Psychology Says This one Thing Is Absolutely Critical for Leading Change
Today only one competitive advantage is capable of making a real and lasting difference.
It is the capability of learning new things, and of using what we have learnt more quickly than others.
It is important for us as individuals, but also for our companies.
In effect, companies that claim to be learning and “transforming” seem to be everywhere. But when you look deeply into whether those organizations are truly redefining what they are and what they do, you find another reality.
According to a recent study of S&P 500 and Global 500 firms, published in Harvard Business Review, successful change efforts are exceptionally rare. I have seen many change programs fading away over time, or taking a destructive and conflictual twist.
The main cause is often the misunderstanding of one important psychological ingredient of leading change: tension.
Our investigation into the criticality of this psychological factor starts by looking into the two different roads that company follow to obtain change: top down actions and building adaptive capacity
Top-down actions
This is the most common approach, especially in traditional medium sized companies. Top managers provide directives and specific commands for strategical actions to the lower levels of the hierarchy.
This method is recommendable for technical challenges in well known and tested areas. An expert following the directives of his superior can solve this kind of problems .
But competitive issues are more complex and go beyond the technical aspects .
And even if a senior manager or a consultant has the necessary technical skills related to his function, this does not mean he always knows what needs to be done to solve a specific situation. This knowledge problem can be solved by delegating tasks to down the hierarchy.
In my consulting assignments I always insist on dedicating the right amount of time to participation via team work. Otherwise it would be impossible to successfully implement an improvement program, such as a new business control system, an operational improvement, or a sales cycle transformation.
Building adaptive capacity
The top-down method of delegating tasks to teams is not workable for a company that needs to take on challenges that require learning new things, change behavior and get a new understanding of the business context.
Instead of following up on top-down orders, competitive challenges require us to learn a complex organizational skill.
It is called adaptive capacity. It permits us to treat change not as a standalone project, but as an opportunity to improve our competitive advantage on a continuous basis.
Inter-functional team work, experimentation and participatory leadership function very well within an organization that has acquired the skill to adapt itself quickly.
Not only a skill, but also a will
Whether you procede with top-down actions or dedicate time to become more adaptive, sooner or later one thing will happen:
People will have to give up things they hold dear such as their daily habits and ways of thinking. And they may be asked to accept a solution that requires turning part or all of the organization upside down.
These issues are more a will than a skill. They touch not only important practical aspects of people’s lives, but also their values and emotions.
As a consequence leading change needs to become a psychological process. Only by doing so can we help our people to find the will to successfully integrate the new values, competencies, behaviors, and processes into a new vision of their working life.
The psychological dynamics of change
In his book Adaptive Capacity, Juan Carlos Eichholz touches the crucial psychological phases of a change process:
- In period of change, a person feels a loss because he weighs losing something twice as much as he or she weighs a possible gain.
- The feel of loss creates resistance.
- The problem that exists and is communicated within the organization creates a disequilibrium, because we feel a gap between our inspirations and the perceived reality.
- Tension is created when the organization is in disequilibrium.
- People decide to change only when they feel an appropriate level of tension for a certain time.
This psychological reality makes tension unavoidable. And our human nature makes it also a necessary aspect of leading change.
Tension must be monitored and managed carefully so that the following 2 situations do not occur:
- If tension fades away people will avoid the call for change.
- Tension can rise so high that it becomes a destructive force.
We can compare tension like the fire on a barbecue. The fire needs the right intensity according to the type of food we want to prepare. Not too cold and not too hot.
How to become adaptive to change
This scheme illustrates how adaptive capacity can be increased so that we can face our challenges with more success.
2 elements amplify the range of tension our organization needs to be open for change: Responsiveness and Holding environment
Responsiveness
Having a greater responsiveness means taking collective actions at an early stage. When the disequilibrium and the tension is not yet so high and a less responsive company would have ignored the signal for change coming from inside or outside.
Greater responsiveness prevents also that the tension fades away and people regress gradually to the old way of doing things.
These 4 actions enforce early responsiveness:
- Protecting critical voices that differ from the general way of thinking.
- Discouraging defensive and parochial behavior.
- Encouraging employees to pay attention and reflect to what is going on inside and outside the company.
- Make everyone feel responsible within and beyond their function.
Holding environment
This refers to the level of uncertainty and tension that a company is capable to handle. The higher the holding environment, the less likely things will get out of control when tension rises.
These are 5 things we can do to maintain a proactive environment in difficult moments:
- Providing context and a reason for action to the challenge.
- Showing the benefits of the future in a meaningful way.
- Proceeding with a step by step approach.
- Hearing and responding to people’s concerns.
- Building trust in the system
Conclusion
Understanding the psychological dynamics of change and tension is a key success factor for leading change.
Taking on competitive challenges requires a less hierarchical organizational structure and a participative and transformational leadership style. Only so can we encourage every person to provide his contribution and feel truly engaged in the change process.
Do you want to find out more?
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