It is easy to confuse people in this group with those who have an antiquated mindset. Nevertheless, they will be on your side if you provide them with support and corresponding recognition.
In a company I helped in the UK, a graphic designer who had worked for nearly two years with a multifunctional Scrum team decided that she didn’t feel ready for the challenge. She was comfortable in the company but had decided to disconnect from its vision and goals. Obviously, her attitude generated high-risk situations, with high emotions that hindered others from reaching their goals. The organization decided to move ahead because it did not want to assume the cost of recruiting and training another individual. After a few months, the other employees were focusing more on the processes and less on their interactions. They lost motivation and began to disconnect from their daily tasks.
A good alternative here would have been to have a timely and crucial conversation—an open, honest, and transparent talk between the disconnected employee and someone they respected. If it isn’t possible to connect the change plan with what matters to an employee—their goals and purpose or learning—the plan will have little chance of surviving.
Many consultants call it WIIFM (What’s in it for me?), meaning that individuals need to know the benefits they will receive from a change and fully understand why they must change before they will attempt to do so.
Here are some things you can do to make people feel motivated during the transformation of your company:
1. Provide employees with the business context.
Explain the context that has made a change plan necessary. Share the vision, strategy, data, business goals, contractual issues, and any topic that can provide information on the situation.
2. Help understand the constraints.
Help people understand the constraints of the company, be they limited skills or unavailable resources. Help them also understand limitations such as dependencies that can’t be removed in the medium term or aspects that are dragged from the past and that will have an impact on the change plan (technical debt, archaic processes, etc.).
3. Use the real capacity.
Ensure that employees can choose the workload they consider most appropriate, according to their knowledge and availability (Pull System, Kanban).
4. Connect people with the client and the purpose.
Ensure that individuals understand the client and why the change is needed. Nothing is more motivating than knowing that you are helping real people.
5. Give time to discover and reflect.
Many teams have no time to think, reflect, and discover how the new change strategy could affect them. Ensure that employees have the time to do so and ensure that managers reaffirm this practice.
6. Gamify the matter.
Use games for people to have fun while reinforcing positive behaviors, values, and principles. Create an environment that encourages healthy competition for achieving goals so employees can witness their progress. Don’t forget to offer rewards to increase motivation.
7. Create suitable metrics.
Ensure teams can collectively understand and collect simple metrics that measure the progress of change. Also ensure that any local improvement has a positive impact on the rest of the organization.
If you decide to use gamification to impact behaviors, make sure you use games that make people feel good at the end of their day/sprint. They should see the progress they have made towards something that matters to them. Every gamification initiative should leverage the following techniques:
Dynamics: motivate behavior through scenarios, rules and progression.
Mechanics: help achieve goals through teams, healthy competitions, rewards and feedback.
Components: track progress through quests, points, levels, badges and collections.
In Chapter 6, you’ll see how to connect many of these points with a Transformation Team.
The Story of Peter
I’ve known Peter for many years now. We met in Uruguay when I had a company that created software tools for corporations. I still remember the day he told me that he had an innovative idea and that he wanted to set up a business.
During startup, he had only a few employees. Communication between them was mainly face-to-face. There was mutual trust, they knew what others thought of the company, and they understood its vision and strategy.
At that time, the company’s size was easily manageable, and information traveled quickly, informally, and with low levels of distortion. Every day, internal and external feedback helped avoid wrong paths or decisions.
I must admit that there were gaps in the company. Some skills were scarce, but everyone was happy to collaborate and share their knowledge, even when overly busy. Teams would meet if there was an urgent problem, and they exchanged ideas until the problem was resolved. You could see what others were doing, because the actions were observed in the office and the progress was seen on physical boards. They were happy, and it seemed as though it would last forever.
During that time, no one thought it would be necessary to transform the company or that explicit values would be desperately needed to align the entire organization.
Peter didn’t know that core values are the most important aspect of a modern organization. They establish basic limitations as to how, where, and why to compete. They dictate how people will behave socially and how everyone will provide visibility of their work. He didn’t even suspect that a small change in those values could affect the five basic foundations of the organization.
There is no universal truth, but regardless of the size of a company, the following pillars will always exist:
Company vision and strategy
Clear distribution of power in the organization
Behaviors / social systems (how people behave, interact, and make their work visible)
Structures and their connections (hierarchical structures) that help employees
Control systems (how people and things are controlled)
When one or more values are modified in the organization, a cascading effect occurs upon the other areas. Although it may seem like common sense, employees do not always stop to reflect on the importance of employing a strategy that will produce a chain of changes. When all the pillars change, we say that the company has undergone a transformation.
FIGURE 3.2: Core values cascading effect
Peter wanted me to help his company succeed, and he completely trusted my opinion because we had a relationship based on friendship and respect. One day, he told me he wanted to start a transformation and begin with the software teams. He’d heard about the miracle of SAFe (Scaled Agile Framework) and LeSS (Large-Scale Scrum), and he wanted to try them.
Unfortunately, he didn’t believe me when I told him that starting with a change in the way we coordinate people or how employees are controlled (control systems) would be a slow way to transform.
Control systems are procedures/processes designed to verify, regulate and supervise people and their outputs.
Modifications in coordination and control are weakly associated with changes in people’s mindsets. Many companies are convinced that by becoming digital they can transform quickly by simply altering the way people work. In fact, some might choose to modify processes to promote change. But to really alter something, you need a radical disruption that breaks the patterns of organizational inertia and helps individuals learn new ways of thinking.
Agile and the Scrum framework have an important role here. The Agile Manifesto contains principles that Scrum aligns to and that result in important disruption, such as putting the customer and employees first, the self-organization of teams, cross-functional groups, and real feedback from the client and the rest of the company. Pay attention to Scrum’s values and think about how they could impact your company:
Courage - Team members have the courage to do the
right thing and work on tough problems.
Focus - Everyone focuses on the tasks of the work cycle and the goals of the Scrum team.
Commitment - People personally commit to achieving the goals of the Scrum team.
Respect - Team members respect each other as capable, independent people.
Openness - The Scrum team and its stakeholders agree to be open about all the work and the challenges of performing the work.
Scrum offers a minimum set of rules, such as a fixed work cycle (Sprint), a single priority for work (Backlog), time to reflect (retrospective meeting), and recurring meetings to empower people (Daily Scrum, planning, etc.).
Back to Peter and his company . . . he didn’t ask me about Scrum, but he was lucky. A few months after launching his product, the small business became a success. This attracted the attention of hundreds of customers and a lot of capital. The immediate result was the creation of new departments, roles, and rules to better serve their clients. This positively impacted the company’s economic stability and helped predict actions to be taken in the medium term.
He decided to move to new offices and needed to create a logo that better identified the corporate culture. It was clear to all that the growth of the company had brought new benefits—but also additional processes.
One day I heard someone mention that better performance was needed and that this could only be achieved by focusing on cost reduction. I also heard that they wanted to add new departments to address this issue. Within the company, everyone began to get used to the idea that each time there was a new corporate requirement (cheaper and more reliable service, higher quality, faster speed of the market, etc.), a new role or department would be added to deal with the matter.
As the company and the number of departments and roles grew, the number of associated processes increased. Along with this, more bureaucracy and dependencies were created. Little by little, the flexibility of the organization diminished, and it became more difficult to determine if the value delivered to the client was right.
Because the company was growing, everyone figured it would be a good idea to abandon the physical whiteboards that had been used since the beginning. These were replaced with a software tool to increase collaboration. Soon after installing this software to manage tasks, they began getting rid of the physical boards and their sticky notes.
With the new tool, not everyone had the same visibility. It was now necessary to ask for usernames, passwords, and permissions. It was also necessary to learn how to use the application, and a new department was created to oversee this. As a result, visibility decreased, and complexity and transaction costs increased. No one had realized the impact that a small change of habit would have. People were happy to send tickets and emails back and forth and were confident that this would exponentially increase their productivity.
One month later, they opened two new branches in nearby countries, and the following Monday Peter said that he wanted to achieve a clear corporate identity in all his branches. A new business-alignment (Brand Management) department was established to reaffirm the existing core values and ensure the entire company had the same foundations. Greater stability was achieved, which allowed people to better understand the unique character of the company and establish an internal legitimacy for desired behaviors.
Working with Peter as a consultant before his company’s exponential growth, I had noticed the continuous feedback between employees and clients. But as the company grew, informal communication channels had been standardized and replaced by coordination structures through processes in all corners of the company.
The Transformation Team announced the new vision of change and strategy with a small event, and they sent everyone an email with the company’s new values and principles. To increase visibility, inspirational photos were hung in the meeting rooms. Rules were also adopted to comply with the new vision, and a recruitment system was established to find candidates for the new profile. At that time, Peter did not know that his company was going through a period of convergence.
FIGURE 3.3: A convergent period ends and another one starts
Companies often confuse a period of convergence with a transformation, but these are different situations.
An organization has many periods of convergence, one after another, during its life cycle, but these stages do not alter the company. They reaffirm and evolve the organization’s initial ideas. During a convergence stage, there is no disruptive change. The values and most of their strategies remain intact. Forces move to support the status quo. Each time a new period of convergence begins, stronger interpretations of the current situation are created, and these are commonly reinforced by new processes and practices.
A period of convergence is a stage where organizations elaborate, reaffirm, and increase existing structures and control systems to offer greater alignment with their core values and strategies.
The longer the convergence period, the more difficult it will be for a consultant or any other change agent to make a radical change. There will be more obstacles to remove and greater institutional resistance, both psychological and procedural.
As the converging periods come and go, the status quo is reinforced by what we call incremental change. In traditional companies, these stages increase dependencies and complexity, because more interpretations and standards are usually added after each adjustment.
Something similar can be seen in many governments, where convergence periods result in hundreds of laws, rules, and guidelines—but there’s no real transformation. It’s better to reboot the system with a focus on simplifying processes.
In most companies, convergent periods add or formalize new rules or habits around their initial beliefs. I’ve seen many teams loaded with bureaucracy, reports, metrics, and guidelines resulting from many years of incremental change.
Moments of turbulence are one of the triggers for the reduction of complexity. I remember an episode in a company that was about to lose an important client. The organization went into chaos as they questioned many of their processes and beliefs. They finally simplified their forms of communication, methodologies, and standards, and this helped them win the client back.
I realized that the only way for Peter to run, grow, and transform his organization was by simplifying the company with a clear vision of change. Unfortunately, this would only happen if he and his company experienced real problems, such as a sustained period of low performance or high competition that resulted in the questioning of their beliefs and how they worked.
One morning, I read in the newspaper that a group of companies was coming to the market with products similar to Peter’s. I imagined that the likelihood of their executives receiving the information from that news was extremely low because the organization had gone through long and successful convergence periods.
I waited for management to become aware of the news, but it never happened, as their focus was exclusively on the improvement of their processes.
In April 2015, I had to transfer to Chile to help another client. For several months, I heard little of Peter’s company, so I figured it must be fine. When I returned to Spain, I was surprised to find a different Peter.
He’d gone through a couple of interesting stages, and I was glad to see he’d learned a lot from them. Initially, he’d decided to compete with the other companies by reducing costs: He hired cheaper labor and reduced the quality of the products so they would hit the market faster. He also tried to expand his software department to produce more applications, but he encountered a lot of pressure, a shortage of skills, an increase in bureaucracy, unhappiness, conflict, and a decrease in business value for the client. It was not a good time for him. But he learned—a lot.
FIGURE 3.4: Strategic reorientation leads to new convergent periods
During the year I was in Chile, Peter remembered I’d mentioned the Cost of Delay techniques for decision-mak
ing and that he should look for exponentiality for the areas of his company that were scarce (knowledge, resources, etc.). This helped him set a strategic reorientation, which meant a short period of discontinuous change because of a new radical strategy. And this led to a new alignment, which caused some turbulence and alterations in the distribution of power, control, social systems, and organizational structures.
At that point, he understood the impact that changing values and principles had on the pillars of an organization.
FIGURE 3.5: A company reinvents itself after a re-creation (transformation)
I had the feeling that this re-creation (transformation) had been the most extreme and exciting event in the history of Peter’s company.
During a re-creation, all or some of the company’s values change, triggering a cascade effect upon the other pillars of the company. Re-creation is how organizations reinvent themselves. Consultants and change agents usually refer to this as business transformation.
I thought Peter was going in the right direction and that his organization was evolving because of honest feedback from clients and employees. He was actively working on reaffirming those informal channels and reducing the complexity of their processes, metrics, and forms of interaction. The company had a powerful vision of change that motivated them to move forward together.
Leading Exponential Change Page 9