Organisational Change and Your Second “Operating System”

One of the key indicators of (team) performance and change is exploration, i.e. how we communicate with one another. Since competitiveness often receives higher regard than cooperation this exploration typically does not come naturally.

In a recent article in the Strategic Management Journal this is illustrated in the selection stage of bottom-up strategy formulation.

1. The probability of an idea being approved for further consideration increases when the idea submitter belongs to the same subunit as the evaluator;
2. The bias of evaluators in favour of ideas from their own subunit increases with their tenure within those subunits;
3. The bias of evaluators in favour of ideas from their own subunits decreases with the size of their subunits; and
4. The bias of evaluators agains ideas from other subunits decreases with the status of those subunits.

We find that when we start measuring exploration in teams – do they learn from other teams – overall team performance goes up and the company as a whole benefits.  John Kotter talks about how your existing structures and processes form your organisation’s operating system. This operating system ensures your current – hopefully top – performance.

However, to make sure you are able to deal with change you need a second operating system which deals with the design and implementation of strategy. This is not a second hierarchical system but it should use an agile, network-like structure staffed by volunteers throughout the company.

Here are some principles for this second operating system:

• Many volunteer change agents (not just a few) from all over your organisation;
• A want-to and get-to (rather than a have-to) mindset;
• Head and Heart (not just head);
• Emphasis on leadership; and
• Two systems, one organisation.

Part of developing this second operating system is to develop a strategy mindset in your company. In our company-wide strategy workout – typically following an executive strategy workout – all people involved will:

• Understand and experience the value of in-depth strategic understanding in mixed table teams;
• Understand your company’s resource base and learn how to this is changing;
• Understand and experience how to understand the core business;
• Understand and experience the interaction between organizational structure, strategy, and behavior; and
• Understand how this new strategy understanding is going to change what you do and how you do it.