This is the last post in my series on the evolution of organizational paradigms. Sometimes the only thing required for a business initiative to succeed is an occasional adjustment in the way people operate within the organization. Other times, success requires dramatic, fundamental alterations not only in how people work but also in their view of the business itself, their customers, their roles, etc.—“paradigm shifts.” These change projects are the ultimate challenge and should be entered into cautiously. Yet, today’s competitive markets demand more leaps of this magnitude than ever before. This means an organization’s success requires senior executives who are highly skilled in creating their business’s operational paradigms. They must build and manage paradigms that help convert key business initiatives into competitive advantage. They also must know when and how to dismantle existing paradigms that have outlived their utility and create new ones more suited for the emerging demands.
As professional change facilitators, we have a key role in helping the leaders we serve understand and effectively apply the dynamics of paradigm management—the creation, leveraging, dismantling, and then re-creation of the paradigms needed for an organization to sustain success in turbulent markets/work environments.
There are eight key points of paradigm shifts.
In this series, we’ve been exploring the evolution of organizational paradigms. In my last post, I talked about the collapse/renewal phase, the place where either shift “happens” or it “hits the fan.” Here, I’ll pick up with an exploration of what is involved when orchestrating a new paradigm. It requires a four-part approach involving leadership, a learning environment, a new culture, and resilience.
Strong Leadership Is Imperative
Existing paradigms are typically not dissolved by consensus nor by insiders. Usually a single, determined individual or small group with the power to sanction dramatic change throughout an organization concludes that short-term “fixes” are no longer working. Such leaders perceive that the market environment has shifted and realize it is time for the organization’s core mindsets to be re-examined. They recognize the opportunity that is embedded within the crisis they are facing, decide that the timing is right to “seize the moment,” and insist that fundamental, rather than superficial, action be taken.
Strong leadership and a responsive hierarchy are required for this task, but they must be deployed in a way that avoids the counterproductive results of traditional authoritarianism. Focused passion, decisiveness, and tenacity from senior executives must be evident at all levels of the organization. However, this must be carried out in a manner that also promotes employee participation and empowerment.
It is possible but extremely difficult for incumbent leaders to recognize the need to dismantle paradigms they helped build. Myopia sets in and it’s hard to see that what once might have been a perfect solution has grown stale and unresponsive (if not counter-productive) to new demands. Moreover, even when they do try to shift their outlook, when pressured, they tend to revert to what has worked in the past. To make matters worse, others who have perceived incumbents in a certain way often are unable or unwilling to acknowledge their attempts to change. And if incumbents attempt modifications, people tend to disbelieve that they can sustain what they initiate.
What this means is incumbents face an uphill battle when pursuing paradigm shifts. As a result, most successful transformations are driven by new leadership. Those orchestrated by incumbents reflect radically new perspectives acquired under difficult circumstances.
For this reason, at the CEO, COO, or president level, the style of leadership described above, combined with a willingness to explore what has been previously unquestioned, is often imported from outside the organization.
The Environment Must Foster Learning
Renewal is not a point in time; it is a state of mind. It is not a project; it is a way of life. The ability to respond quickly to a crisis depends largely on the organization’s capacity to learn. This kind of learning is characterized by the willingness to question what has and what may still be working, the skill to develop new alternatives, and the capacity to transfer those ideas to action.
Organizational success results from learning applied to both short- and long-term corrective action. During the harvest phase, three levels of corrective actions (fixes) are available for an organization to address declines in the productivity and quality of its existing paradigm:
This level of corrective action is generally associated with continuous improvement efforts.
During the renewal phase, an additional level of corrective action is required for an organization to develop a new paradigm.
The development and application of any of these five levels of corrective action require a certain milieu referred to as a learning environment. Such an environment represents a workplace atmosphere that fosters innovation, accountability, responsibility, consequence, and humility instead of risk aversion, blaming, neglect, punishment, and arrogance. In a learning environment, five things take place:
The Culture Must Be Re-examined
Most efforts at applying innovative approaches to organizational crises are not successful. These initiatives typically fail because they lack the cultural support necessary for people to see their relevancy or sustainability. Organizational renewal demands a re-examination and, if necessary, a significant modification to the basic mindsets and behaviors serving as the infrastructure for the enterprise. Without this type of cultural context to reinforce the innovations emerging from a learning environment, important changes tend to be initiated but not sustained.
People and Teams Must Increase Resilience
The process of renewing an organization’s paradigm is typically accomplished within an external business environment already in a high state of flux. This produces a combination of internal and external turbulence that can generate a magnitude of change beyond what many people are prepared to face. When this happens, the dysfunctional symptoms people display are referred to as future shock. Not only does future shock lower morale, it also produces a short-term, superficial application of the intended changes.
Individuals, teams, and entire organizations that are able to minimize future shock and prosper during periods of high uncertainty are referred to as resilient. Highly resilient people regain their equilibrium faster and are more productive and healthy than people facing the same degree of challenge with less resilience. Resilient people share certain common characteristics. They tend to remain positive, focused, flexible, organized, and proactive toward a change, even when faced with extremely high levels of uncertainty. This kind of resilience can be fostered within an organization by focusing activities in four areas:
To recap, organizational renewal is dependent on four key points of focus:
Next: 8 Things to Remember When Shift Happens
The Uncertainty Phase—Time to Shift or…
So far in this series, we’ve explored the meaning of the term “paradigm shift,” and we’ve looked at the first two phases of an organizational paradigm evolution. Now it’s time for us to look at how the actual shift happens, to uncover why the existing paradigm begins to decay.
It’s upsetting to realize that a critical issue (current or anticipated problem or opportunity) cannot be adequately addressed by the existing paradigm and its multitude of fixes. Such a crisis is usually precipitated by a combination of two circumstances:
In Stephen Elop’s now-famous “burning platform” memo, the Nokia chairman outlines exactly what has put the organization in crisis: Apple’s powerful ecosystem, Android’s platform, MediaTek’s low-end price range, Chinese OEMs. Nokia has fallen behind, missed big trends, and lost time. They now find themselves years behind the competition. (More on Nokia in subsequent posts.)
The key thing to understand is that a crisis is not responsive to more fixes and, left unresolved, will result in a significant loss of productivity, quality, and safety.
The Decay Begins
When an organization’s response to a crisis results in the preservation of existing mindsets and behaviors, productivity, quality, and safety take a nosedive. It occurs when corrective measures, primarily directed toward methods, systems, and behaviors (fixes), are continued even though they have become ineffective. In a word, the situation stinks.
During decay, organizations spend increasing amounts of time and other resources:
This can go on for an extended amount of time. People in these organizations have succumbed to the pressure that exists within all successful companies to protect the present means of operation instead of staying focused on the company’s primary purpose. The outcome of all this is a lethal combination of unyielding methods, rigid systems, inflexible behaviors, unchallenged mindsets and unquestioned assumptions.
Deep in the Shift—The Collapse/Renewal Phase
In this series, we’ve been talking about organizational paradigm shifts and how they evolve. When a crisis develops, companies tend to protect the present means of operation instead of staying focused on the company’s primary purpose. The outcome of all this is a lethal combination:
This results in a significant loss of productivity, quality, and safety.
The Grass Is Greener on the Other Side of the Shift
An organization’s response to a crisis can result in the reshaping of its fundamental mindsets to significantly enhance productivity and quality. First, the organization must admit that the “fixes” that worked in the past are no longer an effective way to resolve critical business challenges. Second, leaders have to do some serious evaluation:
Organizational renewal results from examining and dramatically altering each key component in the existing paradigm. It begins with the difficult task of recognizing previously unquestioned mindsets that have served as the foundation for prior decisions and actions. From modified or altogether new assumptions, fresh implications are generated for what is believed to be true, relevant, and so forth. From these frames of reference, priorities emerge and specific behaviors are identified that can best manifest the intent of these beliefs.
As this effort unfolds, certain clusters of mindsets and behaviors are modified or altogether new systems are designed to accomplish specific outcomes (e.g., hiring people, processing and using information, etc.). Finally, these systems will demand new methods (rules, tools, etc.) necessary for their operation.
Renewal is the building of a new organizational paradigm from the ground up. The result may be a new paradigm that includes aspects of the old one, renders the old one completely obsolete, or reduces it to limited applicability. The key is that whatever the new one includes, it is built with little dependency on the previous one…it represents embarking on a new era.
I mentioned Nokia’s burning platform memo in my last post. Stephen Elop, Nokia’s chairman, understands exactly what must be done to spur renewal, and he outlined it at a strategy meeting in February. It included a bold new strategic plan and “a new leadership team and organizational structure with a clear focus on speed, results, and accountability.”
Composing new paradigms calls for replication of the sequence that generated success for the old one: mindsets ? behaviors ? systems ? methods. The difference is, instead of relying on trial and error, intuition, and luck (as is often true during the evolution of the initial paradigm), the new paradigm is created by intentionally challenging what has worked in the past and deliberately building a fundamentally different alternative.
Next: How to make shift happen
In my last post, I talked about the term “paradigm shift.” Very simply, we can say it’s “a fork in the road that opens up a completely new way of perceiving, thinking, and taking action—with no turning back.” I also said that the term has become part of our slang, and that its real meaning has often been diluted by popular use. In this post and the three that follow, I’d like to explore my understanding of an organizational paradigm (a perception held and shared by employees concerning their organization’s purpose and how it is to be achieved) and how it evolves over time.
The Four Components of a Building a Successful Paradigm
An organizational paradigm is moving toward achieving its purpose if it is prospering (or at the very least, surviving). This progress is the result of successfully aligning four components:
In the building phase, leaders identify the proper configuration of these variables to make sure sufficient progress is achieved. They do this through intentional design and trial-and-error learning.
The time necessary to complete the building phase may be measured in weeks, months, or even years. The length of time necessary is a function of the leader’s experience and maturity in forming such an organization in a similar environment.
Once a successful configuration is formed, the length of time it remains viable depends on how long the environment remains stable. The basic operating paradigm of an organization may remain productive for months or even decades, but at some point, it will no longer perform as desired.
In phase two, the harvest phase, an organization reaps the benefits of the operational configuration developed during the building phase. For many paradigms, performance is highest near the beginning of this phase. Over time, however, the configuration gradually (often imperceptibly) begins to weaken. More and more “fixes” are required to maintain performance goals. “Fixes” are actions designed to correct minor deviations from performance goals in methods, systems, or behaviors of a paradigm. Some fixes are directed at strategic issues, like marketing of major new products or use of technology, while others are tactical, like reorganizing a department or conducting a training program to develop better teamwork.
Regardless of the scope of the effort, all fixes share a common goal of protecting the overall framework of “how things are done around here.” The fabric of the initial framework is slowly replaced by a patchwork of bandages, baling wire, and exceptions to the rules, all designed to keep the original paradigm operational.
Paradoxically, it is during this harvest phase that the organization sows the seed of its paradigm’s demise. At the very time performance measures are being met or exceeded, the dynamics that will eventually undermine this success are beginning to unfold.
The sequence of paradigm development that spawned the original success (mindsets ? behaviors ? systems ? methods) begins to reverse:
As the shelf life of the paradigm’s utility is extended by more and more fixes, the ultimate (though usually unconscious) purpose of the organization becomes the success of internal mechanisms rather than success in the external marketplace. Such an organization operates within a different paradigm from the one developed during the building phase. Not only is this new paradigm’s purpose different from the initial one, its methods, systems, and behaviors now drive the fundamental mindsets instead of the reverse.
Next: The Movement Begins
“Rather than being an interpreter, the scientist who embraces a new paradigm is like the man wearing inverting lenses.” ~Thomas Kuhn
“Paradigm shift.” How many times have you heard that term thrown around?
Thomas Kuhn was the first to popularize it when he used it in his book, The Structure of Scientific Revolutions. He said that science doesn’t progress in a linear way. Instead, it undergoes periodic, transformative upheavals he called “paradigm shifts.”
He said unconventional thinking drives revolutionary science. It is always a hard sell among scientists, because they apply their current perceptions and understandings to something new and unorthodox. In other words, “out-of-the-box” thinking is scrutinized by “in-the-box” biases. Therefore, it’s rejected most of the time.
However, Kuhn pointed out that when these breakthroughs in acceptance occur, they often lead to large, impressive changes in the sciences—paradigm shifts. He used the term to describe people behaving differently, but even more importantly, actually seeing their world from a new perspective. It represents a bifurcation point—a fork in the road that opens up a completely new way of perceiving, thinking, and taking action with no turning back. Once the paradigm threshold is crossed, things aren’t seen the same way ever again.
It didn’t take long for change facilitators to lay claim to Kuhn’s views. He introduced the term in 1962. By the ’70s, “paradigm shift” was showing up in all kinds of change-related books and articles. The idea was emerging that change unfolds in different ways, depending on whether it affects people modestly or dramatically. Kuhn’s findings gave an added dimension to this idea. Of course, this is common knowledge today, but in the ’70s and ’80s, our profession was young. Kuhn’s concept and nomenclature help to differentiate between slight, incremental, major, and transformative levels of transition.
Paradigm shift quickly became popular for describing DNA-level recalibration. This is the most powerful of the impact options when introducing initiatives into organizations. By the late ’90s and into the early part of this decade, the phrase went from just being popular to reaching saturation status in the literature and in everyday usage.
And that’s a problem.
When new terminology spreads quickly among practitioners in a young discipline, there is bound to be some degree of confusion and misuse around certain concepts and wording. The change industry is a good example of this. We have overused, even abused, “paradigm shift.” We took what Kuhn meant as a tightly defined expression of rare and difficult-to-achieve transformation and mutated it into slang.
Often, we attach “paradigm shift” to any change initiative that needs to be hyped so that it can compete with all the other changes being implemented. Yes, we have to clarify the importance of any new endeavor to an organization’s future. That’s different, however, from the order of magnitude the change represents. Paradigm shift is a reference to how big the departure is from the status quo, not how critical it is to the organization’s success.
Another way we misuse the term? We overstate the intended impact of a project. We use “paradigm shift” to refer to initiatives that are big disruptions but that don’t meet the criteria Kuhn stated. The vast majority of organizational change announcements that claim or imply a paradigm shift are actually dressed-up extensions of what is already taking place. Significant modifications to the status quo are important, but they aren’t paradigm shifts. Even when we are careful to apply it properly ourselves, many of us are reluctant to correct clients who misunderstand or misuse the concept.
There is not just one perspective on how paradigm shifts can be applied to facilitating organizational change. What is your viewpoint?
In the next four posts, I’ll describe my understanding of how organizational paradigms evolve.
Next: Before Shift Happens