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February 4, 2006

Change How You Change

The overall session plan for the strategic planning retreat was conventional. It began with a period of discovery and investigation, and would follow up with some prioritizations and then finally some commitment-making. But now it's running late. Then the attendees hit the realization that they don't yet agree on how to agree...

This moment is likely to recur; we can expect it at least once during discovery/investigation; again during prioritizations; and yet again during the committing phase.

The way the sessions are currently formatted is supposed to get them past these points, but now that's being seriously tested. The particular instruments being used along the way -- collaborations, pop quizes or games, spreadsheets, anecdotes, humor, testimonials and others -- are important accelerators and steering wheels, but are they even the level on which this barrier needs to be tackled?

We can detect the heat of the moment by someone saying "How about, let's try this..." and not infrequently the group willpower to make progress will find something that seems to cure the moment. But what if this is really skirting the issue -- which is that not knowing how to agree is a symptom of not knowing how to change?

I.

Real change hasn't occurred until the party that must sustain the change has become an agent of the change. For this to happen, that party's consciousness has to be altered. When the party is an entire group, the timing might be more difficult to anticipate, but the rule remains the same.

The change of group consciousness is a pattern we come to recognize -- occurring in four main stages that will ultimately allow a strategy to be adopted.

To see this clearly, the three-stage session format must first be set aside, although it might later be brought back more clearly as a vehicle instead of as a driver.

Even then, though the direction is towards making strategy adoption allowable, the destination must be correctly understood. There will still not yet be a strategy plan to adopt; but this is appropriate and, more to the point, necessary.

Why is that more to the point? Because making strategy is inherently a creative process and the bulk of the value is in the process of making, not in the product (aka the strategy plan) made.

Once the product exists, the value of the product is not a function of strategy -- rather it is a function of applying the strategy plan, which really is the issue of execution. Execution accounts for the mandate "change how you succeed". Because everyone wants to focus on success, it's natural that almost everything gets seen through the filter of execution.

But Strategy accounts for the mandate "change how you change." The most significant transformation that the organization has to go through is not the difference between new directives versus old ones, or between certain new processes versus old ones, but instead between being routinely strategic versus not being routinely strategic. The key challenge for most organizations now is to generally and continuously behave strategically, instead of simply executing approvingly.

II.

Here's how, in these sessions, we get to the real "strategic goal", which is actually not a way of being new but instead a new way of being.

First, we learn or otherwise acknowledge that needs are not requirements. Too often groups go into "strategy sessions" believing that the reason they are there is to find solutions instead of finding themselves. The solutions of course are connected to perceived problems, which in turn are connected to ideas about intolerable current differences from a state that "should be". (Observe how much churning is associated just with the disparities in those perceptions...) This issue of what "should" be is most often set forth as a future state which is described as goals. Those goals are normally "felt" like requirements to meet. So what's wrong with this? Answer: the feeling is almost invariably interpreted through familiarity with the way things have already been done. That feeling is about what, and how much, of the familiar stuff has to change. Granted, it is sensible to think about "how do we get there from here" -- but this is not going to establish the reason or justification for adopting an emerging strategy. Actually, it's a source of wrangling over commitments to the past.

The one thing that must be clear before the next step in consciousness can emerge is instead a common awareness of what need must be met. Meeting the need will happen in the future, but the importance of the need is that it already exists. Yet the need will not be properly acknowledged until the stakeholders have been identified and ranked by their importance as target beneficiaries. Keeping in mind that we ourselves are stakeholders, too, our responsibility to the stakeholder(s) defines the need that must be addressed. We have to both acknowledge the primary stakeholder's mandate, and agree to cooperate with it. To round out the understanding of need, we also have to be able to relate our own interests as a stakeholder to the highest priority other stakeholder. It is necessary to ask, "What is our purpose", but it is insufficient; we must also ask "Why is that purpose ours?"

In the next step, that clarity of need sets the perspective that sorts out the discoveries from current-state investigations so that effective selection and organization of knowledgable inputs can occur. What should come here is visibility that allows us to identify the right problem to solve. This step is often deceptive because of the difficulty of defining problems in the way they need to be defined. In this phase, a "problem" is a necessary difference to be made, for which the significance is stated and agreed but the approach and means is not. In other words, the problem is the "value proposition". The working definition of value is "a distinction with a difference" -- and the essential task of this step is to decide what difference is necessary to satisfy the already affirmed need. In this stage, understanding difference involves recognizing that alternatives exist -- as opposed to just modifications. A modification means that the stakeholder can make something useful in a different (and presumably better) way, but an alternative means that they are free to simply use something else entirely. To eventually be responsible for an alternative, the providing party will take efforts that must be understood now yet need not be chosen until later, as in the next phase.

Consequently, some parties, at this point, understand for only the first time their true current position .

In the third step, the challenge is to choose your pain. This is a double-barrelled shot, because it calls for acknowledging that any choice has both positives and negatives, and because a choice must actually be made. Where do parties go wrong here? Their energy is highly charged and in large supply for trying to negotiate a consensus on which benefits and which risks should be accepted -- as if they were separated from each other in different aisles in the grocery store and only wind up in the same shopping basket by our discretion. But these invented match-ups will often be just fictions waiting to fail. Instead, some from of rigor must be applied to measuring opportunity costs, so that it is clearly understood that all value comes with risks, and that one cannot choose a value without choosing its already "built-in" risk as well.

When the logical associations of value and risk are frankly admitted across the board, the final step in the change of consciousness can develop in a way that can rationally affect agreed action. In this step, value and risk are both seen as aspects of opportunity, and the ability of the organization to leverage the risk of value becomes a foreground subject -- one that will point at logical material relationships of the expectations, structure and command of the organization. In effect, by emphasizing recreation instead of modification, this stage will change how we change.

Changing how we change does not necessarily produce a different outcome -- instead, the point of it is to be able to produce the needed outcomes in a different way. Developing a strategy is creating a way of being; and changing a strategy is changing a way of being. Being strategic is a competency, not an event.

III.

A design equation for the strategy forms: "why we should take this value" plus "how we should take this risk". Solving the equation will create the common vision of the way the organization should be. That provides the rationale for how strategy adoption on the personal level will link to and complement its adoption on the workgroup, departmental, division and finally enterprise level.

Many organizations will be able to approximately navigate the sequence of four phases by identifying and aligning such issues as:
- the purpose
- the value proposition related to the purpose
- the benefits and opportunity cost of realizing the value proposition
- the allowable and sustainable organizational structure given the above

In real life, all current states offer alternative futures but no guarantees. The part that we can control is the way that we will be. In picking a future, an alternative is proposed but until it is adopted it is just an idea. Adoption means that we have become an agent of the thing we adopted.

Here is a recipe for mistakes and posibly rejection:

- starting out with "requirements": requirements don't make sense until after priorities have been determined about committing to the value proposition. Essentially, requirements point at "allowable means". On the one hand, that makes them a huge source of debate, since different stakeholders have both different means and different allowances. On the other hand, starting from "allowable means" focuses attention away from purpose and onto opportunity. Justifying the opportunity is business planning, not strategy planning.

- mistaking "control" for value: control is a quality governor, which is an execution-driver, not a value-driver. Control means a proposed distinction may be sustainable; but it does not mean that the distinction is necessarily meaningful to the strategically primary stakeholder. Stakeholders see value as progress. Management should be dedicated to progress, and control is important only when it is an enabler of execution and thus of progress.

- not defining ROI in terms of the offered value to fulfill: doing this sends a message that the work and/or workers assigned to pursue objectives will not be evaluated based on impacts but instead on compliance. Consequently, it distances the worker's motivation from the strategic purpose.

Arriving at a strategic identity can get sidetracked at each of those three points, and an existing strategic identity can likewise be thrown off-track. In learning to change how we change, the learning is crucially dependent on visibility of the appropriate things, but no less so on the credibility of how they appear.

IV.

Visibility and credibility are two-thirds of the way that a changed consciousness can get to adoption. This is why the session format of discovery/investigation and prioritization is common.

The final element is constancy. Assuming a strategic identity becomes sensible because it shows signs of being sustainable for the period set out by the primary stakeholder's need. What naturally goes along with this is that successfully satisfying the need can change the stakeholder, so the strategy should expect to evolve as well. But for most parties, a pervasive plan of investment in the strategy must materialize and illustrate that the organization's impending coherence is predicated on the strategy. This will explicitly describe the reasons why participants can count on their involvement being supported consistently enough for them to realize the benefits that they need themselves.

V.

The biggest question in strategic transformation can easily be whether changes in consciousness allow visibility, credibility and constancy to be efficiently and effectively received and used by key participants. Said differently, while much data and information is evidently critical to the ability to formulate and describe the strategy, the more important issue is the perspectives in which such data or information are found and used. In order to get participants to agree on how to agree, they must have a shared perspective that is consistently appropriate to the subject of taking responsibility for realizing the primary purpose. The four stages in changing consciousness creates that perspective.

Posted by Malcolm Ryder at February 4, 2006 7:03 PM

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» Change and TOC from Knowledge Jolt with Jack
Malcolm Ryder has a recent piece that looks at Change that provides some steps to consider on the way to creating change within the organization. As I read his article, I saw some parallels to the Theory of Constraints' five focusing steps. [Read More]

Tracked on February 9, 2006 9:16 AM

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