Who Drives Change In Your Organization?
Business unit leaders, who often sit unnoticed between the C-suite and team leadership, play the most significant role in implementing change, delivering business benefits and ensuring high levels of sustained business performance, according to Accenture data.
By Deborah Brecher
Today's companies must navigate constant, disruptive change to survive. It not only takes strong leadership, but a clear strategy to drive needed organizational change forward. The C-suite steers the direction of the organization and often senior executives believe that change also must be driven from the top down. Others think of change as more of a bottom-up approach, with change initiatives being pushed organically by employee teams on the front lines. The reality is that it's business unit leadership that holds the real power to drive successful change.
Over more than 15 years, Accenture analyzed the experiences of nearly one million employees undergoing change at 150 global corporations across 50 industries and 25 countries, identifying 10 major drivers of change. These include communication, business and team leadership, skills and staffing, systems and processes, accountability and a broad range of emotions. In doing so, we found that the most successful change programs radiate from the center of the organization. Specifically, our data indicates that business unit leaders, who often sit unnoticed between the C-suite and team leadership, play the most significant role in implementing change, delivering business benefits and ensuring high levels of sustained business performance.
While the bottom line is always top of mind, a "successful" change program achieves "high performance." This means companies must look beyond only achieving the financial benefits of change. With the Wharton Leadership Conference focused on "leadership to make a difference," our research reveals that leadership at all levels is needed to drive successful change. Following are steps leadership should take to make successful change happen within their organization.
Define Successful Change
Organizations should aim for change that will build strengths across the board. There needs to be a greater emphasis on the big picture -- being able to strategically make decisions while considering long-term consequences to any action. The C-suite should consider "high-performance change" that achieves the following:
Realizes the benefits outlined in the business case for the change program;
Improves business performance across the course of the change;
Builds people's capabilities to manage change; and
Leaves the organization in good shape to undertake further change.
Although organizations might start a change program with weaknesses, those that are successful build capability in these areas while change is taking place.
Challenge Business Leaders to Take on the Task
The C -suite must work through business leadership to drive progress. The big danger is that strength at the top can be counterproductive if there are leadership deficiencies elsewhere. Successful change requires strong leadership at all levels but especially at the divisional and business unit level.
According to our data, the lowest-performing change programs (those in the bottom 25 percent in delivering benefits and improving business performance) have strong leadership capability at the top to implement change. The problem is that the capabilities of the business unit leadership are only a fraction of the C-suite, and the capabilities of team leaders even less.
Therefore, to be successful, business leaders must be at the heart of change since business leadership has, by far, the most significant impact on business performance. This includes improvements in effectiveness, customer service and cost management. The data also shows that the highest-performing change programs (the top 25 percent) have strong, consistent capabilities in leading change across all levels of leadership, with each level playing its required role.
Business leaders must work through the team leadership to build strong teamwork and accountability among staffers. This is of particular importance in high-speed, disruptive, highly digital environments where workgroups are becoming increasingly fragmented and virtual. When leaders at all levels -- the C-suite, business unit and team -- are working together effectively, the result is a system of trust aligned at multiple levels.
Make Tough Talent Decisions
Business leadership at many organizations is often not up to the task of leading change. In those cases, the C-suite needs to work closely with business unit leaders to build their capabilities and to establish a mindset where institutionalizing change is just as important as fixing day-to-day problems. Accenture's research indicates that a 30 to 40 percent improvement in the level of business leadership is often required to bring change back on track. Effective business leaders are crucial to laying the foundation of an organization's change capability. Our data clearly shows that attaining the highest levels of business performance requires this core strength, enabling organizations not just to endure change but truly thrive on it.
When leadership in the center holds, the C-suite becomes the ultimate winner. Change should be driven by business leaders who keep their hands tightly on the wheel, quickly implementing one initiative after another while still staying in firm control of their organization's forward moving direction.