Organisational Change, done the start-up way
There is a new way of creating organisational change. A method that is more effective, involving and ultimately is inspired by how new companies are changing the world.
For the past 11 years, I have worked with “organisational change” in a number of different projects, organisations and functions. The last 2 years I have been sitting in the FinTech incubator MobileLife. A unit built in the intersection of the largest Nordic bank Danske Bank and a corporate start-up environment. Built to disrupt our own business model.
My daily job is to integrate and implement new corporate ventures into our core traditional banking business (most lately with our, digital home buying solution, called Sunday into 100 branches and 3000 employees).
The following is my attempt at sharing some of the learnings I’ve accumulated.
First of all, it’s a very know notion that employees in organisations are resistant to change. I would say it’s not change they are resistant to. But bad solutions, products and implementation methods.
I have learned that “lean start-up principles” can indeed drive change, and the key to create sustainable change is not to drive the change, but to design solutions and processes so the change drives itself.
This work requires an immense amount of behavioural change, and instead of traditional change management approaches, we took the best learnings from the world of starting up new companies, and used it in a new way, and it worked really well. In fact better than anything I’ve ever been involved in.
So what did we do, and what did we learn?
Sunday .dk — the digital home-buying solutions employees had to adopt to
# 1 Just Do It!
One of the first things we applied from the start-up world, was and emphasis on “doing instead of saying”. In the start-up world, an idea is good, but execution is everything. The same goes with behaviour change. In organisations we have a tendency to believe we can change behaviour behind the desk, or on PowerPoint. We say a lot of words, make a lot of
presentations, talk about burning platforms, change assessments, and finally we might get to the management buy-in workshop. All valuable and important exercises, but also a lot of time spent before the actual people who needs to change, is involved. I think the logic is flawed.
Many behavioural psychologists agrees, in fact they suggest it should be done in reverse. As Consumer Psychologist Adam Ferrier states “action changes attitude a lot faster than attitude changes action”. So we need to make people act, and then they will change mind-set, that again will reinforce action.
In our change project we used “Just Do It” as a behavioural design principle.
In the old days, we would make a “4-hour management seminar”, and a “1-day employee training” — all with the aim of explaining the strategy, making exercises about motivation, and showing the new work processes. To change this logic we instead made a very short introduction of the vision, and then immediately had people play with the new product, with accompanying feedback right after. We followed them very closely, and ensured we could help and support them when needed. This approach created a lot of confusion and frustration at first, but over time it fostered a unique ownership and understanding of the solution.
Sunday.dk want to make home finansing easy for all users- create a digital budget, match budget with homes for sale and get a digital credit decision.
# 2 Create a “Minimal Viable Change” (MVC)
A well-known concept in the start-up world is the Minimal Viable Product (MVP). An MVP is a new product developed with only the most sufficient features to satisfy early adopters. Only after considering product feedback from the initial users will new features be added and gradually build a complete set of features. Said in another way: an MVP is like developing and launching a skateboard, that with continuos feedback from the user, may turn into a car over time.
In my experience it’s the same with organisational change, only here it’s a “Minimal Viable Change” (MVC). An MVC can be small in both it’s scope for change, implementation scale and timeframe. You should really ask yourself: “what is the smallest change we can do, that will have the biggest impact?” Charles Dughigg describes a similar thought in his book “The Power of Habits” all about how small changes (he calls it key stone habits) can have a very positive change effect on other aspects in your life. e.g. families that eat together everyday have fewer divorces, people who make their bed have a better financial overview, people that run once a week, have a tendency tohave healthier eating habits etc.
The trick is not to change everything at once, but to change a small thing that could have a positive impact on other behavioural areas. The “30 day challenge” is a great concept for an MVC, because 30 days is long enough for something to become a habit, but short enough, not to feel like a life sentence. For us it was MVC approach, instead of a traditional big bang, starting with implementation in only two branches. We followed this on close hand, with extensive co-creation with employees, managers and customers. We did it on both a product, and change level. Simply focusing our effort on the smallest change aspects, our advisors could have with the new product. This simple introduction, made everyone want to do more. A triggered motivation to learn other parts of the products.
The user can easilly match their personal budget with all homes in Denmark.
#3 Implement First
The third central learning was having the courage to “implement first” and develop later.
In the classic strategy execution model (the waterfall model) we analyse, develop, test and then in the end we implement. This paradigm is all about strategy execution as a structured, controlled and linear process. Everybody who has been working with developing new products, IT systems or business models, knows that this is not the case. Most projects run over time and budget, and then when the implementation day, finally arrives the benefits have a hard time being realized because, it turns out processes, working methods and customer expectations were different than anticipated.
So how can we instead be sure that the product or strategic initiative is actually a good fit, and creates the benefits intended?
Co-creating the solution with key stakeholders from the very beginning turned out to be key. At the end of the day, it is either the employees or the customers, who will have to live with the changes, so why not involve them in making the change from the get go.
“Implementing First” is not a easy task for traditional organisations to do. It requires a willingness to experiment, and therefore this method can seem like a risky approach compared to the waterfall model. We typically met concerns like “what will the customers say when we implement a product or process that is not at all finished?” and “what will the employees say, won’t they get confused when the change is not clear?” However the experience was quite opposite. Both customers and employees were positive and willing to give input, experiment and co-create as long as we would listen and act on their inputs. Many customers found the willingness to listen and involve themselves, because the company became more personal, and didn’t act like an institution. So with an “implement first” approach, we acted more like an agile start-up, with product implemented happening on the go, learnings that came in at an early stage, and made us fail fast in order to win big in the end.
So what did we achieve?
Working with the three behavioural design principals Just Do It! MVC & Implement First, the change became a WANT for employees and managers. For the first time in my career, I experienced employees and managers asking for when they could get started with the change. Instead of being fed the change like a foie gras duck, people made the change their own- because they were a part of creating it. They became experts on the solution and on the change. After 3 months we had an adoption rate on merely 90%, and we could see the change spreading organically throughout the organisation. People began to team up and taking initiative to get the product out to employees and customers- a movement was created. So at the time of the big implementation, the way was paved for organisational motivation.
I truly hope that these three behavioural design principals; — Just Do It!, MVC & Implement First — can inspire you when you are transforming your organisation, and that the learnings we gained can help foster a more efficient and sustainable way of conducting change. In the era of the digital revolution, I would argue that our true challenge is not how we speed up the digital development, but most importantly how we speed up a sustainable behavioural change.