Built To Change

Dec. 11, 2006
Organizations change. Sometimes by design; sometimes change is forced upon them.
In our industry, organizational change often manifests itself publicly through postings on Jim Pinto’s Web pages that are often critical of management. That’s because change is unsettling to many people. But what if there were an organizational model built on the assumption that continuous change is business as usual? I lifted that question from a very good and important article from the Fall 2006 issue of the “MIT Sloan Management Review,” titled “Designing Organizations That are Built to Change,” by Christopher G. Worley and Edward E. Lawler III. Ideas usually come in groups. I read this article while contemplating a couple of automation companies. Rockwell Automation has undergone a series of evolutions over the past few years. Right now, there is a quiet revolution within its marketing organization. I’m sure that the change is unsettling to many people within the organization, who wonder what will become of them. The second company is Schneider Electric. My recent session with Andy Gravitt, senior vice president of automation at Schneider got me reflecting on changes there. I think Schneider has undergone quite a transformation over the past few years, and seems nothing like the company of 2001. This suggests to analysts, don’t let your opinions of a company remain cast in concrete. Organizations, like people, change.Built not to changeAccording to the Review article, the source of the problem about bringing change to organizations is simply that organizations are not built to change—in fact, they are built not to change. The authors quote a classic text, “The Social Psychology of Organizations,” by Katz and Kahn, “One can define the core problem of any social system as reducing the variability and instability of human actions to uniform and dependable patterns.” No wonder you can’t change an organization! This may have been OK in the 1950s and 1960s, but global competition and technology are forcing rapid change on organizations today. You need to build an organization in which change is business as usual. Here are a few tidbits of suggestions to whet your appetite to go to the article (found on the Web at http://sloanreview.mit.edu). First, managing talent. Instead of telling employees what their jobs are, built-to-change organizations encourage people to find out what needs to be done. When hiring people, built-to-change organizations seek individuals who like change and are quick learners. Organization structure. Built-to-change companies are concerned about being caught off-guard, so they place everyone close to customers and the environment. Build a network structure (units or individual organizations
within a company pulled together to exploit specific opportunities), because a network structure leads to organizations with large surface areas due to all of the alliance relationships that managers and employees must address.
Leadership. Leaders need to practice shared leadership—what Mark Hurd, the chief executive officer of Hewlett-Packard Co. has described as “leadership as a team sport.” Shared leadership substitutes for hierarchy and builds a deep cadre of leadership talent. And multiple leaders at all levels who understand the external environment and the internal capabilities often see important trends that call for corporate change before senior management does. Most importantly, shared leadership supports more effective change management. I’ve been privileged to have many positions in my career where I got to define the position—or even if the position was technically defined, I still got the opportunity to define the role. It was great experience. It helps me see the importance of these ideas and how all of us should look not at a static job description, but at what needs to be done.

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