transformation deficit

Business transformation will remain at the forefront in 2023, as organizations continue to refine hybrid ways of working and respond to the urgent need to digitalize, while also contending with inflation, a continuing talent shortage, and supply-chain constraints. These circumstances, which require higher levels of productivity and performance, also mean a lot of change: In 2022, the average employee experienced 10 planned enterprise changes — such as a restructure to achieve efficiencies, a culture transformation to unlock new ways of working, or the replacement of a legacy tech system — up from two in 2016, according to Gartner research.

While more change is coming, the workforce has hit a wall: A Gartner survey revealed that employees’ willingness to support enterprise change collapsed to just 43% in 2022, compared to 74% in 2016.

We call the gap between the required change effort and employee change willingness the “transformation deficit.” Unless functional leaders steer swiftly and expertly, the transformation deficit will stymie organizations’ ambitions and undermine the employee experience, fueling decreased engagement and increased attrition.

Cian O Morain and Peter Aykens

"Employees Are Losing Patience with Change Initiatives," Harvard Business Review. May 9, 2023

change happens

In any business environment, change happens.

Let’s rephrase: In any business environment, change should happen. It shows you're committed to the kind of growth and evolution it takes to stay modern, relevant, and competitive.

Countless factors make change inevitable. Think of technological advancements, globalization, cultural shifts, and shifting economies. And since nobody's corporate goals include falling behind or growing stale, embracing change is a must.

But what kind of change are we talking about here? Change can include things like:

• Introducing new software or updating marketing practices
• Updated business processes
• A full-on restructuring
• Leadership changes
• Updated thinking
• Budget constraints
• Shifts in strategy

These all fall under the umbrella of organizational change. If you’re already on board with shaking things up, you’re ahead of the game. And you're not alone.

According to Gartner, 99% of all organizations have undergone a major organizational change in the last three years. But big or small, change doesn't happen naturally. Therefore, effective change requires a clear action plan.

Emily Smith

"7 Organizational Change Management Frameworks That Stick," Remesh Blog. October 10, 2021

the pursuit of value

The trigger for any corporate transformation is the pursuit of value. Ideally, that entails both improving efficiency (through streamlining and cost cutting) and reinvesting in growth. But many transformation efforts derail because they focus too narrowly on one or the other.

In some cases, attempts to streamline the business through productivity improvements, outsourcing, divestments, or restructuring undermine growth. The cuts are so deep that they hollow out capabilities, sap morale, and remove the slack that could have fueled new endeavors.

Bharat N. Anand and Jean-Louis Barsoux

"What Everyone Gets Wrong About Change Management," Harvard Business Review. November-December 2017. 

leaving gracefully

There comes a time in jobs, life phases, or relationships where you know an arc has reached its end. Knowing when it is time to end — and ending well — will become an increasingly valuable skill as lives lengthen and transitions become multiple across both personal and professional lives. Ends can come from within, the result of burn out or boredom, depression or exhaustion. Or they can come from without, the land of restructurings and layoffs, divorce or other major life shifts. They are the prequel to re-creation. It is not always an easy time — for anyone involved, at work or at home. We can spend quite a lot of it loitering unproductively, wondering whether we should stay or go. But good endings are the best building blocks to good beginnings.

Choosing to choose gives you agency. The choice itself, sometimes made years before you actually move, is the first, and often the biggest, step.

• Ask yourself if you are staying where you are out of love, or out of fear. Do you love where you are, or do you fear leaving it for a murky unknown? The latter is a lousy place from which to live, but many of us stay stuck here. Who would I be without this title, this salary, or this position? It can be an exciting question, not a scary one.
• Embrace confusion, ambiguity, and questions. There re-definition lies. And remember, you don’t have to face them alone.

Avivah Wittenberg-Cox

"Learn to Get Better at Transitions" Harvard Bsiness Review. July 5, 2018

what other decisions can they handle?

[GM CEO Mary Barra said,] “A lot gets set aside when you’re going through a restructuring process, so it was an opportunity to really define our culture. So, brainstorming with the HR department, I said let’s change the dress code. Let’s make it ‘dress appropriately.’

But the HR department ironically posed my first hurdle. They started arguing with me, saying, it can be ‘dress appropriately’ on the surface, but in the employee manual it needs to be a lot more detailed. They put in specifics, like, ‘Don’t wear T-shirts that say inappropriate things, or statements that could be misinterpreted.'” 

“What does inappropriate, in the context of a T-shirt, even mean,” she asked the audience, half-jokingly. ”So I finally had to say, ‘No, it’s two words, that’s what I want.’ What followed was really a window into the company for me.”

After replacing GM’s 10-page dress code treatise with a two-word appeal, Barra received a scathing email from a senior-level director. ”He said, ‘You need to put out a better dress policy, this is not enough.’ So I called him—and of course that shook him a little bit. And I asked him to help me understand why the policy was inept.”

The director explained that occasionally, some people on his team had to deal with government officials on short notice, and had to be dressed appropriately for that. 

“Okay, why don’t you talk to your team,” Barra replied. ”He was an established leader at GM, responsible for a pretty important part of the company, with a multimillion-dollar budget. He called me back a few minutes later, saying, ‘I talked to the team, we brainstormed, and we agreed that the four people who occasionally need to meet with government officials will keep a pair of dress pants in their locker. Problem solved.'”

“What I realized is that you really need to make sure your managers are empowered—because if they cannot handle ‘dress appropriately,’ what other decisions can they handle? And I realized that often, if you have a lot of overly prescriptive policies and procedures, people will live down to them,” she said.

“But if you let people own policies themselves—especially at the first level of people supervision—it helps develop them. It was an eye-opening experience, but I now know that these small little things changed our culture powerfully. They weren’t the only factor, but they contributed significantly.”

Leah Fessler

"GM’s dress code is only two words" by Leah Fessler. Quartz. April 3, 2018.