Critical Business Change is a new way of thinking to help companies evolve in a changing, interconnected world.
It combines concepts from Strategy, Operations, Theory of Constraints and Human Behavior, and it´s based on the premise that change is no longer a Question, it has to be embedded in the company´s DNA.
For decades companies have deal with change, but for many of them it´s still a very difficult challenge. Hyper-competition and Information technology are speeding up the way businesses need to respond to changes in the environment, and many of them are not responding well. Bureaucracy, arrogance, lack of vision or lack of talent, are some of the factors that affect why companies do not deal with change in an effective way. But there is another key element that affects companies in their transformation efforts: they are strong organizations designed to resist change. Companies are top-down hierarchical structures, grouped in functional silos that demand specialized people, and work by standards that determine executive´s compensation. All of these elements combined, create rigid structures, focused on executing today´s work, and very resistant to new and risky ideas.
In contrast, CEO´s are dealing with challenges that require quick answers and innovative solutions, to new demands of a well informed customer that lives in a changing world. Financial institutions are trying to gain confidence after the last economic crisis, Airlines are trying to reduce costs and many of them in a desperate survival effort, even Toyota is working in customer confidence after some important recalls. These type of challenges are hardly questioning how companies work, and why they are not responding to change in a more effective way.
Companies need to deal with the Execution-Change paradox in a daily basis, they can´t choose between one concept or the other, they can´t separate short term from long term, they need to understand that the “managing for the quarter model” is dangerous, if it is not complemented by risky innovation projects that may not work immediately, but that build company´s future.
Step one. Change the way you think.
Managers must think of their job as a process of managing the Execution-Change paradox. Change must not be a question anymore in any organization, it has to be one of the fundamental purposes of every part of it. Organizations need to execute today´s work with mastery, and achieve short term results, but deeply question the process and the purpose, and challenge the status quo with new innovative initiatives that answer tomorrow´s questions. This new way of thinking would definitely make manager´s work harder, they need to build strong organizational structures, but continuously question them, challenge them and break them apart if necessary.
Step two. Define your Vision and Timing for change, and focus on High Profile Opportunities
It is very important to determine What do you want to do?, What do you need to do?, and What you can do?, answering this questions with responsibility and an holistic view, would give managers a concrete start point.
We analyze change based on two variables: Vision (we define it as the combined answer of the three questions stated above) and Timing (we define it as the time you have to give an answer).
After doing this analysis in order to understand better where to star, the next step is to focus on the High Profile Opportunities. These are the most difficult problems and the bigger opportunities, business is dealing with. If change initiatives are focused in “not profitable” areas, change is going to be too expensive. Another important element to consider is the “size of change”, it can´t be that small that is irrelevant, or it can´t be that big that is unfeasible to achieve.
Step three. Process Innovation
The next step is to understand the main business of the company (main street not wall street), and rethink processes and operations, from an outside in perspective, with high sense of business purpose not only functional perspectives, and deeply questioning What?, How?, Why?, Who?, When?, Where?, What technology is used?, Why it can´t be faster, easier or user friendly?, Does it adds value or cost?
Step four. Implementation 2.0
From our experience in Critical Business Change projects, we conclude that enabling change capabilities in areas or companies where change was implemented is the hardest part. Our proposal is that change responsibility needs to be given to people in the front line, not managers. Implementation 2.0 is a continuous improvement model, where managers develop change capabilities in their people, and facilitate change initiatives through improvement cells, but the concrete initiatives of what needs to be done come from the people in the front line.
- Help companies execute their internal transformations and del with change in a better and more effective way.
- Help leading companies stay "at the top".
- Give change management a new perspective and a higher contribution to business objectives.
- Help Managers and Executives deal with change in a better way.
- Help companies be more flexible and dynamic in order to deal with the speed of markets.
- Distribute CBC paper in order to recieve feedback and hear about success stories and failures of people within organizations.
- Create a forum where change agents share their experiences.
- Distribute CBC methodology in companies from different industries.