1) According to John Kotter, traditional organizational hierarchies are not well-suited for environments where constant change is the norm. He argues that organizations need both a hierarchy to manage daily operations as well as a parallel, network-like system to drive strategic change and agility.
2) Kotter proposes eight "accelerators" that organizations can use to build a dual operating system, including creating a sense of urgency, forming a guiding coalition, developing a strategic vision, and removing barriers to action.
3) The document describes a case study of how consulting firm BB&A helped Kimberly-Clark Europe engage employees in bringing their new strategic ambition to life through a three-phase change process of co-
2. 2
According to John Kotter…
“The traditional organizational hierarchy has evolved to meet the daily demands
of running an enterprise, but this system simply is not built for an environment
where change has become the norm… “
Why some businesses struggle…
John Kotter is an author and American professor. http://www.kotterinternational.com/
3. 3
The evolution of an organisation
All organizations begin like this ... And evolve into this ...
• network-like structure
• founders are at the centre
• people working on different initiatives
• people seeking opportunities and taking risks,
• people guided by a vision that people buy into.
• energized individuals that move quickly and with agility
• structured as a hierarchy
• driven by well-known managerial processes: planning,
budgeting, job defining, staffing, measuring, and
problem solving
• a well-structured hierarchy
• managerial processes that are driven with skill
• producing reliable results
John Kotter is an author and American professor. http://www.kotterinternational.com/
4. 4
The evolution of an organisation
… and ultimately become constrained by the
hierarchy
5. 5
The evolution of an organisation
• focus on management rules and procedures,
• silo thinking
• pressures to make quarterly numbers
• complacency or insufficient buy-in
• limited number of go-to change leaders
• the management-driven hierarchy alone is no
longer up to the task of winning in this faster-
moving world
• communication across silos slows project progress
• short-term crises distract from long-term strategies
• risky new ideas are discouraged for fear of the
career impact of potential failure
• pervading sense of smugness can result from
continued success (Microsoft, Blackberry).
7. 7
The dual operating system
Kotter observes that the solution is a network-like
system built for agility and speed existing along-side a
mature organization's hierarchy that focuses on getting
today's business out the door.
It makes an enterprise easier to run while accelerating
strategic change.
This is not a question of "either/or". It's "both/and" - two
systems that operate in concert.
9. 9
Potential solution according to Kotter – the eight accelerators
1. Create a sense of urgency around a Big Opportunity. Urgency gets
people thinking about how they might be able to help you pursue a Big
Opportunity
2. Build and evolve a guiding coalition. This group of people from all silos
and levels feels the urgency deeply, and they are ready to take on strategic
challenges, deal with hyper-competitiveness, and achieve the Big
Opportunity. They have the drive, the intellectual and emotional commitment,
the connections, the skills, and the information
3. Form a change vision and strategic initiatives. The initiatives the
nascent network side attacks first will be those that these individuals are
very passionate about, that the organization's executive committee
agrees make sense to work on, and that the hierarchical side lacks the
ability to address well or fast enough.
4. Enlist a volunteer army. The guiding coalition, and others who wish to
help, communicate information about the change vision and the strategic
initiatives to the organization in ways that lead large numbers of people to
buy in. Done well, this process results in many people wanting to help.
5. Enable action by removing barriers. People act in the spirit of an agile and swift
start-up to identify and remove barriers that slow or stop strategically important
activity.
6. Generate (and celebrate) short-term wins. All wins, both big
and very small are celebrated. That celebration gives credibility to
the new structure, which in turn promotes more and more
cooperation.
7. Sustain acceleration. With relentless energy focused forward
on new opportunities and challenges, we find a motor which helps
all the Accelerators keep going.
8. Institute change. Wins are institutionalized, infusing the changes into the culture
of the organization. After a few years, this action drives the whole dual operating
system into an organization's DNA.
14. 14
Incidentally backed up by McKinsey research…
Tactics that drives successful transformational
change:
• setting clear, aspirational targets;
• creating a clear structure;
• maintaining energy and involvement throughout
the organisation;
• and exercising strong leadership
http://www.mckinsey.com/insights/organization what_successful_transformations_share_mckinsey_global_survey_results
15. 15
Incidentally backed up by McKinsey research…
Most successful approaches in transforming a
business are:
• engaging employees collaboratively
throughout the company and throughout the
transformation journey
• building capabilities—particularly leadership
capabilities—to maintain long-term
organisational health
• focus on strengths and achievements, not just
problems, throughout the entire transformation
process
http://www.mckinsey.com/insights/organization what_successful_transformations_share_mckinsey_global_survey_results
16. 16
Incidentally backed up by McKinsey research…
Furthermore, the survey also identifies some
approaches for creating a change plan that are
closely tied to success:
• assessing a company’s present situation
rigorously,
• identifying the current state of corporate
capabilities as well as problems,
• explicitly identifying the underlying mind-
sets that must change for the
transformation to succeed
• engage employees early in the planning
process
• break down the change process into
clearly defined smaller initiatives
• Invite employees to participate in shaping
change initiatives
• collaboration and co-creation are very
important: nearly a quarter of the extremely
successful transformations were planned by
groups of 50 or more
http://www.mckinsey.com/insights/organization what_successful_transformations_share_mckinsey_global_survey_results
23. The outcome
This is a current and ongoing programme, but even in these initial stages, the Oxygen Team feel empowered to
generate ideas, create solutions and inspire others in the activation of the new Ambition. They are using their local
knowledge, their influence, their energy to push the Ambition agenda forward, knowing that they have the full support
of their Leadership Team who they have engaged in the endeavours. They are passionate about helping people within
the organisation to understand what ‘Be Bold, Proud and Essential’ means to them, and highlighting the examples that
they find to share with others as inspiration. Their journey is really only just beginning, but they have the drive, energy
and enthusiasm to make it happen. As co-creators and tool-makers helping them on this journey, we are providing
them with the expertise, advice and additional enthusiasm, and thoroughly enjoying working with them along the way.
We now have the oxygen, we have the
heat in the organisation, now is the
time to start those fires!
BB&A are doing a great job helping us
steer the Oxygen Team and create the
tools and activities to make this
happen!
Strategy Manager
Kimberly-Clark Consumer Europe
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