As Yogi Berra would say, “It was Deja vu all over again.” Five years earlier, we’d conducted introductory service/quality improvement workshops for senior management and head office staff of a large company. Culture and feedback surveys gathered input before and during these follow-up workshops. The company clearly had problems with low engagement, faltering customer service, rising costs from inefficient processes and quality problems, and low innovation.

We recommended a comprehensive culture change process. We showed how that could significantly boost the performance of the organization. The senior management team declined. They felt the time and money needed to plan, coordinate, train, and support such an extensive change process was too high. Instead, they initiated piecemeal programs of “smile training,” incentives, and rebranding.

They hired an expensive consulting firm to design and install millions of dollars’ worth of new technologies. This was based on a strategic plan that took months of senior management time, market studies, financial analysis, and more expensive consultants.

State of the Stagnation Address from a Learning-Impaired Leader

Now, here I was five years later, watching the CEO deliver a presentation to his company’s managers and head office support people. He outlined the company’s stalled results for the past few years and talked about the changes needed. He urged everyone to work together better. They had to get costs down. He said they all needed to work harder and smarter. Service and quality levels had to rise. Managers needed to take more leadership and empower people.

He was clearly operating on the assumption that if they knew better, they’d do better. He urged them to help change the culture to “full participation, full communication, and full disclosure.” He argued for “not thinking in traditional ways” and “finding innovative ways to get the job done.”

He implored them to “look for ways to add value through totally accurate shipments, timely delivery, quick turnarounds, a positive attitude, eliminating unnecessary paperwork and tasks, cooperative teamwork, improving efficiency, sharing ideas, reducing shrinkage, and initiating change.”

The CEO went on to outline “a suggestion program” (which was a form to fill out and send to him) and stressed the company’s open-door policy. He then suggested that managers should be “kind enough to have meetings with your staff” and have them fill out a suggestion form and send these to him. “Our senior team will take a hard look at it, and if there are any worthwhile suggestions, we’ll act on them very quickly.”

That was it. There was no leadership development, no systems alignment, no systematic approach to strategic process management, no improvements to their measurement and feedback systems, no education and communication, and no changes to the company’s reward and recognition systems and practices.

There was nothing but good intentions and exhortations to improve. His stunted learning showed his stunted leadership. He was trying to get different results while continuing to do the same things. It was like announcing a long trip to an exciting destination and then pulling up in a depleted old school bus.

Only 12% of Change Efforts Produce Lasting Change

Two Bain & Company partners just published a Harvard Business Review article, “Transformations That Work.” The article reports the findings of a survey of 300 large companies attempting transformational change. Bain found, “unfortunately, most transformation programs aren’t all that transformative…only 12% of major change programs produce lasting results.”

The research uncovered six critical practices found in successful transformations:

  1. Treating transformation as a continuous process.
  2. Building transformation into the company’s operating rhythm.
  3. Explicitly managing organizational energy.
  4. Using aspirations, not just targets, to stretch management thinking.
  5. Driving change from the middle out.
  6. Accessing substantial external capital from the start.

The authors conclude, “Transformation programs often promise breakthrough results, but most never realize them. The successful ones adopt an approach that fundamentally differs from the approach at other companies… successful transformations employ a transformative strategy — a must for companies aiming for enduring success in today’s ever-changing world.”

Change This: Transforming Us to Transform Them

An organization’s culture reflects the dynamics and behavior of its leadership team. Culture development is intertwined with leadership team development. Executive team effectiveness tightly interweaves with the organization’s culture in a reinforcing feedback loop like a Mobius strip. An organization’s culture ripples out from the team leading it. Mediocre or dysfunctional organizations are led by weak, mediocre, or dysfunctional teams.

In his book, The Age of Unreason, London Business School professor, Charles Handy writes, “If changing is, as I have argued, only another word for learning, the theories of learning will also be the theories of changing. Those who are always learning are those who can ride the waves of change and who see a changing world as full of opportunities rather than of damage. They are the ones most likely to be the survivors in a time of discontinuity. They are also the enthusiasts and the architects of new ways and forms and ideas. If you want to change, try learning one might say, or more precisely, if you want to be in control of your change, take learning more seriously.”

It Takes Learning Leaders to Transform Organizational Culture

The American founding father, author, and statesman, Benjamin Franklin, was highly devoted to lifelong learning. His book, The Art of Virtue (edited by George Rogers), is an inspiring account of Franklin’s life and an instructive guide to his continuous improvement habits. Franklin said, “If you empty your purse in your head, no one can take it away from you. An investment in knowledge always pays the best interest.”

The “Learning Leaders” survey of 326 Canadian CEOs by the University of Toronto found that “regardless of the size of the business or the industry in which it competes, organizations headed by learning leaders are far more likely to be achieving their operational goals than those that do not have that leadership…the higher the learning effectiveness of the senior team, the more likely that the firm is prospering…the CEO’s personal development is not personal. It is fundamental to sustaining and rejuvenating the health of the organization.”

In his Fortune article, “Leaders Learn to Heed the Voice Within,” Stratford Sherman writes, “Organizational change begins with leaders who walk the talk by transforming themselves.”