In a coaching conversation with a CEO, the recent SMRT challenges surfaced. How, over the last several months, there have been so many negative customer experiences, with a new problem surfacing every time an old one was fixed. What, asked my client, is the CEO missing? Is it all really only technical challenges or is there a bigger issue at play?
I threw it right back at her, and she said there was certainly something missing.
Sensing change within an organisation is the leader's job but more often than not, a leader's attention is absorbed by external circumstances and competitive changes.
What is happening internally - in terms of the cognitive, psychological and spiritual development of people, and how subtle changes in their behaviours based on shifting values, beliefs and assumptions are derailing the culture of the organisation - is often missed out.
American writer Ken Wilber, whose "integral theory of spirituality" tries to map human understanding and consciousness, refers to four quadrants of change - two internal and two external. Organisations usually spend much time and money on design, workflow, processes, policies and procedures. Investment is also made to develop individual skills and competencies to improve performance. Both of these have a clear external orientation.
Technical problems can always be addressed with an external focus. However, adaptive challenges - problems or dilemmas that have no apparent solution - need a whole new mind to deal with them. It is the structure of mind, the degree of complexity of thinking, the evolved mind that needs to find a new approach, a new way of resolving a problem.
Adaptive challenges are difficult to deal with because often, we do not realise that we are facing one; it has a way of sneaking up on the organisation over time without the chief executive officer's knowledge, and then when things begin to fall apart, all kinds of technical solutions are thrown at it in the hope that it will go away.
Solutions to adaptive challenges cannot be found with the same level of thinking at which the problem was perceived in the first instance. It needs a whole new mind, a more complex thought process that can keep pace with the ever increasing complexity of doing business.
In the words of my client, Mr Amit Banati, the president of Kellogg Asia Pacific: "It is not enough to mechanically run an engagement survey at the end of a year. The CEO needs to have his finger on the pulse of his leadership team and through them, the rest of the organisation. People, performance and culture are strongly interlinked."
Kellogg Australia is a case in point. Performance began to slide and all the usual marketing efforts directed at external challenges did not produce results. Something had changed internally and clearly, there was a need to address people's beliefs, values and behaviours. A cultural transformation, personally led by the CEO, sat at the heart of an effort to turn around the business. This involved a reset of the leadership team, one on one coaching, many motivational and difficult conversations, including weeding out those who were not willing to change.
The cultural transformation produced a turn around in the business performance.
More often than not, leaders cannot sense the slow change that has been taking place in their organisations over time. These changes are happening at the internal level, inside each individual first and then collectively, where they share the same beliefs and assumptions which shape their collective behaviour.
A leading manufacturer of pharmaceutical products recently told me that when they contract manufacture for large Global MNCs, their people make no mistakes, but when they make the products for themselves to be sold in their own markets, there are so many quality defects and product returns that profitability is affected.
An organisation is nothing but a collection of people. Strategies don't mean anything if the people do not implement them. That is why Mr Herb Kelleher, former CEO of South West Airlines, always used to say "the business of business is people". If people are not committed, not motivated and do not take ownership of their roles and so their business, the organisation is doomed to fail. This is not news, yet when you treat your people as if they were secondary to processes and do not matter in the larger scheme of things, you get a dysfunctional workforce that are victims of their own negative narratives which kill their self-belief and self-esteem.
What they need is the trust of the leadership, the autonomy to do the things they need which will give them a sense of pride and achievement to see how they play a role in the success of the organisation.
This can only be done if the leaders have instilled a strong sense of purpose in the organisation. People come to work to express themselves, not to impress others. They need to feel a strong emotional connection with what they are doing and how it contributes to the well-being of others.
It is never just about the money. They need to be inspired to perform. Telling them that they will be forgiven and will not be punished if they admit their mistakes is hardly the way to inspire and motivate.
There are leaders and there are those who lead. Most leaders do it with power and through exercising their authority. We follow those who lead not because we have to but because we want to, because the leader inspires us. We don't do it for the leader, but we do it for ourselves.
So leaders need to give their people a very strong reason as to why their organisation exists. The key question to ask is: Are we living our purpose, are we feeling good about why we are doing what we are doing?
If a leader has sensed the change and is ready to deal with the adaptive challenge, the first thing she or he needs to do is to change the language in the organisation. If she wants to create a new way of being for the organisation, she needs to create a new way of being for the people so they develop a new way of doing things.
The culture will only change with new beliefs, new values, new behaviours which need to be fuelled by new conversations. Conversations perhaps not had before. This requires a new way of thinking, a new way of engaging, opening minds to new perspectives, and listening to learn.
• Pratap Nambiar is the Executive Chairman of Thought Perfect, a Singapore-based organisation that provides business performance coaching and leadership transformation for CEOs.