Change Management

No Ambiguity with Ambiguity

We're big fans of Dan and Chip Heath's work. You'll see it referenced in our materials frequently as they undertake very solid research and present their findings in readable and interesting ways.

We were especially pleased when they highlighted one of the behaviours we have identified as organizational Noise which waste people's time, resources and potential:

Good leaders excel at converting something ambiguous into something behavioral. Take Terry Leahy, one of the leaders responsible for reversing the fortunes of Tesco, now the U.K.'s No. 1 grocer. One of Tesco's ambiguous goals was to do a better job "listening to customers." Leahy broke down that goal into a set of specific actions. For instance, cashiers were trained to call for help anytime more than one person was waiting in the checkout line. In addition, Tesco received 100,000 queries per week from customers. Leahy's team made sure that all Tesco managers had access to customer concerns. (If you want to listen to customers, you had better make sure your managers can hear what they're saying.) As a result, they learned counterintuitive lessons, such as that customers dislike stainless-steel refrigerators, which remind people of a hospital -- not an ideal association for a grocer.

Ambiguity simply isn't good for individuals, teams or entire enterprises. Read the full article at Fast Company here:

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Game-ify This

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Any man who can drive safely while kissing a pretty girl is simply not giving the kiss the attention it deserves. 

Albert Einstein

I've always loved this quote. Although, I would like to understand the context in which it was given. Perhaps it was uttered in the same vein as his quote about intelligence being the capability to hold two opposing ideas in one's mind at the same time...? Or, sometimes a cigar is just a cigar...I'd like to think he was being literal in this case.


Either way, I'm mulling over two things I've seen or read lately and a recurring theme in the industry that's been bothering me. So inevitably, I won't be giving any of them the attention they each deserve.

The two things that have interested me are some of the most recently published research on the neuroscience of leadership and organizational change (thanks to my friend Michael Buckstein) and the website (thanks to Dan Pink for this one). The other item is the annoying present theme of "gamification."

First the interesting.

In issue 43 of strategy + business, authors David Rock and Jeffrey Schwartz summarize some of the latest findings in the neuroscience of leadership that would have been considered "counterintuitive or downright wrong only a few years ago:"



Change is pain. Organizational change is unexpectedly difficult because it provokes sensations of physiological discomfort.

Behaviourism doesn't work. Change efforts based on incentive and threat (the carrot and the stick) rarely succeed in the long run.

Humanism is overrated. In practice, the conventional approach of connection and persuasion doesn't sufficiently engage people.

Expectation shapes reality. People's preconceptions have a significant impact on what they perceive.

Attention density shapes identity. Repeated, purposeful and focused attention can lead to long-lasting personal evolution.

As usual, this excerpt doesn't do justice to the entire article.


After reading this article and mulling it over a few days, I got wind of the I love the idea...making behaviour change fun. The winner of the contest was a speeding lottery where the goal was to make obeying the speed limits fun. It's entertaining to review some of the submissions. But I have to wonder given the above, does any of this lead to long-term behaviour change? I know it's a theory (hence the name) and probably more of a marketing scheme than anything...but more data please.

Now, moving completely to the extreme end of the spectrum...gamification. It sounds suspiciously like technology in search of a problem again. Where's the evidence that this is effective in a workplace? I know, I'm channeling Grumpy Old Men again, but c'mon...if people have to be "gamed" at work to do things, shouldn't they be looking for alternate employment? 

Isn't this also another form of carrot and stick incentives which we know don't work in many scenarios? As usual, I have more questions than answers, but this one is giving me the itchy scratchy's right now...perhaps I'll be a born-again convert with the proper evidence.



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The Way We're Working Isn't Working

I have to admit I'm a sucker for a good bibliography and notes sections in a book. The first thing I do when I grab a business text is to scan the notes and bibliography to see what research the author draws from. This provides me a snapshot of the direction of their work, as well as potentially new and interesting research I haven't read.

When I picked up The Way We're Working Isn't Working a few weeks back, I really liked the bibliography because it showed primary research I have seen referenced before in a few other (good) books. But this book seemed to be using it in a different way/context; and sure enough it does.


I love this book. The first chapter title totally resonated with me, (More and More, Less and Less) and typifies how enterprises have somehow forgotten that actual people drive their success and not multi-tasking, data-hoovering, automatons who don't have lives to live outside of work.

The authors, Tony Schwartz, Jean Gomes and Catherine McCarthy do a bang-up job explaining the theory and science behind improving enterprise performance using a multidisciplinary approach that incorporates physical, emotional, mental and spiritual components.

Our Core Needs:

Significance - Spirit
What I stand for and believe in - what gives me a sense of meaning

Self-Expression - Mind
Freedom to develop and express my unique skills and talent

Security - Emotions
Feeling appreciated, cared for, valued for who I am and what I do

Sustainability - Body
Being able to regularly renew and take care of myself, so I'm healthy, fit and resilient

Material needs and desires

To many, these ideas are going to seem "fluffy" or "touchy feely" or that Schwartz and his coauthors are stretching the applicability of this science a bit too far. I would wholeheartedly disagree. Look around and observe. Out-dated management practices are everywhere and people's precious time is being squandered because of it.


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Hammer vs. Nail Gun

I've been fortunate enough to be involved in building some amazing things. Some of those have been companies, and some of those have been actual physical structures. Either way, I figured out far too late in life that I'm at my happiest when I'm engaged in building something; preferably in a hands-on kind of way.

One of the structures I'm most proud of is a cabin I built with some help from my brothers a few years ago. It isn't that it is particularly significant building in size or design. And it didn't cost a lot to build or require that much skill (otherwise I wouldn't have been able to finish it). It's only for sleeping. But it is a tidy little structure and my family and I love it. (note: the picture shows the cabin mid-construction - although the unpainted stripes are quite fashionable)

cabininprogress.jpgSince our property is so remote, and I don't own a generator (or smart enough to rent one), it was constructed almost completely with hand tools. I did employ some battery-powered tools, but once my limited number of battery packs ran out, I was back to arm strong tools.

When I did a rough tally of the number person-days that went in to it's construction, I landed around 90. It took me two full summers to finish it and pretty much exhausted my family's patience with me. While they were vacationing, I was building. And then there were my solo trips where I would just work around the clock only to come home and collapse.

All the effort that went into that cabin has made me very proud of the outcome. But something awful happened a year ago on my trip to close-up for the winter; I helped a friend on the lake build some beams for a boathouse that was falling into the water. No, that's not awful. But I used a good nail gun for the first time in 30+ years of building things.

Now I feel like a complete ass. I laminated two 16 foot beams with 3 layers of 2x12's in around an hour. I will NEVER, build another structure without a nail gun. Incredible.

After I calmed down and quit beating myself up, I immediately thought of the parallels with software. Sick, I know...but it is my job...and my calling.

That was the final push to build mercanix for me; we had a nail gun, and it could save a lot of time and effort. You can't hold it in your hand and fire nails into wood, but it is pretty handy in our view. We hope it helps you, the company builders.

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Manhole 3, 4 & 5 - Enterprise 2.0

...continued from Manhole 2 & 3 - Enterprise 2.0

Manhole 3: Picking the wrong change approach.

Olrlikowski and Hofman in subsequent research go on to state, "There is a discrepancy between how people think about technological change and how they implement it. Moreover, we suggest that this discrepancy contributes to the difficulties and challenges that contemporary organizations face as they attempt to introduce and effectively implement technology-based change. 9

Traditional ways of thinking about technological change have their roots in Lewin's three-stage change model of "unfreezing," "change," and "refreezing." According to this model, the organization prepares for change, implements the change, and then strives to regain stability as soon as possible. Such a model, which treats change as an event to be managed during a specified period, may have been appropriate for organizations that were relatively stable and bounded and whose functionality was sufficiently fixed to allow for detailed specification.

Today, however, given more turbulent, flexible, and uncertain organizational and environment conditions, such a model is becoming less appropriate - hence, the discrepancy." 10

Manhole 4: Investing too little in organizational capital

In Enterprise 2.0, many changes have a major technological component - installing a piece of enterprise software or new corporate information architecture to support e-business. But the success rate of these large IT projects (in terms of percentage that achieve the anticipated benefits) is often low. Many blame the technology, but a large-scale study undertaken by MIT Professor Erik Brynjolfsson illustrates that investing in IT is insufficient.

This survey and analysis of 753 large firms shows that firms only gain the benefits of new technology when they make substantive investments in organizational capital (in the form of training, business process engineering, and new management practices). Indeed, the work suggests that each dollar invested in technology needs approximately $10 in investment in the organization. Firms that invested too little in either technology or the organization had lower market capitalization and did not see the same productivity gains as firms that invest in both IT and the organization. 11

An important influence on the effectiveness of any change process is the interdependent relationship among three dimensions: the technology, the organizational context (including culture, structure, roles, and responsibilities) and the change model used to manage change. Ideally, the interaction among these three dimensions is compatible, or at a minimum, not in opposition. 12

Manhole 5: Solving the wrong issue(s) first.

With any new initiative, especially those with technological interdependencies, organizations inevitably have a heightened skepticism surrounding its chances of success. This skepticism comes naturally as many in the enterprise will have first-hand experience with technology solutions failing to live up to their billing.

Gaining credibility with the first e-business initiatives then is of paramount importance. Choosing the wrong issue(s) to solve on the first foray seriously impacts the credibility of your efforts and hence the long-term chances of success.

Because success often depends on coordinating the right technology, the right product mix, and dozens of the right strategic and structural issues all at once, near misses can leave a firm worse off than if it had never attempted the change. While several studies have documented the importance of coordinated change, managers continue to have difficulty achieving it. 13

Often, the problem is not that the proposed system is unworkable but that the transition proves more difficult than people had anticipated. Too often, managers proceed in a hit-or-miss fashion, implementing the most visible bits and pieces of a complex new system, while missing the hidden but critical interconnections. between practices. 14


9. W.J. Orlikowski and J.D. Hofman, "An Improvisational Model for Change Management:

The Case of Groupware Technologies," Sloan Management Review, 38,2, Winter 1997: pp. 11-21
10. Ibid
11. E. Brynjolfsson, "eBusiness Transformation" (MIT, Cambridge, Massachusetts:
Proceedings of the Center for eBusiness @MIT Research Workshop, June 14, 2001, p. 16)
12. Ibid
13. E. Brynjolfsson, A. Austin Renshaw, M. Van Alstyne, "The Matrix of Change," Sloan
Management Review, Volume 38, Number 2, Winter 1997: pp. 37-53
14. Ibid

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Manhole 1 & 2 - Enterprise 2.0

...continued from Open Manholes - Enterprise 2.0

Manhole 1: Wrong team/person for the initiative or right people with not enough support from top executives.

If you are going to undertake an Enterprise 2.0 initiative, it matters alot who you task with getting the job done. This has the potential to be a business transformation issue as much as anything, and it will require the full support of the top executives.

Action-oriented, consensus-builders with a fully supported mandate need to be the core of your team. Rocket science? Nope. Often screwed up anyway? Yup.

Manhole 2: Assuming the decisions to be made are merely technology choices rather than viewed as an enterprise change initiative.

There's a widespread misconception (propagated by too many technology vendors) that if you throw enough technology at business problems you will defeat them. It would be great if it were that easy. Unfortunately, research does not support this view.

This is especially true in emerging, or hype-filled markets like ERP or CRM where vendors create unusually high levels of client dissatisfaction by: under-educating customers, making unsubstantiated claims, being sales-driven rather than customer-driven, being imitative rather than innovative and implementing inflexible systems poorly.5

Product companies are completely focused on selling what they have. What they have is technology. And their capital requirements mean they need short payback on their acquisitions and sales efforts. So rather than sell what companies really need, they sell what they have. None of this should come as a surprise. But as the saying goes, "the problem with common sense is it's not that common."

The real problem is that companies are expecting any return on information technology at all. What drives a return on investment is the use of information technology. Technology on it's own can not deliver increased productivity, only the use of it can.6 This may seem like splitting hairs, but it makes an enormous difference to how enterprises approach the selection and implementation of Enterprise 2.0 projects.

Wanda Orlikowski, a professor and researcher from MIT, draws a distinction between "espoused technologies" (the technologies we buy and install into our offices, factories and homes) and "technologies-in-use" (the technologies we use in our action).

Espoused technologies are the bundles of sophisticated hardware and software components that provide a given set of predefined features available consistently over time and place.

Technologies-in-use are the specific features we engage with in particular ways depending on our skills, tasks, attention and purposes, and varying by time of day, situation at hand, and pressures of the moment.7

What we buy is given and predefined (espoused technology); what we engage through our use is contingent and local (technology-in-use). The two are not the same, and managing and measuring the former as if it were the latter can lead to conceptual and practical difficulties.8 be continued...

5. CRM, High-Yield Marketing, Mangen Research Associates, "Multi-Function
CRM Software: How Good Is It?", October 2001
6. W.J. Orlikowski, "Managing Use not Technology: A View from the Trenches," Financial Times, March 22, 1999, pp. 10-11
7. Ibid
8. W.J. Orlikowski and J.D. Hofman, "An Improvisational Model for Change Management: The Case of Groupware Technologies," Sloan Management Review, 38,2, Winter 1997: pp. 11-21

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Open Manholes - Enterprise 2.0

[Disclaimer: I apologize in advance. This post will undoubtedly tip you-off to the fact we've been working on web-based software for a while...since 1994, we may sound a little less idealistic and wide-eyed than you might expect.;)]

It is almost laughable to recall the breathlessness of the "pundits", "gurus" and "visionaries" predicting the rapid decline of traditional businesses in favour of new economy or .com enterprises (circa 2000). Strategies, business models, business practices and IT infrastructures all had to be thrown out because as the advertising assured us, "The Internet changes everything!"

Unfortunately, the rhetoric and heroic gestures of a revolution rarely keep their promises. And the e-business revolution was no exception. Notable and trustworthy experts have decisively debunked any support for theories that suggest strategy has changed forever (1), never-before-seen issues threaten our organizations (2), loyal employees aren't critical (3), or technology by itself is ever a primary root cause of either greatness or decline (4).

With the dot com boom and bust long behind us, we are now experiencing the next incarnation of the e-business wave, re-named enterprise 2.0 or web 2.0, and supported by a new army of fresh-faced, eager evangelists.

There are tons of great things happening this time around, as there were in the last cycle. In particular, the widespread adoption of broadband and web technologies has allowed levels of connectivity (people, systems, data, etc) that truly can bring about the creation of things that never existed. In the dot com era, there were very few instances of creating things that didn't exist before. Rather, the breakthroughs were more likely to be doing things we've always done in business, only more efficiently and with lower interaction costs.

That being said, there are many youthful voices that can't draw on the history of the past couple business cycles, to help temper their perspective; which is a great positive in many ways. The only potential downside is neglecting the parts of history that are still relevant.

We liken these to open manholes on the street. If you aren't careful, present and aware of your surroundings, you might just hurdle down one of these holes and not reappear for a while. We can say from first-hand experience that you're going to want to watch for these.

1. M. E. Porter, "Strategy and the Internet," Harvard Business Review, March 2001, pp.
2. C. Shapiro, H. Varian, Information Rules (Boston, Harvard Business School Press,
3. J. Pfeffer, Human Equation: Building Profits by Putting People First (Boston, Harvard
Business School Press, 1998)
4. J. Collins, Good to Great (NewYork, HarperBusiness, 2001)


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