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The Four Levers of Corporate
Change, by Peter L. Brill and Richard Worth Reviewed by C. Donald Williams, MD Peter Brill’s and Richard Worth’s book begins with the following passage: On a steamy July day, the leaders of a
major American organization assembled at a stately old colonial building to discuss the
serious problems currently confronting them. They
were operating in an environment that was daily growing more turbulent, with increasing
economic pressures from abroad and dissatisfaction among their domestic customers, and the
organization itself was rapidly being torn apart by fierce internal struggles between its
various units. Indeed, disaster seemed in the offing unless the organization could somehow
change. This introduction, a variation of the classic “It was a dark and
stormy night…”, sets the tone for a book that is at once an amalgam of the
storyteller’s art (Richard Worth has 20 years experience as a writer and video/film
producer for Fortune 500 clients) and creatively expressed insights into organizations,
their dynamics, and techniques for bringing about change. It is clear throughout the book
that the ideas have been developed and proven in the field.
The book is organized around the use of “four levers of change into twelve
hallmarks of outstanding organizations.” Using historical anecdotes and case material from the Peter
Brill’s own consulting practice, the authors develop the central themes of the book. Crises, either naturally arising, or created by
the organization’s leader, provide the catalyst for change. The effective use of power, combined with an
understanding of human nature, are prerequisites for successful leaders. Social processes, i.e. exercises designed to
change employee’s belief systems on both an intellectual and emotional level, are
illustrated with case examples. Maintenance of successfully initiated organizational
change requires that the organization’s members both identify with and internalize
the new values on an emotional level. The book is divided into three parts, “A Framework for Change,” “The Four
Levers,” and “Ensuring Continued
Success.” “A Framework for Change” underscores the complexity of
organizations, and the fact that there are no simple solutions. It explores the role of crises in opening an
organization to a change process, and specifies both the purpose and limitations of ideals
and vision statements in that process. The second section, “The Four Levers,” describes each
aspect of change one by one: the human factor, the
uses of power, social process, and dimensions
of leadership. The concluding section, “Ensuring Continued Success,”
focuses on sustaining change by means of fostering identification
and alignment. Part 1 ~ A Framework for Change Part One begins with a description of how successful organizations
possess certain essential qualities; these include having vision, innovation, flexibility, and being customer driven.
Bringing these qualities into harmony requires effective organization and
distribution of power within the organization while taking into account an understanding
of human nature. Effective leaders must be
able to create networks within the organization which remain at once in balance with each
other and capable of efficient pursuit of the goals of the organization. To accomplish this, requires an understanding of social process. When guided effectively by the
leader, social process can be used to produce and sustain changes in vision and power
relationships within the organization. The beliefs and value systems of the individuals
who are assigned the task of achieving its goals must be aligned with the purposes of the
organization, and in harmony with its overall structure and purpose. The complexity of managing organizations is articulated in this
comparison with psychotherapy: Management is not an exact science, like
mathematics; it is closer to psychotherapy, where there are generally no right or wrong
answers, just theories—and hundreds of them, at that.
Perhaps to an even greater extent than psychotherapy, the study of organizations is
only in its infancy. We simply don’t
have the database to say with any confidence what works or what doesn’t, and (even
more importantly) why. However, Peter Brill has considerable experience with consulting to
organizations, and records his experiences in accessible language. For example:
Strategies employed by Jack Welch when he became CEO of General
Electric are used to illustrate the effective use of power.
Welch created a crisis at GE to make it open to change, and then created a vision
statement which radically altered the way in which GE approached its business. Welch recognized that GE would have to be able to
compete internationally if it were to prosper as an organization. To precipitate the crisis necessary to create the
openness necessary for initiating the change process he decreed that all GE divisions that
were not leading their market area would be sold off.
The initial reaction against this initiative was intense. However, as Welch
demonstrated that he possessed the power to implement his plan and that his plan made
sense in the changing global competitive environment and, it became obvious that it was
untenable for anyone to argue that second place was good enough. Some easy to read business books are full of fluff. Well written and easy to follow, this book is densely packed with valuable insights. A good novelist may achieve this meld as a matter of course; management consultants are less often as successful. More examples: regarding the three “realities of power” several principles are enumerated.
Part Two, “The Four Levers,” begins with a story about the
Luddites. The Luddites were workers in the stocking
trade—journeymen and apprentices operating the hand looms for their bosses, master
stockingers, who had rented them from hosiers. These
stocking workers were craftsmen, used to producing high-quality, finely styled stockings. Unfortunately, they were also members of a dying
trade. The stocking market was changing;
hosiers were now demanding mass-produced, lower quality stockings and were willing to pay
far less for them. Wages declined, and the
workers saw their hours cut. Then the hosiers
introduced the wide frames, which would enable them to produce even more stockings faster
and with eve fewer operators. Seeing their
livelihoods in jeopardy and being forced to reduce the quality of their products, the
workers eventually began to demonstrate. When
this didn’t work, they turned to violence. Eventually
the Luddites attacked factories, destroying power looms and wool shearing machines,
killing armed guards whom the owners had hired to protect their factories. Ultimately they were arrested, tried, and executed
or transported to penal colonies. Today they
are regarded as ignorant workers with an “irrational, shortsighted attitude toward
change.” Used to illustrate a truth regarding human nature, this example from
English history during the Industrial Revolution adds dimension to the principle under
examination: “Change must occur at the emotional level—the same place where
resistance to change usually occurs. It’s a battle for the hearts of employees, and
if you lose that battle, the transformation process will encounter barriers that may prove
insurmountable.” An in depth analysis of
resistance (familiar in the therapeutic context to all psychiatrists) follows. The “elites, the ins, and the outs” all
have a particular view of the world that is determined by their place in the hierarchy.
These views direct the responses to change initiatives undertaken by management. The consultant must appreciate the different
perspectives of the members of the organization, as it is shaped and influenced by their
status. This book contains several insights, strategies, and techniques that
are arresting in their impact. Because human
beings are complex, full of contradictions and paradoxes, and internally conflicted,
obtaining clear and accurate information regarding an organization is difficult. Several principles of information gathering are
elucidated:
Immediately useful and practical techniques for gaining insight into
organization members are presented. These
include the “Life Chart” (Fig. 4-1). Retrospectively
obvious in its conception (as in, “Why didn’t I think of that?”), it
consists of a graph with life satisfaction levels on the y-axis and age on the x-axis. Peaks
and valleys are labeled as significant events in the individual’s life. Remarkable longitudinal insights can be developed
in the 40 minutes or so that completion of the chart requires. This portrayal of patterns serves to lead
naturally to an appreciation of sequences of repetition, in which developmentally
significant experiences are played out repetitively in relationships with co-workers and
superiors. Case examples illuminate the
points being illustrated. This procedure is one of the “social processes”
utilized in bringing about change within an organization; much of its potency resides in
the emotional impact this self disclosure entails. Most
people completing the chart learn things about themselves they did not know consciously. This lends power to the entire process, and
enhances its credibility. I found myself wondering whether this could be useful in
psychotherapy as part of an assessment process. Other techniques, which impressed me with their apparent simplicity,
include the use of “Powergrams,” a graphical means of representing the power
relationships within an organization. The
clarity of the diagrams is a testimony to the thought and experience which led to their
development. Figures 5-1 through 5-6 depict a
variety of relationships within a top management group, ranging from split to cohesive. Specific case examples illustrate the concepts, a
principal strength of this book. The detailed analysis of the elements of a “social process”
presented in Chapter 6 is too lengthy to include in this review. However, the following quotation illustrates its
basis: “Centuries ago the Greek mathematician Archimedes, trying to demonstrate the
power of a lever to King Hiero II, reportedly told him, ‘Give me a place to stand and
I will move the world.’ Properly designed, a social process can act as a lever,
initiating change in almost any organization. Conversely,
a process that is poorly designed can only increase resistance, produce deadlock, and
eventually derail an entire change effort.” For
example, when Welch used his power to create a crisis at General Electric to serve as a
catalyst for change, he continued the process by controlling the power sources within the
organization. He eliminated the authority of
staff at central headquarters, who historically approved all planning and financial
decisions made by the business managers. He
shifted power to the business managers themselves, resulting in a decentralization of
authority and enabling the business units to respond more quickly to marketplace changes. He maintained his own authority by controlling the
purse strings himself. He then perpetuated
the change process by instituting a new curriculum at GE’s management training
center, in the process “winning the battle for the hearts and minds of the
company’s mangers.” Ultimately,
over the course of many years, the entire culture of General Electric was changed. Proper emphasis is placed on the necessity of the
change process focusing on the elements of the organization which need changing, as
opposed to change processes which focus simply on personal development. While the latter may be desirable, what is
critical for the organization is that the change be directed to improving the
organization’s functioning in critical areas. The “universal
solvent,” a means of obtaining crucial information from employees is designed to
be an efficient and powerful “social
process.” Suppose an organization
needs to know the opinions of 20 key people regarding 10 issues. If all 20 people are invited, in a theater group
setting, to raise their hands and offer their opinions, with each being allotted 5 minutes
per issue, nearly 17 hours will be required, and the proceedings will most likely be
dominated by the most aggressive people, who are a) not likely to reflect the opinions of
the group as a whole and b) are likely to be influenced in what they say by their
expectation of what their boss’s response will be; candor will suffer. The alternative (depicted in Fig. 6-1), the
“universal solvent,” breaks the group up into 10 pairs of two people, each
assigned to ask one question, with 5 minutes allotted for their partner’s response,
the listener simply acting as a recorder and not offering any opinion of his own. Every 10 minutes the pairs change, and after only
100 minutes, all 20 have expressed their feelings about each one of the 10 issues,
privately, and without group coercion. The responses are summarized, without identifying
who said what, and presented to management. Each participant feels that he or she has been
listened to, and the truth comes out. Equally
important, each person becomes emotionally engaged in the process, and feels empowered.
The universal solvent removes the power of
the boss as an obstacle to communication. Furthermore, when the answers are summarized at
the end and presented to the boss, the exercise demonstrates dramatically his or her
willingness to listen. The entire group sees
that the boss is prepared to take in new information and learn from it. This provides a model for them to do the same
thing. Capturing the emotional commitment of the key members of the
organization is critical to succeeding in any change process. The example just given, along with the “life
chart,” is one of the principal “social process tools” utilized towards
that end. It is also essential in perpetuating the changes.
Part 3 ~ Ensuring Continued Success The concluding section begins with a description of how Mikhail
Gorbachev’s efforts at perestroika, or “restructuring,” failed. In discrediting the past conduct of the state and
undermining Communist ideology, Gorbachev failed to provide any credible replacement. This history lesson dramatizes how a change
process can spiral out of control of a leader. It
also demonstrates “the importance of an ideology—a glue—to hold things
together as the change effort is underway.” The
parallel with modern corporate experience is apparent.
The old security of lifetime jobs which was given in return for loyalty to the
company is gone. Layoffs and restructuring
broke the contract between employer and employee. Now
companies are attempting to create a culture with which employees can identify even though
they can no longer count on security and loyalty from their companies. These efforts are meeting with mixed success at
best. The authors examine the process of identification, the process of attributing to themselves, consciously or unconsciously, the characteristics of another person or group. Utilizing examples of how people identify with sports teams, and then proceeding to describe the role of identification in the developmental process, they give the concept depth. With observations about pathological identification, such as that which occurred with the Nazis, and the role identification plays in Christian beliefs, they identify key elements:
A detailed program for developing identification with overall
corporate goals by means of a three day training workshop is presented in Fig. 8-2. This program was developed because after power was
decentralized, it became apparent that the work teams did not share in the overall
corporate goal, nor did they work together. Instead,
they pursued independent agendas and worked at cross purposes. The training workshop was utilized as a social
process, and included life charts, the universal solvent, and an educational component. Simulation activities provided an opportunity to
practice what was learned, and to experience both success and failure. Great emphasis is placed on having events occur in
proper sequence, as this is the key to its impact. A public ceremony in which each
employee “proclaimed what he or she would do individually to embody the values of the
organization and implement them in their jobs” while holding posters with symbols
they had created was highly emotional, and cemented the identification process. The final chapter reviews the elements of change, 12 characteristics of organizations which will achieve success:
The book concludes with policies for following up.
This consists of regular information gathering which will allow for mid-course
corrections as necessary. Sampling different levels and areas of the organization at least
every three months to provide the leader with accurate data is essential. Outside consultants may provide a truer picture of
the status of the change effort, and can assess employee morale, and current attitudes
towards the change process. The Four Levers of Corporate
Change is a valuable contribution to the organizational consultation literature. It is a bonus that it is also enjoyable to read. |