00:00:04 Dan:
Most of us are familiar with the statistic that 70% of change initiatives in organisations fail.
00:00:10 Dan:
In fact, our last episode was about a new number that said it was 88%.
00:00:15 Dan:
Not many of us would see that number and have the curiosity to go out and find out why they fail and what we can do about it.
00:00:21 Dan:
Well, our guest today is a little bit different.
00:00:24 Dan:
Michael Lopez is an author and a consultant in change, hugely experienced, but he did go out
00:00:30 Dan:
and do that research.
00:00:31 Dan:
What he has to share with us really sheds light on exactly what's going on in organisations now that actually lead to their failure, but points really specifically to some new leadership habits that we need to have in these times of tumultuous change where we can actually make things happen in our organisation despite the numbers.
00:00:52 Dan:
Hello and welcome back to We Not Me, the podcast where we explore how humans connect to get stuff done together.
00:00:58 Dan:
I'm Dan Hammond.
00:00:59 Pia:
And I am Pia Lee.
00:01:01 Dan:
And in the studio today, we have a one-person panel who is Michael Lopez.
00:01:06 Dan:
Welcome, Michael.
00:01:07 Michael:
Thank you for having me.
00:01:08 Michael:
It's great to be here.
00:01:09 Dan:
Absolute pleasure.
00:01:10 Pia:
Have you been a one-person panel before?
00:01:12 Pia:
That's quite an intro, isn't it?
00:01:14 Michael:
I would guess yes, but I've never been introduced that way.
00:01:17 Michael:
So now it's my new standard introduction everywhere I go.
00:01:20 Pia:
Welcome.
00:01:21 Dan:
We're going to be asking you to take
00:01:23 Dan:
So Michael, welcome again to the show.
00:01:26 Dan:
Tell us a little bit about you.
00:01:27 Dan:
I think this is a perfect timing because I think you've written exactly the book that we want to hear about.
00:01:32 Dan:
I appreciate that.
00:01:33 Michael:
I'm A consultant by profession and have been in and around the world of consulting and change and transformation for the better part of the last two decades.
00:01:43 Michael:
Really, I'd say the last five years on a crusade to change the world of change.
00:01:48 Michael:
I have been watching and experiencing and delivering what
00:01:53 Michael:
I would call the traditional organisational change management playbook for quite a while.
00:01:58 Michael:
And while that world, myself included, is full of hardworking, well-intentioned, good people that are trying to make a difference for their clients, for their teams, for their companies, for their organisations, I have seen the results of that work.
00:02:13 Michael:
We've quoted a number of stats from 70 to 80% of all transformations fail.
00:02:17 Michael:
And I felt like we needed to have a different conversation.
00:02:20 Michael:
And so that's the work that I do.
00:02:23 Michael:
I've been working shoulder to shoulder with big companies very, very closely in their own transformation journeys and have written a book about change and released a big study about change.
00:02:32 Michael:
And that'll lead to the next book that I'll write about change here coming up in 2027.
00:02:36 Dan:
Wonderful, wonderful.
00:02:37 Dan:
Michael, before we dive into the enterprise version of change, tell me about the change that happened in your life.
00:02:43 Dan:
months ago that I feel listeners need to hear about.
00:02:46 Michael:
It was exactly 11 months ago when our twins were born and it is a wonderful, wonderful experience.
00:02:53 Michael:
And I will say to this, I'm 53 years old, I have 11 month old twins, so I'll let everybody just do the math on that really quick.
00:03:01 Dan:
A late bloomer?
00:03:02 Michael:
It was an early bloomer and a late bloomer, so I've got quite a big range.
00:03:06 Michael:
But I will say I've done a lot of hard things in my life and having twins is without question the hardest thing I've ever done and the most rewarding.
00:03:12 Michael:
So
00:03:13 Michael:
We're just getting to the good part.
00:03:15 Michael:
It's all been the good part, but the part that starts to get a little bit smoother.
00:03:19 Michael:
So yeah, it's a fun fact for sure.
00:03:21 Dan:
Wonderful.
00:03:22 Dan:
Congratulations.
00:03:23 Michael:
Yeah, amazing.
00:03:24 Michael:
Thank you so much.
00:03:25 Dan:
So Michael, start us off.
00:03:26 Dan:
You mentioned that stat of the 70 to 80%.
00:03:29 Dan:
In our last episode, we actually found this Forbes article that talks about 80% now.
00:03:35 Dan:
So these numbers are going up, aren't they?
00:03:36 Dan:
Who knows what they are?
00:03:37 Dan:
But tell us about the number, first of all, that sparked this desire to write about change.
00:03:42 Michael:
The 70% number
00:03:43 Michael:
is a pretty famous number that was published by McKinsey, I think maybe eight years ago or so on a study of change and transformation.
00:03:51 Michael:
It was a study done by executives mostly.
00:03:54 Michael:
So they were asking senior executives in companies what was their success rate.
00:03:59 Michael:
And there was a couple of different angles to that.
00:04:01 Michael:
But that has become, I think, the standard quoted statistic.
00:04:04 Michael:
And of course, to your point, it could be higher, it could be a little bit lower.
00:04:07 Michael:
I think the takeaway irrespective of the specific number is that most change efforts or transformation
00:04:13 Michael:
efforts fail to live up to the expectations of the people that are delivering them.
00:04:18 Michael:
And there's all sorts of reasons for that.
00:04:20 Michael:
And so what I tried to do differently in the study that I've just released is while that number was quoted largely by executives, we went and asked 1000 workers across the US here primarily, what do you need when it comes to change and what do you get?
00:04:33 Michael:
And the results were pretty stark.
00:04:36 Michael:
I knew there would be some key features in that study that would be shocking to some, but we asked a very simple question to start the study.
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What are the top five things that you get from your company when you go through change?
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And what are the top five things that you actually need?
00:04:50 Michael:
And it should be shocking to maybe no one that there was 0 overlap between those two lists.
00:04:55 Michael:
And so that really kicked off, I think, what's been a really interesting investigation of the human experience of change inside of big companies.
00:05:03 Pia:
There are two really simple questions.
00:05:05 Pia:
How did you design those questions?
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Because the questions you ask is what you get.
00:05:10 Michael:
Sure.
00:05:11 Michael:
We actually have 10 questions in the study itself.
00:05:13 Michael:
that are really end up being more like 40 because we sliced them a million different ways to Sunday.
00:05:19 Michael:
But we were really trying to understand at a top level, again, what is the traditional playbook that you receive as an employee or a leader when it comes to change?
00:05:29 Michael:
And what is the industry giving to you?
00:05:30 Michael:
Not just my profession, but companies that have organic teams and what does that look like?
00:05:35 Michael:
And it's all the stuff that you would expect.
00:05:36 Michael:
It's e-mail, it's communications, it's a little bit of training.
00:05:40 Michael:
those kinds of things, which by the way, are important and you need those things.
00:05:43 Michael:
But what we were trying to really get at was what is the more experiential side of this equation that you need?
00:05:48 Michael:
And that top five list was all about experimentation.
00:05:52 Michael:
It was about the ability to make mistakes productively, to get feedback and coaching through an iterative process of learning.
00:05:58 Michael:
It was about watching your leaders go first and really embracing the change themselves.
00:06:02 Michael:
It was about their environment and not just tools, but the workplace and how teams are structured.
00:06:07 Michael:
So as I like to say, the first list and what
00:06:10 Michael:
we tend to get from change is all the stuff that's done to people.
00:06:13 Michael:
And what employees really said is we need all the stuff that's done by people.
00:06:17 Michael:
And so we have a number of other questions in there about leadership, about generational dimensions, about what makes it hard, what you get from the traditional OCM vendor.
00:06:26 Michael:
So it's a pretty in-depth study.
00:06:28 Michael:
The full version is about 50 pages.
00:06:30 Michael:
So it's a pretty serious document.
00:06:32 Pia:
That's such an extraordinary piece of research.
00:06:35 Pia:
It is just a really simple set of questions, even though they're probably much more complex
00:06:40 Pia:
You've constructed them.
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But what you get and what you need are often two completely different things, and we're not setting people up.
00:06:48 Pia:
What was the biggest surprise for you?
00:06:50 Pia:
Well, I think the.
00:06:51 Michael:
First one we just talked about, which is the zero overlap finding, I thought there would be a gap.
00:06:56 Michael:
I didn't expect it to be that big.
00:06:58 Michael:
That was really a matter of degree that I was really surprised by.
00:07:02 Michael:
The other big finding is we did ask some questions about the industry and the patterns of behavior and how change management
00:07:10 Michael:
is sold and pitched and consumed by companies and what that means for vendors.
00:07:16 Michael:
And it's one of the big themes.
00:07:17 Michael:
There's 5 big themes from the study.
00:07:19 Michael:
And we call it the failure minimization cycle, which is part of the crusade I've been on is we've been selling the easy button of change for quite a long time.
00:07:28 Michael:
It's the kind of professional version of this won't hurt a bit, just follow 4 easy steps.
00:07:32 Michael:
But we know that that's not true.
00:07:34 Michael:
And so there's a cycle of minimizing complexity and difficulty in order to sell the project in whatever
00:07:40 Michael:
that looks like in order to get a budget approved, in order to get a vendor on board.
00:07:45 Michael:
I tell a story in my first book about being a part of this, of actually minimizing, hey, this is not going to be tough.
00:07:50 Michael:
Of course, what that does is it gets everything approved, but it minimizes the resources that are actually being given to employees, which now you have two problems.
00:07:59 Michael:
I have a set of expectations that have been artificially muted.
00:08:03 Michael:
When it is hard, it seems even harder.
00:08:06 Michael:
I don't have the resources I need to work through that complexity.
00:08:09 Michael:
And what that leads to is a huge, not just flywheel of this hurricane going around and around and the next project gets harder and harder, a huge lack of trust in organisations from employees that think, I don't believe what you're telling me about how hard this is going to be.
00:08:24 Michael:
I'm going to either resist or opt out or just passively resist.
00:08:27 Michael:
And so I was really shocked at how pervasive that problem was.
00:08:31 Dan:
Michael, have you seen those promises, the minimization piece?
00:08:35 Dan:
done by consultants or internal change agents.
00:08:39 Dan:
Where does that come from?
00:08:41 Michael:
It's A systemic issue that I would like to say.
00:08:44 Michael:
By the way, I don't want to suggest that this is some nefarious conspiracy that is being driven by people trying to make a buck.
00:08:51 Michael:
I don't mean that at all.
00:08:53 Michael:
What I mean, it's a well-intentioned, hopeful optimism that says, hey, we've done this before.
00:08:58 Michael:
We want to make sure you feel confident.
00:09:00 Michael:
We want the ROI numbers to look good.
00:09:02 Michael:
It comes from places where I think people generally have good intentions
00:09:06 Michael:
I've certainly been in places where people don't and I don't want to call them out.
00:09:09 Michael:
But it's really both sides of the coin.
00:09:10 Michael:
It's that clients and companies want to get the best price.
00:09:14 Michael:
And of course they should.
00:09:15 Michael:
They want to minimize the money they're spending and that's perfectly reasonable.
00:09:18 Michael:
It's that vendors want to pitch the best solution and be responsive to that price.
00:09:23 Michael:
It's that they want to seem low risk, which is certainly important.
00:09:26 Michael:
And maybe just to give you an example is I've done a lot of ERP implementations in my time and not one of those things has ever gone according to plan.
00:09:34 Michael:
And it's not because people are
00:09:35 Michael:
It's just, it's really complex.
00:09:37 Michael:
And yet I've been a part of proposals where people have said, here's our 36 month plan that's going to go exactly as scheduled.
00:09:44 Michael:
And I'm just like, that's never happened.
00:09:46 Michael:
So let's be honest about that.
00:09:48 Michael:
And I started about five years ago, started to really say the quiet part out loud.
00:09:52 Michael:
And it's really with the intention of provoking a conversation amongst ourselves to be honest about what it really takes.
00:09:59 Michael:
And if we can do that, then we can start to shape a better solution.
00:10:02 Pia:
And I think the other bit, and we talked about this on the previous episode, is that transformation and change sometimes have different perceptions and they're clumped together with things like restructures and job losses and reshaping.
00:10:18 Pia:
There's a fair amount of often pain that is experienced at the time of change, and that tinges people's beliefs.
00:10:28 Pia:
I think they feel a degree of cynicism.
00:10:30 Pia:
The organisation that they thought was going to support them and back them and grow them actually
00:10:36 Pia:
there probably more for the shareholder return than anything else.
00:10:40 Pia:
And so they feel very small in that.
00:10:42 Pia:
Do you see that in the work that you do?
00:10:44 Pia:
And how do you help people get their mindset right at the beginning in order to be able to really sort of progress along this journey with the best intent?
00:10:53 Michael:
There's a lot there and it's a multi-dimensional problem.
00:10:56 Michael:
The first thing to understand is that the only person you can change is yourself.
00:11:01 Michael:
And it's important to understand that because I think a lot of times as people, not just in organisations,
00:11:07 Michael:
but as people, we are impacted upon in all sorts of ways by external events, by other people.
00:11:13 Michael:
And we often look to those other sources as not just the source of our discomfort, but also the source of the solution.
00:11:20 Michael:
And so my first book, Change, is really about
00:11:24 Michael:
What's happening to us at the microscopic level when we try to do anything different, whether you're trying to learn to play the piano, learn a new language, lose weight, be a better spouse, whatever you're trying to do in making a shift in your life, there is a real biologic process that happens there.
00:11:38 Michael:
And when you show up to work, those processes still exist.
00:11:41 Michael:
And so I've been a big proponent of helping companies and leaders understand you are made-up of human beings.
00:11:47 Michael:
And those human beings have certain experiences and patterns that go on.
00:11:51 Michael:
And so first and foremost, the only person you can change is you.
00:11:54 Michael:
The second one is you are made-up of people and each of those people are both very similar and very different in terms of the ways that they respond to things.
00:12:02 Michael:
I think when it comes to leadership, the other thing I say back to the only person you can change is yourself is I think leaders need to start changing how they talk about change.
00:12:10 Michael:
There's a lot of incentives for us, again, to minimize the complexity, to increase the certainty of the future.
00:12:16 Michael:
If there's anything we're learning about the moment we're in right now is that those predictions are largely wrong and if I can change the expectation
00:12:24 Michael:
of what I talk about, then it comes to the next recommendation I make, which is you've got to build a stress-tolerant culture.
00:12:30 Michael:
And a lot of times we tell employees that everything will be fine.
00:12:33 Michael:
We know the future.
00:12:34 Michael:
We know the answer.
00:12:35 Michael:
But I like to tell people and companies that the best thing you can do, to your point about pain, Pia, is let's choose our pain of doing the hard thing and learning how to build a company that doesn't overreact, that doesn't embrace skepticism, that has employees that are optimistic but understand it's still going to be difficult, that have teams that work
00:12:54 Michael:
together through uncertainty, that have leaders that can embrace complexity and pass that on to their employees, right?
00:13:00 Michael:
Those are all features of organisations that can withstand change, not just once, but over and over and over again.
00:13:07 Michael:
And so if you're thinking about change as a project, yeah, okay, I guess we could do that.
00:13:11 Michael:
But I like to talk to companies about thinking about change as a capability.
00:13:15 Michael:
And if I can get good at that, then the next thing is just the next opportunity to display that capability.
00:13:21 Dan:
Without wishing to be a doomonger,
00:13:24 Dan:
One of the things we've observed is that, yeah, I think it's a really interesting point.
00:13:27 Dan:
This is how you have to lead through change.
00:13:30 Dan:
You have to shape your leadership in this way.
00:13:32 Dan:
You have to change as a leader and create this culture of resilience.
00:13:36 Dan:
That's really interesting and fascinating for us.
00:13:39 Dan:
What we've observed in a lot of organisations now is leadership itself is a side dish.
00:13:44 Dan:
It's very much the thing I'll do when I've got time.
00:13:47 Dan:
I'm going to focus on my tasks.
00:13:48 Dan:
Have you seen that?
00:13:50 Dan:
Because that's obviously a sort of real foundational challenge that we've seen is that
00:13:54 Dan:
even lead issue itself is not something that people are dying to learn and take to the next level.
00:13:59 Michael:
Yes, and I think it speaks to the findings of the study and my work more directly, which is most change in companies, and I say most because it's not all,
00:14:09 Michael:
Most change strategies are designed around what I call the hardware of the organisation, the operational piece, the systems, the products, the projects, the technology, whatever it is that was the trigger for why I'm changing.
00:14:21 Michael:
But the truth is, and AI is a great example of this.
00:14:24 Michael:
It's a perfect example of this.
00:14:26 Michael:
What have most companies done in this last wave?
00:14:28 Michael:
Maybe they have Copilot, maybe they bought Claude or ChatGPT for work, they turned it on and they told everybody to go.
00:14:34 Michael:
Go find something innovative, go automate your job, go make us be cheaper.
00:14:39 Michael:
all of these things.
00:14:40 Michael:
And what we found is you can't just build it and people will automatically innovate or learn.
00:14:45 Michael:
Yes, do you want to have a sandbox from the plan?
00:14:48 Michael:
Of course, but it takes real human leadership to be able to sit with someone and first of all, go, all right, I'm asking you to automate something.
00:14:56 Michael:
I'm not going to lay you off.
00:14:57 Michael:
Or if I am, you know what, maybe we might, but I'm going to be honest about that.
00:15:00 Michael:
Here's our goals.
00:15:01 Michael:
We're trying to save $50 million, whatever, pick some number, whatever it is.
00:15:05 Michael:
And that's the piece that we've forgotten is that on the other end of this
00:15:09 Michael:
you're calling change is a real human being that has beliefs and biases and hopes and dreams and fears and regrets.
00:15:16 Michael:
And by the way, every other employee has a different set of those things.
00:15:20 Michael:
And we can't just peanut butter spread a set of training across everyone in that organisation and go, yep, they're good.
00:15:26 Michael:
It takes real shoulder to shoulder leadership.
00:15:29 Michael:
And the challenge with that is it's really, that's time consuming.
00:15:33 Michael:
It's difficult to measure.
00:15:34 Michael:
And a lot of companies just want to make the plan work.
00:15:39 Michael:
I just did a post about this on Monday.
00:15:41 Michael:
One of the big stats from our study, 65% of all employees felt like their company had a change plan that asked them to change faster than was realistic.
00:15:49 Michael:
Like, I can't catch up, right?
00:15:51 Michael:
The hardware you can put in place pretty quickly, but I'm going to need more time.
00:15:55 Michael:
And so that takes real leadership.
00:15:56 Dan:
It's making me think of an old colleague of Pier Charlie used to talk about the frog and the bicycle.
00:16:01 Dan:
And it's very much seen as a bicycle challenge, this isn't it?
00:16:04 Dan:
But there's a frog that's trying to ride the thing.
00:16:06 Dan:
Your research is so powerful in putting a finger on that.
00:16:09 Dan:
With an ERP, I've seen this myself back in my corporate days.
00:16:13 Dan:
We're going to switch to SAP.
00:16:15 Dan:
Great, fantastic move.
00:16:17 Dan:
And it sounds so simple, really.
00:16:18 Dan:
It's just another system, isn't it?
00:16:20 Dan:
Just put a system in place.
00:16:21 Dan:
But the humans?
00:16:24 Michael:
I have a story that opens my book.
00:16:26 Michael:
It was one of my light bulb moments.
00:16:28 Michael:
And I was in an SAP training.
00:16:30 Michael:
We were being given that as a company.
00:16:32 Michael:
And there was, I don't know, 50 or so people in the room.
00:16:37 Michael:
And we were going through a three, four hour session, running through scripts, et cetera.
00:16:41 Michael:
But what was actually happening?
00:16:42 Michael:
Half the room was doing e-mail.
00:16:44 Michael:
Some of the people were out taking calls.
00:16:46 Michael:
Some people never showed up.
00:16:47 Michael:
Some people sent their assistants.
00:16:49 Michael:
I don't want to have to learn this.
00:16:50 Michael:
And then we all get through it.
00:16:52 Michael:
And then the system didn't go live for another six months.
00:16:55 Michael:
And so it's like, we didn't really learn.
00:16:57 Michael:
Our go live date is when it's actually real, not in this moment.
00:17:01 Michael:
And so that's my whole point is that we've got to incorporate and really incorporate the experience
00:17:06 Michael:
of the human being.
00:17:07 Michael:
And so I'm not suggesting it's easy.
00:17:09 Michael:
It's certainly not fast.
00:17:11 Michael:
And I'll be the first one to tell you that.
00:17:13 Michael:
If you're trying to change your organisation in any significant way, you're up for an 18 to 24-month journey.
00:17:19 Michael:
And I just think people need to get used to that and be willing to make the long-term investment.
00:17:23 Pia:
What I've observed is that 18 to 24-month journey feels endless because at the end of it, there's another one.
00:17:32 Pia:
So there's that feeling and that adds the cynicism, the burnout as well, because this is quite exhausting.
00:17:37 Michael:
It is.
00:17:38 Michael:
And I'm honest about that.
00:17:39 Michael:
And I think it's important that we acknowledge that.
00:17:41 Michael:
But I would say again, that if we think about change as an ability, if we think about it as a muscle, then I increase my tolerance.
00:17:47 Michael:
It's not infinite, but it's at least more able to handle that.
00:17:51 Michael:
And if we can use AI in ways that actually reduce the transactional things that are soaking up my time, then I can actually make space for it.
00:18:00 Michael:
So there's real opportunity.
00:18:02 Dan:
Michael, have you met people along the way who are just great at this, who are inside organisations that when a change comes along, they just say, boys and girls, this is how it's going to be?
00:18:13 Dan:
Follow me.
00:18:15 Michael:
Of course.
00:18:16 Michael:
Again, I think a lot of people might be looking at me and saying, well, you're just poking people in the eye.
00:18:21 Michael:
And in the study, I have a bunch of recommendations in my book.
00:18:23 Michael:
I have a bunch of recommendations, things that I'm suggesting that we do.
00:18:27 Michael:
Of course, there are people who have a natural ability
00:18:30 Michael:
to lead through complexity and lead through uncertainty.
00:18:33 Michael:
It's definitely a rare thing I think these days when you just want to follow the established playbook and kind of let's make this easy and move on.
00:18:41 Michael:
But I think this moment that we're in is teaching people that it needs to be more commonplace than it is.
00:18:47 Michael:
I did a little article for Forbes Business Council about a month ago and I was talking about what this moment teaches us about how companies and people really change.
00:18:56 Michael:
And I think there's so much opportunity and so much possibility.
00:18:59 Michael:
My hope is
00:19:00 Michael:
to give people at least some deep thoughts to start provoking from within themselves the hard questions about, am I getting what I need from the established community and how could we do it better?
00:19:10 Pia:
And the other topic I wanted to raise with you, which is in some of the clients that we work with, is a resistance to change.
00:19:18 Pia:
and almost holding the system to ransom and holding it out, hoping that the system goes, reverts back rather than their having to adopt change.
00:19:29 Pia:
How do leaders work with those people and how do organisations steer themselves through that?
00:19:34 Michael:
It's such a complex, in fact, I saw a post from someone the other day about this and why does change resistance happen?
00:19:40 Michael:
And I think organisationally, there's a number of reasons.
00:19:43 Michael:
It could be the last effort was a failed attempt that didn't go well.
00:19:47 Michael:
And so
00:19:48 Michael:
I don't want to repeat that experience.
00:19:49 Michael:
It could be the fact that I can just wait it out and I know this is going to go away the flavor of the month.
00:19:55 Michael:
It could be that I've never been really convinced individually that it should matter to me.
00:20:00 Michael:
There's a lot of reasons why I think employees will be skeptical.
00:20:03 Michael:
I also think that the lack of honesty around how hard change is part of the reasons why people tend to passively resist.
00:20:10 Michael:
It's because they know that, again, either it's going to be overtaken by events or something else is going to come along or if I just wait long enough,
00:20:18 Michael:
I've had clients that I've worked with directly, quite honestly, that stopped in the middle of their journey because they felt like it wasn't working.
00:20:23 Michael:
Maybe we're not seeing progress fast enough.
00:20:25 Michael:
There's all sorts of reasons why.
00:20:27 Michael:
But I think it's also important to understand why we as people give up on our goals.
00:20:32 Michael:
There's a stat in the book that I share, very famous, something called Quitter's Day.
00:20:36 Michael:
And Quitter's Day is the day that most people give up on their New Year's resolutions.
00:20:42 Michael:
That's 3 weeks into the calendar year.
00:20:45 Michael:
And so part of that is understanding motivation, how motivation works, how do we deal with the messy middle of goal pursuit?
00:20:52 Michael:
How do we reframe goals so that they're naturally more motivating to begin with?
00:20:56 Michael:
The difference between an approach goal versus an avoidance goal, we can get into that.
00:20:59 Michael:
But that's where I think there's so much opportunity for us to get lower into, you know, there's a real person here that needs to have an attachment and a contribution to your goal.
00:21:09 Michael:
And if they don't have that, they're going to slowly
00:21:12 Michael:
slide away.
00:21:13 Michael:
And I'll be very critical here about, we've all heard about the What's In It For Me document that is very famous in the change world.
00:21:19 Michael:
I've never seen that document change a single person in my life.
00:21:22 Michael:
I've never seen it do anything.
00:21:23 Michael:
Now, it's not because they're not important things in there, but what we understand about the science of motivation is that when I feel a sense of contribution to the goal that I'm pursuing, not that I get a cookie at the end of it, not that I get some reward, but when I feel a sense that I have contributed my ideas and
00:21:42 Michael:
in the pursuit of something that we are collectively building, I am far more attached to that goal than if you hand it to me and say, if you get this done, I'll give you a bonus.
00:21:51 Michael:
Things like that are ways that we can think differently about how to craft our transformation strategies.
00:21:57 Dan:
Yeah, it's fascinating.
00:21:59 Pia:
How are you experiencing executive teams in leading these transformations?
00:22:03 Pia:
Sometimes it comes out of a transformation office, and so someone's designated that responsibility.
00:22:10 Pia:
But what we
00:22:12 Pia:
experience and see often of executive teams is they're not really teams at all.
00:22:17 Pia:
They're actually groups of individuals and they're often vying for their own function.
00:22:23 Pia:
And there might have been a big trade-off that had to happen as a result of that.
00:22:27 Pia:
For us, that's the source of where change begins and cascades.
00:22:32 Pia:
And if you don't get alignment and clarity of that goal, it's going to be much more difficult.
00:22:37 Pia:
Is that what you see?
00:22:39 Michael:
And in fact, in the recommendations in the study, I break them up into 3 categories, which is for leaders, CEOs, how do I change my experience with change individually?
00:22:48 Michael:
How do I prepare my team, which is the executive team?
00:22:51 Michael:
And then how do I give my employees the tools to be successful?
00:22:55 Michael:
And that middle layer is exactly what you've just described.
00:22:57 Michael:
And I think the leader of an organisation has three responsibilities.
00:23:01 Michael:
It's to set strategy, to build culture, and to prepare their second team to lead through the pursuit of that goal.
00:23:09 Michael:
So I think if you're not able as a leader to help your team, your VPs, your SVPs, your functional leaders to be not just conversant in change, but capable, I think it's going to be a tough road for you for sure.
00:23:22 Michael:
Because that 15 to 20 people, however many it is, depending on the size of your organisation, those are not just the ones that are going to carry the message.
00:23:29 Michael:
They're going to carry the resource commitment over that 18 to 24 months that you're going to need to actually change the human beings in your organisation.
00:23:37 Michael:
So you're absolutely right.
00:23:39 Michael:
If you don't get it right there, it's not going to go very far.
00:23:41 Michael:
In fact, I just had a client that they're one of the clients that said they sort of stopped halfway through.
00:23:45 Michael:
And part of it was they did not have a leader that was really committed to what we were working on.
00:23:50 Michael:
And they had some leadership changes.
00:23:51 Michael:
It was more of a committee.
00:23:53 Michael:
And I've seen the places where this has really worked is there is a passionate champion
00:23:58 Michael:
who understands the value of change and culture and is willing to make the long-term investment, which usually means I'm willing to fight the board or some other investors that are saying, hey, it's all about the bottom line or whatever it may be.
00:24:10 Michael:
So that individual has to absolutely be committed to the cause.
00:24:14 Michael:
But then they've got to get their second team, the rest of the C-suite or executives ready to lead through that experience.
00:24:20 Michael:
And so yeah, it's the 1st place to start.
00:24:23 Dan:
Something you mentioned there, Michael, sparked for me this question, which is around sort of
00:24:27 Dan:
polarity management, if you like, but it's specifically around through the change process, how do you balance that having a plan and having agility, sort of pushing on through pain and being able to pivot if it's not working?
00:24:40 Dan:
Because as you say, people do give up quite, sometimes they don't really give it enough chance, then just back off again.
00:24:46 Dan:
This may be an unfair question, but are there any sort of ways in which leaders can navigate those polarities?
00:24:53 Michael:
It's a great question.
00:24:53 Michael:
I think
00:24:54 Michael:
Maybe the simple answer, what we all are experiencing is maybe a return to the agile methodology of project planning and project execution.
00:25:02 Michael:
I do think there's a lot of wisdom in that experience.
00:25:05 Michael:
But I think there's a couple anchors to this process that aren't just about the sense and adjust process that every company should need.
00:25:12 Michael:
It's also about the stability of your values as an organisation.
00:25:16 Michael:
Because I think if you're not anchored in strong identity values, corporate values, who are we, what are we trying to achieve, and how enduring are
00:25:24 Michael:
those principles, then an agile process just becomes a process of reacting to everything that might be happening to you.
00:25:30 Michael:
So I think it's important to have that foundation as an organisation.
00:25:34 Michael:
I also think it's important to understand the way you measure progress in a plan is also not just about kind of wins and losses of maybe setbacks or base hits or doubles that you get in terms of product releases, whatever you're working on.
00:25:48 Michael:
But we talk about it in terms of what we call hard signals and soft signals.
00:25:51 Michael:
And every business has a set of hard signals
00:25:54 Michael:
both the outputs of what we're trying to do, it's revenue, it's profitability, it's all of those things that everybody cares about.
00:26:00 Michael:
But there's also what we call hard input signals, which are the actions we're taking differently in the pursuit of a different outcome.
00:26:07 Michael:
And maybe it's new leadership behaviors, maybe it's new team behaviors, but what are the things I'm practicing every day that I can see will eventually ladder up to different performance?
00:26:18 Michael:
And that's where I spend a lot of my time with companies is helping them understand the inputs to performance, not just
00:26:24 Michael:
The other thing we talk about a lot is these soft signals, which are the stories and the cultural indicators that change is happening.
00:26:32 Michael:
It's the conversations where you go, hey, I sat down with Dan and Pia and it just felt different today.
00:26:37 Michael:
We were talking about different stuff.
00:26:39 Michael:
Yeah, it was hard, but I could see they were showing up in a different way.
00:26:42 Michael:
Or I nominated somebody for an award because I saw them do something that was just a different display of behavior in a way that I thought was really inspiring.
00:26:50 Michael:
These human stories and stories are a big part of how we build culture.
00:26:54 Michael:
executive teams then are not just a silver bullet of ROI, but it's actually a portfolio of things that says change is happening.
00:27:02 Michael:
And so we might need to adjust the details of the plan, but the long-term goal remains the same.
00:27:08 Michael:
And so that takes nuance, it takes conversation, it takes insight, it takes complexity.
00:27:14 Michael:
It's not just here's my dashboard of red, yellow, and green.
00:27:16 Michael:
I must be doing a good or bad job.
00:27:18 Michael:
So that's the way we like to talk about this is you've got to get comfortable understanding the balance
00:27:24 Michael:
between the hardware of the organisation and the software of human beings that actually connect with one another on that journey.
00:27:30 Dan:
It strikes me if you took a 35,000 foot view of a company, an organisation that is changing well, you'd hear a lot of conversations, wouldn't you?
00:27:38 Dan:
Is that reasonable?
00:27:39 Michael:
You would hear a ton, and you do hear a ton.
00:27:42 Michael:
And I also think it's important, and I guess this is why I have a job, but it's also important to put that journey in perspective.
00:27:49 Michael:
And I think I've failed on a couple times with clients of giving them a better sense of the roadmap,
00:27:54 Michael:
But here's the phase of the experience that you're in, and this is what this phase looks like.
00:28:00 Michael:
There's a couple steps forward, a step back, there's new information or whatever it may be.
00:28:04 Michael:
Those things help people anchor themselves because we are a linear species.
00:28:09 Michael:
We do think about time in a single dimension, which is going forward.
00:28:12 Michael:
And so I think giving people a sense of where am I in space and time to the best of my ability and what should I be looking for next
00:28:21 Michael:
is a great way to help people not get overreacting to sometimes the ambiguity of the moment, which feels like, is something really happening?
00:28:30 Michael:
I can't tell.
00:28:31 Michael:
There's ways to tell, but you've got to go get that data.
00:28:33 Michael:
You've got to do the work to go ferret that out.
00:28:36 Pia:
That brings up an interesting concept of instantaneous gratification, which we're actually wooed into a world of that at the moment.
00:28:45 Pia:
And we expect that we put in X and immediately you get Y, but I think the three of us know that behavior
00:28:51 Pia:
change is the hardest part to create and does, as you say, take a longer period of time.
00:28:57 Pia:
Are many organisations willing to put in that commitment for that period of time?
00:29:02 Pia:
And are you seeing that change or shift in any direction?
00:29:05 Michael:
It's hard to say yes or no because so many organisations are different and I haven't been in all of them, so that would be unfair.
00:29:10 Michael:
I think there's a better appreciation
00:29:13 Michael:
in our industry and in the world of change for behavior and the role that plays.
00:29:17 Michael:
So I think first and foremost, yes, there is an appreciation and there's a lot more neuroscience now that's creeping into this world of change in terms of understanding the brain and how it works and how it operates.
00:29:28 Michael:
I think we can get even deeper and I've tried to do that in my book, but I think there is, yes, an appreciation that behavior matters, behavior changes more slowly, people change more slowly.
00:29:38 Michael:
But I do think the pressure of returns, I think the pressure of performance
00:29:42 Michael:
continues to be a tension that we will always experience in companies.
00:29:46 Michael:
Some leaders and teams are more willing to place that bet.
00:29:50 Michael:
Some of them have a shorter fuse for that.
00:29:52 Michael:
And I think to your point earlier, Pia, so much of that is understanding the personality of the leadership team.
00:29:58 Michael:
I will tell you that the clients that I work well with have a couple of attributes, and I've opted out of working with some clients based on just understanding the, if you're looking for the standard playbook and you want it quick and you don't want it to be super complex, I'm not your guy.
00:30:12 Michael:
And I would tell you, go somewhere else and have your experience, and I think that's great.
00:30:15 Michael:
The leaders that I've had better success with, they're naturally progressive in their mindset.
00:30:20 Michael:
They're people who are just naturally curious about new approaches, new ideas.
00:30:25 Michael:
They're open-minded.
00:30:26 Michael:
They're willing to accept a little bit of risk.
00:30:28 Michael:
I think the second thing is they've run the standard playbooks and they realize that that's not enough anymore and they are looking for something else.
00:30:36 Michael:
And then I think the last piece is they're less concerned with following a route or a rote prescription and they're willing to go on a journey where that journey is additive.
00:30:47 Michael:
I always tell people, I don't have a process, I have phases.
00:30:50 Michael:
It's like the development of a person.
00:30:52 Michael:
We go through a journey where it could take you two months, it could take you two weeks, it might take you four months
00:30:58 Michael:
depending on your workforce and how things are going, where you're at, I'm not going to tell you you're going to be done by X time.
00:31:04 Michael:
I'm going to tell you we're going to go on this first part of the journey and this is what that looks like.
00:31:08 Michael:
And when we're done, we're going to take the next step and then we're going to take the next step.
00:31:11 Michael:
So there's a pattern, but it's not a fixed journey.
00:31:14 Michael:
And so you have leaders that are willing to sort of step into the unknown a little bit and go on that journey together.
00:31:19 Michael:
And just to be fair, that's a lot to ask of companies who are like, hey, I've heard the same story for years.
00:31:26 Michael:
You want me to just jump into the deep end
00:31:28 Michael:
then I totally get that.
00:31:30 Dan:
It's a lot to ask in an environment where leaders are expected to have certainty.
00:31:35 Dan:
You go to your QBR or annual planning session and you say to your global CEO or whatever, well, I don't really know what's going to happen next year, but I'm curious and I'm exploring.
00:31:46 Dan:
I mean, that's probably your last meeting, isn't it?
00:31:49 Dan:
Well, maybe you'll find.
00:31:50 Dan:
I'm exaggerating, but it does take boldness, doesn't it?
00:31:53 Dan:
You've got to have that sort of a little bit more metal, but it does take boldness in a world where people mistake
00:31:58 Dan:
confidence for competence.
00:32:01 Michael:
We've gotten to a place, I think, at times where false precision feels really good, where we can say this is what's going to happen.
00:32:07 Michael:
And I believe that change is about accuracy more than about precision.
00:32:12 Michael:
And so I think you go on a journey with an intention to accomplish a set of goals.
00:32:16 Michael:
I think goals are great.
00:32:17 Michael:
There's all sorts of strategies for how to design goals that are more meaningful, more motivating.
00:32:22 Michael:
And then you learn along that journey and you've got to be willing to adjust.
00:32:26 Michael:
You've got to be willing to adapt.
00:32:27 Michael:
You've got to be even
00:32:29 Michael:
to consider the goal you thought you wanted isn't the goal that you actually need.
00:32:32 Michael:
And that's a whole separate conversation.
00:32:34 Michael:
And this is the point that I try to make to leaders is that think about anything you've tried to accomplish in your life and think about how hard that is.
00:32:42 Michael:
And then extrapolate that over 1,000, 2,000, 10,000 people.
00:32:47 Michael:
Why would you think that this would happen in months?
00:32:49 Michael:
It's just not reasonable.
00:32:51 Michael:
But if I can understand how people work, if I can understand how to pull levers that help my brain be more adaptable, that help me
00:32:58 Michael:
understand how to do hard things, and I can build leaders that are operating like that, and I can deploy them and empower them in an organisation that has a clear sense of where we're headed, you'll be amazed at what people come up with.
00:33:10 Michael:
They will truly unleash themselves in ways that you underestimated at the beginning of that journey, but you've got to be willing to enter that conversation differently.
00:33:19 Pia:
And I think that probably sort of circles round to the area that is where Dan and I spend all of our times inside teams.
00:33:27 Pia:
So the leaders,
00:33:28 Pia:
It's their job to translate that strategy and to make that meaningful and to set up the conditions.
00:33:35 Pia:
How are you observing leaders leading their teams and the way that teams are rallying around them?
00:33:41 Pia:
What's your observations of that at the moment?
00:33:44 Michael:
You know, one of the interesting things that comes up a lot in companies that I work with is decision making.
00:33:49 Michael:
All companies want to go faster.
00:33:51 Michael:
All companies want to be more nimble.
00:33:53 Michael:
A lot of companies want to be more distributed.
00:33:55 Michael:
And that requires that we are able as a population
00:33:58 Michael:
to make better decisions faster, closer to the point of wherever that decision needs to be made without as many escalations and hierarchy and all of that.
00:34:06 Michael:
And I think that's an example of a place where I think companies are challenging themselves to truly take a concept that is well understood by people about who makes decisions, decisions are part of the business, but change the way we go about it.
00:34:21 Michael:
It's not as simple as just saying, all right, now the manager core is going to go make this decision.
00:34:26 Michael:
They have to understand what does a good decision look like.
00:34:29 Michael:
They have to have practice at making that decision.
00:34:32 Michael:
They have to fail at it a couple times and know that if I fail at it, I'm not going to get fired.
00:34:36 Michael:
They have to have coaching along that journey, which means I have to spend time with them.
00:34:40 Michael:
It's not enough to just pass something on.
00:34:43 Michael:
You've got to do the groundwork of actually working shoulder to shoulder with your teams and sharing your experience, mentoring, guiding, challenging
00:34:51 Michael:
taking the gloves off and letting them steer the car for a while or whatever analogy you want to use.
00:34:56 Michael:
And I think leaders that are willing to go on this journey are starting to challenge many of the traditional playbooks for how their teams are led.
00:35:05 Michael:
And they're willing to be the first person to look in the mirror and challenge themselves to go, have I been too controlling?
00:35:10 Michael:
Have I been too command and control?
00:35:12 Michael:
Have I been too top down?
00:35:14 Michael:
Where do I have opportunities to grow myself?
00:35:16 Michael:
How do I really let go and let the ego take a step back and let others shine?
00:35:21 Michael:
stuff sounds great.
00:35:21 Michael:
To get a real human involved who's been promoted several times, who's leading a company because of their competence and their results, and now you're telling them to just, oh, just go be different.
00:35:30 Michael:
It's not that simple.
00:35:31 Michael:
And there's a journey that they have to go on.
00:35:32 Michael:
So I think particularly in the age of AI, if you want your companies to be nimble, to reinvent themselves, it's going to come because a group of people come together and help your organisation navigate the moment.
00:35:44 Michael:
It's not going to happen just because of one person.
00:35:46 Michael:
Perfect.
00:35:47 Dan:
Michael, where can people find you online, find your book,
00:35:51 Dan:
beyond our show notes, which we'll pack with goodies, where can people track you down?
00:35:55 Michael:
The best place is my website to start just because there's everything there, michaeljlopez.coach.
00:36:00 Michael:
You can find the book, you can find the study.
00:36:02 Michael:
There's a free version that you can download that's like an executive style version.
00:36:06 Michael:
There's a paid one that's the big one that got a lot more content in it.
00:36:09 Michael:
I'm very active on LinkedIn and Instagram are kind of the two big places that I spend most of the time.
00:36:13 Michael:
So I'm always posting about the study or writing about it.
00:36:16 Michael:
I have my own podcast that I do every week, which is a fun little side gig for me that I enjoy.
00:36:21 Michael:
So
00:36:21 Michael:
you can find there on my website.
00:36:23 Michael:
Wonderful.
00:36:23 Dan:
And we'll pack the show notes with it as well.
00:36:25 Dan:
Michael, thank you so much for being on the show today.
00:36:27 Dan:
Your research is so profound and your interpretation of it is so human.
00:36:33 Dan:
I would say that it's been really wonderful having you on the show.
00:36:36 Dan:
Thank you.
00:36:36 Dan:
I appreciate you having me on.
00:36:38 Michael:
Really timely.
00:36:39 Pia:
Very timely.
00:36:40 Dan:
Absolutely.
00:36:40 Dan:
That is it for this episode.
00:36:42 Dan:
Show notes, as we just mentioned, are at Squadify.net.
00:36:44 Dan:
This podcast is supported by Squadify, driving enterprise transformation through teams.
00:36:49 Dan:
It's goodbye from me.
00:36:51 Pia:
And it's goodbye from me.