no one knows how to use them

In Scott Keller's book Leading Organizations: Ten Timeless Truths, co-written without colleague, Mary Meaney, he recounted a travel experience that is particularly salient on the topic of skill-sets. Scott was fortunate enough to visit East Timor some five years after it had become a fully independent country. He was disheartened to find that the country was riddled with poverty, in part due to its poor infrastructure, especially in light of the significant reconstruction investment that it and many other nations had made on independence. He wondered why things hadn’t changed.

As he was traveling through the country, he came across a field full of bulldozers, compactors, jaws, and all manner of heavy construction equipment ideal for road-making. The field was overgrown, the metal was rusting, and a few local kids were climbing on the equipment as if they were in a giant playground. “What’s all this?,” Scott asked. “Donations from China from when we declared independence,” came the response from his local guide. “What’s wrong with them?,” Scott asked. His guide replied, “Nothing, but no one knows how to use them.”

The aspiration of many countries, including China, to help East Timor develop as a nation was clearly bold and well-intentioned. The desired change, however, fell apart because the skill-set requirements to deliver the aspiration hadn’t been assessed or addressed. This example may seem extreme, but to us it’s emblematic of what we often see in failed change programs. Organizations make East Timor-like big investments in changing structures, systems, or processes without ensuring the skills are built to enable them to work the way they are intended. Our research backs up the premise: organizations that explicitly assess their current skill requirements against those required to fulfill their performance aspirations are 6.6 times more likely to succeed in their change efforts.

Scott Keller and Bill Schaninger

Beyond Performance 2.0: A Proven Approach to Leading Large-Scale Change. John Wiley & Sons, Inc. 2019

when we’re personally involved

Daniel Kahneman performed an experiment involving a lottery run with a twist. Half the participants were randomly assigned a numbered lottery ticket. The remaining half were given a blank ticket and a pen and asked to choose their own lottery number. Just before drawing the winning number, the researchers offered to buy back all the tickets. They wanted to find out how much they would have to pay people who wrote their own number compared with people who were handed a random number. 

The rational expectation would be that there should be no difference. After all, a lottery is pure chance. Every number, whether chosen or assigned, should have the same value. An even more savvy answer would be that you should have to pay the people  who write their own number ever so slightly less, because of the possibility that there will now be duplicate numbers that, if chosen, would mean the size of the price would be cut in half. 

Neither of these turned out to be the right answer. Regardless of nationality or demographic group, people who wrote their own number always demanded at least five times more for their ticket. This reveals an important truth about human nature. When we’re personally involved in “authoring” an outcome, we are far more committed to it because we feel we own it. The underlying psychology relates to our need for control, which is a deep-rooted survival instinct.

…The lesson for change leaders? If you want to increase the motivation for (and therefore, speed of) the implementation of change, it pays to involve others in creating the aspiration, even when the answer may already be clear in the mind of the leader…. Change programs whose aspirations phase is characterized by an organization-wide, collaborative effort are 1.6 times more likely to succeed. 

Scott Keller and Bill Schaninger

Beyond Performance 2.0: A Proven Approach to Leading Large-Scale Change. John Wiley & Sons, Inc. 2019

profoundly simple

Understanding evolves through three phases: simplistic, complex, and profoundly simple.

William Schutz

As quoted in Beyond Performance 2.0: A Proven Approach to Leading Large-Scale Change. John Wiley & Sons, Inc. 2019 by Scott Keller and Bill Schaninger

beware of optimism bias

Beware of optimism bias: the expectation that the best possible outcome will emerge. This accounts for why divorce rates in the western world are around 40 percent, yet when you ask newlyweds to rate their likelihood of divorce they are most likely to put it at 0 percent…. It also explains why, as our colleagues Chris Bradley, Martin Hirt, and Sven Smit describe, “One of the most emblematic outputs of the dreaded strategic-planning process is the ‘hockey stick’ forecast – the line that sails upwards on the graph after a brief early dip to account for up-front investment. These hockey sticks, confidently presented by executives pitching their new strategy, are easy to draw but they don’t score many goals. What tends to happen in reality is that the strategy fails to meet the bold aspirations and is replaced by a new one. 

Being aware of such biases doesn’t help one avoid them. As Dan Ariely, one of the foremost thinkers in the field, declares, “I am just as bad myself at making decisions as everyone else I write about.” Fortunately, however, there are a number of proven and practical tools to minimize biases in decision-making. These include, among others, the following: the “pre-mortem” (generating a list of potential causes for failure of a recommendation and working backward to rectify them before they happen); “red team-blue team” (assigning one person/group to argue for, and one to argue against, a decision); “clean-sheet redesign” (developing a system from only a set of requirements, free from considerations related to current investments or path); and “vanishing options” (taking the preferred option off the table and asking, “What would we do now?”). Importantly, simply ensuring you are engaging a diverse team in decision-making will reap significant rewards – which research reveals can improve decision-making quality by more than 50 percent.

Scott Keller and Bill Schaninger

Beyond Performance 2.0: A Proven Approach to Leading Large-Scale Change. John Wiley & Sons, Inc. 2019

creating a vision

In our experience, the hardest part of creating a vision is finding the balance between what is bold and transformational and what is realistic and achievable. The phrase many use for this is landing on a vision that is “tough but doable.” If the vision feels too incremental, cautious, or overly tailored to existing capabilities, it will fail to create momentum or pressure for an organization to push the limits of what is possible and therefore won’t lead to breakthroughs. At the same time, if people see goals as simply “pie in the sky” and beyond reach, they will become disillusioned and give up. 

Often, examining the “art of the possible” can help find the sweet spot. For example, ask what performance would look like if every area operated at the level of the current best practice within the company? What if all of our processes and systems were operating at the top of their technical limits? What if we achieved best practice in the industry on not one, but all key measures?... By considering the art of the possible in this way, leaders can aim high without the goal feeling untethered to reality. 

When managers are planning two or three years ahead, that period is close enough in time to allow them to choose relevant goals and identify specific initiatives to reach them. 

There are advantages in having objectives distant enough to reduce any temptation to rob tomorrow to pay for today – a constant battle for public companies under pressure to achieve quarterly results. 

Scott Keller and Bill Schaninger

Beyond Performance 2.0: A Proven Approach to Leading Large-Scale Change. John Wiley & Sons, Inc. 2019