by Larry Johnson
The owner of a small company I know recently complained to me that he was having difficulty getting his management team to embrace and implement some much needed expansion of the products they offer.
Priding himself on being a true believer in participative management, he asked his management team to work out a plan for diversification.
After eight months, however, the team had not acted. In meeting after meeting, they discussed and debated the pros and cons of different diversification strategies but never arrived at a consensus.
My friend was quite distressed. “Why,” he asked, “was nothing getting done?”
This falls under the category of “Welcome to the real world.” It’s always difficult for people to change, even when they have a hand in developing the direction of the change, and can see the benefits of it. The unknown is scarier than the known. Harless Cone (one of my heroes in the world of consulting) says, “We always prefer the certainty of misery to misery of uncertainty.”
I too, am a firm believer in the magic of participative management. When people can contribute to a plan, they will usually take ownership in it and amazing things result.
That’s called empowerment, and it’s a great management tool. But a manager needs many tools — one won’t do everything in every situation. When you do all this good empowerment stuff, and there still is chronic non-action, another approach may be required.
Take IBM for example. Considered by many to be a dying behemoth in the 80’s, it’s now one of the most vibrant companies in the US economy. The reason for the turnaround? A nearly universal answer is Lou Gerstner.
(Morris, Betsy, “Lou Gerstner, The Holy Terror Who’s Saving IBM,” Fortune, April 14, 1997.)
Direct, brusque, and unafraid to confront conventional wisdom, Gerstner started questioning everything that IBM was doing. His predecessor, John Aikers, had begun dismantling IBM’s mainframe business, believing that networked personal computers would be the wave of the future. By the time Gerstner arrived, that strategy had become conventional wisdom.
Gerstner pushed to revitalize mainframes, taking the position that the company must once again serve as the source of business computing solutions for its customers, and mainframes should be a part of those solutions.
He also started demanding accountability for performance. According to one long time IBMer, “Meetings in the pre-Gerstner days were congenial and pleasant – – whether anything was accomplished or not…meetings with Gerstner are anything but pleasant now. He demands that excuses be replace with results, and that if something isn’t working, it’s either fixed or it’s scrapped immediately.”
This is not to say that Gerstner attacked people personally. He was just very hard nosed when it came to accountability, even to the point of firing some key people who “just wouldn’t get with the program.”
For Lou Gerstner and IBM, the strategy has worked. The stock has rebounded, profits are up, morale has greatly improved, and the company is once again seen as an industry leader rather than the industry dinosaur.
Am I saying that if you want to bring about change in your on your team or in your organization, you must abandon your participative style and become a Gerstner like “tough guy?” Definitely not. On the other hand, don’t discount the approach all together.
Most changes, even those with very positive goals, are painful for those who must change. To implement change effectively, you must manage three painful elements of change that I call, P1, P2, and P3.
P1 = the pain of continuing to do things as you did in the past
P2 = the pain of not having the change in place (aka “the unfulfilled desire for the change)
P3 = the pain of actually going through the change
These three factors can be expressed as an algebraic formula that reads:
When P1+P2>P3, change will occur.
In other words, when the pain of continuing with the “old way” (P1), plus the pain of the unfulfilled desire for the “new way” (P2), are greater than the pain of changing to the “new way” (P3), people will change.
You can use this formula to facilitate the change process in your organization by manipulating the variables. For example, you can raise the level of P2 in your staff by showing them the advantages of the “new way” and empowering them to plan and implement the change. Also, you can lower P3 by providing training and careful planning of the change to make it as painless as possible to get there. Finally, you can raise P1 by making it more painful for people to continue with the “old way.”
It was obvious that IBM needed a good dose of P1 to get it to move off the dime and start producing. Gerstner provided it.
My advice to my friend was to add some P1 to the pot by becoming more involved in the planning discussions, by setting some hard deadlines for implementing changes, and by being tough about results, even if it means causing some pain to those who are dragging their feet.
If you are having trouble getting change to happen on your team, you might ask yourself if your managerial approach contains the right amount of “tough,” along with the with the right amount of “tender,” to create the changes you want.
