Friday, April 06, 2007

CEO: Change Encouragement Officer

Effective CEOs understand that in the same time incremental changes can be made organically, large-scale changes can be led. Incremental changes are ineffective, by the time they are completed, the market has already moved ahead.

Change is not an occasional effort necessary only when revenues slide or stockholders revolt.
Companies must reinvent themselves periodically to acheive the performance transformations to stay ahead of the second-raters. So who is responsible for this? The CEO is singularly critical to the effort, even more so than the executive team or the other managers who may sponsor the change effort?

While every company differs and every situation differs, the exact role of the CEO in each transformation is impacted the size, speed and nature of the change; the willingness of the organization to accept change; and the abilities of the CEO to encourage change.

Still, not every change effort is a complete crap shoot - experience - and research by no less than McKinsey - identify these critical functions for the CEO - Change Encouragement Officer:
  • Making the change meaningful for the individual AND the organization. People will eagerly support causes they can believe in, so the impact of the communicating the objectives of the change is depends on the CEO’s ability to make the transformation personal.
  • Act as if, that is, role-model desired mind-sets and behavior. Successful CEOs' actions encourage employees to support and practice the new types of behavior to bring about the change. Creating two sets of rules - one for executives and another for employees - not only undermines a change effort, but puts up obstacles to it. Strategy180 has viewed - from a distance fortunately - this very dynamic and can share it as a case study - contact us about it at inquiry@strategy180.com
  • Building a strong and committed top team. To leverage the influence of top executives, CEOs must make tough decisions about who has the ability and motivation to make the journey.
  • Get involved. There is no substitute for leaders rolling up their sleeves when significant financial and perceived value is in play.

Because everyone takes their cues from the top, the role of the CEO is unique. CEOs who are seen only as giving lip service to change will find everyone else doing the same.

Change isn't for every CEO. Only the best and the brightest can truly accept and execute these critical behaviors.