Strategic change is always personal
Constantly changing environment requires more and more organisations to re-invent themselves. But to change an organisation leaders need to contend with change within them as well.
“What business are we actually in?” — I heard the CEO of a large manufacturing company ask this question of his team in the middle of a workshop. It was the beginning of a strategy review which would take them into completely new territories. I was a strategy facilitator standing at the side of the room observing the group dynamics and thinking about how to create a good environment for some fresh thinking.
For the CEO it was a very challenging time professionally. The question of “what business are we in?” was also an inquiry into his own identity, which he developed over many years alongside the industry’s evolution. To be asking this question was to be challenging what made him successful in the past.
He wasn’t alone in that realisation — many other leaders in the room shared a similar story, so it was also a time of transformation for the whole team. The company had to come to terms with the fact that it needed to adapt to the changing landscape — and therefore create a new understanding of itself and its environment. The CEO’s question challenged the basic assumptions that this business had about itself but also brought forward the need to face what people from various parts of the organisation experienced: uncomfortable feelings associated with uncertainty and ambiguity of transitions.
CEO’s question created a subtle shift of energy in the room. People shifted their gaze from the enchanting PowerPoint presentation to conversations with each other. First a whisper, perhaps like a raindrop of a thought, shared between two bodies in a far corner. Then more words, more conversations all around the room.
The way that the CEO asked the question was not interpreted as a test. This was a gentle, but a serious invitation. An invitation to explore together what actually matters. Not just how to make their business better, but to start talking about the new meaning behind their work.
To question the reason for one’s existence is a sign of intelligence and maturity.
If leaders of all levels shy away from inquiring into their organisation’s vision and mission they condemn their business to short-terminism, leaving it to the whim of markets.
“What business are we in?” — that’s the fundamental strategic question for organisations to be asking today. We live in a networked world, where business models are not as homogenous within industries or geographies as they used to be. The sector boundaries are shifting fast and more and more organisations are caught with old assumptions and habits, not fitting the new environments. As Michael Porter is pointing out:
[…] new types of products alter industry structure and the nature of competition, exposing companies to new competitive opportunities and threats. They are reshaping industry boundaries and creating entirely new industries […] forcing the fundamental question, “What business am I in?”
Strategy managers are realising that their discipline needs to move with the times. The 50th anniversary edition of the McKinsey Quarterly points out that managers need help in reinventing their companies, not merely in improving them. Associated with that direction is a growing recognition that designing new strategies is a creative and a social process, not just an analytical one. It requires imagination, invention and engagement of the whole organisation and increasingly also its outside stakeholders.
Creativity, imagination, a clear vision — although all important in re-inventing are not sufficient alone for the actual transformation to occur. What is also needed is a space in which people can feel free and safe enough to let go of the familiar, not only because of the appeal or the rationality of the new direction, but also despite the pain and the anxiety of letting go of what is known, in exchange for what is not yet fully discovered. This delicate but deliberate process is not unlike when we transition from one career to another, from one life-stage to another, and as such is full of existential torment, emotional upheaval, loss and associated grief. Emotions and experiences that if not acknowledged and supported, act often as the real barriers to change.
Strategy is not just a thinking exercise: it is also a making and experiencing exercise. We don’t transform in our heads, but with our whole bodies. And our bodies hold a lot more than just ideas — they are the source of action: habits and choices that actually build the new realities. And changing habits rarely works because of the rationality of any argument — it works because a new argument can be embodied, and the old assumptions that motivated us in the past, can be let go off. The problem is that those assumptions made people like this CEO very successful thus far. Letting go of the old ideas is not just a process of logic. It is a developmental process that needs to address the core of who we are: our identities, and who we are to each other: our relationships.
Strategy making needs both a social and intellectual backbone that supports exploration of new and challenging ideas conceptually and in practice.
Strategy is not just a thinking exercise: it is also a making exercise. It is about making by co-creating, so it cannot be done effectively behind closed doors. It is a group process, with its complexities and tensions.
Hence, organisations wanting to reinvent themselves have to work with the intellectual and social dynamic in parallel. They need to acknowledge and use the discomfort arising from uncertainty and at the same time they need to face the complexity of increased optionality.
In simpler terms, it needs us to learn and to love. Learn not just how to make existing things better, or even choose what matters — but to actually develop ourselves and embody these new ideas — transition our identities and mindsets. And love, so that we can feel free and yet committed to ideas that are larger than the individual selves. And to feel it’s ok to let go of who we were in the past, without yet knowing exactly who we could become or will become. Only in a loving environment this kind of learning is possible, and only through letting go of the old can we learn and experience the new.
Without those two components, without love and learning, we cannot build new stories. And at the heart, that’s what a strategy is: authoring a new story that gets build, and in turn — a process in which we become new too.
