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November 7, 2013

How To Transform Your Organization When Times Are Good

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 5:55 AM


Lead and be the change: Mark Mueller-Eberstein at TEDxRainier [Source: http://www.youtube.com/watch?v=yv-QiSvuLLM]

Winston Churchill once said that you should never let a good crisis go to waste.

As business leaders we know exactly what he meant. It's often an imperative to transform your organization when times are tough. Outside challenges give you the excuses to act quickly and decisively. You can shake up the company without the board of directors of fellow executives questioning your every move.

In some respects it's more challenging to transform an organization during a period of relative calm. If the economy as well as your business is chugging along, then why rock the boat? Why bring unnecessary heartache into your life by hiring and firing and charting a new strategic course?

Yet transforming an enterprise during the good times is something management experts urge us to consider. When you're not making decisions under pressure and duress, you often have a more rational and longer-term view of the organization. One of the signs of an exceptional CEO is how he or she can maintain an organization's current success while doing what it takes to ensure it will succeed ten years from now.

We often lead from a relative position of comfort and familiarity. Who's to argue? That's what organizations hire its officers to do. Taking oneself out of familiar territory is a good test of how we'll perform when the market takes a turn for the worse. We have diagnostic tools to gauge the health of our various computer systems. It's not a bad thing to have a diagnostic that tests our resilience as business leaders.

There's a great story someone shared with me recently that puts this paradigm into context. A tale from ancient Greece goes something like this: After a long battle, sailors bring a ship into port and begin to replace its planks. Then they take the old planks that they have removed and use them to build another ship. The question posed by the ancient tale is which of the two ships is the one they sailed into port? If it is the latter ship, then when did it become that ship? In other words, was there a point at which a certain amount of old planks came together that it could truly be thought of as the original ship?

We should think of companies in much the same way. When our enterprise commands exceptional market share and is posting record profits, it's hard to justify replacing the planks and building a new ship. That's the right time to do so, however. Why not rebuild and refine an organization when it's sheltered in a safe port and surrounded by the best people? It stands to reason that replacing the planks when it's out at sea, in the middle of a storm no less, is fraught with problems.

Specifically, the planks of an effective organization are things like management, corporate culture, and market awareness. Too often an organization is forced to change its culture because it's facing setbacks in the marketplace. Or a company becomes so comfortable with dominating a certain sector that its leaders aren't mindful that start-ups might be redefining the market - or creating complexly new ones.

To be sure, it's easier to speak of change than actually implementing it. And I don't mean to suggest that organizations institute bold change simply for change's sake. Those types of moves don't address the core issues of a company. If a particular strategy is truly effective, there's no point in reinventing the wheel. It's just that many times organizations are lulled into complacency by long stretches of commercial success.

Using those successful periods to your advantage is the key to successful leadership. We all encounter storms every now and then. When we do, it pays to have a water-tight vessel that can brave the swells and bring you back into a safe harbor.

Comments

Transformation or change is a continuous event in a leading organization. During crisis change is necessary under compulsion whereas during good times it is as per plan.

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