Leading Organizational Transformation

People have been talking about the importance of change as a critical management practice for decades. No matter how many approaches we recycle, one timeless truth returns to us again and again: Change is profoundly difficult and wed prefer not to do it. And those who try often fail. Its staggering how many costly failures in transformation there are. A McKinsey survey of nearly 3,000 executives regarding their enterprise transformation efforts found the failure rate to be more than

60 percent. Companies that used a full suite of transformation methods, however, increased their success rates to around 80 percent.

I recently sat down with Orlando Ashford, president of Seattle-based Holland America Line (HAL). Since taking the helm, Ashford has launched a number of such changes to refresh and reposition the HAL brand. His approach seems to be working well. The projections for sales growth this year bear this out. Here are some of his approaches.

1. Invite the organization to join the cause. Too often, when a new leader arrives, people expect some monumental act signaling profound change, says Ashford. But I have found the simplest changes start momentum that sticks. Having not grown up in the industry, and succeeding an industry icon who led HAL for a decade, he needed to establish his credibility as a leader. He hosted gatherings for employees, as well as happy hours at local cafes where employees could ask questions, share ideas and join a dialogue. He cast a vision for where the organization is heading, and invited people to share their ideas for getting there. I wanted a vision everyone felt ownership of, he explains.

2. Translate ideas into action. Its important to act upon the ideas people offer by allowing them to blaze the trail. Over the last year, Ashford reports, we have taken some of our peoples great ideas and put them in motion. A deeper understanding of what HALs guests want has translated into a refreshed focus on Destinations as a key differentiator among cruise lines. Knowing that the premium classic style of their cruises appeals to those who want to learn about the world has translated into a segment HAL will uniquely embrace. Many of the exciting new offerings now appearing on HALs cruises are the direct result of discoveries generated by people throughout the organization.

3. Make the change stick by linking learning with strategy. Once momentum starts and people believe change is happening, you have to put structures and systems in place that sustain it. Weve done the easy part. Now we have to push the change into the organization to make sure it takes, says Ashford. To make sure his key leaders are prepared to execute the strategy, HAL is linking the development of leaders with the execution of strategy. By combining the what of the strategy with the how of leading it, HAL is building new capabilities while implementing them. This not only accelerates change, but also increases adoption across the organization as people come to realize this isnt a passing fad, but a serious commitment. This is also when people commit to opt in for the long run. I believe in my people, and I believe they all want to be fully engaged in the direction, says Ashford, but I also realize the way organizations work, and sometimes people decide some changes arent for them. The good news is the bigger story unfolding isnt going away. Its evolving as more people fingerprint it with their ideas, shape it and own it.

As you consider launching new efforts to transform your team, department or enterprise, apply these universal truths about organizational change. Youll find that, taken step by step, transformation neednt be painful. And a more comprehensive, long-term approach will also ensure your efforts beat the odds and succeed.

ron carucci is managing partner in the Seattle office of Navalent, consulting to executives on organizational transformation. Reach him at [email protected].