Page 55 - Harvard Business Review (November-December, 2017)

FEATURE WHAT EVERYONE GETS WRONG ABOUT CHANGE MANAGEMENT

not really linked to the strategy. For example, CONDUCT A QUEST AUDIT GETTING STARTED
India’s Infosys developed a widely admired Rate each of these competencies on a It can be useful to think of value generation
approach to leadership development but 1-to-7 scale (7 is strongest). Your lowest and leadership development as the char-
ran into trouble because it failed to tie that to scores will identify your most urgent iot wheels that support a transformation,
priorities for change.
the transformational needs of the business— and the quest as the horse that provides
forcing the IT giant to turn to an outside CEO direction and momentum. Alignment
to drive the necessary changes. GLOBAL PRESENCE among the three is critical if you want to
Being seduced by the wrong quest. The How well do we… reach your destination.
board and the top team may be led astray by • pursue expansion with a strategic The quest audit facilitates alignment by
global perspective?
the vision of a forceful CEO (like Ron Johnson • share local learning about business making it easier to diagnose the current sit-
at J.C. Penney), try to copy the strategic practices globally? uation, identify which transformation could
moves of competitors, or fall for recommen- • use digital technology to bring be a game changer, and decide which en-
dations from consultants who favor partic- together key populations? ablers and blockers to target to make it hap-
ular quests. In those situations, the chosen pen. This tool has been validated with more
quest misfires because it was not the product than 500 executives and road tested by a
of deep deliberation or shared conviction or it CUSTOMER FOCUS dozen companies (across industries and con-
fails to address the central issue. For example, How well do we… tinents) seeking to transform themselves. It
GE transplant Bob Nardelli tried to transform • create offerings with meaningful value helps address these underlying challenges:
to customers?
Home Depot by selling supplies to construc- Facing reality. Having a structured
tion professionals as well as to homeowners. • recognize team-based efforts in way to solicit and gather input allows se-
developing and selling solutions?
The pursuit of customers in adjacent mar- nior teams to take a cold, hard look at the
kets distracted attention from Home Depot’s • use analytics to identify which company. Knowledge, competencies, or
solutions customers need most?
core problem of slumping store sales. When activities that were once central to the orga-
Nardelli resigned, under intense pressure nization may have become what Harvard’s
from shareholders, the strategy was immedi- INNOVATION Dorothy Leonard-Barton calls core rigidi-
ately reversed and the wholesale arm sold off How well do we… ties. If so, they need to be adapted or jetti-
to allow the company to refocus on its core re- • cooperate with external partners to soned. The more radical the transformation,
tail business. From seventh-largest global re- create new technologies and offerings? the greater the chance that such limitations
tailer, Home Depot has since jumped to third. • create an environment of trust for will be exposed. Confronting harsh reality
Focusing on multiple quests. The effective collaboration? may also involve identifying and addressing
quest choice may be muddled if lead- • leverage digital platforms for blind spots.
ers can’t agree on which direction to go. innovation? For the HR head of a European postal
Different parts of the business (regions, services group, a quest audit revealed a
functions, levels) see different problems NIMBLENESS disconcerting pattern. “The low scores on
and priorities. Some corporations over- How well do we… value, customer focus, and innovation seem
reach, taking on too many quests at once or • sense changes in the environment? to highlight our company’s ineffectiveness
overestimating their leadership capabilities • act on those changes in a timely way? in listening respectively to the market, to
in a given area. Back in 2009 the incoming • share information across the our customers, and to suppliers or part-
Carrefour CEO, Lars Olofsson, launched an organization? ners,” she told her team. “It’s hard to admit,
ambitious transformation plan for the retail but it’s better to recognize now the inertia
giant based on seven strategic initiatives, SUSTAINABILITY of our organization that needs to be tack-
including enhanced innovation, customer How well do we… led urgently.” Similarly, the head of HR at a
engagement, agility, and global expansion. • integrate our sustainability strategy Japanese food group observed that doing the
The result was confusion, a loss of domes- into the overall corporate vision and exercise opened up team dialogue on issues
tic market share, and a 53% plunge in share strategy? that were previously off-limits: “It provided
price in one year. Olofsson lasted barely two • implement sustainability in decision ‘permission’ to reflect on the current reality
years in the job. His replacement, Georges making, processes, and systems and how we got to where we are. That im-
Plassat, panned the leadership capability of throughout the organization? munity led us to frame some breakthrough
the previous team, labeling the members • use digital technology to catalog and questions to understand our challenge and
“incompetent in mass retailing.” In a suc- evaluate sustainability initiatives? what we needed to do to solve it.”
cessful recovery plan, Plassat first focused Debating priorities. Often the diag-
on shedding operations in noncore markets nosis reveals multiple challenges and the
and streamlining internal operations. He debate centers on which of them matters
then reignited domestic sales by cutting most—or which can be tackled immediately,
prices and diversifying stores. Three years given the company’s current leadership ca-
later Carrefour had regained a clear lead in pabilities. Conceptual tools can’t tell top
the French market. teams what to do, but they can support a

84 HARVARD BUSINESS REVIEW NOVEMBER–DECEMBER 2017