The role of a leader in driving large-scale change requires a healthy dose of transformational leadership, emotional intelligence, grit, and patience. Underlying each of these practices is servitude leadership. When it comes to change, leaders have very little power. Leaders are only leaders when followers enable them to be. Each change leader has one role when it comes to achieving a true paradigm shift away from long-standing status quo to a new way of being: a commitment to enable people to accelerate along a personal change journey.
The focus on people is critically important. The change management business is not for the faint of heart. Seventy-five percent of change management programs fail. The leaders of change fail to realize the desired outcomes of a change initiative when they do not pay attention to their stakeholders - the people who have a stake in the success or failure of the change initiative. Stakeholders take many forms: executives, peers, individual contributors, customers, partners, vendors...the list goes on and on.
Stakeholder engagement starts at the individual level. Each stakeholder requires a catalyst, one that forces an awareness that things must change. I asked two executives who have built careers on driving large scale change to share their views on the tipping points that accelerate large-scale change.
Peter Maier, General Manager, Energy and National Resources Industries, SAP
Over his 26 year career at SAP, Peter Maier has led his share of transformation programs. The technology SAP brought to market disrupted the way businesses are run and how industry ecosystems compete and innovate. The four tipping points Maier has witnessed tend to be cross-board projects with big impact milestones for customers and opportunities for the workforce to develop and engage.
- Globalization. According to Forbes, emerging markets will represent two-to-three times the growth of developed countries. "SAP went international from the beginning. Now we are global," says Maier. As one of the first technology vendors to invest in India, Maier believes that global trends provide a unique and highly complex tipping point for large scale change. Globalization trends related to global and domestic economic growth and bottom-line costs impact of talent are the top two global tipping point trends.
- Digital transformation. Change in the early days of the ERP followed a sequenced approach. Disruption was planned and the technology innovators were the creators. Leaders built mini-kingdoms in silos, with the question "how many people do I have?" as the norm mindset. "Due to the digital world, siloed approaches no longer work. Leading differently has become a catalyst for cultural changes at the leadership level," says Maier. The tipping point comes at a time when fostering agility and speed for cost and efficiency become urgent factors in sustaining or regaining competitive advantage versus competing on table stakes.
- Innovation. The technology industry thrives on disruptive innovation. Here's the thing: it's one thing to be the instigator of disruption, it is another to be the recipient. As the enterprise technology market evolved due to the Internet of Things, new pressures such as the consumerization of the user experience, development and marketing of competing multiple point applications, and much more impact product offerings in many ways. "It used to take enterprise technology vendors 18 months to bring new innovations and enhancements to market. If you did that today, the opportunity would already be gone," says Maier. The increasing speed of innovation, the innovation itself, for example machine learning, and how people interact with each other in the industry and within each company drive leaders to create cultural transformation initiatives with the goal of continuity.
- Business model. Not so long ago, business-to-business technology vendors sold on-premise solutions as a one-time per-user license fee. Each quarter, the race to close business meant negotiating over large, complex contracts. Then the cloud happened. "When the cloud disrupted the enterprise market, many saw the implications with a technology lens. The impact was far greater and required a complete restructuring to the business-to-business (B-to-B) vendors' business model," says Maier. In addition to changing how technology is developed and deployed, cloud has forced a change to our business model and how the business should be structured to accommodate for the customer experience in the long term, far after go-live.
Seventy-five percent of the world's economy runs on SAP software. Changes the company undertakes impacts far beyond the walls of the business. "We must remember that large scale change impacts all people. It impacts our customers, our workforce, our partners, and the communities we serve," says Maier. As a change executive, Maier spends much of his time providing pragmatic guidance to customers on priorities, solutions, and navigation of the expanding ecosystem. He also coaches several people at SAP with a commitment to invest in typically under-represented populations in the technology industry. He opens his network and his breadth of knowledge to those who can benefit as they navigate their corporate journeys.
Michelle Nix, Vice President, Technology Risk and Compliance, National IT Compliance Officer, Kaiser Permanente
Michelle Nix has been in the healthcare industry for 28 years. Throughout her career, Nix has led her fair share of large scale change on a national scale. Her work focuses on ensuring that the organizational risk appetite is operationalized in for IT with implications throughout the company. For business leaders, interruption from achieving business goals and objectives is rarely welcome regardless of corporate mandate.
Cultural transformation and quantifiable change metrics are difficult to achieve in any circumstance. When you are driving change from what many in the business view as a cost center, that transformation becomes even more difficult. Nix has seen two scenarios consistently emerge into tipping points for the type of cross-organizational transformation that she and her team drive:
- Realized risk. Sometimes the catalyst for change comes only when the worst case scenario is realized. Whether an audit is not passed, a law is broken, or a financial threat becomes reality, nothing brings a need for change to the forefront quite like a material failure. These types of risk carry more than fines or other financial implications, sometimes, depending on the scenario, brand equity can also be at stake.
- Unbearable pain. The only medicine for chronic organizational pain is change. That's it. That is the only lever that leaders have to resolve challenges that persist and hurt both hard and soft business objectives. Whether the pain is impacting morale and engagement, or operational efficiencies and bottom line impact. Every leader has a threshold. Once the pain threshold has been exceeded, change happens and happens swiftly.
"Either of these scenarios can drive rapid and invasive change," says Nix. She warns against falling into the trap of short-term thinking and actions. The tipping point is a catalyst. Creating a new status quo requires a plan that will take the new organizational changes into the mainstream. Nix recommends the reinforcement mechanisms that resonate at the individual level. These include role models, training, and policy changes. "Sustaining the results of these changes is where the work really happens and where it shifts from change to transformation," says Nix.