biological agents can spread with terrifying speed, and where even in rich countries inequity and inequality raise serious questions about the viability of democracies, we need (and can create) a lot more change that astounds.
Experiences that have left people disappointed, pessimistic, or cynical will raise questions about that assertion. But there is sufficient evidence in the research, especially the success stories, to support optimism.
This evidence comes from cases where bold new strategies are not partially but wholly executed within accelerated time frames; where digital transformations do not disrupt business, cost a fortune, and take forever; where restructurings create great efficiencies without killing productivity, morale, or innovation; where remarkably fast and smooth M&A integration eliminates clashing mindsets and all the problems that creates; and perhaps most difficult of all, where real substantial cultural change propels firms into a much better future.
There is a line of thought, typically traced back to the great economist Joseph Schumpeter, that suggests that the problem of change has a better solution than the one we offer here. Schumpeter's solution is called “creative destruction.” For example, if government would stop protecting bigger and older enterprises and instead make it easier for entrepreneurs, the dinosaurs who can't adapt would die off and be replaced by innovative youngsters. We would not need to teach the slow-moving or out-of-touch companies to be agile. Instead, we would just let them go extinct when they can no longer keep up.
Of course, creative destruction does happen in our world today, just not in the pure form that some would advocate. The pure form is unrealistic because capital and product markets would struggle to adapt to this constant birth-death dynamic. And labor markets would do more than struggle. They would fail in their attempts to swiftly move massive numbers of unemployed into very different jobs, demanding very different skills, usually in very different parts of the country or the world. Unemployment above a certain point would not only create massive pain to individuals and families, but would undermine faith in capitalism and democracy—perhaps faith in any form of government or economic system.
The clock is ticking. The gap between what is needed and what most organizations are capable of continues to widen. Bringing an organization up from poor performance to the norm is useful and will potentially benefit many people. But going from an F or D grade to a B is not what the world needs. Good is no longer good enough. Even for large numbers of organizations, good still means wasted resources, results coming too slowly, wealth left unrealized, and ultimately people suffering. Rising up from the norm to enter the top 10%, but doing so over 20 years, is no answer, either. Too much is moving too fast for thinking in terms of two decades.
When it came to change, risk mitigation traditionally meant a bias toward caution. Increasingly, risk mitigation means getting on with it and not missing opportunities. In today's world, not adapting fast enough is the greatest risk. Yes, be deliberate and use results from the latest research as a guide. Employ insights from truly outstanding success stories. Learn from people who have been involved in those stories. But get after it.
Our goal in this book is to inspire you to embrace change and “get after it!”
And why not? The vast majority of the time, people who successfully help us deal better with change benefit greatly themselves. They not only do better in their careers but they feel better about life. They not only receive material rewards; they gain esteem. They not only survive; they truly thrive. And they leave legacies of which they are deeply proud.
The challenges that businesses—and even more broadly, humanity—face are not small. As the coronavirus pandemic demonstrated, it is no understatement to say that our ability to adapt and respond to these challenges is not only a question of creating prosperity but indeed one of survival.
So much more is needed—and, with a better understanding of some core components of human nature, of the limitations of the design of modern organizations, and of the leadership needed and possible in this era—as you will shortly see, so much more is possible.
Chapter 2 The Emerging Science of Change
The number of different beliefs about why people and organizations often struggle with more change is far from small. The same can be said about the number of possible solutions for how you might mobilize individuals or enterprises to adapt more swiftly and intelligently. The great number of possibilities can leave one confused or even with a sense that few useful generalizations can be made in this soft and convoluted realm.
In fact, we have reached a point where our very understanding of change is changing. There is today what might best be called an emerging science of change—especially the complex, transformational change that needs to happen more often, at faster speeds, and even under conditions of greater uncertainty. This new science tells us much about why people struggle with change, why a few succeed, what the latter do differently, and how we can use this knowledge in our own organizations.
As introduced in Chapter 1, this emerging science—with a set of concepts and principles and tactics—has three major root systems. One system involves the study of individuals: specifically, our “human nature” and resistance to or capacity for change. This study is based on research that goes back centuries but has recently been enhanced greatly with a trove of new material from brain science.
A second root involves the study of the modern organization, work that seriously took off in the 1930s and 1940s. Peter Drucker's The Concept of the Corporation was the most visible early example. Some very informative projects in this tradition have come in the past decade.
The third area is the actual study of modern organizations and the people in them trying to lead change, with commentary on outcomes and speculation about causality. Initial examples of this work can be found in the 1950s, but most of this information is much more recent. This increased work on internal change and leadership very much parallels the increase in the rate of contextual change around organizations.
Human Hardwiring: The Survive/Thrive System
Although we have talked about human nature for centuries, only recently have we been able to combine intense observational research with methods that are able to map the hardwiring of the brain and body. The implications of this research stream can be huge, as we will demonstrate in our discussion of strategy, digital transformation, restructuring, cultural change, M&A, scaled Agile, and broad social initiatives.
With our focus on prospering in a more rapidly changing and complex world, the most useful picture that emerges from this research is not the way that most people think about human nature. In particular, the vast majority of people tend to seriously underestimate the power of our built-in survival instinct and how it can inadvertently overwhelm our capacity to swiftly see opportunities, innovate, adapt, lead, and change for the better.
Humans have within them something we call the Survive Channel. It has the biological equivalent of a radar system that is constantly on the lookout for threats. At first, a very long time ago, these were probably mostly physical threats. Today, the same basic hardware is programmed by society and personal experiences to be alert to career, economic, psychological, and other perceived hazards to our well-being.
When our brain detects what is perceived to be a danger, a lightning-quick, subconscious sequence of actions occurs. First, our amygdala instantly sends a signal to our brain's “control center” (the hypothalamus). This signal activates the mechanism (our sympathetic nervous system) that is responsible for responding to potentially dangerous situations. Epinephrine (better known as adrenaline) flows through our bodies, increasing heart rate and
