The Idea in Brief
Why do managers struggle so hard to get employees’ cooperation on change initiatives? Even charismatic leaders have spotty records—winning commitment to change in some cases but failing dismally in others.
According to Christensen, Marx, and Stevenson, too many leaders use the wrong change tools at the wrong time—wasting energy and risking their credibility. For example, a vision statement helps get people on board if they already agree on where their organization should go. Without that consensus, vision statements won’t change behavior—aside from provoking a collective rolling of eyes.
How to wield the right change tools, at the right time? Gauge how strongly your people agree on 1) where they want to go and 2) how to get there. Then select tools based on the nature of employees’ agreement. For instance, if people disagree about goals and ways to achieve them (common during mergers), use power tools—such as threatening to make key decisions yourself. If employees have goals that differ from your company’s but agree on how work should be done (think independent contractors), use management tools—including training and performance measurement systems.
Choose the correct tools, and you spur the changes your firm needs to stay ahead of rivals.
The Idea in Practice
Selecting the Right Change Tools
Scenario #1: If employees agree on goals but disagree on how to achieve them, use leadership tools: vision, charisma, salesmanship, and role modeling. Example:
In December 1995, Microsoft’s Bill Gates published his visionary “Internet Tidal Wave” memo. The memo persuaded employees that the World Wide Web would become integral to computing (which countered most employees’ beliefs). Employees responded with products that crippled Internet rival Netscape and maintained Microsoft’s dominance in the software industry (which employees and the company wanted).
Scenario #2: If employees disagree on both goals and how to get there, use power tools: threats, hiring and promotion, control systems, and coercion. Example:
To merge JP Morgan with BankOne, CEO Jamie Dimon slashed hundreds of executives’ salaries 20% to 50%. He threatened to select a single IT platform to replace the firm’s myriad systems if the IT staff didn’t pick one themselves in six weeks. And he told branch managers they’d lose their jobs if they failed to meet sales quotas.
Scenario #3: If employees agree on both goals and how to get there, use culture tools to counter complacence. In particular, use “disaggregation” (separating the organization into entities that each have their own agreed-upon goals and plans for achieving them) to disrupt high-level agreement about goals and methods that could otherwise preserve the status quo. Example:
Hewlett-Packard recognized that its new inkjet printer business—with its unique technology and economics—could thrive only if it was protected from the cultural expectations of its traditional laser printing business. Disaggregating the two businesses eliminated the need for cooperation between them and enabled the groups to operate on very different profit models.
Scenario #4: If employees disagree on goals but agree on how work should be done, use management tools: measurement systems, standard operating procedures, and training. Example:
In many companies, the reasons unionized manufacturing workers come to work differ markedly from those of senior managers. But as long as workers accept management’s assertion that following certain manufacturing procedures will help them make products with desired quality and cost, they will follow those procedures.
The primary task of management is to get people to work together in a systematic way. Like orchestra conductors, managers direct the talents and actions of various players to produce a desired result. It’s a complicated job, and it becomes much more so when managers are trying to get people to change, rather than continue with the status quo. Even the best CEOs can stumble in their attempts to encourage people to work together toward a new corporate goal.
