The Ultimate Guide to Leading Organizational Change

Leading Organizational Change

This comprehensive document on leading organizational change is researched and written by Arthur Carmazzi, Globally ranked as the #4 Organizational Culture thought leader and #10 in Leadership for 2020. As an active Consultant, Coach, Keynote Speaker, and developer of the “Culture Evolution” organizational culture change consulting initiative, he is constantly involved in real-world problems as organizational development solutions and working with the C Team to ensure sustainable business excellence.

The leader’s role in organizational change is not to define the change but rather to enlist and support team members to create and own an organizational culture that helps them to be personally successful in the process of achieving organizational goals. This document focuses on the corporate culture elements needed in leading organizational culture change and how that affects engagement and organizational effectiveness.

Each organizational change process has two elements:

Each part of the corporate culture change process has various chapters to identify the strategies of achieving “sustainable” organizational change. The keyword for this culture change guide is sustainability. Too many initiatives are not only never fully implemented, but if they are, only a limited percentage is sustainable.

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Where are you in the Organization Culture Evolution?

Once we know at what level our culture is at, leading organizational change needs to define three factors before continuing on an organizational culture change strategy.

• An understanding and label of where we are and what that means to our fulfillment and effectiveness as people in the organization.
• A specific path and defined characteristics to improve
• An opportunity to create milestones and show progress to maintain motivation throughout the process.

Culture Bench-marking or an Organizational Culture Audit, can be done an internal survey allowing team member segments: Senior management, Middle management, and Staff to anonymously rate the characteristics above from 1 to 10. Tabulate the findings and compare segments to each other, then compile all segments and compare the overall perspective to each individual segment.

The other option would be to take the Culture Evolution Assessment – a culture benchmarking tool that uses the Culture Evolution model. This assessment creates the first benchmark then allows organizations to retake the assessments and compare how much (or how little) they have evolved. The assessment also tabulates and illustrates elements of the multiple culture evolution levels to help organizations see both positive and negative elements to reinforce or work on for organizational change.

This bench-marking assessment is a powerful tool to evolve corporate culture and can be found at: www.cultureevolution.com

The motive and motivation behind Culture Benchmarking

The motive and motivation behind Culture Benchmarking Most organizations have a vision… (even if they don’t know what it is really for). The concept of a company “Vision” is designed to provide a guiding purpose the is the foundation for every decision made in the organization… always asking: “is this decision in line with the organization’s vision”. Most organizations however do not communicate how far or close the team is to achieve that vision… which usually leads to most people forgetting about the vision.

Organizational change has the same emotional foundation as vision, only that there are specific structures and processes in place to achieve the specific “change” result which ideally should have a promise of something better in store for the team. Which brings us back to culture benchmarking.

When we lead organizational change, we need to know how far or close we are from the change objective… and we need to periodically check to see our improvement for two reasons:

• Keeping the change objectives constantly in the minds of the team.
• Motivating the team by confirming what they have achieved is of value in reaching the objectives

One of the primary reason’s leaders have difficulty in engaging their team in organizational change is that there are not enough milestones to measure and show progress of an initiative… not enough reasons to celebrate and people lose interest and sight of the bigger promise of a more efficient and possibly more fun work environment.

So when we know where we are, and regularly check our progress in relation to our corporate change promise/objective, it provides opportunities to calibrate.

We use the OCEAN Organizational Culture Assessment instrument for this purpose.

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The Company Motivational Blueprint from a 7-minute emotional profiling game:

The purpose of this is to identify the emotional mix of individuals and determine the primary “Motivational Blueprint” of the organization. When a large enough cross-section is complete, we compare it to the values and desired organizational culture. If there is a mismatch, we need to know upfront so we can fix it.

The game is simple. Using a deck of CBC Cards (Colored Brain Communication Cards), we ask each interviewee to choose 5 cards that best describe what they would do if they had Ten Million Dollars.

The cards have specially chosen images that elicit subconscious values, memories, lost knowledge and help individuals get more clarity that answering “off the top of their head”.

When the player chooses a card, the image is not what is important, it is the meaning they give to the image that tells the story. These are based on the Directive Communication Psychology, Emotional Drive model that can be seen at: www.emotionaldrive.net/what-are-emotional-drivers combined with the Colored Brain model at: www.coloredbrain.com

The interviewee explains each card and why they chose it. The interviewer interprets the emotional mix and clarity process of the individual. Then combines the data with other interviews and determines the motivational mix of teams and the organization.

In this game, the meaning of each image represents a primary emotional drive and also shows which emotional drives are not important. The process or how they explain and chose cards identify their genetic “ambiguity relief” clarity process (colored brain) that affects how they approach things.

Usually, each individual will have 3 to 4 primary emotional drives that affect “WHY” they do what they do and these decisions are filtered through their “HOW” colored brain process. In this effort, we are mostly concerned with their “WHY” which should have similar associations to the organizations “WHY”. When these emotional drives align with organizational values and the desired culture, the organizational change process is much easier. When it does not, either we modify the outcome and values of the culture, or we modify the staff mix to get a positive organizational change result.

The purpose of the four questions is to identify two essential factors required to predict the outcomes and catalysts for organizational change.

The 4 questions:

1. If you were the CEO, what changes would you make in the organization and its practices?
2. What are your biggest frustrations working here?
3. Who are the people that you respect and appreciate most in the organization? Why?
4. Are there people who you feel are hindering your ability to succeed in this company? Why?

Question 1 and 2 are essential for the same outcome – identify the issues creating disengagement. Different people will respond to one question more than they would to the other, so we get a more complete perspective.

While we may get some answers like: We want fresh fruit in the pantry. Or everyone should have their own private office… the majority of the answers will relate to issues that MOST of the staff agree with, and that are viable concerns for their own sense of value in relation to the organization, their productivity and emotional connection to the organization, and visible perceived problems that affect their engagement.

The other 2 questions are to identify people who have positive and negative influences on the organizational culture. These are the Key Influencers and the ones who have the potential for positive change will be leading the organizational change program with support from coaches who work with them to implement the methodology.

Connecting to senior management desired outcomes

Buy-in happens before the culture change initiative starts. There are 2 steps to making this work.

1. A 1 day session with leadership team to identify what they want to achieve in their organizational culture, including the Ideal Work Environment. We discover if the issues identified by the staff and senior manager have gaps and what those gaps are. In most cases, we find more similarities than differences. In the case of the ideal working environment, it is always the same.
2. The next step is to look at both discoveries, the desired outcomes of the senior management, and the frustrations and improvements from the masses. See what matches and identify parameters of time and budget for implementation… then work with senior management to define acceptable parameters and areas of focus for the organizational change and culture initiative.
   Once senior management agrees on what is acceptable and what is not, the successful and aligned culture change process becomes a matter of facilitation to ensure the people in the organization independently come up with the same thing. This is easier than it sounds because they already have identified the biggest issues. So when they come up with often brilliant solutions to solve these issues, it will not be a surprise… it will only be a matter how much time and budget resources they will use to solve them.

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To capture the trust and buy-in from the masses, consultants or senior management have limited influence compared to people who already work with them and are trusted and liked. Regardless of their position in the organization, there are individuals who other respect and listen to. These people are key influencers and have the foundations required to lead organizational change.

But not all key influencers support positive change. In our Culture Evolution Change initiative with the Malaysian government, we encountered a very positive young lady who was very ambitious in developing her career. She personally felt that learning and excelling were important for her. She also had a very strong belief that if you did not wish to excel or improve, that was your right, and no organization should try to change you. This young lady had much influence and people listened to her because the message supported less effort. She meant well, but her message was taken literally by the masses who once in the system, could not lose their job, and it negatively affected productivity, engagement, and competency development. But the worst part was that people who were not in her circle and were encouraged to spend time and effort improving their skills and competency actually enjoyed their jobs more than those who felt doing as little as required during work time was in their best interest.

To counter this we worked with her and included her with the Positive Key Influencers to understand the consequences of her influence while respecting her values. When she understood her role and some of the counter value consequences of her influence, she supported the initiative, and the organizational culture improved for everyone.

But not all individuals with negative influence were ready to accept change. One manager was very invested in his way of dealing with people which created low motivation and poor engagement. His perspective was one where he was the manager and his way and process should not be questioned. The idea of helping the people to create their own culture to support their success threatened his authority and he rebled. In communicating with him, he suggested that if we wanted organizational change that supported the organization, we should pay him to do it his way which was better. We felt he was not able to work within the confines of the culture and identified him “The Enemy”. While other peers also tried to support a more productive attitude towards having an ideal work environment, he did not respond and we recommended removal from the current position. Since this organization could not remove anyone from their job, we created a “Happy Department” where the negative influencers were moved to. While they maintained their same pay, their job description was changed to creating a weekly newsletter that identified all the positive actions and attitudes of others who supported the improved culture and the people around them. After some time, some of the people in this happy department became more positive and were restored to other positions… but not all.

When have identified the positive Key Influencers, they become the implementation leaders. it is not the consultants or the management who lead organizational change, it is the dishwashers who tell jokes or the pretty girl in accounting who is always smiling or the tea lady who listens and knows more about what is really happening in the company than the CEO… Anyone who is leading organizational change needs to get the key influencers on their side.

Key influencers are collected. Before they begin influencing organizational behavior, each has a specific group they impact. So, each key influencer creates a cell of these people mixed with people from different departments and their own supervisor or manager. With this mix, they provide the right mix of influence and diversity and build trust and confidence with their manager/supervisor. These groups consist of between 8 to 18 people and one will have the CEO in the group run by a general staff member that is in the key influencer’s group.

In day one key influencers learn the relationship between culture and group dynamics psychology, and the culture change process. They go through a variety of exercises where they identify their Ideal Work Environment as their greater purpose (even though we already know what it will be) and brainstorm ideas for their Unified Identity in line with this ideal. They then learn one facet of the methodology to achieve this “Greater Purpose” and its application to improve their corporate culture.

On day two, the same key influencer group takes their findings and ideas about the Greater Purpose, Unified Indemnity, and application of the one element of the methodology, and shares it with their influence cell. They get feedback and work on buy-in from the cell to work towards the achievement of the ideal work environment.

They also identify between one to five issues in the organization they want to change (these have been identified earlier through the discovery process) In most of the organizational culture change initiatives we do, there are 2 groups of key influencers. While group one is implementing on day 2, group two of the key influencers is in class, then implements on day 3 with different cells they influence.

This process continues for 10 days, one day of facilitation and training with specific objectives, and the next day of implementation. The final day is a presentation attended by the entire organization, where the Key Influencers present to senior management (more on the specifics of this below).

What methodology you use for the culture change process will determine organizational performance and how you divide the efforts and strategy with the key influencers. There are fundamental elements of a bottom-up organizational change initiative to show results. These are:

1. The methodology and process must show visible results FAST– Leading organizational change in the current age of “NOW” requires speed since we are less patient, less tolerant and if something doesn’t show a result quickly, we often dismiss it as not useful. Even though we may have a great plan and promise great new and exciting working environments… today, people will be skeptical. To get the buy-in to insight and perpetuate the organizational culture change process, people NEED to see fast, even almost instant results. but when they do, it goes viral. People spend their own time and extra effort because the promise appears real, and so seeing it through is exciting and personal.The down side to getting this kind of Fast Visible results is that it usually disrupts the efficiency of operations during the 2 week implementation period. We have attempted to spread out the process to reduce the disruption… and we found the benefits and impact of the shorter implementation largely outweighs the 2 week disruption… and highly recommend the sucking it up for the bigger payoff.
2. You must do a discovery to identify the issue BEFORE you start – The discovery helps define the issues so the initiative so the senior management is not surprised of what the initiative will yield. The predictability of the outcome is essential to align expectations from senior management as well as staff.
3. Key influencers lead the organizational change process– peers are trusted more than consultants or management. When a peer we trust share ideas and includes us in the process of change, we are more honest, we take more action and we internalize it more because we feel there is no Extra agenda. We feel they really care for our wellbeing. After all, they are one of us.
4. Methodology training and facilitation must be divided into one-day sessions and focus on One module of the methodology at a time– long training and facilitation that does not create opportunities to practice in real-world situations do not stay with us. But when we learn, use the learning to create strategies to solve real problems, then teach others while implementing what we have learned, it not only stays with us but we gain emotional satisfaction and confidence in leadership roles for our future.
5. People must be allowed to fix company problems affecting culture– the majority of the staff is experiencing the organization and its culture at a different level than senior management. To let them have ownership, they must choose the issues that create the biggest obstacles to their personal success through the organization (this excludes financial compensation-related issues). As this is predetermined before in the discovery and guidelines are already agreed on, alignment is already in place.
6. Guiding principles (code of conduct related to core values) must be created by the people– when the people set the rules of behavior for themselves, they hold each other accountable for their actions. These rules also apply to all levels of management and support more effective leadership since everyone is help accountable for treating each other with the “Type” respect the people wish to have in their work environment. This increases engagement and motivation yielding high productivity.
7. Everyone must be involved in the organizational change process – The key influencer cells combine to include every person in the organization. Each day of training and facilitation must provide the opportunity for key influencers to work through feedback from their cells and take it back to them with input from all others – the process must be personalized to what the people want. When the people feel they are heard and they have power to change for the better, they nurture their entrepreneurial spirit and find a new passion, new innovations, and better ways to communicate and achieve… especially if the “Methodology” is supporting these. The key influencers’ job is to get everyone involved in creating the organization’s culture. After getting the feedback from their cells, they collaborate to find common ideas so all the people in the organization have a voice. To build the ownership of people and the culture and support success for everyone… including the organization.
8. The management team must actively participate– A key factor in the success of the initiative is the minimization of barriers and maximization of trust between the staff and the senior management. It becomes essential that they participate as Learners and are educated and facilitated by subordinates (preferably front line or younger staff). The bigger the gap, the bigger the effect. When these sessions are documented and shared, this provides high-quality PR value for the sincerity of the initiative and senior management’s integrity.
   After our successful work with Emirates, one Airline requested a presentation for the same process. However, when we mentioned that the entire senior management team must spend about 3 hours every second day to be in a subordinate’s cell, they implied that their “position” needed to be maintained and they could not afford the time. We explained that the program would not be effective without their active involvement and when they indicated we should do it without them, we decided not to proceed. This factor is so important to the initiative’s success that we would rather give up a lucrative assignment to ensure the right deliverables. Do not let Ego get in the way of success.
9. Size Matters– we find the maximum group we can effectively implement this process with is 1200 people. Any larger group can be broken down into divisions or areas.
10. Negative influencers must be removed – One person who has influence and a negative focus can have a dramatically negative effect on the organizational culture. While there may be legal or emotional issues surrounding this, there are ways to remove people from the mix without firing them. In one instance with the Malaysian government, we created a special department called the “Happy Department” (as mentioned earlier) to isolate the negative influencers and redefine their KPI’s to discovering and communicating the positive actions of people who are supporting the culture.
11. Produce an entertaining show to catalyze sustainability– the culmination of the methodology training and implementation is presented in one 3 hour show where everyone from the organization shows up. The show should be directed and participated in by the key influencers. Its objective should be to present the new culture and guiding principles to senior management and share how this will create a competitive advantage. In this theatrical presentation, they present the culture they and their cells have agreed they want to create, strategies to achieve this, recourses required, strategies on how to fix 5 major issues affecting engagement and performance, and some fun representations of the Before and After culture… Organizational leaders instantly agree! Why? Because it was predicted before the initiative started and they know exactly what the outcomes would be.
12. Elect generals – once the culture, guiding principles and 5 issues to work on are agreed on by senior management, they need to be implemented. The role of the generals (2 or 3 individuals) is just that… to be the liaisons between the people and the senior management to support execution and implementation of the organizational change that is planned and agreed to. Because most are still performing their usual job duties, this extra responsibility should also come with a paycheck. Extra money not only provides an incentive for future generals but creates a sense of responsibility for the outcomes. The term of office should not be more than 3 months and they should not be able to run for 2 consecutive terms. This is designed to minimize complacency and to revitalize the actionable initiative every three months during the elections. 2 weeks before the elections, individuals wishing to get the General post, a campaign to show how they can improve continue to improve the culture and the actions they will take to do so. Besides the extra money they receive, the bigger benefit is the leadership track it puts them on for their career.