9: Embarking On Reengineering
In this chapter, the author means to discuss the "tremendous challenge" of persuading people within an organization to support, or at least refrain from resisting, the prospect of a major change.
A radical change impacts peoples' work lives, which is a significant matter that involves quote a bit of anxiety. It cannot be done in a single stroke, but must be "sold" even before it begins and supported long after the change is implemented.
In his experience, it's actually quite simple if you bother to do it: companies can easily sell change by being communicative and open. Employees are told what to expect, and see what they have been led to expect.
Whether they believe what you say largely depends on your track record of honesty; but in any case, tywo brief messages are critical to selling an idea:
- This is why we can't stay as we are. The first message is a case for change, and it must make a compelling argument for change, as employees who are not convinced a change is needed will seek to preserve the status quo, refusing to participate and even working to undermine change.
- This is what we must do differently. The second message is a vision statement, and it helps overcome uncertainty by giving the employees a clear sense of what will be coming, and perceive the reason for the changes they will be asked to make.
A bit more detail is provided:
Case for Change
The case for change must be concise, comprehensible, and compelling. A vague statement conveys general and unfocused panic, which undermines the credibility and respect of leadership. There must be a convincing argument that, if things keep as they are, the firm will lose competitive advantage, its profits will be eroded, or some other specific consequence.
The case should be strong, but it should not be exaggerated. Melodrama creates doubt and distrust. A sober look at a credible prediction, followed by a reasonable amount of supporting analysis, makes a convincing case. The author also stresses brevity and bluntness. The key reason for change should be short and memorable - and few enough that it doesn't become a clutter of vague information.
One example is provided from a pharmaceutical company. Its key message is:
- It takes a long time for us to develop and register new drugs
- Our leading competitors have significantly shorter business cycles
- Having small and independent R&D efforts causes chaos and conflict
- Consolidating and coordinating their efforts will eliminate this inefficiency
- Failing to change means foregoing profit and losing competitive advantage
The author natters on about this, though the qualities are fairly self-evident from those points: it puts the firm in the context of the industry, indicates the problem, considers the reason, and describes as solution, though the last bit strays into the vision statement.
These statements should be backed by supporting detail: proof that the firm's cycle time is longer than competitors, an indication of the financial impact (a loss of $1M in revenue each week a product is waiting to be approved for sale), and the like.
It's also noted that "a company doesn't have to teeter on the verge of bankruptcy to make a compelling case for reengineering." There is temptation to aggrandize problems, at the cost of credibility. A slow slide, or even failure to seize an opportunity, can sell a change - though the benefits should justify the cost and inconvenience.
Another example is provided from a consumer products company. More of the same.
Vision Statement
The vision statement goes beyond "we have a problem" to "here's how we're going to solve it" and "here's how we'll be better off for having done this." In effect, desire to achieve the vision is what inspires people to act and focus their efforts.
Creating this statement is a bit more challenging and requires a lot of faith. The problem is based on known factors for which there is a great deal of supporting data that supports a cause-and-effect relationship. The vision is for something that hasn't happened yet, and for which there is no proof that it will go off exactly as it is planned.
The vision also provides a yardstick for measuring progress toward success. Once the vision is announced, questions arise "how soon will we get there?" and "are we there yet?" Evidence of making progress toward goals is critical to keeping people focused and engaged.
The case for action tells people why they can't stay as they are. Without a compelling vision, this creates a sense of disempowerment and panic. With a compelling vision, these negative emotions are transmuted into empowerment and ambition.
As with calls to action, vision statements can be short, powerful, and compelling but should be careful of melodrama. If the vision is too modest, it will be regarded as unworthy of the effort; if it is too grandiose, it will be disregarded as unachievable or unrealistic.
Specific mention is made of "leadership retreats" after which management returns reinvigorated and inspired, and then their passion burns out quickly. Employees who are used to seeing this pattern will likely be jaded and expect management's strong enthusiasm one day to evaporate the next. In such as situation, concrete details are essential to convincing employees there is some substance and not just a passing fancy.
The author lists a few qualities of a good vision statement: it must focus on operations, include measurable objectives, and a tie to organizational strategy.
One of the best and simplest examples of a vision is a service guarantee, such as that of Federal Express, which promised "we will deliver the package by 10:30 the next morning." When a promise is made to a customer, employees recognize that management is serious about it.
A few longer examples are provided, from a pharmaceutical company and a consumer products firm.