The last three months has been an exhausting whirlwind of work with different client organizations going through profound change. During this time, I’ve had the privilege of working with more than a half dozen companies who are:
- Acquiring another company and integrating
- Being bought by another company and being forced to integrate
- Spinning off multiple business units
- Transforming themselves through a radical reorganization and shedding of assets
- Doing three of the four above at the same time
Current leadership literature, research, and of course the consultants will have you believe that organizations going through all of these transformations must engage in deep and complex Change Management processes to address the culture, people, structure, and the processes.
While all of this may be true and important, I have noticed and believe that organizations that lack strong foundational business acumen skills will not succeed well during the change process.
In most of the current change process methodologies, there are similar themes that take this common path:
- Acknowledge the reality of the situation
- Share the new vision
- Manage the expectations
- Unfreeze behaviors
- Make the changes and communicate, communicate, communicate
- Learn new behaviors and create a new culture
- Re-Freeze behaviors
This change process is usually extremely hard to execute and I suggest that it is impossible to execute without a foundation of business acumen skills. Think about each of the elements of the change process in terms of the step in the process and the business acumen skills needed:
Acknowledge the reality of the situation
One of the first steps in the change process is to acknowledge the reality of the situation. Too often, while the intentions are good, the acknowledgement is of the wrong reality because leaders don’t have the acumen to know the real business challenges and opportunities relative to strategy and performance.
Share the new vision
How can leaders share the new vision if they don’t have the business acumen skills to develop the best vision and value proposition to customers? Creating vision requires a deep understanding of strategic models, framework and best practices in addition to the financial metrics of measuring the right successes.
Manage the expectations
An expectation is a belief and perception of the future. If leaders don’t have the acumen to set the right goals and objectives, they will end up managing to the wrong expectations which creates more confusion and frustration. This will result in more dysfunctional behavior and push the organization and change process deeper into the valley of despair.
In classic change leadership process, one of the critical pivot points in the step is getting people to “unfreeze” their current behaviors to they can adapt and learn new ones. Many times the poor current behaviors are a result of not having the right business skills to make the right business decisions. When a dysfunctional organization without foundational acumen skills unfreezes bad behaviors, often times they can only adapt to even worse behaviors.
Make the changes and communicate
This one goes without saying; leaders need to have the best and right business acumen skills to choose the new paths, strategies, systems, and structures in order to make change happen and work. Without them, they will make the wrong moves.
Learn new behaviors and create a new culture
The new behaviors and new culture has to support a new business strategy and value proposition. Again, business acumen skills are critical for the entire organization to have in order to execute the overall change process.
The final part of the change process is re-freezing behaviors. That means not reverting back to the old behaviors or evolving them to even newer behaviors when the new ones don’t work. Strong business skills are crucial in terms of making sure the right new strategies have been chosen so there isn’t the temptation to keep fixing a broken system.
In summary, too many companies are spending millions of dollars to change and they don’t realize that they are missing a critical ingredient in the process, having foundational business acumen skills to guide and support each step of the process.