Previous experience may help us adapt to the future.
A study carried out by independent research organisation The Conference Board earlier this year among 444 chief executive officers (CEOs), presidents and chairmen from public and private companies, highlighted that excellence in execution was their biggest concern.
The top 5 challenges were as follows:
- Excellence in execution 42.3%
- Consistent execution of strategy by top management 39.9%
- Sustaining top line growth 38.8%
- Customer loyalty/retention 33.5%
- Speed flexibility, adaptability to change 29%
Examples of businesses struggling to respond to change include British Airways, Royal Mail, Toyota and Honda. For British Airways and the Royal Mail, the challenge is to persuade the workforce to accept fundamental changes in pay levels and working practices. For Toyota and Honda it was about improving product quality. The construction and infrastructure sector is now facing similar challenges, so what lessons can it draw from other sectors?
Reasons for resistance to change are not necessarily rational
Resistance to change is not necessarily based on rational or considered criteria. Any disconnects between the leader’s vision and his subordinates needs to be identified and fixed before change can be successful. It is vital that CEOs seek to truly understand the causes and nature of the resistance they face, even if their instinct is to instigate enforcement and settle for compliance. Change through enforcement is rarely sustainable and always sub-optimal because improvement is not continuous and employees feel excluded and brow beaten into submission.
The largest barrier to change is in people’s heads. John P Kotter, contends in his excellent article Leading change: Why Transformation Efforts Fail that business change or transformation is viewed by most companies as an event when in fact it is a process. This misunderstanding in our experience is then compounded by a lack of rigour and urgency in implementing change. Some of the most important factors ensuring success are the following:
- Ensuring that top management is involved and visible in managing the change. Do not abdicate management responsibility and involvement, the team will see this as a lack of commitment
- Doing a rigorous diagnosis resulting in a strong case for change
- Having clearly defined goals and metrics linked to reward and recognition for those responsible
- Having a strong results focus
- Ensuring the scope of the project encompasses and engages all the areas which will impact on the outcomes and results sought
- A comprehensive and consistent problem solving approach with training and sharing of the appropriate tools and techniques to achieve the results sought
- Critical mass involvement where ownership for success is shared with those whose activities and behaviours need to change
The construction sector has a bright future and if companies take this opportunity to improve productivity and quality of delivery, the future will be even brighter.
- Stuart Smith is managing director of Bourton Group