Leading change: What leaders can learn from high oil prices

Oil, which is like the black cocaine of our energy-hungry society, is once again over $100/barrel. At the pumps, this is translating to over $4.00/gallon, and consumers are feeling it.

$4.00 seems to be the point where real discussion begins about alternatives. Over the kitchen table, it’s reducing driving or getting a hybrid. In government, it’s about funding research and giving tax credits. Entrepreneurs smell opportunity for alternative energy markets. In any case, we have a real discussion, because people are feeling it personally. So this round of high prices is not just a problem in the petroleum supply – what we have are the conditions necessary for change.

 

Creating a personal connection to a change

It’s been touted by many in the field of change management – achieving a personal connection to the problem is a key prerequisite to any major change. A leader will try to wake a sleeping company by story-telling and laying out cold, hard facts to create urgency around a change. Stephen Elop, Nokia’s new CEO, did just that in his compelling “Burning Platform” memo to all employees last month, using the story of the Piper Alpha oil rig fire in the North Sea in 1988 (oil again…) as an analogy of the state of Nokia and how they have to move forward.

It’s a great story, but for most employees, it’s still just a story. What employees feel is what happens within arms’ reach – they need to be touched by the problem, not just hear a business case describing it. For example, employees can’t “feel” lost market share, so they won’t commit to painful remedies that leaders push when trying to fix it.

The same is true for changing the minds of executives. With the velocity and ambiguity that execs deal with, the executive mind is often set to “screen out” mode or “decide and move on” mode. When people deep in the organization flag a need for change that challenges the status quo of the business, it’s tough for executives to wrap their brains around it.

John Kotter, Professor Emeritus at Harvard Business School and organizational change guru, wrote about this in a recent blog post. In the post, he talks about how an employee had to get the attention of leaders about a purchasing problem wasting the company’s money, but the execs weren’t getting it. What finally got everyone’s attention was bringing over 400 different pairs of work gloves – all bought from different suppliers at different prices - and dumping them on the CEO’s desk. The tangible example of the deeper issue helped the CEO, and then the senior leadership team, finally “get” the problem, leading to change in the company’s operations.

 

How to help employees connect with the need for change

So how do you connect people to the case for a change?  It’s a lot of work, but without doing the work, you can’t expect the change to actually happen.  And recovery from failed change implementation is far more difficult than tilling the soil for your change in the first place.

Here are three ways you can create the connection:

1. Simulate the change: Create a way for people to “experience” the change before it happens.  Two popular approaches are:
• Experiential exercises: The old “rocks and ropes” exercises usually don’t do much to teach people new skills, but they’re great at helping people see something that’s broken.  This is particularly good for showing gaps in team dynamics or cross-organizational processes.
• Business simulations: A true simulation actually creates a model of the business – a “before” model, an “after” model, or both.  People run the business, the process or org that will undergo change and personally see how their actions matter.  Sims aren’t cheap, but if the change is deep and strategic, it can be well worth it.  Companies like BTS in the US specialize in building business sims.
2. Publicly execute the old way of doing things: In change management there’s a saying – “change is more about what you stop doing than what you start doing.” Until the old way dies, change can feel like a bolt-on to the old way, instead of a departure from it.  I once consulted with a metal parts manufacturing company trying to change its manufacturing processes.  On the shop floor, the crew measured success by total weight of parts produced that day.  This drove the team to pick the heaviest jobs to run in the plant, even though these products were the least profitable and often sat in inventory.  It wasn’t until the day that the shop supervisor ceremoniously tore up the log for tracking weight that the crew began to understand what was expected in the new world.
3. Involve people in creating the change: We’ve all heard about this – it seems so obvious, doesn’t it? But too often the involvement is superficial just to claim it was done. People take you seriously when you pull a couple of the sharpest front-line folks out of their day jobs and engage them in the planning – and you actually use their contributions.

So when you look at the price at the pump next time you fill the tank, and you feel that pinch, remember the feeling for the next time you have a change to implement.  If you or the people you work with aren’t feeling that same four-buck-a-gallon twinge yet, chances are that change won’t happen.