How do you approach a change process in a multinational company, what do you do when a company is geared to the short-term, what is Spain’s position in respect of international changes and how do you motivate a team of people to face up to the challenge of a change. Spencer Johnson –author of who moved my cheese?- states: “John Kotter knows more about organisations change that anyone anywhere in the world”.
An initial e-mail from John Kotter arrived a few months ago asking for more time to think from his office at 975 Memorial Drive, in Cambridge, Massachusetts. It is curious that the best expert from Harvard Business School resides in an American city which is called Cambridge, also the base of the Massachusetts Technological Institute. However, more than anything, it highlights that John Kotter wishes to reply as precisely as possible. That he does want to share his knowledge, but that he is asking for time “to think” and prefers to read them for a telco some time before. This tidiness is what has set him apart as a business change guru. “One of the problems of being a rigorous academic” is the way his first e-mail ends.
Finally, we agree to have a telephone conversation. With a calm and reflective tone, Kotter responds to the questions in a manner which is clear and simple. For a senior Director or informed consultant not to have heard of John P. Kotter (1947) would be somewhat rare because his publications “Our Iceberg is Melting” (2006), “The Heart of Change (2002)” and “Leading Change” (1996) have become contemporary classics on change management. His theory of change in eight steps and, especially, its applications to change management, is a reference for the business world of today and actively seek out the levers needed to regain the confidence in the future possibilities for the company by revising its “strategic vision” or creating a new one which will serve as a guide for its actions. A complex strategic process which starts from a “sense of urgency and illusion:, followed by a real directive compromise (which sometimes requires the creation of a group of opinion formers or “leader coalition”) which involves the necessary people to revise the “mission, ambition, values and fundamental qualities” and inspire employees so that they do not give up during the implementation phase.
During our conversation, Kotter responds to questions which the majority of directors and those involved in a process of business change have and whose “possible” replies cover thousands of pages of speculation. How do you approach a process of change in a multinational organisation when a company is very focused on the short-term, if your could suggest a slightly modified model for Spain, as a good connoisseur of the international economy and how is it possible to motivate a large team of people so as to meet the challenge of change?
In respect of how to approach a process of change in a multinational company when the cultures of each country are different, John Kotter explains that “we have found that the 8-step model of which I am the author, really works when applied to different countries because the difference are only in the detail. For example, let us suppose that we are implementing a change process in a company which is based in 40-60 countries. We are able to approach this challenge in two ways. Obviously one would include the one called “leader coalition” – vital in this case – for persons who are not only in different areas but also in different countries. In reality, we are faced with the same problem when we do the same in a company which is developing its activities in a very large country. By taking the example of a company based in the United States, out of 35 people we would choose 7 or 8 who would be North American and then we would, on a proportional basis, include people from Europe, South America and Asia, probably including those from China these days. In order to ensure the cohesion of the leader coalition it would be necessary to plan weekly idea-sharing sessions which take into account the time differences and by using modern technology to ensure that these people are kept permanently informed. Afterwards, the process would be the same as described in my publications, with the exception that the cultural differences would need to be reviewed in advance. Of course, in Spain I think that there are differences compared to working practices in Germany. But only in the detail. This brings us to the second point: to make it clear to everybody involved that there are always, in any change process, more similarities than differences. People from across the world work in the same way, meetings, IT, connectivity, decisions and projects. We are already living in global countries in which working differences are less and disappearing. For example, the way of working by Microsoft is the same in Seattle as it is in Tokyo, with just differences in languages and of detail which those involved need to permanently manage, but not fear. Change is necessary and when everyone is behind it, then it is possible, then you do it”. Kotter cites the model of Martin Luther King, who stated “I have a dream” when he explained that xenophobia was in reality “inconsistent with the laws of numerous countries” and that in all of them, regardless of their management, it was “overwhelming logic” which placed his conciliatory theory of races on the side of progress.
In respect of what you do when a company is more focused on the short-term or on profits, how do to approach the change process, Kotter explains. “In public companies, for example, this problem usually arises. They look for predicable results so as to cover certain costs, a clear problem which leads to our system of government. It presumes that each action translates into profit into less time that the legislative mandate which makes change difficult. However, we have found that a clear vision of change always helps. Of course there is a clear difference between the short-term and the long-term but it is precisely the short-term which drives one towards the long-term. Jack Welch, the most successful manager of the 20th century, said that the aim in to change in the short-term and have this change last in order to lead to long-term change, because what is done over one, two or three years must imply a sustainable direction”. By referring to his book “A sense of urgency”, Kotter highlights three tactics to create a real sense of urgency despite looking at long-term change: “connecting the external with the internal, acting with urgency on a daily basis, finding opportunities in crises and neutralising the NoNos”.
About Spain and change, the expert wanted to make it clear that “no company and no country should focus on the short-term, this can rapidly sink a system which is what has in fact happened. Economic details vary, including within countries, but Spain is no different from any other country. The whole of Europe is trying to investigate what will replace the state of well-being which has been assured for decades and which take us back to Bismarck. In Spain I think that it has been difficult for a number of years to give rights to workers. In France they are fighting for changes in the working day. In Greece, for example, it is an extreme case of how policies against workers have placed its economic system in danger. It is consequently necessary, in my opinion and within the regulatory framework of each country, that each company takes the reins of change in accordance with the Value-Benefit chain whereas governments need to take decisions which assist business change”. In respect of the international crisis which is affecting our country, he highlighted four errors which should be avoided in order to have success: “assuming that a crisis creates the need for urgent change across the whole company, going further in the emphasising of change thereby giving employees the sense that they are being manipulated or used, waiting for the end of the crisis without benefiting from it – or, in some cases, boosting it in the accounts to produce an effect – and undervaluing the effect of the Change”.
How to be truly inspirational, especially in the final phases of the change. Is it necessary to make efforts over months or years? Kotter asks “if employees truly believe that they are faced with an opportunity for themselves, we should not discourage them because they know that they are helping themselves as professionals and as people. Based on the progress, you have to give employees space, trust them and have them see that they are winning. The word winning is undervalued but really it does not have a negative connotation; people love to win and this increases energy and in the era of progress one person winning does not mean that someone has to lose. The most rapid way to halt someone’s energy is to have them sense that they are losing. On the other, it is for managers to show that they are truly convinced of the corporate values and that they are seeking to achieve the goals. If employees feel the energy of their directors, they know that focusing on change is a great opportunity to win and they are inspired. People like to win, in reality it is necessary to focus on change as a chain or smaller or larger sized successes. The sense of urgency is really the sum of winning thoughts and ideas”. He adds, in relation to inspiration, how “creating convincing, surprising and, where possible, visual experiences is the best way of changing how people feel in respect of any situation: a change in the way of feeling needs to be associated with a change in the way people behave, which is not brought about through rules or pressure”. The guru ends the conversation with a few questions on the position in respect of the change processes in Spain in large companies –Telefónica, BBVA and many other are involved in these processes and an exordium: apply the winning attitude of Kotter in order to “win”.