I have several clients in larger, matrixed firms that are in the midst of restructuring. Many firms were already poised for a shift and then the mother of all triggers hit. The clients I’m working with are successful, larger private and publicly-traded companies, all of which found success both before and during the COVID crisis.
The shock of success has kicked off substantial internal change in leadership, organizational alignment, and technology development that is moving through the firms like shockwaves through a child’s slinky toy.
In one case, the firm has made product and physical plant acquisitions and is in the process of integrating the technical and operational assets into its core operational model. In a second case, demand has pushed the firm to streamline product operations and find ways to scale key technical talent into fresh opportunities.
The macro intent is to build freshness and efficiency into the firms. This includes better market alignment, value creation and transfer, and the ability to adapt quickly.
From to Toward
When a firm undergoes a major revision (changes in a business unit, technology or geography; R&D centralization or decentralization; direct vs. indirect distribution), a natural feeling of disorientation kicks in. Early on everyone maps back to the “old” system, but there is a moment when this backward reference fades and the new normal is the baseline picture everyone has in their minds. Finally, there is a moment when the “new” is normal and people are looking toward the future.
Getting to that first step is very significant (when the backward reference fades) because as humans, we are very attached to our patterns. To make that first move is an act of leadership that consistently references a better and more compelling future.
To help leaders keep their own orientation as well as help their teams process the changes, I encourage them to think in a framework called “from to toward.” By consistently setting the context (where we came from), outlining the near term (what we are moving to), and giving insight on what the organization is moving toward, leaders are doing essential work to lay a framework and a vocabulary that lets everyone talk through the hard and uncomfortable parts.
We are always leading toward a specific desirable future.
The Path and Two Ditches
The textbook path is always the intention when people begin these journeys. It’s our hope that leaders and groups are able to quickly see the big picture and “lean into” the needed updates and changes. We have visions of strategy working sessions where we roll out the intent and our teammates go to work on implementation.
Unfortunately, it’s rarely that smooth. The good news is that if we prepare for it, things are rarely not recoverable either. There are two “ditches” on either side of the preferred path that I brief leaders to expect:
- Balkanization & Wall Building
This typically is a group within the firm that has built out a very independent role and is used to exerting control over its partners and leadership. Prior to the changes in organizational structure, they are typically consistent and sometimes perform exceptionally. When this shows up, it will begin as below the water line resistance, but as things progress, it can move from passive to quite active. The coaching point here is to engage these teams well ahead of changes and work hard to find a point of buy-in.
- Loss of Identity and Catastrophization
This is the opposite of the above, where teams and individuals are quite supportive of the changes at the outset, but then realize that their “identity” will be lost as things progress. This can lead to a cycle of disillusionment, which can pull the team’s performance off track. Unfortunately, this tends to hit your highest performers the hardest and can tip them into a committed downward spiral. When you talk with them, even small issues are suddenly catastrophic and their ability to handle ambiguity is greatly diminished.
Responses to Change – Leadership Mindset
To execute well through the change, leadership needs to be committed for a long duration of time. While compliance and intellectual assent can be developed pretty quickly, leaders are always surprised when the emotional speed bumps come up – sometimes months down the road.
The coaching point here is that every member of the firm has a story in their mind about who they are as individuals and how their team contributes to the firm. When the firm changes leadership alignment, those stories are disrupted…and until they are able to tell a better story, there will be dissonance.
To lead well, take time to listen through the stories prior to the change, and be very intentional about understanding and working with key informal leaders in the group to give them the context and important information about why the firm made the changes and what the hoped-for future looks like.
One tool that has proven universally effective is to set up truly randomized skip-level meetings between senior leaders and front line thought leaders. Well facilitated, the authenticity and first-person connection that is established helps a great deal to change those stories and get team members to step out of their comfort zone.
Coaching
It’s deceptively hard to get these changes in leadership and the organization planned and executed well (this may be the biggest understatement in the article). One key to getting this work done is having a trusted internal or external partner that can ask you those harder questions and help find blindspots before you make the changes.
Each situation presents uniquely and can only be addressed with frameworks that are anchored in the strategic intent of the firm. If you’d like to talk about what that might look like for you and your firm, give me a call or reach out for a meeting using this link.
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