Have you ever wondered what it takes to be a transformational leader? While every major transformation is unique, it is possible to draw some insights from leadership behaviours and strategies that are a common thread in some of the most successful transformations in recent corporate history
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I love leadership books and papers that are based on detailed, empirical research - marrying sound data with our uniquely human capacity for connecting the dots, and drawing deep insights. Good To Great, the best seller by Jim Collins, is an excellent example of this genre.
So I really enjoyed reading What the Best Transformational Leaders Do by Scott D. Anthony and Evan I. Schwartz recently published on hbr.org.
The question that the authors try to answer is “What, if any common characteristics and strategies, underlie the most successful transformations in recent corporate history?”
The cases that the authors chose to study included successful transformation from recent times such as : Netflix successfully pivoting from mail-order dvds to online streaming; Amazon’s bet on cloud computing and storage which led to AWS becoming its most profitable division; and Microsoft which after an extended, seemingly somnolent phase, re-emerged as a significant player in mobile and cloud computing.
Each of the transformation cases cited is interesting in its own right. However, what is really fascinating, are the common threads in leadership behaviours and strategy, that according to the authors, played a significant role in success of these transformations.
In brief, the common characteristics and strategies underlying successful major transformations, that the study identifies include:
- The ability of the leader to retain an “outsider” perspective, while being an insider with deep knowledge of the organisation and how it works
- The company electing to invest aggressively in a new growth area, while continuing to work on repositioning the existing/core business in parallel. This is distinct from the more common approach of trying to put everything in one basket and try and move the entire organisation together
- Work with and on the culture at the same time to drive significant change
- Telling powerful stories, tailored for different groups within the organisation, and focussed on the challenges ahead as well as the opportunities and the organisation’s path to success. Repeating ad nauseam
- Acting early. Devising strategy on little more than weak/early warning signals and having the courage to implement - long before the disruption becomes apparent
The article is rich with examples and anecdotes, that illustrate the points the authors seek to make.
The idea that I found most fascinating was the pursuit of a dual strategy of transformation. I believe this is covered in more detail in a recent book co-authored by Scott D. Anthony. I just moved it closer to the top of my reading list for next quarter.
Many firms that have tried to transform have failed. A common reason why is that leaders approach the change as one monolithic process, during which the old company becomes a new one.
That doesn’t work for a host of practical reasons. An organization that grew up producing newspapers, for instance, not only lacks key skills to build a digital content company but also might actively resist embracing the new in order to protect the business it knows and loves.
Success requires repositioning the core business while actively investing in the new growth business.
From a leadership development perspective, there are a number of skills and practices that would serve future leaders leading transformations well. These include:
- Cultivating and maintaining an outsider perspective by volunteering to work on non core, futuristic businesses with a great degree of connect with the company’s customers
- Honing your story crafting and storytelling skills
- Working on your ability to detect weak signals early and crafting strategy under uncertainty with limited information
