These days, everybody is talking about the need for organizations of all sorts to transform themselves in the face of such challenges as constantly changing markets, customer preferences and social norms. The list of failures — especially among retailers — demonstrates how much easier it is to talk about this than to actually do it. Consultants and business academics offer a whole range of explanations for what this should be so. They include not acting quickly or decisively enough, failing to embrace technology properly and not realising the extent to which new entrants are utilising data to be more competitive.
All are probably to an extent valid. But a more intriguing analysis focuses more on the human side. Michael Beer, a professor at Harvard Business School and co-founder of the consulting firm TruePoint Partners, suggests that there are two inter-related reasons for the failure of managers to transform their organizations effectively and rapidly. First, he says, “the whole system of organizing, managing and leading has to be transformed if organizational behaviours and underlying mindsets are to be changed.” But — and this is the second reason — hierarchy discourages people at lower levels of the organisation from sharing with senior leaders vital information and knowledge about how the organization really works. As a result, adds Beer, “leadership is left unaware of critical aspects of the systemic changes it needs to make.”
Several years ago having helped introduce the concept of the “six silent killers” that stalk businesses like the medical afflictions that affect people, he builds on this notion of corporate fitness in his new book Fit To Compete. Subtitled “Why Honest Conversations about Your Company’s Capabilities Are the Key to a Winning Strategy, it argues that “honest organization-wide conversations between top management teams and employees who know why their organization is foundering” have proved successful in aiding transformation. Acknowledging that understandable fears among the more junior employees can make such conversations difficult to carry out, Beer offers a method that he says has borne fruit with a range of organizations around the world.
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