Summary: The way we work has changed — and so has leadership. Leaders are under new pressures to perform at higher levels and adapt quickly to changing demands. In this article, the author shares advice from three leadership experts and outlines the six skills leaders need to succeed: 1) emotional aperture; 2) adaptive communication; 3) flexible thinking; 4) perspective seeking, taking, and coordinating; 5) strategic disruption skills; and 6) resilient self-awareness. Developing these six key leadership skills isn’t just about your personal growth, it’s about shaping the future of work and inspiring those around you.

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“The best leaders of the twentieth century were question answerers, setting the vision and strategy from above,” says Kirstin Lynde, founder of the leadership development firm Catalyse Associates. “But the best leaders in the twenty-first century are question askers. They seek feedback and new perspectives, and they ask curious questions about themselves, their teams, and their environment.”

The pandemic also had a profound and lasting impact on leadership dynamics, notes Jeffrey Sanchez-Burks, a behavioural scientist at the Stephen M. Ross School of Business at the University of Michigan. “Where people were in their lives during lockdown — whether starting college, beginning a job search, stepping into a managerial role, or juggling remote work with parenting — has shaped who they are today,” he says. “Leaders need to be attuned to these dynamic forces and adapt to the different needs and challenges their teams face.”

This transformation extends beyond individual experiences, adds Shimul Melwani, associate professor of organizational behaviour at Kenan-Flagler Business School at the University of North Carolina. “We’re facing massive technological shifts with AI,” she says. “Workers are increasingly demanding flexibility, purpose, and work-life balance, all while organizations navigate an era of value polarization.”

Given these changes, our experts highlight six leadership skills that have become essential in today’s workplace and offer practical advice on how to develop them.

1. Emotional Aperture

This term, coined by Sanchez-Burks, captures the ability to understand and tune into the emotional dynamics of your people. “It’s about reading the room, gauging the collective mood, and recognizing the emotional landscape of your team,” he says. Is everyone on the same page, or is there unspoken tension? Is there cohesion, or are there gaps in understanding? Are all voices being heard, or are some perspectives missing?

Successful leaders pick up on these signals to gain a deeper understanding of how their team members process information, approach risk, and maintain commitment. This heightened awareness builds stronger relationships and fosters deeper connections, which in turn drives retention and employee engagement. “It’s a rich source of information that helps you keep people around a little longer and lean in a little more.”

How to tune into the emotional dynamics of your team

Developing this skill takes practice and intentional effort, says Sanchez-Burks. He recommends seeking out resources that focus on group dynamics and collective emotions. Self-reflection exercises, such as journaling about team interactions and your interpretations of them, can also improve your awareness over time.

Lynde advises regular temperature checks with your team. At your next group meeting, try this exercise: Ask everyone to write down (anonymously or not) three things they love about their work that motivate them, and three things that are frustrating. After collecting the responses, take some time to review and synthesize the feedback. Then, share the common themes with the group. Talk about the positives and the pain points. Be open and honest; transparency helps build morale and trust within the team. “You might not be able to solve every problem, but this is a magical way to make your team feel that their leader cares about them,” she says. “People want to feel heard.”

Practice sharpening your emotional radar outside of work, too, adds Sanchez-Burks. Try observing conversations in public spaces like cafés. Pay attention to emotional undertones, reactions, and how people connect (or don’t). Notice the nuances in their relationships and look for non-verbal cues like facial expressions, body language, and even silence. Think of it as people-watching with purpose. “Have fun with it,” he says.

2. Adaptive Communication

This skill involves knowing how and when to adjust your behaviour and leadership style to fit the situation and your audience. Successful leaders adapt their approach to meet the moment and boost overall team performance. “Leaders need to know how to move hearts and minds,” says Sanchez-Burks. “That means not just understanding how others feel, but using that knowledge to influence, motivate, and guide.”

Connecting with the group’s emotional energy can make a difference in your problem-solving and relationship-building; it helps you work toward a compelling vision. Simply put: Vibes matter.

If you need your team to rally around a project or organizational goal, for instance, maintaining a positive, consistent emotional tone helps everyone focus and reach the finish line. But when the game plan involves a complex challenge related to business strategy, allowing a mix of emotions can bring out different ideas. “Emotional diversity sparks creativity,” Sanchez-Burks adds.

How to get better at adjusting your style to fit the moment and your audience

“The golden rule — treat people as you would like to be treated — is outdated,” says Lynde. “It’s now the platinum rule: treat people as they want to be treated.”

This requires a concerted effort at relationship building. Whether you’re part of a team or leading one, carve out time for one-on-one conversations to understand what your colleagues care about, their priorities, and how they see the world. Empathize. Make a genuine effort to understand your colleagues’ perspectives and feelings. “Don’t do all the talking,” Lynde says. “Ask questions and really listen.”

Lynde also recommends tools like the DISC assessment, a measure of interpersonal behaviour, or the Lifo survey, which looks at individual work styles, to gain deeper insights into people’s personalities. “These provide a new lens to see each other. Some people are down-to-business and task-oriented, while others are more people-oriented.”

Sanchez-Burks notes that we often instinctively try to change a colleague’s feelings — by cheering them up or calming them down. Sometimes, simply acknowledging their emotions is enough. “Letting someone know you understand their feelings without trying to change them helps in building trust.”

Mindful reflection can also be helpful here. Before a meeting or important conversation, set clear goals for what you want to achieve and how you want to be perceived. Afterward, review how well you met those goals and consider any tweaks for next time. This practice helps develop self-awareness and adaptability.

3. Flexible Thinking

When things feel unpredictable and uncertain, there’s a natural tendency to become rigid in your thinking, which limits your ability to weigh different solutions to problems. But to be an effective leader in challenging times, you must be able to juggle competing priorities and hold opposing ideas in your head. “Leaders need to be open to paradox,” says Melwani.

This means embracing ambiguity, seeking out new perspectives, and understanding the larger context. When leaders signal they’re open to new opinions, research shows that team members feel safer sharing their ideas, ultimately leading to more thoughtful decisions and stronger outcomes. “Thriving amid uncertainty means leaning into it, not shying away,” she says.

How to boost your mental agility

Dealing with the unknown is inherently challenging and sometimes downright scary. “You have to keep your knees bent; there are going to be bumps,” says Lynde.

Leaders in the past felt pressure to have all the answers, but the pace of technological change calls for a different approach, she adds. Like AI, problem-solving now centres on skillfully engineering the right prompts rather than storing all the information in your head. “The big arc for leaders is asking the right questions,” she says.

Asking good questions allows you to “move beyond your hardened perspective and embrace very different possibilities and ways of thinking,” says Sanchez-Burks.

Melwani recommends activities to boost your mental agility on your own, such as mind mapping. Mind mapping is a technique for diagramming ideas and organizing information in a structure similar to a flowchart, showing relationships between them. You can take meeting notes in mind-map form; you can also experiment with it during group discussions and brainstorming sessions. “It taps into your creative side,” she says. “And it helps you visually explore ideas and uncover connections that might not be immediately obvious.”

4. Perspective Seeking, Taking, and Coordinating

Research consistently shows that power reduces empathy and narrows focus. It’s not surprising then that as business leaders rise the corporate ladder, they often rely more on their own opinions and overlook others’ perspectives. But for effective management at any level, it’s essential to actively seek different perspectives and integrate new information into your approach.

This managerial skill is also crucial for tasks like negotiating, managing risk, strategic thinking, and resolving conflicts. “When you put yourself in another person’s shoes, you become a more attentive listener and use a broader, more holistic perspective to find the way forward,” says Melwani.

How to broaden your understanding of different perspectives

Regularly reflect on past and future situations where understanding others’ outlooks could improve outcomes. The aim is to interrogate your beliefs and “to get in the minds of others,” Melwani says. Question your assumptions; what you take for granted might mask your biggest blind spots.

Melwani also recommends expanding your network both in and outside your organization with people whose worldviews are different from yours. Seek feedback from them and others who can help you uncover your biases and challenge you.

Another effective method? Reading more novels. Fiction immerses you in the perspectives of characters from other backgrounds, including different races, nationalities, and genders. Research suggests this exposure broadens your understanding of different viewpoints and the challenges people face in their lives. “The more you do this, the more skilled you become,” says Melwani.

Understanding how you come across and how others perceive you is essential for growth, adds Lynde. “Sometimes it’s big things you’re off base about; sometimes it’s very little things that are holding you back.”

5. Strategic Disruption Skills

This is a skill that involves challenging the status quo. Rather than sticking to established conventions, leaders must identify and question outdated practices to explore new ideas that could improve outcomes. “It’s not about breaking rules just for the sake of it, but rather questioning long-standing practices and pushing for continuous learning and improvement,” says Melwani.

This is an especially effective strategy for advancing inclusion and equity in your company and your team. To build a more open and inclusive environment, leaders need to rethink and revise deeply entrenched practices and norms.

How to get more comfortable challenging the status quo

Lynde advises tapping into the ideas and perspectives of others to open up new possibilities. Remember: People on the front lines and colleagues in different departments see things that you might overlook. “Think about how you can, as a leader, get into a habit of dredging their imaginations and minds for ideas,” she says. “Not only are you broadening your own thinking, but you’re also making others feel that their contributions matter.”

She recommends reserving the last 10 minutes of weekly meetings to ask everyone: What could we be doing better? This practice encourages team members to come prepared with suggestions. Even if you’re not officially running meetings, you can still contribute to a culture of innovation by offering ideas for improvement. “Strategy is a shared responsibility,” she says.

Finally, support your team in learning new skills, piloting projects, and learning from failures. Embrace a willingness to take on new challenges and experiment in your own work, too. “Take a cue from software development and adopt an agile approach: test, try, and iterate,” says Lynde.

6. Resilient Self-Awareness

As a leader, you’re expected to be always on call and constantly available to support your employees, whether with work issues or their mental health needs. “You’re expected to be dissociated from your humanity, but leaders are only human, too,” says Sanchez-Burks. “It can be lonely at the top.”

Self-awareness involves recognizing your own limitations and understanding when to seek support. This important leadership skill is not only about managing your own stress but also about setting a healthy example for your team. By being aware of your needs and boundaries, you demonstrate strength and self-care, which contributes to a positive work environment.

“Leaders face the same challenges as everyone else, managing work, stress, and life demands, but they’re expected to carry the weight for their teams, too,” says Melwani.

How to foster emotional strength and mental endurance

To effectively support your team, you need a strong support network of your own. Melwani recommends seeking resources both inside and outside of work, such as mentors, counsellors, and peer groups. Having people who can offer constructive advice is invaluable — “especially if they can help with real-time adjustments,” she says.

Choose a couple of areas on which to focus, and then follow up with specific questions like: Five months ago, you told me to work on becoming a better listener. I’ve tried not to interrupt and to stay off my phone. How am I doing?

Lynde recommends repeating this process two to three times a year. You might fear that admitting weaknesses will make you seem less competent. “But really, you’re modelling how to receive feedback,” she says. “It makes you seem stronger and more human.”

Sanchez-Burks suggests studying your favourite athletes and drawing inspiration from how they manage their physical and mental states to perform at their best. “Performing at peak is not sustainable,” he says. “You need to know when to taper, how to recover, and how to build up endurance.”

Developing these six key leadership skills isn’t just about your personal growth, it’s about shaping the future of work and inspiring those around you. Leaders are under new pressures to perform at higher levels and adapt quickly to changing demands. But while “leadership today is harder, it is also more exciting,” says Melwani. “There is more opportunity to drive real change and to make a lasting positive impact.”

More and more companies today are facing adaptive challenges: Changes in societies, markets, and technologies around the globe constantly force businesses to clarify their values, develop new strategies, and learn new ways to operate. The most important task for leaders in the face of such challenges is mobilizing people throughout their organizations to do adaptive work. In this HBR article from 1997, the authors suggest that the prevailing notion that leadership consists of having a vision and aligning people with it is bankrupt; this approach ignores the fact that many work situations are adaptive rather than technical. Heifetz and Laurie instead offer six principles for leading adaptive work. The authors say leaders need to get on the balcony–they should be able to spot operational and strategic patterns from high within the organization, as though on a balcony, and set or create a context for change rather than get caught up in the field of action. They need to identify the adaptive challenges–with input from throughout the company, leaders need to pinpoint just how a company’s value systems or methods of collaboration need to change. They need to regulate the inevitable distress that adaptive work generates-people invariably resist change. They need to maintain disciplined attention among employees, getting workers to confront the fact that they come together with different work habits, procedures, and beliefs; tough trade-offs may be necessary. Leaders need to give the work back to people, letting employees take the initiative in defining and solving problems. And finally, they need to protect the voices of leadership coming from below. An example of adaptive change at KPMG Netherlands, a professional services firm, illustrates these principles.

To stay alive, Jack Pritchard had to change his life. Triple bypass surgery and medication could help, the heart surgeon told him, but no technical fix could release Pritchard from his own responsibility for changing the habits of a lifetime. He had to stop smoking, improve his diet, get some exercise, and take time to relax, remembering to breathe more deeply each day. Pritchard’s doctor could provide sustaining technical expertise and take supportive action, but only Pritchard could adapt his ingrained habits to improve his long-term health. The doctor faced the leadership task of mobilizing the patient to make critical behavioral changes; Jack Pritchard faced the adaptive work of figuring out which specific changes to make and how to incorporate them into his daily life.

Companies today face challenges similar to the ones that confronted Pritchard and his doctor. They face adaptive challenges. Changes in societies, markets, customers, competition, and technology around the globe are forcing organizations to clarify their values, develop new strategies, and learn new ways of operating. Often the toughest task for leaders in effecting change is mobilizing people throughout the organization to do adaptive work.

Adaptive work is required when our deeply held beliefs are challenged, when the values that made us successful become less relevant, and when legitimate yet competing perspectives emerge. We see adaptive challenges every day at every level of the workplace—when companies restructure or reengineer, develop or implement strategy, or merge businesses. We see adaptive challenges when marketing has difficulty working with operations, when cross-functional teams don’t work well, or when senior executives complain, “We don’t seem to be able to execute effectively.” Adaptive problems are often systemic problems with no ready answers.

Mobilizing an organization to adapt its behaviors in order to thrive in new business environments is critical. Without such change, any company today would falter. Indeed, getting people to do adaptive work is the mark of leadership in a competitive world. Yet for most senior executives, providing leadership and not just authoritative expertise is extremely difficult. Why? We see two reasons. First, in order to make change happen, executives have to break a longstanding behavior pattern of their own: providing leadership in the form of solutions. This tendency is quite natural because many executives reach their positions of authority by virtue of their competence in taking responsibility and solving problems. But the locus of responsibility for problem solving when a company faces an adaptive challenge must shift to its people. Solutions to adaptive challenges reside not in the executive suite but in the collective intelligence of employees at all levels, who need to use one another as resources, often across boundaries, and learn their way to those solutions.

Solutions to adaptive challenges reside not in the executive suite but in the collective intelligence of employees at all levels.

Second, adaptive change is distressing for the people going through it. They need to take on new roles, new relationships, new values, new behaviors, and new approaches to work. Many employees are ambivalent about the efforts and sacrifices required of them. They often look to the senior executive to take problems off their shoulders. But those expectations have to be unlearned. Rather than fulfilling the expectation that they will provide answers, leaders have to ask tough questions. Rather than protecting people from outside threats, leaders should allow them to feel the pinch of reality in order to stimulate them to adapt. Instead of orienting people to their current roles, leaders must disorient them so that new relationships can develop. Instead of quelling conflict, leaders have to draw the issues out. Instead of maintaining norms, leaders have to challenge “the way we do business” and help others distinguish immutable values from historical practices that must go.

Drawing on our experience with managers from around the world, we offer six principles for leading adaptive work: “getting on the balcony,” identifying the adaptive challenge, regulating distress, maintaining disciplined attention, giving the work back to people, and protecting voices of leadership from below. We illustrate those principles with an example of adaptive change at KPMG Netherlands, a professional-services firm.

Get on the Balcony

Earvin “Magic” Johnson’s greatness in leading his basketball team came in part from his ability to play hard while keeping the whole game situation in mind, as if he stood in a press box or on a balcony above the field of play. Bobby Orr played hockey in the same way. Other players might fail to recognize the larger patterns of play that performers like Johnson and Orr quickly understand, because they are so engaged in the game that they get carried away by it. Their attention is captured by the rapid motion, the physical contact, the roar of the crowd, and the pressure to execute. In sports, most players simply may not see who is open for a pass, who is missing a block, or how the offense and defense work together. Players like Johnson and Orr watch these things and allow their observations to guide their actions.

Business leaders have to be able to view patterns as if they were on a balcony. It does them no good to be swept up in the field of action. Leaders have to see a context for change or create one. They should give employees a strong sense of the history of the enterprise and what’s good about its past, as well as an idea of the market forces at work today and the responsibility people must take in shaping the future. Leaders must be able to identify struggles over values and power, recognize patterns of work avoidance, and watch for the many other functional and dysfunctional reactions to change.

Without the capacity to move back and forth between the field of action and the balcony, to reflect day to day, moment to moment, on the many ways in which an organization’s habits can sabotage adaptive work, a leader easily and unwittingly becomes a prisoner of the system. The dynamics of adaptive change are far too complex to keep track of, let alone influence, if leaders stay only on the field of play.

We have encountered several leaders, some of whom we discuss in this article, who manage to spend much of their precious time on the balcony as they guide their organizations through change. Without that perspective, they probably would have been unable to mobilize people to do adaptive work. Getting on the balcony is thus a prerequisite for following the next five principles.

Identify the Adaptive Challenge

When a leopard threatens a band of chimpanzees, the leopard rarely succeeds in picking off a stray. Chimps know how to respond to this kind of threat. But when a man with an automatic rifle comes near, the routine responses fail. Chimps risk extinction in a world of poachers unless they figure out how to disarm the new threat. Similarly, when businesses cannot learn quickly to adapt to new challenges, they are likely to face their own form of extinction.

Consider the well-known case of British Airways. Having observed the revolutionary changes in the airline industry during the 1980s, then chief executive Colin Marshall clearly recognized the need to transform an airline nicknamed Bloody Awful by its own passengers into an exemplar of customer service. He also understood that this ambition would require more than anything else changes in values, practices, and relationships throughout the company. An organization whose people clung to functional silos and valued pleasing their bosses more than pleasing customers could not become “the world’s favorite airline.” Marshall needed an organization dedicated to serving people, acting on trust, respecting the individual, and making teamwork happen across boundaries. Values had to change throughout British Airways. People had to learn to collaborate and to develop a collective sense of responsibility for the direction and performance of the airline. Marshall identified the essential adaptive challenge: creating trust throughout the organization. He is one of the first executives we have known to make “creating trust” a priority.

To lead British Airways, Marshall had to get his executive team to understand the nature of the threat created by dissatisfied customers: Did it represent a technical challenge or an adaptive challenge? Would expert advice and technical adjustments within basic routines suffice, or would people throughout the company have to learn different ways of doing business, develop new competencies, and begin to work collectively?

Marshall and his team set out to diagnose in more detail the organization’s challenges. They looked in three places. First, they listened to the ideas and concerns of people inside and outside the organization—meeting with crews on flights, showing up in the 350-person reservations center in New York, wandering around the baggage-handling area in Tokyo, or visiting the passenger lounge in whatever airport they happened to be in. Their primary questions were, Whose values, beliefs, attitudes, or behaviors would have to change in order for progress to take place? What shifts in priorities, resources, and power were necessary? What sacrifices would have to be made and by whom?

Second, Marshall and his team saw conflicts as clues—symptoms of adaptive challenges. The way conflicts across functions were being expressed were mere surface phenomena; the underlying conflicts had to be diagnosed. Disputes over seemingly technical issues such as procedures, schedules, and lines of authority were in fact proxies for underlying conflicts about values and norms.

Third, Marshall and his team held a mirror up to themselves, recognizing that they embodied the adaptive challenges facing the organization. Early in the transformation of British Airways, competing values and norms were played out on the executive team in dysfunctional ways that impaired the capacity of the rest of the company to collaborate across functions and units and make the necessary trade-offs. No executive can hide from the fact that his or her team reflects the best and the worst of the company’s values and norms, and therefore provides a case in point for insight into the nature of the adaptive work ahead.

Thus, identifying its adaptive challenge was crucial in British Airways’ bid to become the world’s favorite airline. For the strategy to succeed, the company’s leaders needed to understand themselves, their people, and the potential sources of conflict. Marshall recognized that strategy development itself requires adaptive work.

Regulate Distress

Adaptive work generates distress. Before putting people to work on challenges for which there are no ready solutions, a leader must realize that people can learn only so much so fast. At the same time, they must feel the need to change as reality brings new challenges. They cannot learn new ways when they are overwhelmed, but eliminating stress altogether removes the impetus for doing adaptive work. Because a leader must strike a delicate balance between having people feel the need to change and having them feel overwhelmed by change, leadership is a razor’s edge.

A leader must attend to three fundamental tasks in order to help maintain a productive level of tension. Adhering to these tasks will allow him or her to motivate people without disabling them. First, a leader must create what can be called a holding environment. To use the analogy of a pressure cooker, a leader needs to regulate the pressure by turning up the heat while also allowing some steam to escape. If the pressure exceeds the cooker’s capacity, the cooker can blow up. However, nothing cooks without some heat.

In the early stages of a corporate change, the holding environment can be a temporary “place” in which a leader creates the conditions for diverse groups to talk to one another about the challenges facing them, to frame and debate issues, and to clarify the assumptions behind competing perspectives and values. Over time, more issues can be phased in as they become ripe. At British Airways, for example, the shift from an internal focus to a customer focus took place over four or five years and dealt with important issues in succession: building a credible executive team, communicating with a highly fragmented organization, defining new measures of performance and compensation, and developing sophisticated information systems. During that time, employees at all levels learned to identify what and how they needed to change.

Thus, a leader must sequence and pace the work. Too often, senior managers convey that everything is important. They start new initiatives without stopping other activities, or they start too many initiatives at the same time. They overwhelm and disorient the very people who need to take responsibility for the work.

Second, a leader is responsible for direction, protection, orientation, managing conflict, and shaping norms. (See the exhibit “Adaptive Work Calls for Leadership.”) Fulfilling these responsibilities is also important for a manager in technical or routine situations. But a leader engaged in adaptive work uses his authority to fulfill them differently. A leader provides direction by identifying the organization’s adaptive challenge and framing the key questions and issues. A leader protects people by managing the rate of change. A leader orients people to new roles and responsibilities by clarifying business realities and key values. A leader helps expose conflict, viewing it as the engine of creativity and learning. Finally, a leader helps the organization maintain those norms that must endure and challenge those that need to change.

Third, a leader must have presence and poise; regulating distress is perhaps a leader’s most difficult job. The pressures to restore equilibrium are enormous. Just as molecules bang hard against the walls of a pressure cooker, people bang up against leaders who are trying to sustain the pressures of tough, conflict-filled work. 

Although leadership demands a deep understanding of the pain of change—the fears and sacrifices associated with major readjustment—it also requires the ability to hold steady and maintain the tension. Otherwise, the pressure escapes and the stimulus for learning and change is lost.

A leader has to have the emotional capacity to tolerate uncertainty, frustration, and pain. He has to be able to raise tough questions without getting too anxious himself. 

Employees as well as colleagues and customers will carefully observe verbal and nonverbal cues to a leader’s ability to hold steady. He needs to communicate confidence that he and they can tackle the tasks ahead.

Maintain Disciplined Attention

Different people within the same organization bring different experiences, assumptions, values, beliefs, and habits to their work. This diversity is valuable because innovation and learning are the products of differences. No one learns anything without being open to contrasting points of view. Yet managers at all levels are often unwilling—or unable—to address their competing perspectives collectively. They frequently avoid paying attention to issues that disturb them. They restore equilibrium quickly, often with work avoidance maneuvers. A leader must get employees to confront tough trade-offs in values, procedures, operating styles, and power.

That is as true at the top of the organization as it is in the middle or on the front line. Indeed, if the executive team cannot model adaptive work, the organization will languish. If senior managers can’t draw out and deal with divisive issues, how will people elsewhere in the organization change their behaviors and rework their relationships? As Jan Carlzon, the legendary CEO of Scandinavian Airlines System (SAS), told us, “One of the most interesting missions of leadership is getting people on the executive team to listen to and learn from one another. Held in debate, people can learn their way to collective solutions when they understand one another’s assumptions. The work of the leader is to get conflict out into the open and use it as a source of creativity.”

A leader must sequence and pace the work. Too often, senior managers convey that everything is important. They overwhelm and disorient the very people who need to take responsibility for the work.

Because work avoidance is rampant in organizations, a leader has to counteract distractions that prevent people from dealing with adaptive issues. Scape-goating, denial, focusing only on today’s technical issues, or attacking individuals rather than the perspectives they represent—all forms of work avoidance—are to be expected when an organization undertakes adaptive work. Distractions have to be identified when they occur so that people will regain focus.

When sterile conflict takes the place of dialogue, a leader has to step in and put the team to work on reframing the issues. She has to deepen the debate with questions, unbundling the issues into their parts rather than letting conflict remain polarized and superficial. When people preoccupy themselves with blaming external forces, higher management, or a heavy workload, a leader has to sharpen the team’s sense of responsibility for carving out the time to press forward. When the team fragments and individuals resort to protecting their own turf, leaders have to demonstrate the need for collaboration. People have to discover the value of consulting with one another and using one another as resources in the problem-solving process. For example, one CEO we know uses executive meetings, even those that focus on operational and technical issues, as opportunities to teach the team how to work collectively on adaptive problems.

Of course, only the rare manager intends to avoid adaptive work. In general, people feel ambivalent about it. Although they want to make progress on hard problems or live up to their renewed and clarified values, people also want to avoid the associated distress. Just as millions of U.S. citizens want to reduce the federal budget deficit, but not by giving up their tax dollars or benefits or jobs, so, too, managers may consider adaptive work a priority but have difficulty sacrificing their familiar ways of doing business. People need leadership to help them maintain their focus on the tough questions. Disciplined attention is the currency of leadership.

Give the Work Back to People

Everyone in the organization has special access to information that comes from his or her particular vantage point. Everyone may see different needs and opportunities. People who sense early changes in the marketplace are often at the periphery, but the organization will thrive if it can bring that information to bear on tactical and strategic decisions. When people do not act on their special knowledge, businesses fail to adapt.

All too often, people look up the chain of command, expecting senior management to meet market challenges for which they themselves are responsible. Indeed, the greater and more persistent distresses that accompany adaptive work make such dependence worse. People tend to become passive, and senior managers who pride themselves on being problem solvers take decisive action. That behavior restores equilibrium in the short term but ultimately leads to complacency and habits of work avoidance that shield people from responsibility, pain, and the need to change.

Getting people to assume greater responsibility is not easy. Not only are many lower-level employees comfortable being told what to do, but many managers are accustomed to treating subordinates like machinery that requires control. Letting people take the initiative in defining and solving problems means that management needs to learn to support rather than control. Workers, for their part, need to learn to take responsibility.

Management needs to learn to support rather than control. Workers, for their part, need to learn to take responsibility.

Jan Carlzon encouraged responsibility taking at SAS by trusting others and decentralizing authority. A leader has to let people bear the weight of responsibility. “The key is to let them discover the problem,” he said. “You won’t be successful if people aren’t carrying the recognition of the problem and the solution within themselves.” To that end, Carlzon sought widespread engagement.

For example, in his first two years at SAS, Carlzon spent up to 50% of his time communicating directly in large meetings and indirectly in a host of innovative ways: through workshops, brainstorming sessions, learning exercises, newsletters, brochures, and exposure in the public media. He demonstrated through a variety of symbolic acts—for example, by eliminating the pretentious executive dining room and burning thousands of pages of manuals and handbooks—the extent to which rules had come to dominate the company. He made himself a pervasive presence, meeting with and listening to people both inside and outside the organization. He even wrote a book, Moments of Truth (HarperCollins, 1989), to explain his values, philosophy, and strategy. As Carlzon noted, “If no one else read it, at least my people would.”

A leader also must develop collective self-confidence. Again, Carlzon said it well: “People aren’t born with self-confidence. Even the most self-confident people can be broken. Self-confidence comes from success, experience, and the organization’s environment. The leader’s most important role is to instill confidence in people. They must dare to take risks and responsibility. You must back them up if they make mistakes.”

Protect Voices of Leadership from Below

Giving a voice to all people is the foundation of an organization that is willing to experiment and learn. But, in fact, whistle-blowers, creative deviants, and other such original voices routinely get smashed and silenced in organizational life. They generate disequilibrium, and the easiest way for an organization to restore equilibrium is to neutralize those voices, sometimes in the name of teamwork and “alignment.”

The voices from below are usually not as articulate as one would wish. People speaking beyond their authority usually feel self-conscious and sometimes have to generate “too much” passion to get themselves geared up for speaking out. Of course, that often makes it harder for them to communicate effectively. They pick the wrong time and place, and often bypass proper channels of communication and lines of authority. But buried inside a poorly packaged interjection may lie an important intuition that needs to be teased out and considered. To toss it out for its bad timing, lack of clarity, or seeming unreasonableness is to lose potentially valuable information and discourage a potential leader in the organization.

That is what happened to David, a manager in a large manufacturing company. He had listened when his superiors encouraged people to look for problems, speak openly, and take responsibility. So he raised an issue about one of the CEO’s pet projects—an issue that was deemed “too hot to handle” and had been swept under the carpet for years. Everyone understood that it was not open to discussion, but David knew that proceeding with the project could damage or derail key elements of the company’s overall strategy. He raised the issue directly in a meeting with his boss and the CEO. He provided a clear description of the problem, a rundown of competing perspectives, and a summary of the consequences of continuing to pursue the project.

The CEO angrily squelched the discussion and reinforced the positive aspects of his pet project. When David and his boss left the room, his boss exploded: “Who do you think you are, with your holier-than-thou attitude?” He insinuated that David had never liked the CEO’s pet project because David hadn’t come up with the idea himself. The subject was closed.

David had greater expertise in the area of the project than either his boss or the CEO. But his two superiors demonstrated no curiosity, no effort to investigate David’s reasoning, no awareness that he was behaving responsibly with the interests of the company at heart. It rapidly became clear to David that it was more important to understand what mattered to the boss than to focus on real issues. The CEO and David’s boss together squashed the viewpoint of a leader from below and thereby killed his potential for leadership in the organization. He would either leave the company or never go against the grain again.

Leaders must rely on others within the business to raise questions that may indicate an impending adaptive challenge. They have to provide cover to people who point to the internal contradictions of the enterprise. Those individuals often have the perspective to provoke rethinking that people in authority do not. Thus, as a rule of thumb, when authority figures feel the reflexive urge to glare at or otherwise silence someone, they should resist. The urge to restore social equilibrium is quite powerful, and it comes on fast. One has to get accustomed to getting on the balcony, delaying the impulse, and asking, What is this guy really talking about? Is there something we’re missing?

Doing Adaptive Work at KPMG Netherlands

The highly successful KPMG Netherlands provides a good example of how a company can engage in adaptive work. In 1994, Ruud Koedijk, the firm’s chairman, recognized a strategic challenge. Although the auditing, consulting, and tax-preparation partnership was the industry leader in the Netherlands and was highly profitable, growth opportunities in the segments it served were limited. Margins in the auditing business were being squeezed as the market became more saturated, and competition in the consulting business was increasing as well. Koedijk knew that the firm needed to move into more profitable growth areas, but he didn’t know what they were or how KPMG might identify them.

Koedijk and his board were confident that they had the tools to do the analytical strategy work: analyze trends and discontinuities, understand core competencies, assess their competitive position, and map potential opportunities. They were considerably less certain that they could commit to implementing the strategy that would emerge from their work. Historically, the partnership had resisted attempts to change, basically because the partners were content with the way things were. They had been successful for a long time, so they saw no reason to learn new ways of doing business, either from their fellow partners or from anyone lower down in the organization. Overturning the partners’ attitude and its deep impact on the organization’s culture posed an enormous adaptive challenge for KPMG.

Koedijk could see from the balcony that the very structure of KPMG inhibited change. In truth, KPMG was less a partnership than a collection of small fiefdoms in which each partner was a lord. The firm’s success was the cumulative accomplishment of each of the individual partners, not the unified result of 300 colleagues pulling together toward a shared ambition. Success was measured solely in terms of the profitability of individual units. As one partner described it, “If the bottom line was correct, you were a ‘good fellow.’” As a result, one partner would not trespass on another’s turf, and learning from others was a rare event. Because independence was so highly valued, confrontations were rare and conflict was camouflaged. If partners wanted to resist firmwide change, they did not kill the issue directly. “Say yes, do no” was the operative phrase.

Koedijk also knew that this sense of autonomy got in the way of developing new talent at KPMG. Directors rewarded their subordinates for two things: not making mistakes and delivering a high number of billable hours per week. The emphasis was not on creativity or innovation. Partners were looking for errors when they reviewed their subordinates’ work, not for new understanding or fresh insight. Although Koedijk could see the broad outlines of the adaptive challenges facing his organization, he knew that he could not mandate behavioral change. What he could do was create the conditions for people to discover for themselves how they needed to change. He set a process in motion to make that happen.

To start, Koedijk held a meeting of all 300 partners and focused their attention on the history of KPMG, the current business reality, and the business issues they could expect to face. He then raised the question of how they would go about changing as a firm and asked for their perspectives on the issues. By launching the strategic initiative through dialogue rather than edict, he built trust within the partner ranks. Based on this emerging trust and his own credibility, Koedijk persuaded the partners to release 100 partners and nonpartners from their day-to-day responsibilities to work on the strategic challenges. They would devote 60% of their time for nearly four months to that work.

Koedijk and his colleagues established a strategic integration team of 12 senior partners to work with the 100 professionals (called “the 100”) from different levels and disciplines. Engaging people below the rank of partner in a major strategic initiative was unheard of and signaled a new approach from the start: Many of these people’s opinions had never before been valued or sought by authority figures in the firm. Divided into 14 task forces, the 100 were to work in three areas: gauging future trends and discontinuities, defining core competencies, and grappling with the adaptive challenges facing the organization. They were housed on a separate floor with their own support staff, and they were unfettered by traditional rules and regulations. Hennie Both, KPMG’s director of marketing and communications, signed on as project manager.

As the strategy work got under way, the task forces had to confront the existing KPMG culture. Why? Because they literally could not do their new work within the old rules. They could not work when strong respect for the individual came at the expense of effective teamwork, when deeply held individual beliefs got in the way of genuine discussion, and when unit loyalties formed a barrier to cross-functional problem solving. Worst of all, task force members found themselves avoiding conflict and unable to discuss those problems. A number of the task forces became dysfunctional and unable to do their strategy work.

To focus their attention on what needed to change, Both helped the task forces map the culture they desired against the current culture. They discovered very little overlap. The top descriptors of the current culture were: develop opposing views, demand perfection, and avoid conflict. The top characteristics of the desired culture were: create the opportunity for self-fulfillment, develop a caring environment, and maintain trusting relations with colleagues. 

Articulating this gap made tangible for the group the adaptive challenge that Koedijk saw facing KPMG. In other words, the people who needed to do the changing had finally framed the adaptive challenge for themselves: How could KPMG succeed at a competence-based strategy that depended on cooperation across multiple units and layers if its people couldn’t succeed in these task forces? Armed with that understanding, the task force members could become emissaries to the rest of the firm.

On a more personal level, each member was asked to identify his or her individual adaptive challenge. What attitudes, behaviors, or habits did each one need to change, and what specific actions would he or she take? Who else needed to be involved for individual change to take root? Acting as coaches and consultants, the task force members gave one another supportive feedback and suggestions. They had learned to confide, to listen, and to advise with genuine care.

Progress on these issues raised the level of trust dramatically, and task force members began to understand what adapting their behavior meant in everyday terms. They understood how to identify an adaptive issue and developed a language with which to discuss what they needed to do to improve their collective ability to solve problems. They talked about dialogue, work avoidance, and using the collective intelligence of the group. They knew how to call one another on dysfunctional behavior. They had begun to develop the culture required to implement the new business strategy.

Despite the critical breakthroughs toward developing a collective understanding of the adaptive challenge, regulating the level of distress was a constant preoccupation for Koedijk, the board, and Both. The nature of the work was distressing. Strategy work means broad assignments with limited instructions; at KPMG, people were accustomed to highly structured assignments. Strategy work also means being creative. At one breakfast meeting, a board member stood on a table to challenge the group to be more creative and toss aside old rules. This radical and unexpected behavior further raised the distress level: No one had ever seen a partner behave this way before. People realized that their work experience had prepared them only for performing routine tasks with people “like them” from their own units.

The process allowed for conflict and focused people’s attention on the hot issues in order to help them learn how to work with conflict in a constructive manner. But the heat was kept within a tolerable range in some of the following ways:

• On one occasion when tensions were unusually high, the 100 were brought together to voice their concerns to the board in an Oprah Winfrey—style meeting. The board sat in the center of an auditorium and took pointed questions from the surrounding group.
• The group devised sanctions to discourage unwanted behavior. In the soccer-crazy Netherlands, all participants in the process were issued the yellow cards that soccer referees use to indicate “foul” to offending players. They used the cards to stop the action when someone started arguing his or her point without listening to or understanding the assumptions and competing perspectives of other participants.
• The group created symbols. They compared the old KPMG to a hippopotamus that was large and cumbersome, liked to sleep a lot, and became aggressive when its normal habits were disturbed. They aspired to be dolphins, which they characterized as playful, eager to learn, and happily willing to go the extra mile for the team. They even paid attention to the statement that clothes make: It surprised some clients to see managers wandering through the KPMG offices that summer in Bermuda shorts and T-shirts.

• The group made a deliberate point of having fun. “Playtime” could mean long bicycle rides or laser-gun games at a local amusement center. In one spontaneous moment at the KPMG offices, a discussion of the power of people mobilized toward a common goal led the group to go outside and use their collective leverage to move a seemingly immovable concrete block.
• The group attended frequent two- and three-day off-site meetings to help bring closure to parts of the work.

These actions, taken as a whole, altered attitudes and behaviors. Curiosity became more valued than obedience to rules. People no longer deferred to the senior authority figure in the room; genuine dialogue neutralized hierarchical power in the battle over ideas. The tendency for each individual to promote his or her pet solution gave way to understanding other perspectives. A confidence in the ability of people in different units to work together and work things out emerged. The people with the most curious minds and interesting questions soon became the most respected.

As a result of confronting strategic and adaptive challenges, KPMG as a whole will move from auditing to assurance, from operations consulting to shaping corporate vision, from business-process reengineering to developing organizational capabilities, and from teaching traditional skills to its own clients to creating learning organizations. The task forces identified $50 million to $60 million worth of new business opportunities.

As a result of confronting strategic and adaptive challenges, KPMG task forces identified $50 million to $60 million worth of new business opportunities.

Many senior partners who had believed that a firm dominated by the auditing mentality could not contain creative people were surprised when the process unlocked creativity, passion, imagination, and a willingness to take risks. Two stories illustrate the fundamental changes that took place in the firm’s mind-set.

We saw one middle manager develop the confidence to create a new business. He spotted the opportunity to provide KPMG services to virtual organizations and strategic alliances. He traveled the world, visiting the leaders of 65 virtual organizations. The results of his innovative research served as a resource to KPMG in entering this growing market. Moreover, he represented the new KPMG by giving a keynote address discussing his findings at a world forum. We also saw a 28-year-old female auditor skillfully guide a group of older, male senior partners through a complex day of looking at opportunities associated with implementing the firm’s new strategies. That could not have occurred the year before. The senior partners never would have listened to such a voice from below.

Leadership as Learning

Many efforts to transform organizations through mergers and acquisitions, restructuring, reengineering, and strategy work falter because managers fail to grasp the requirements of adaptive work. They make the classic error of treating adaptive challenges like technical problems that can be solved by tough-minded senior executives.

The implications of that error go to the heart of the work of leaders in organizations today. Leaders crafting strategy have access to the technical expertise and the tools they need to calculate the benefits of a merger or restructuring, understand future trends and discontinuities, identify opportunities, map existing competencies, and identify the steering mechanisms to support their strategic direction. These tools and techniques are readily available both within organizations and from a variety of consulting firms, and they are very useful. In many cases, however, seemingly good strategies fail to be implemented. And often the failure is misdiagnosed: “We had a good strategy, but we couldn’t execute it effectively.”

In fact, the strategy itself is often deficient because too many perspectives were ignored during its formulation. The failure to do the necessary adaptive work during the strategy development process is a symptom of senior managers’ technical orientation. Managers frequently derive their solution to a problem and then try to sell it to some colleagues and bypass or sandbag others in the commitment-building process. Too often, leaders, their team, and consultants fail to identify and tackle the adaptive dimensions of the challenge and to ask themselves, Who needs to learn what in order to develop, understand, commit to, and implement the strategy?

The same technical orientation entraps business-process-reengineering and restructuring initiatives, in which consultants and managers have the know-how to do the technical work of framing the objectives, designing a new work flow, documenting and communicating results, and identifying the activities to be performed by people in the organization. In many instances, reengineering falls short of the mark because it treats process redesign as a technical problem: Managers neglect to identify the adaptive work and involve the people who have to do the changing. Senior executives fail to invest their time and their souls in understanding these issues and guiding people through the transition. Indeed, engineering is itself the wrong metaphor.

In short, the prevailing notion that leadership consists of having a vision and aligning people with that vision is bankrupt because it continues to treat adaptive situations as if they were technical: The authority figure is supposed to divine where the company is going, and people are supposed t o follow. Leadership is reduced to a combination of grand knowing and salesmanship. Such a perspective reveals a basic misconception about the way businesses succeed in addressing adaptive challenges. Adaptive situations are hard to define and resolve precisely because they demand the work and responsibility of managers and people throughout the organization. They are not amenable to solutions provided by leaders; adaptive solutions require members of the organization to take responsibility for the problematic situations that face them.

Leadership has to take place every day. It cannot be the responsibility of the few, a rare event, or a once-in-a-lifetime opportunity. In our world, in our businesses, we face adaptive challenges all the time. When an executive is asked to square conflicting aspirations, he and his people face an adaptive challenge. When a manager sees a solution to a problem—technical in many respects except that it requires a change in the attitudes and habits of subordinates—he faces an adaptive challenge. When an employee close to the front line sees a gap between the organization’s purpose and the objectives he is asked to achieve, he faces both an adaptive challenge and the risks and opportunity of leading from below.

Leadership, as seen in this light, requires a learning strategy. A leader, from above or below, with or without authority, has to engage people in confronting the challenge, adjusting their values, changing perspectives, and learning new habits. To an authoritative person who prides himself on his ability to tackle hard problems, this shift may come as a rude awakening. But it also should ease the burden of having to know all the answers and bear all the load. To the person who waits to receive either the coach’s call or “the vision” to lead, this change may also seem a mixture of good news and bad news. The adaptive demands of our time require leaders who take responsibility without waiting for revelation or request. One can lead with no more than a question in hand.

Even successful change efforts are messy and full of surprises. Here are eight common errors companies make during critical transformations.

Summary.   

Businesses hoping to survive over the long term will have to remake themselves into better competitors at least once along the way. These efforts have gone under many banners: total quality management, reengineering, rightsizing, restructuring, cultural change, and turnarounds, to name a few. In almost every case, the goal has been to cope with a new, more challenging market by changing the way business is conducted. A few of these endeavors have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.

John P. Kotter is renowned for his work on leading organizational change. In 1995, when this article was first published, he had just completed a ten-year study of more than 100 companies that attempted such a transformation. Here he shares the results of his observations, outlining the eight largest errors that can doom these efforts and explaining the general lessons that encourage success.

Unsuccessful transitions almost always founder during at least one of the following phases: generating a sense of urgency, establishing a powerful guiding coalition, developing a vision, communicating the vision clearly and often, removing obstacles, planning for and creating short-term wins, avoiding premature declarations of victory, and embedding changes in the corporate culture.

Realizing that change usually takes a long time, says Kotter, can improve the chances of success.

Over the past decade, I have watched more than 100 companies try to remake themselves into significantly better competitors. They have included large organizations (Ford) and small ones (Landmark Communications), companies based in the United States (General Motors) and elsewhere (British Airways), corporations that were on their knees (Eastern Airlines), and companies that were earning good money (Bristol-Myers Squibb). These efforts have gone under many banners: total quality management, reengineering, rightsizing, restructuring, cultural change, and turnaround. But, in almost every case, the basic goal has been the same: to make fundamental changes in how business is conducted in order to help cope with a new, more challenging market environment.

A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale. The lessons that can be drawn are interesting and will probably be relevant to even more organizations in the increasingly competitive business environment of the coming decade.

The most general lesson to be learned from the more successful cases is that the change process goes through a series of phases that, in total, usually require a considerable length of time. Skipping steps creates only the illusion of speed and never produces a satisfying result. A second very general lesson is that critical mistakes in any of the phases can have a devastating impact, slowing momentum and negating hard-won gains. Perhaps because we have relatively little experience in renewing organizations, even very capable people often make at least one big error.

Error 1: Not Establishing a Great Enough Sense of Urgency

Most successful change efforts begin when some individuals or some groups start to look hard at a company’s competitive situation, market position, technological trends, and financial performance. They focus on the potential revenue drop when an important patent expires, the five-year trend in declining margins in a core business, or an emerging market that everyone seems to be ignoring. They then find ways to communicate this information broadly and dramatically, especially with respect to crises, potential crises, or great opportunities that are very timely. This first step is essential because just getting a transformation program started requires the aggressive cooperation of many individuals. Without motivation, people won’t help, and the effort goes nowhere.

Compared with other steps in the change process, phase one can sound easy. It is not. Well over 50% of the companies I have watched fail in this first phase. What are the reasons for that failure? Sometimes executives underestimate how hard it can be to drive people out of their comfort zones. Sometimes they grossly overestimate how successful they have already been in increasing urgency. Sometimes they lack patience: “Enough with the preliminaries; let’s get on with it.” In many cases, executives become paralyzed by the downside possibilities. They worry that employees with seniority will become defensive, that morale will drop, that events will spin out of control, that short-term business results will be jeopardized, that the stock will sink, and that they will be blamed for creating a crisis.

A paralyzed senior management often comes from having too many managers and not enough leaders. Management’s mandate is to minimize risk and to keep the current system operating. Change, by definition, requires creating a new system, which in turn always demands leadership. Phase one in a renewal process typically goes nowhere until enough real leaders are promoted or hired into senior-level jobs.

Transformations often begin, and begin well, when an organization has a new head who is a good leader and who sees the need for a major change. If the renewal target is the entire company, the CEO is key. If change is needed in a division, the division general manager is key. When these individuals are not new leaders, great leaders, or change champions, phase one can be a huge challenge.

Bad business results are both a blessing and a curse in the first phase. On the positive side, losing money does catch people’s attention. But it also gives less maneuvering room. With good business results, the opposite is true: Convincing people of the need for change is much harder, but you have more resources to help make changes.

But whether the starting point is good performance or bad, in the more successful cases I have witnessed, an individual or a group always facilitates a frank discussion of potentially unpleasant facts about new competition, shrinking margins, decreasing market share, flat earnings, a lack of revenue growth, or other relevant indices of a declining competitive position. Because there seems to be an almost universal human tendency to shoot the bearer of bad news, especially if the head of the organization is not a change champion, executives in these companies often rely on outsiders to bring unwanted information. Wall Street analysts, customers, and consultants can all be helpful in this regard. The purpose of all this activity, in the words of one former CEO of a large European company, is “to make the status quo seem more dangerous than launching into the unknown.”

In a few of the most successful cases, a group has manufactured a crisis. One CEO deliberately engineered the largest accounting loss in the company’s history, creating huge pressures from Wall Street in the process. One division president commissioned first-ever customer satisfaction surveys, knowing full well that the results would be terrible. He then made these findings public. On the surface, such moves can look unduly risky. But there is also risk in playing it too safe: When the urgency rate is not pumped up enough, the transformation process cannot succeed, and the long-term future of the organization is put in jeopardy.

When is the urgency rate high enough? From what I have seen, the answer is when about 75% of a company’s management is honestly convinced that business as usual is totally unacceptable. Anything less can produce very serious problems later on in the process.

Error 2: Not Creating a Powerful Enough Guiding Coalition

Major renewal programs often start with just one or two people. In cases of successful transformation efforts, the leadership coalition grows and grows over time. But whenever some minimum mass is not achieved early in the effort, nothing much worthwhile happens.

It is often said that major change is impossible unless the head of the organization is an active supporter. What I am talking about goes far beyond that. In successful transformations, the chairman or president or division general manager, plus another five or 15 or 50 people, come together and develop a shared commitment to excellent performance through renewal. In my experience, this group never includes all of the company’s most senior executives because some people just won’t buy in, at least not at first. But in the most successful cases, the coalition is always pretty powerful—in terms of titles, information and expertise, reputations, and relationships.

In both small and large organizations, a successful guiding team may consist of only three to five people during the first year of a renewal effort. But in big companies, the coalition needs to grow to the 20 to 50 range before much progress can be made in phase three and beyond. Senior managers always form the core of the group. But sometimes you find board members, a representative from a key customer, or even a powerful union leader.

Because the guiding coalition includes members who are not part of senior management, it tends to operate outside of the normal hierarchy by definition. This can be awkward, but it is clearly necessary. If the existing hierarchy were working well, there would be no need for a major transformation. But since the current system is not working, reform generally demands activity outside of formal boundaries, expectations, and protocol.

A high sense of urgency within the managerial ranks helps enormously in putting a guiding coalition together. But more is usually required. Someone needs to get these people together, help them develop a shared assessment of their company’s problems and opportunities, and create a minimum level of trust and communication. Off-site retreats, for two or three days, are one popular vehicle for accomplishing this task. I have seen many groups of five to 35 executives attend a series of these retreats over a period of months.

Companies that fail in phase two usually underestimate the difficulties of producing change and thus the importance of a powerful guiding coalition. Sometimes they have no history of teamwork at the top and therefore undervalue the importance of this type of coalition. Sometimes they expect the team to be led by a staff executive from human resources, quality, or strategic planning instead of a key line manager. No matter how capable or dedicated the staff head, groups without strong line leadership never achieve the power that is required.

Efforts that don’t have a powerful enough guiding coalition can make apparent progress for a while. But, sooner or later, the opposition gathers itself together and stops the change.

Error 3: Lacking a Vision

In every successful transformation effort that I have seen, the guiding coalition develops a picture of the future that is relatively easy to communicate and appeals to customers, stockholders, and employees. A vision always goes beyond the numbers that are typically found in five-year plans. A vision says something that helps clarify the direction in which an organization needs to move. Sometimes the first draft comes mostly from a single individual. It is usually a bit blurry, at least initially. But after the coalition works at it for three or five or even 12 months, something much better emerges through their tough analytical thinking and a little dreaming. Eventually, a strategy for achieving that vision is also developed.

In one midsize European company, the first pass at a vision contained two-thirds of the basic ideas that were in the final product. The concept of global reach was in the initial version from the beginning. So was the idea of becoming preeminent in certain businesses. But one central idea in the final version—getting out of low value-added activities—came only after a series of discussions over a period of several months.

Without a sensible vision, a transformation effort can easily dissolve into a list of confusing and incompatible projects that can take the organization in the wrong direction or nowhere at all. Without a sound vision, the reengineering project in the accounting department, the new 360-degree performance appraisal from the human resources department, the plant’s quality program, the cultural change project in the sales force will not add up in a meaningful way.

In failed transformations, you often find plenty of plans, directives, and programs but no vision. In one case, a company gave out four-inch-thick notebooks describing its change effort. In mind-numbing detail, the books spelled out procedures, goals, methods, and deadlines. But nowhere was there a clear and compelling statement of where all this was leading. Not surprisingly, most of the employees with whom I talked were either confused or alienated. The big, thick books did not rally them together or inspire change. In fact, they probably had just the opposite effect.

If you can’t communicate the vision to someone in five minutes or less and get a reaction that signifies both understanding and interest, you are not done.

In a few of the less successful cases that I have seen, management had a sense of direction, but it was too complicated or blurry to be useful. Recently, I asked an executive in a midsize company to describe his vision and received in return a barely comprehensible 30-minute lecture. Buried in his answer were the basic elements of a sound vision. But they were buried—deeply.

A useful rule of thumb: If you can’t communicate the vision to someone in five minutes or less and get a reaction that signifies both understanding and interest, you are not yet done with this phase of the transformation process.

Error 4: Undercommunicating the Vision by a Factor of Ten

I’ve seen three patterns with respect to communication, all very common. In the first, a group actually does develop a pretty good transformation vision and then proceeds to communicate it by holding a single meeting or sending out a single communication. Having used about 0.0001% of the yearly intracompany communication, the group is startled when few people seem to understand the new approach. In the second pattern, the head of the organization spends a considerable amount of time making speeches to employee groups, but most people still don’t get it (not surprising, since vision captures only 0.0005% of the total yearly communication). In the third pattern, much more effort goes into newsletters and speeches, but some very visible senior executives still behave in ways that are antithetical to the vision. The net result is that cynicism among the troops goes up, while belief in the communication goes down.

Transformation is impossible unless hundreds or thousands of people are willing to help, often to the point of making short-term sacrifices. Employees will not make sacrifices, even if they are unhappy with the status quo, unless they believe that useful change is possible. Without credible communication, and a lot of it, the hearts and minds of the troops are never captured.

This fourth phase is particularly challenging if the short-term sacrifices include job losses. Gaining understanding and support is tough when downsizing is a part of the vision. For this reason, successful visions usually include new growth possibilities and the commitment to treat fairly anyone who is laid off.

Executives who communicate well incorporate messages into their hour-by-hour activities. In a routine discussion about a business problem, they talk about how proposed solutions fit (or don’t fit) into the bigger picture. In a regular performance appraisal, they talk about how the employee’s behavior helps or undermines the vision. In a review of a division’s quarterly performance, they talk not only about the numbers but also about how the division’s executives are contributing to the transformation. In a routine Q&A with employees at a company facility, they tie their answers back to renewal goals.

In more successful transformation efforts, executives use all existing communication channels to broadcast the vision. They turn boring, unread company newsletters into lively articles about the vision. They take ritualistic, tedious quarterly management meetings and turn them into exciting discussions of the transformation. They throw out much of the company’s generic management education and replace it with courses that focus on business problems and the new vision. The guiding principle is simple: Use every possible channel, especially those that are being wasted on nonessential information.

Perhaps even more important, most of the executives I have known in successful cases of major change learn to “walk the talk.” They consciously attempt to become a living symbol of the new corporate culture. This is often not easy. A 60-year-old plant manager who has spent precious little time over 40 years thinking about customers will not suddenly behave in a customer-oriented way. But I have witnessed just such a person change, and change a great deal. In that case, a high level of urgency helped. The fact that the man was a part of the guiding coalition and the vision-creation team also helped. So did all the communication, which kept reminding him of the desired behavior, and all the feedback from his peers and subordinates, which helped him see when he was not engaging in that behavior.

Communication comes in both words and deeds, and the latter are often the most powerful form. Nothing undermines change more than behavior by important individuals that is inconsistent with their words.

Error 5: Not Removing Obstacles to the New Vision

Successful transformations begin to involve large numbers of people as the process progresses. Employees are emboldened to try new approaches, to develop new ideas, and to provide leadership. The only constraint is that the actions fit within the broad parameters of the overall vision. The more people involved, the better the outcome.

To some degree, a guiding coalition empowers others to take action simply by successfully communicating the new direction. But communication is never sufficient by itself. Renewal also requires the removal of obstacles. Too often, an employee understands the new vision and wants to help make it happen, but an elephant appears to be blocking the path. In some cases, the elephant is in the person’s head, and the challenge is to convince the individual that no external obstacle exists. But in most cases, the blockers are very real.

Sometimes the obstacle is the organizational structure: Narrow job categories can seriously undermine efforts to increase productivity or make it very difficult even to think about customers. Sometimes compensation or performance-appraisal systems make people choose between the new vision and their own self-interest. Perhaps worst of all are bosses who refuse to change and who make demands that are inconsistent with the overall effort.

One company began its transformation process with much publicity and actually made good progress through the fourth phase. Then the change effort ground to a halt because the officer in charge of the company’s largest division was allowed to undermine most of the new initiatives. He paid lip service to the process but did not change his behavior or encourage his managers to change. He did not reward the unconventional ideas called for in the vision. He allowed human resource systems to remain intact even when they were clearly inconsistent with the new ideals. I think the officer’s motives were complex. To some degree, he did not believe the company needed major change. To some degree, he felt personally threatened by all the change. To some degree, he was afraid that he could not produce both change and the expected operating profit. But despite the fact that they backed the renewal effort, the other officers did virtually nothing to stop the one blocker. Again, the reasons were complex. The company had no history of confronting problems like this. Some people were afraid of the officer. The CEO was concerned that he might lose a talented executive. The net result was disastrous. Lower-level managers concluded that senior management had lied to them about their commitment to renewal, cynicism grew, and the whole effort collapsed.

In the first half of a transformation, no organization has the momentum, power, or time to get rid of all obstacles. But the big ones must be confronted and removed. If the blocker is a person, it is important that he or she be treated fairly and in a way that is consistent with the new vision. Action is essential, both to empower others and to maintain the credibility of the change effort as a whole.

Error 6: Not Systematically Planning for, and Creating, Short-Term Wins

Real transformation takes time, and a renewal effort risks losing momentum if there are no short-term goals to meet and celebrate. Most people won’t go on the long march unless they see compelling evidence in 12 to 24 months that the journey is producing expected results. Without short-term wins, too many people give up or actively join the ranks of those people who have been resisting change.

One to two years into a successful transformation effort, you find quality beginning to go up on certain indices or the decline in net income stopping. You find some successful new product introductions or an upward shift in market share. You find an impressive productivity improvement or a statistically higher customer satisfaction rating. But whatever the case, the win is unambiguous. The result is not just a judgment call that can be discounted by those opposing change.

Creating short-term wins is different from hoping for short-term wins. The latter is passive, the former active. In a successful transformation, managers actively look for ways to obtain clear performance improvements, establish goals in the yearly planning system, achieve the objectives, and reward the people involved with recognition, promotions, and even money. For example, the guiding coalition at a U.S. manufacturing company produced a highly visible and successful new product introduction about 20 months after the start of its renewal effort. The new product was selected about six months into the effort because it met multiple criteria: It could be designed and launched in a relatively short period, it could be handled by a small team of people who were devoted to the new vision, it had upside potential, and the new product-development team could operate outside the established departmental structure without practical problems. Little was left to chance, and the win boosted the credibility of the renewal process.

Managers often complain about being forced to produce short-term wins, but I’ve found that pressure can be a useful element in a change effort. When it becomes clear to people that major change will take a long time, urgency levels can drop. Commitments to produce short-term wins help keep the urgency level up and force detailed analytical thinking that can clarify or revise visions.

Error 7: Declaring Victory Too Soon

After a few years of hard work, managers may be tempted to declare victory with the first clear performance improvement. While celebrating a win is fine, declaring the war won can be catastrophic. Until changes sink deeply into a company’s culture, a process that can take five to ten years, new approaches are fragile and subject to regression.

After a few years of hard work, managers may be tempted to declare victory with the first clear performance improvement. While celebrating a win is fine, declaring the war won can be catastrophic.

In the recent past, I have watched a dozen change efforts operate under the reengineering theme. In all but two cases, victory was declared and the expensive consultants were paid and thanked when the first major project was completed after two to three years. Within two more years, the useful changes that had been introduced slowly disappeared. In two of the ten cases, it’s hard to find any trace of the reengineering work today.

Over the past 20 years, I’ve seen the same sort of thing happen to huge quality projects, organizational development efforts, and more. Typically, the problems start early in the process: The urgency level is not intense enough, the guiding coalition is not powerful enough, and the vision is not clear enough. But it is the premature victory celebration that kills momentum. And then the powerful forces associated with tradition take over.

Ironically, it is often a combination of change initiators and change resistors that creates the premature victory celebration. In their enthusiasm over a clear sign of progress, the initiators go overboard. They are then joined by resistors, who are quick to spot any opportunity to stop change. After the celebration is over, the resistors point to the victory as a sign that the war has been won and the troops should be sent home. Weary troops allow themselves to be convinced that they won. Once home, the foot soldiers are reluctant to climb back on the ships. Soon thereafter, change comes to a halt, and tradition creeps back in.

Instead of declaring victory, leaders of successful efforts use the credibility afforded by short-term wins to tackle even bigger problems. They go after systems and structures that are not consistent with the transformation vision and have not been confronted before. They pay great attention to who is promoted, who is hired, and how people are developed. They include new reengineering projects that are even bigger in scope than the initial ones. They understand that renewal efforts take not months but years. In fact, in one of the most successful transformations that I have ever seen, we quantified the amount of change that occurred each year over a seven-year period. On a scale of one (low) to ten (high), year one received a two, year two a four, year three a three, year four a seven, year five an eight, year six a four, and year seven a two. The peak came in year five, fully 36 months after the first set of visible wins.

Error 8: Not Anchoring Changes in the Corporation’s Culture

In the final analysis, change sticks when it becomes “the way we do things around here,” when it seeps into the bloodstream of the corporate body. Until new behaviors are rooted in social norms and shared values, they are subject to degradation as soon as the pressure for change is removed.

Leading Change from the Top Line

Two factors are particularly important in institutionalizing change in corporate culture. The first is a conscious attempt to show people how the new approaches, behaviors, and attitudes have helped improve performance. When people are left on their own to make the connections, they sometimes create very inaccurate links. For example, because results improved while charismatic Harry was boss, the troops link his mostly idiosyncratic style with those results instead of seeing how their own improved customer service and productivity were instrumental. Helping people see the right connections requires communication. Indeed, one company was relentless, and it paid off enormously. Time was spent at every major management meeting to discuss why performance was increasing. The company newspaper ran article after article showing how changes had boosted earnings.

The second factor is taking sufficient time to make sure that the next generation of top management really does personify the new approach. If the requirements for promotion don’t change, renewal rarely lasts. One bad succession decision at the top of an organization can undermine a decade of hard work. Poor succession decisions are possible when boards of directors are not an integral part of the renewal effort. In at least three instances I have seen, the champion for change was the retiring executive, and although his successor was not a resistor, he was not a change champion. Because the boards did not understand the transformations in any detail, they could not see that their choices were not good fits. The retiring executive in one case tried unsuccessfully to talk his board into a less seasoned candidate who better personified the transformation. In the other two cases, the CEOs did not resist the boards’ choices, because they felt the transformation could not be undone by their successors. They were wrong. Within two years, signs of renewal began to disappear at both companies.

There are still more mistakes that people make, but these eight are the big ones. I realize that in a short article everything is made to sound a bit too simplistic. In reality, even successful change efforts are messy and full of surprises. But just as a relatively simple vision is needed to guide people through a major change, so a vision of the change process can reduce the error rate. And fewer errors can spell the difference between success and failure.

Summary.   

To get ahead in the business world, it’s not enough to think strategically. You also have to effectively communicate those ideas. There are several ways to do this, including elevating the conversation to focus on the big picture and broader context, being forward-looking in your comments, anticipating the effects of potential decisions, connecting disparate concepts, simplifying complex issues, using metaphors and analogies, stimulating dialogue with questions, showing you are informed, actively listening, and seeking feedback.

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Are you a strategic thinker? Do key people in your organization — such as your boss and senior leadership — think so? To get ahead in your career, it’s critically important to ensure that the people around you perceive you as leadership material. One key to achieving that is communicating in ways that demonstrate your strategic mind. You can’t just think strategically. You need to speak strategically, too.  Here are some ways to do it:

Elevate your perspective

Instead of focusing on specifics, describe the broader landscape and articulate the bigger-picture narrative. By using language such as “Considering our organization’s three-year vision…” or “Reflecting on the trajectory of innovation in our industry…” you shape the context in which the tactical details can then be explored. This also helps to align stakeholders, ensuring everyone is on the same page.

Be forward-looking

Strategic thinkers see emerging challenges and opportunities. You can demonstrate that you are thinking about the future by using statements like “Projecting our growth, by 2028…” or “In light of our competitors’ plans, should we be…” By communicating a forward-looking stance, you demonstrate your capacity to help the organization develop long-term strategy.

Anticipate potent impacts

Strategic thinkers don’t just make decisions; they assess and communicate their broader potential effects. You can showcase your critical thinking ability by highlighting possible outcomes or unintended consequences, for example, “This product has the potential to…” or elaborating with “Beyond the immediate benefits, our long-term gains include….” Doing so shows that you value thorough evaluation over immediate action.

Connect the dots

Show you look beyond surface events to the deeper picture of systems and interconnections and that you recognize their importance, for example, “This unexpected increase in digital adoption directly influences our e-commerce strategy…” or “Because of these supply chain constraints, we must revise our production timelines and product development strategy….” Doing so shows you have an integrative and holistic thought process.

Simplify the complicated

Strategic thinkers can break down complex situations in simple yet powerful terms. To distill complicated issues into their essentials, use explanations like “In essence, this technology can…” or “At its core, our strategy rests on three pillars….” In doing so, you indicate masterful comprehension of the topic.

Use analogies and metaphors

Analogies and metaphors help to communicate strategic ideas in relatable ways. When you make comparisons like “Think of our infrastructure as the backbone, supporting every function…” or “Imagine our marketing approach as a net, widening to capture diverse markets…,” you show you can translate strategic jargon into everyday language, fostering broader understanding and alignment.

Stimulate strategic dialogue

When engaging with colleagues in strategic conversations, ask reflective questions such as “If our brand were a story, what chapter are we in?” or “How does this decision echo our company’s foundational values?” This creates an environment where strategic thinking is collective and prompts discussion that will help you refine ideas and encourage others to adopt strategic mindset.

Show you are informed

Your strategic insights will be more impactful when grounded in current realities. Observations such as “Given the recent shifts in digital consumption patterns…” or “The latest research on consumer behavior suggests…” prove you are informed about the evolving landscape, an essential strategic thinking capability.

Practice strategic listening

Strategic thinking is best when it incorporates disparate views so it’s important to listen closely and actively to others. Comments like “Building on what you’ve said…” or responding with “Your point about market saturation aligns with…” highlight your ability to do just that, enhancing your reputation as a strategy collaborator, enriching the discussion, and activating the group’s collective intelligence.

Seek feedback

After strategic conversations, show you are focused on learning by asking for feedback from others. Use questions such as “Did the strategic direction resonate with everyone?” or suggestions such as “How can we better align these discussions with our broader mission?” to demonstrate your commitment to growth and improvement.

In summary, business leaders must be strong strategic thinkers and communicators. Those who can speak about strategy as well as they formulate it are the ones who will rise to the top.

When I speak to business leaders about succession planning, I often receive a glazed-eye response, much like when discussing strategic planning or annual performance reviews. The problem with succession planning, as well as many other necessary business activities, is that it is often viewed as a “have to” rather than a “want to” process.

When organizations treat succession as a box to be checked, it is clear the focus is on the process and not the outcome. And what’s even more absent is the intent. Like performance reviews, many leaders tend to see this as a compliance effort, rather than a commitment to developing people. If done correctly, succession plans should be the result of an ongoing development effort that focuses on the growth and readiness of people.

These same leaders who glaze over are also the ones who often tell me they are not sure they have the right people in the right roles doing the right things to accomplish the objectives of the organization. Further, few of them will confirm if they are completely satisfied with the performance of their teams. Even fewer are certain if they are positioned to deal with changes in the business or industry. So why is there such reluctance around the concept of succession planning?

I believe this reluctance creates an opportunity to shift your thinking from “succession planning,” which implies an event, to “succession readiness,” which invites leaders to think in terms of ongoing development. Simply stated, leaders cannot succeed one another if they are not developed and ready for that next role. Also, the organization cannot be prepared for change if there is no way to understand and speak in terms of the readiness of each leader and what each person is prepared to do.

The following are three key steps leaders can take to ensure they are building a culture of succession readiness:

1. Understand and accept your primary role as a developer of people.

How often do you have developmental discussions with your direct reports, and how clearly do you outline their development needs? Organizations such as Gallup have been studying the relationship between leadership and performance for years. In their 2016 meta-analytic study, they validated the performance metrics associated with highly engaged organizations. Going back to Frederick Herzberg’s work in the 1960s, Gallup and others continue to demonstrate the direct correlation that leadership has on engagement and the performance of others. In their statistically validated Q12 survey, five of the twelve questions deal directly with the leader’s role in development, including, ”Is there someone at work who encourages your development?” and “In the last year, have you had opportunities to learn and grow?”

This is a leadership responsibility, not an HR compliance effort. After all, your success is dependent on your team’s success. So how effectively will you evolve your role or move on if you have not developed a successor and if your team is not performing as the direct result of your lack of focus in this area?

2. Be a coach to enable your team’s growth.

The best leaders are great coaches. Unlike the ranting, sideline images you might associate with coaching, in the non-sports world, coaching is about asking more than telling. In his book The Tao of Coaching, Max Landsberg offers us the GROW — goal, reality, obstacles or options, way forward — model, which is rooted in asking your direct reports to identify and act on their solutions. This establishes the baseline for each individual’s capacity for action and enables you to understand where they stand in relation to their current role and development needs for future roles.

Developmentally, coaching is a powerful way to stimulate your direct reports to close gaps. By first identifying and agreeing on the gaps, the “way forward” can be elicited by asking questions such as:

• “What steps do you think you can take to improve in that area?”

• “What resources can you leverage for growth?”

• “How do you envision me supporting your growth in this area?”

Using open-ended questions that start with words such as “describe,” “what” and “how” stimulates thinking in others. It enables them to define pathways that make sense to them while focusing on the need. This allows them to own the issue and how they plan to act on it. They now own the “how,” and you have remained focused on the “what.”

3. Hone your ability to identify potential.

How effectively do you separate current performance from future potential? While coaching will elicit insights and help define performance capacity at the individual level, you need a consistent approach to understanding the relative competency and potential of each team member in order to define the level and rate of advancement.

You can use models such as performance-versus-potential matrices to stimulate thinking around both current state performance and the future potential of individuals. They also set the stage for framing whether an individual is ready for that next assignment. When used consistently across organizations, these types of models can also help create uniformity in how development and succession readiness are handled. Finally, and in concert with No. 1 above, having the conversations with team members about where they stand and why, through the lens of a consistent model, is critical to setting the stage for change.

If your organization cringes at the thought of succession planning, I believe you should begin thinking in terms of succession readiness. The ability to promote people is the direct result of development. Further, your organization’s ability to shift and deal with change could be compromised if you do not. Leaders, this cannot be something you assign to HR. You own it. It’s your duty to drive the development and performance of your team.