Does your Organizational Context support your transformation strategy?
Over the course of my career I have worked with more than 40 organizations at over 100 locations. In most cases, it has been for the purpose of deploying some form of Operational Excellence (Lean Manufacturing predominantly, but also quality management systems, ERP systems, statistical process control or other methodologies). In any instance where a technical solution is implemented, it almost always works…initially.
According to a survey conducted by McKinsey & Company, 70% of transformation programs fail. My experience validates these numbers. Clients usually aren’t interested in keeping consultants on board beyond technical implementation to work on organization and culture. An executive client once lamented: “You know, we are supposed to do Plan, Do, Check, Adjust and cycle through those stages continuously. But what we really do is Plan, Do, Abandon, Revert.”
According to a survey conducted by McKinsey & Company, 70% of transformation programs fail.
Sadly, this is the norm more than it is the exception. Another client had a term for the relics left behind following abandoned transformation attempts. He called it “Kaizen Debris.” There are many potential reasons for this phenomenon. I hope to touch on all of them in my writings. The one I want to focus on today is an incongruence between the Organizational Context of the company and the transformation methodologies they are attempting to implement. I will use Lean as an example.
Lean is very seductive to business leaders because of the eye-popping results that Toyota has achieved and has attributed to it. The methodologies are very simple and straight-forward (otherwise I wouldn’t be able to understand them and implement them for my clients). But there is a catch. The methodologies only work in a culture defined by an obsession for learning, respect for people, relentless problem-solving, tireless striving for perfection, and transparency. Let’s face it, not every organization has a culture that puts a premium on these values. So, when we put in place the technical solutions that assume that the people in the organization are going to act with those values in an organization where those values are not fully developed, it should not be surprising that those solutions do not sustain, even after initial success.
That brings us to the concept of the Organizational Context Model. It represents a progression of thinking. The thinking flows from top to bottom. One level informs the next. There can be no disconnects. The worst failure mode I have observed is to attempt to deploy new Strategies (starting in the middle), develop new Operational Capabilities, put in place new Processes & Practices, execute Projects, or change Work Activities without assessing whether the planned changes fit into prevailing Purpose, Mission, Vision and Core Values.
One way this can happen is if no Model exists. That is, the company has not defined a Purpose, Mission, Vision and Core Values. That doesn’t mean there is no context, it means that it is likely that the context is not communicated and universally understood. In which case there is no way to assess whether a new methodology fits into the prevailing context.
Another way this can happen is if the Model isn’t valid. Purpose, Mission, and Vision statements should be first and foremost authentic, then targeted and succinct. They are important tools with a purpose. When poorly crafted or poorly used, they are ineffective.
Purpose, Mission, and Vision statements should be first and foremost authentic, then targeted and succinct.
Finally, the Model will be ineffective when it is not applied. There are many organizations who have posted Purpose, Mission, Vision and Core Values, but have leaders who do not refer to them for guidance when making decisions. This invalidates what is posted on the wall and communicates that the actual Purpose, Mission, Vision and Core Values are secret and hidden. This erodes trust and creates insecurity which leads to loss of productivity.
If your organization is considering making a significant transformation, I urge you to first consider defining your Organizational Context. You may find that there is Cultural and Organizational work to do prior to making the transformation. It will be time and effort well spent. Need help? Contact us. We will set up a free initial assessment to determine the best combination of Coaching and Consulting for your unique situation.