Tag Archives: strategic objectives

Change is THE strategic capability

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Making change a strategic capability

I have been working on a capability model for change recently and then preparing to teach a course on strategy as part of a management qualification. Putting the two together brings me to a conclusion that the one thing an organisation has to be able to do to survive is to be good at change. Michael Porter points out that operational excellence is necessary to have a profitable business but not sufficient. A strategy is necessary to fit the business into its competitive framework. However, having a strategy is no good if you can’t execute it effectively.

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Using a capability model for organisation change

Go and take the survey nowChange Capability Model

We have developed a simple capability model for organisation change. The purpose is to better understand the nature of organisation change and how people go about it.

The model allows us to explain what sort of training is useful given the organisation’s capability maturity (i.e. the level they are at). It also explains how to make better use of training to improve change capability. We have already asserted the need for organisations to increase their change capability as the outside world changes faster and faster.

Generally a capability model enables an organisation to benchmark itself (where are we now) against the model and then produce a plan to improve its capability (where do we want to be) which is realistic and reflects the real issues it faces now.

C4CM Capability Model

Our model follows the generic capability model and is aligned with the UK Government maturity model for Portfolios, Programmes and Projects (P3M3). Our levels are:

  • Level 1: essentially the organisation does not know how well it does change and does not realise it could improve — blissful ignorance!
  • Level 2: some staff are working hard to deliver good change; but against a tide of senior management indifference and organisational stupor — an age of heroes!
  • Level 3: the whole organisation is now doing change the same way with full senior management support; results are better but still patchy — getting there.
  • Level 4: the organisation is measuring performance, outcomes and benefits which leads to consistently better change — effective change at last.
  • Level 5: the organisation is applying its learning culture to improve its change processes into a strategically important capability — a winner.

As well as the levels of capability our model includes some specific aspects of change competence:

  • Leadership and governance
  • Processes and roles
  • Knowledge and skills
  • Managing change

We also look at the way the organisation uses four key skills in managing change (which are reflected in our training qualifications):

Assessment

We have devised a survey questionnaire to assess the level of an organisation. If you would like to use the survey tool on your organisation then please get in touch with us. It requires a number of people within the organisation to take the survey to get a useful picture.

We also have a simpler and quicker self test questionnaire to help you see where you as an individual might fit into the capability model. The model identifies individual behaviours at each level and obviously individuals will vary. Beware, you may find that the behaviours you can exhibit are limited by the capability of the organisation around you. For instance: it will be very difficult to be a level 4 individual in an organisation that does not measure change effects and does not have a performance management culture.

Rate of change increases

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If the rate of change on the outside exceeds the rate of change on the inside; the end is in sight.
Jack Welch

In a recent comment column in the Economist, Schumpeter notes that in 1980 (just 30 years ago) a company in the top fifth of its industry had a 10% chance of falling down to a lower tier within 5 years (the rate of change is 10% of companies drop out of the top fifth every five years); in 1998 this had risen to 25%. It is almost certainly higher now.

Of course, some of the change is newer companies succeeding in the competitive battle and moving into the top fifth; some of the change is companies losing the competitive battle and dropping down. I am interested in the implications for a business that has been going for a while. What should it be doing to survive and succeed. Or crudely put: avoid the Kodak, HMV, Blockbuster effect!

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Strategy and change

I strategy and changeteach a course on strategy in a local management centre so I am keen on the link between strategy, change and operational excellence. I have just read a review in the Economist of a new book on strategy by A. G. Lafley and Roger Martin in which they describe how they turned Proctor & Gamble around and delivered significant shareholder value. In the book they describe six common strategic errors and it occurred to me that these also described six failed approaches to change.

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