MM: Now you’ve gotten to the root cause of why most change initiatives fail: distrust and the lack of transparency in overall process that reinforces distrust.

TM: Yes. And that’s why someone who has this change-management, psychological understanding and can facilitate is an important vehicle. He was able to identify those fears.

MM: Yes! Innovation leaders recognize the legitimate, fact-based, reference experiences that individuals project into the future, and assume will come about with a certain amount of cynical realism.

TM: Absolutely. ‘Cynical,’ is a very good word to use.

MM: Where “cynicism,” is simply the belief that the past will repeat itself.

TM: What’s past is prologue.

MM: Right. So effective change-management and innovation leadership must not start with the end-to-end visual depiction of the current big mess, project and executive leadership must address the deep-seated beliefs, “I don’t trust our workflow” and “I’m sure that I trust others to tell the real truth about what’s really going on around here.” The innovation-leadership process then entails building new trust in the proposed system.

TM: Building trust and—as this person used to always say—eliminating fears: It’s kind of the same thing, but… Fear-based activity is rampant during these processes.

Seeds of Failure Sown in Executing Well

MM: This gets to another underlying issue that you’ve set up beautifully, here.

After a while, most successful businesses become what I call, “execution systems.” From the annual strategic plan, most firms at the senior levels have well-defined goals, roles and responsibilities; everyone then supposedly “executes against plan.” There’s nothing wrong with that: companies must find and keep customers. However, in a larger context, executing against plan results in everyone keeping their heads down and getting their particular jobs done. Only, there’s no mental space to innovation, little or no freedom to change things for the better.

You could say that change and the special class of change—innovation—becomes sand in the gears of execution; that fundamentally most companies have constituted themselves as “change-resistant execution systems.”

TM: Not on purpose, I don’t think.

MM: That’s right. Not on purpose. But everyone got so focused and busy trying to survive, grow sales, and maintain profitability—all excecutional mindsets—that baby that got tossed out with the bathwater. We traded growth and security for our ability to change and adapt—we traded away our ability to innovate as a matter of daily habit.

We’re at the point now where the world continues to change so rapidly—because technologies and innovations change fundamentally how we find and serve customers—we now must bring into our execution system a new set of muscles: innovation leadership muscles.

Today everyone in an execution system knows—for the most part—to whom they contribute information or results in the workflow. Most everyone knows what outputs they owe to whom, and who owes me. What qualifies as good inputs and outputs.

TM: Right.

MM: But in the context of change, there’s no accountability. There isn’t any role clarity around “who owes what, delivered how, by what criteria of satisfaction or quality.”

I say the lack of accountability in the change context surfaces as the root cause of change resistance. No one knows what to produce, for whom, in a change context.

That was what was so brilliant about your end-to-end visual depiction of the catalog development and publishing process.

You made it clear exactly who does what for whom in the current state. The map also supported fact-based discussions, “In the future, interim or automated ideal, “Who should owes what to whom?”

You got everyone to agree, “Yes. That would actually work for me.” That really defines the art of futureproofing: getting everyone to accept a new set of accountabilities rooted in the holist improvement of the business as well as the improvement of individual productivity. Brilliant!

TM: Yes.

MM: So part of addressing fear-based behavior was replacing it with optimistic, forward-looking, pictures and images and experiences—as grounded by this visual depiction of the interim workflow, as well as the optimized workflow.

TM: Yes.

MM: Your work validates one of the emerging principles of an innovation culture or an ingenuity culture: you must have in place a change-management process that you invoke whenever you need to accommodate an innovation.

TM: Yes. That would be an excellent model for any company.

MM: I believe that a lot of people consider innovation as a top-down thing. Yet, the real innovators with whom I have interviewed consider innovation as bottom-up activity, from the actual users – the stakeholders in the workflow. The reason? Because the actual users are the one’s closest to what actually has to get done, and, specifically, the nature and likely root causes of the pain.

TM: That’s absolutely true. However, upper management—even though it’s not their idea—must actively support an innovation or change for it to happen.

MM: However, most change processes run into trouble when it simply becomes a top-down mandate, as opposed to a bottom-up collaboration and discovery of, “What’s the best way of doing this one piece?” Effective change processes maintain the context of business priorities and individual needs.

TM: Absolutely.

Value Chain Analysis

MM: You also did something else at Hubert that I consider most extraordinary: you had developed this end-to-end visual depiction of the entire catalog development and publishing process—in part, what Michael Porter of Harvard Business School calls value chain analysis. In your telling me of this, you tied together several principles that others could apply in achieving similar results. Let’s start with, “Get it right upfront.”

TM: Yes. That was a theme that became our mantra.

It means making sure that you do things right the first time, and therefore you don’t have to worry about it later. That lives in several different areas. It can live as a whole—meaning if we hadn’t done the research and the white paper and all that stuff upfront, would we’ve been as successful.

But you can take it down to the minutia, too. That is, we identified during the current process that there was a maximum of 7 times where a price could be entered into the system. Now, that 7 times didn’t happen all the time—but it wasn’t unusual for a price to be entered at least 4 times into the system at some point.

MM: That means manual data entry of a pricing data 4 or 5 times against 50,000 SKUs?

TM: More than that. Yes.

So if you think about the opportunity for error there, and we’re talking about entering where it could be somebody writing it down on a sheet of paper. That’s “entry.” Right? Or putting it into a spreadsheet and not into a database. That’s entry. Putting it into one database and then another database. That’s two entries.

That’s what I’m talking about—how that is looked at. The idea was, “Let’s find the point where it should be entered—the right point—upfront. Let’s find out where it should be entered, who’s responsible for that entry, and—when you enter it—make sure you do it right.”

MM: Let me unpack it a little bit. First, you had this wonderful, messy, warts-and-all visual depiction of the entire end-to-end process—to which all the involved parties contributed. Then, you got everyone to physically signed off on the visual depiction. In effect, your got everyone to, “Yes. That’s my contract with reality.”

TM: Yes.

MM: Just in that process of getting them to put their signatures to the visual end-to-end process map, you dissolved all or most resistance to change.

TM: Right. When we came out of that, everybody in that room was eager for the next step. Not afraid.