pressure to Adapt
Kotter is clear that the wave of change takes different forms in different places – here an opportunity, there a threat, over there a disruptive technology, all moving really fast. Companies used to develop products with a 20-year lifecycle. Now, he says, two years is more likely. As the speed intensifies, previous best practices become increasingly ineffective. To adapt, you need to understand the relationship between management and leadership. Management, which provides tactics for doing jobs, creating plans, organizing companies and setting budgets, is essential in hierarchical businesses.
We are in the midst of a storm that has been increasing in intensity for decades, driven by advancing technologies and global integration.John P. Kotter
By contrast, Kotter says, leaders must be visionaries who give people the energy to buy into their vision and the freedom to do it quickly. Leaders help people create change and guide them through it. Kotter calls for multiple leaders at all levels. In stable situations, managers can manage, but in chaos, you need leaders. Many large organizations start as engaged networks with real leaders and evolve into stable hierarchies. Then, managers replace leaders as the hierarchy buries their energy. Set that energy free, Kotter urges, and let it flow into your network.
Role Model for Change
A major change is “horrendously challenging.” Blaming organizational structures or policies for resistance to change is easy. The real problem is people who ignore the need for change and cling to the known, even after it stops working.
Accelerating an organization, making it faster and more nimble in dealing with strategic challenges, is never easy.John P. Kotter
Kotter urges you to spread a sense of urgency to generate more power for moving ahead. Be enthusiastic about the opportunities that change enables. Share this urgency. Be a “relentless” advocate for change.
Kotter warns change leaders that they’ll face challenging questions. Why do you have to change how we develop strategies? Because so much is at stake. How do you measure a network’s performance? You can’t measure it as you can a company’s achievements. Networks don’t perform standard tasks or use known metrics. However, you can make qualitative appraisals and trust that the network eventually will produce measurable results.
And who runs this network? In the traditional sense, nobody - though Kotter says you should designate someone to facilitate fluid operations and maintain working relationships. What does starting the network cost, in money, time and energy? Not much, because it must grow organically as existing employees give it about 5% of their time, perhaps a couple of hours a week. Do we have to do this now? Reflect on how well your current system works. If it’s flagging, the time for change has come.
Dual – or Dueling – Systems?
Anyone who’s paying attention will agree with Kotter’s premise in Accelerate – or to be tech cute – XLR8. Amid accelerating change, companies must adapt as they discard rigid silos, established routines and dependency on management. Kotter’s next change management assignment is more challenging: keep your hierarchical structure and grow a second, organic network in symbiotic partnership with it. He suggests developing the new network a bit at a time and staffing it with people from the old one to enjoy the best of both worlds.
Some of Kotter’s accelerators ring familiar (like removing barriers to innovation), including those from some of his other bestselling strategy books, such as That’s Not How We Do It Here! and Our Iceberg Is Melting. His striking ideas for revitalizing companies and seizing opportunity have endured over time. This book’s template, the strategy of dual operating systems, emerges logically from his foundational concepts, particularly the existential need for change.