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Strategies for Building Change Leaders

Driving Organizational Change Through Executive Education

A White Paper Prepared by The Mahler Company

The Mahler Company and Research

 As part of our commitment to leadership in executive education, The Mahler Company conducts ongoing research in the fields of leadership development and change management. This research helps us to identify the skills and competencies that are critical to executive success today and to validate the effectiveness of our leadership development programs.

By sharing our research findings with current and potential clients, we hope to provide new tools and solutions to help them improve their performance and to cultivate long-term, productive client relationships.

About This White Paper

This White Paper is part of a series of planned reports on critical business issues. It is based on the latest research in leadership development and change management, on The Mahler Company's extensive experience in developing effective leaders, and on our work in helping organizations to implement critical change initiatives.

The objectives of this White Paper are to:

  • Examine the growing need for leaders who can drive large-scale change and successfully manage organizations in transition.
  • Outline current trends in leadership development and change management, in order to identify the most effective strategies for developing change leaders.
  • Provide an integrated model for building change leaders that promotes both individual and organizational change through multiple learning methods, including action learning.

Describe best practices for building change leaders from benchmark companies that are recognized for their leadership development practices.

Introduction:
Business Leaders as Change Agents

For executives in every industry, the ability to lead change has become a competency of paramount importance. In recent years, in fact, the concept of leadership has become almost synonymous with that of change management. Globalization, technological innovation, deregulation, and more intense competition have all made it necessary for business leaders to acquire new skills as change agents.

Most management experts now agree that change leadership is critical to corporate success in today's marketplace. And along with this new form of leadership come increased demands for executives to think more critically, to plan more strategically, and to work in more collaborative ways.

In their recent book Building Leaders, Jay Conger, director of the Leadership Institute at the University of Southern California, and Beth Benjamin argue that "there are strong indications that learning how to manage the speed, direction, and intensity of strategic and organizational change will be the key driver of corporate success in the years ahead. Moreover," they add, "this learning will be required not only of the organization's most senior leaders but of leaders throughout the corporate hierarchy."1

Unfortunately, not all business leaders possess this critical capability. Many, in fact, now find themselves confronting the need for radical change in their organizations without having had any previous experience in designing or leading a major change effort. Schooled in an era when business was less complex and more stable, they may lack the vision to initiate large-scale change, as well as the skills to motivate others to make the change succeed.

By helping to fill these leadership gaps, executive education can play a major role in building change leaders and in transforming organizations to become more profitable and more competitive. This is one reason why so many companies are paying attention to leadership development today and are investing in it more heavily than ever before.

But with this growing interest and concern comes increased confusion — about what development strategies work best to produce change leaders, how companies can build change leaders from within, and what external providers can do to help companies meet their growing change leadership needs.

Why Traditional Development Strategies
Don't Produce Change Leaders

 In a rapidly changing business environment, the traditional approaches that are used to educate and develop business leaders may no longer be sufficient. This is especially true when it comes to change leadership, because conventional development practices are largely ineffective in this area — and sometimes counterproductive.

Take mentoring and coaching, for example. Though widely used and well-respected in the corporate world, these on-the-job development practices typically use previous-generation leaders as role models. The result: Though they may expand a leader's repertoire of skills, mentoring and coaching often reinforce traditional leadership capabilities — instead of building new ones — and may equip leaders with skills that are largely out-of-date.

Job rotation, long considered the most effective strategy for developing business leaders, also has major drawbacks. While it's great for producing general managers, the very process of moving managers from one department or division to another tends to build an attachment to existing business practices and may actually undermine their development as change agents.

Similar limitations can be found with strategies that rely on off-the-shelf programs for executive education. Based on leadership competencies that worked well in the past, many still focus on business planning and organizational skills — helping leaders to "manage away" uncertainty —  while failing to develop a tolerance for uncertainty or helping leaders to excel at the roles that are critical for driving change, such as visionary, strategist, and communicator.

In their book Leadership by Design, management professors Albert Vicere and Robert Fulmer claim that many training programs, simply by focusing on competencies, are unable to prepare business leaders for the unprecedented challenges they face today. "By concentrating too heavily on specific competencies," these experts say, "organizations may find they have done a very effective job of developing yesterday's leaders for tomorrow's business environment."2

Components of a New Developmental Approach

From this growing emphasis on transformation and change has emerged a new perspective on leadership development, one that recognizes the different kinds of challenges that business leaders now face and uses executive education as a force to drive organizational change.

Sometimes called strategic leadership development, this approach seeks closer alignment between learning activities and strategic goals, and it focuses primarily on developing those leadership capabilities that are critical to an organization's change agenda. "No longer just a forum for teaching abstract concepts or functional skills," say Conger and Benjamin, "development programs are increasingly used as opportunities to recast the worldviews of executive teams and to align the organization to a new direction."3

Strategic leadership development differs from traditional approaches to executive education in several important ways:

  • It strives to build leadership capabilities while simultaneously facilitating progress toward key business goals.
  • It emphasizes not only the interpersonal capabilities of leadership, but the strategic dimensions as well.
  • It focuses on developing skills and capabilities that can be put to use immediately to bring about organizational change.
  • It works to achieve measurable results that can improve an organization's competitive position.
  • It promotes change leadership at all levels, because widespread involvement is necessary to drive large-scale organizational change.

To implement this approach successfully, companies may have to consider new types of development interventions, become better at articulating their strategic and development goals, and work more closely with providers who offer expertise in strategic leadership development.

To prepare for education initiatives that are based on this approach, companies should ask these questions:

  • What new business imperatives do we face?
     What changes have occurred in the marketplace that affect our strategy, operations, or skills? What must we do differently as an organization in order to compete more effectively and serve our customers better?
  • What are the objectives for development?
    What leadership skills and capabilities are needed to help us change and achieve our strategic goals? Which levels and functions will play the biggest roles and are the best candidates for development?
  • What providers should we partner with? 
    Which providers understand our needs and will best support our change efforts? Which providers have experience in change management and utilize those learning methods that have proved most effective in building change leaders?

Action Learning:
The Key to Building Change Leaders

The action learning method, in which leaders learn by doing, is often a key ingredient in strategic leadership development and is widely recognized as a powerful tool for building change leaders. Originated 30 years ago by British business thinker Reg Revans, action learning blends educational initiatives with guided practical experiments and feedback from facilitators, teammates, and other managers.

Action learning involves not just carrying out tasks, but testing assumptions and experimenting with new ideas. By allowing leaders to address and learn from real business challenges, it has proved to be an effective method for helping leaders to overcome risk-averse behaviors and gain the confidence they need to experiment and take chances. Action learning allows leaders to:

  • Apply theory and principles to work-related projects.
  • Test new approaches and business models on tangible problems.
  • Sharpen their analytical, problem-solving, and project-management skills.
  • Deepen their understanding of their company, how it operates, and it limitations.

When action learning projects are tied to "back home" situations, they provide valuable, on-the-job opportunities for leaders to practice new skills and understand what it takes to build commitment to change within their own culture. "Managers tend to be action oriented by nature," says leadership expert Morgan McCall in High Flyers, "so trial and error, more than reflection, is a critical learning strategy."4

Action learning is also an effective tool for linking learning to an organization's change agenda. Especially when it involves a major business issue that affects the future of an organization, action learning can help to jump-start the change process by building awareness of the need for change and by demonstrating its strategic benefits.

The Mahler Approach to Developing Change Leaders

Based on our work in helping organizations to implement critical change initiatives, we believe that the best approach for developing change leaders is one that combines the principles of strategic leadership development with the high-impact educational benefits of action learning methods.

We call this approach the Duality Concept because it integrates individual changewith organizational change and applies both cognitive and experiential learning methods to produce change leaders.

A unique approach developed by The Mahler Company, the Duality Concept is a powerful developmental tool that companies can use to evaluate the effectiveness of their educational programs for executives and to guide internal initiatives that are designed to build change leaders. By providing both methodology and hands-on practice, the Duality Concept also works to produce business results quickly — usually within 100 days — and gives leaders the tools they need to sustain momentum once the change process has begun.

How the Duality Concept Builds Change Leaders

  • Individual change. Leaders examine their convictions and past learnings about change, develop a personal approach to transformational leader-ship, and acquire the knowledge, tools, and skills they need to lead change effectively.
  • Cognitive learning.  Lectures, case studies, and simulations help leaders to understand the dynamics of change, show how other leaders approach it, and provide a conceptual framework to guide the evolution of change leaders.
  • Organizational change. Leaders learn how to diagnose their organiza-tion's readiness for change, build cross-functional teams that are com-mitted to change, integrate business unit and corporate change strategies, and cascade change initiatives across departments and levels.
  • Experiential learning. By working on real, strategic change initiatives, leaders learn to deal with uncertainty and ambiguity, identify what works and what doesn't work in managing change, and gain the hands-on experience they need to take risks and succeed as change agents.

A proven method for developing change leaders, the Duality Concept has been used by companies in a variety of industries to implement large-scale and strategic change initiatives and to orchestrate change at all organizational levels.

Mahler Case Study:
Fast Change at Bausch & Lomb

For decades, a worldwide leader in technological innovation for contact lenses, Bausch & Lomb is a global eyecare company. Founded in 1853, the company has experienced slow growth in recent years, largely due to increased competition and maturing markets.  Recently it was taken private by a private equity firm.

Several years ago, Mahler was engaged to conduct executive education.  This in turn led to several focused consulting assignments.  Recognizing the need for a new leadership model — one that emphasizes teamwork, cooperation, and the ability to take risks and lead change — the B&L Executive Team asked The Mahler Company to help them communicate the need for change throughout their organization and promote a new management style at all levels. Their primary goals were to:

  • Create a fast-learning organization that can adapt quickly to new market realities
  • Make leaders aware of their increased responsibility to set and drive a change agenda
  • Provide leaders with the tools and skills they need to succeed in the new culture
  • Drive change out beyond the home office to operations around the world

The first step taken by Mahler consultants was to conduct an organizational diagnosis to assess B&L's readiness for change and to identify obstacles to change. Carried out by a task force of eight executives, the diagnosis included in-depth interviews with employees at all levels and questions regarding their ability to cooperate cross-functionally, respond to customer needs, and incorporate learning into day-to-day operations. 

In a three-day follow-up meeting, the results of the diagnosis were reported to the Executive Team, which used the findings to identify significant gaps between strategy, organizational design, and leadership behavior and as a basis for planning continued changes at B&L.

To promote change on the individual level, The Mahler Company developed a customized program for B&L leaders to help them examine their behaviors and attitudes toward change and become more active in changing the way their culture functioned. To promote change on the organizational level, Mahler consultants implemented the Fast Change leadership process, in which leaders learn to initiate and drive change through high-impact change projects that can be completed in 100 days or less.

Facilitated through workshops, coaching, and the ongoing monitoring of change projects,  the Fast Change process gave B&L leaders both a conceptual framework for understanding transformation and how to lead change, as well as practical experience in using the tools and skills that are required for effective change leadership.

Mahler Case Study:
Taking Charge of Change at Cytec

 A major provider of specialty chemicals and materials, Cytec employs nearly 4,500 people in 36 countries. Committed to innovation in technology and excellence in manufacturing, this forward-thinking and truly global company has a long history of leadership development.

As part of an effort to prepare up-and-coming leaders for the business challenges of tomorrow, Cytec invited The Mahler Company to create a program that would focus on those leadership capabilities that are becoming increasingly important. Mahler responded with an intensive, week-long program for "high potentials" that would help them to acquire new skills and behaviors as they grow into their senior leadership roles.

Two important aspects of the program contributed to its effectiveness: the active participation of members of the Executive Team and action learning projects. Through classroom work and on-the-job initiatives, the program worked to enhance 13 capabilities that the Executive Team considered essential for future Cytec leaders. Among them: developing business strategy, communicating a vision and direction, building talent, and taking risks and leading change.

To enhance the change-leadership skills of participants, the program included both cognitive and experiential learning methods. After reading a case study on organizational change, for example, participants were encouraged to explore their personal convictions about change, compare the case to changes they've lived through, and place themselves in the role of CEO and "take charge" of the company studied. Through videotaped role plays, they also practiced articulating their change messages and learned how to tailor them to different audiences, such as employees, shareholders, and investors.

The action learning components of the program included 100-day projects that involved changes of strategic significance to Cytec. After working in teams to identify their projects and present their ideas to the Executive Team, participants were then responsible for implementing their change strategy. This process helped them to:

  • Develop their ability to lead change, plan and organize for results, and motivate others to perform.
  • Develop a personal approach to transformational leadership.
  • Understand what it takes to achieve maximum impact during a change effort and how to sustain momentum once the process has begun.

Best Practices for Building Change Leaders

How do benchmark companies develop change leaders? Our research shows that many of them recognize the importance of adopting a learning orientation for leaders and of linking learning experiences to back-home situations. Many also incorporate the following elements into their development strategies:

  • Strong support from the top
    In companies where leadership development is a high priority, senior management is not only supportive but personally involved. Example: When Michael H. Jordan became CEO of Westinghouse in 1993, he not only included leadership development as a critical component of his turnaround strategy, but personally conducted discussion sessions that were part of the development program.
  • A variety of development tools
    Top companies use a wide range of learning approaches to reach their development goals. Well-known for its commitment to all forms of leadership development, AT&T combines in-house educational programs for executives with coaching, 360-degree feedback, and a strong reliance on programs developed by outside experts.
  • Time-phased learning
    Research shows that new skills and behaviors are more likely to "sink in" when leaders are given time to reflect on and utilize what they've learned. When National Australia Bank launched a new executive development program in 1994, for example, the company decided to spread learning over an extended period, rather than use a continuous workshop format, to give leaders more time to practice their new skills back on the job.
  • Multiple feedback mechanisms
    The best companies recognize the importance of individualized feedback in developing leaders and provide them with valuable data from peers, subordinates, and bosses. When Johnson & Johnson was planning a leadership development initiative for 700 executives in 1992, the company went so far as to hire a professional psychologist to help leaders evaluate their 360-degree assessments.
  • Rigorous evaluation methods
    Companies that are strongly committed to learning, like Motorola, rigorously assess the effectiveness of the programs they invest in to determine how much change has resulted, what value can be assigned to those changes, and to what degree programs have helped them move closer to their strategic goals.

Endnotes

1 Building Leaders: How Successful Companies Develop the Next Generation, by Jay Conger and Beth Benjamin (San Francisco, Jossey-Bass Publishers, 1999), p. 145.

2 Leadership by Design: How Benchmark Companies Sustain Success Through Investment in Continuous Learning (Boston: Harvard Business School Press, 1998), p. 84.
 
3 Building Leaders, p. 149.

4 High Flyers: Developing the Next Generation of Leaders, by Morgan W. McCall, Jr. (Boston: Harvard Business School Press, 1998), p. 74.

About The Mahler Company

A worldwide leader in executive development and organizational change, The Mahler Company combines extensive management experience with leading-edge research to provide organizations with the methodology and support they need to implement critical change initiatives. Helping to build effective leaders for nearly 30 years, we offer external and in-house management development programs, as well as executive coaching and consulting services.

Our program Leading Change: The First 100 Days is designed specifically for executives in charge of organizations in transition.  Providing the knowledge, skills, and tools that leaders need to manage change effectively, Leading Change features a unique and innovative curriculum that combines sound leadership theory with real-time practice and experimentation and guidance from experienced faculty members with extensive business backgrounds.

For more information about The Mahler Company, our programs, or our consulting services, email us at info@mahlerco.com, call us at 201-797-4445, ext. 803 or visit our web site at www.mahlerco.com.

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