Making your organisational transformation a success

Seventy per cent of attempts to transform organisations fail, but every public sector leader is confident they will be in the thirty per cent that don’t.

Every organisation and every attempted transformation is different, but there are some universal principles that can be applied.

Grant Freeland is adjunct Professor at Dartmouth Tuck and adjunct Lecturer at Harvard Kennedy School, and a former Global Leader and Senior Partner at the Boston Consulting Group for 31 years, where he supported large private and public sector organisations drive transformative change. He is presenting an upcoming masterclass in ANZSOG’s Public Leadership Masterclass series on Leading Change to Transform Public Interest Organisations.

Mr Freeland says that leaders who don’t underestimate the difficulty of change, understand where their organisation was starting from, are able to get buy-in from senior leaders and then the rest of the organisation, and who had the resilience to push through tough times were more likely to successfully transform their organisations.

“Leaders are betting their leadership and sometimes their careers on these attempts at transformation, even though statistically only 30 per cent will succeed. I wouldn’t want to be betting on those odds,” he said.

He said that there had never been a greater need to transform both public interest and public service organisations, with changes in technology and rising expectations of citizens.

“Cost and tighter budgets are also an issue which means the sector needs to figure out new ways to manage themselves and to transform at the same time. When you look at the growth of AI, big data and digital, all organisations need to transform themselves but it is doubly so for public sector organisations.”

Public sector organisations tended to be more risk averse but the experience of COVID had shown they had the potential for successful transformation.

“You get into trouble for failure in the public service more than you get rewarded for success, so it does contribute to a slightly more risk averse lens, he said.

“There are certain functions that are mission critical – paying out Medicare benefits for example – you can’t screw up on those during a transformation.

“But there are areas where you can afford to experiment a little. For example the ‘gov.uk’ website was released in 12 weeks, even though they knew it wasn’t perfect, because it wasn’t going to cause a dilemma for people. They deliberately put something out there that citizens could react to, and then improved it.

“COVID showed that public sector organistions can make more change than they think, but they needed a burning platform to drive the need for change.

“Now the question is can you get a burning platform without having COVID to drive you? That’s where leaders need to lead, they need to create this burning platform and need to get buy in from the organisation.”

Aligning organisations behind a transformation

Mr Freeland said that there was no ‘cookbook answer’ to transforming an organisation and leaders needed to understand their organisation’s starting point as well as where they wanted to go.

“What we mean by a starting point is looking at the organisation. For example do you have a public sector agency that has a history of successful change, or one that has resisted change forever?

“The key pitfall is underestimating the change level required, because sometimes you don’t have the luxury of making small incremental changes in small parts.

“It is much lower risk to work in an agile way and run the change process in cycles. Make some changes, develop a Minimum Viable Product, get feedback and adjust what you are doing. I caution against ‘Big Bang’ changes, where you plan and plan and plan, and then try and do something that is near perfect, because the odds of that working is near zero.”

He said that one of the first things leaders needed to do to ensure organisational buy in was to get alignment within the senior team.

“Because organisations can smell dissent, and can smell it when the senior team is not all committed to driving change. So sometimes you need to go slowly at first to get that alignment of senior people so you can move fast later,” he said.

“You need to use the 3Hs, head, heart and hammer. Appeal to their heads and hearts, but if they don’t agree, you need to use the hammer and put them aside or put them elsewhere.

He said that leaders often became too concerned with project management plans and not enough about communicating with the organisation and getting buy in from employees.

“You need to explain why the change is necessary, but you also need to create a sense of dissatisfaction about where you are now, not just reassure people that everything is fine.”

“Within the organisation more broadly, generally a third of people will be with you if you give them a good reason, a third will never be with you, and the battleground is that middle third – if you can get them on board that will get you through.

“Leaders need to identify Key Opinion Leaders within organisations and get them on board. These people are not necessarily the most senior, but they are the ones that people within the organisation listen to. My experience is that they each influence 50 other people, either positively or negatively, so you need to overcommunicate with this group and use them to deliver your message.

“It also helps to be passionate about your organisation and what you are doing. You are also going to need tenacity and grit, because these changes take time, and there will be dark days when things don’t go as expected.”

Leaders need to lead

Mr Freeland said that leaders who wanted to deliver successful changes needed to lead, and not simply ‘delegate the problem’.

“In almost all cases transforming organisations requires changes in behaviour, but if the senior leadership says ‘we are acting in exactly the right way, this is not about us changing it is about you changing’ that is delegating the problem.”

“If you say cost is not an issue for the senior team, but we are going to cut 10 per cent of frontline workers – or if you say that we are too slow in making decisions, but it’s all middle management, nothing to do with the heads of the organisations – you are delegating the problem.

“During most of the COVID changes, leaders were very involved with their staff, because they had no choice but to involve the whole organisation to figure out the answer. That’s part of transformation: you have to involve the people and trust and empower them to make those change,” he said.

“They were out in front leading, and making sure that their staff had the support and resources to take risks and deal with the problems.

“You need to give cover to the people who are driving these changes, protect them when things go wrong and give them permission to break the china if that is what needs doing. If you reward riskless behaviour you’ll get people taking no risks.”

Grant Freeland’s masterclass on Leading Change to Transform Public Interest Organisations will be held on Wednesday 6 December. To find out how to attend visit the Public Leadership Masterclass web page.