The Executive’s Guide to Strategic C H A N G E Leadership

Introduction s executives and consultants, we continue to learn about the complex DYNAMICS of shaping and leading STRATEGIC CHANGE. We believe that market forces will continue to raise the performance bar and drive an accelerated rate of change. Highly effective leaders do not wait for these market pressures to create urgency, but rather set AGGRESSIVE strategic transformation agendas for themselves and demonstrate the INSIGHT and COURAGE to apply FRESH MARKET PERSPECTIVES to assure OPTIMUM ALIGNMENT of people, competencies, business processes and enabling technologies. he purpose of this document is to share with you our view on how the most successful leaders have led their organizations through change. This is not intended to be a recipe, but rather a representation of a strategic leadership process that we trust will challenge you to think through the impact that you as a leader must have on the strategic performance of your organization. T A

Elements of Strategic Change Leadership Leading Market-Driven Strategic Change Applying Tools to Assess Readiness and Facilitate Change Current State Transition State Desired State Mobilize Commitment Shape the Vision Make Change Sustainable Measure & Communicate Progress Create the Need/Assure Readiness

Essential Elements of the Leader’s Role (1) Creating the Need and Assuring Readiness Making sure that the reason to change, either because of danger (problem) or opportunity in the short or long term, is instilled within the organization and making sure that this need is widely shared through data, demonstration, demand and diagnosis. While sensitivity to the current state must be considered, the need to change has to exceed the resistance to change. Shaping the Vision Making sure that the desired outcome of the change is clearly aligned with the vision and strategy of the business, grounded in market dynamics, defined in behavioral terms, consistent with the organizational core values, and is widely understood and shared. Mobilizing Commitment Making sure that there is commitment from a broad and strong network to make the change work, that the right people are willing to invest in the change, and that it gets attention from the top of the organization. Defining “champion” behavior Developing multiple champions (you can’t do it alone!)

Essential Elements of the Leader’s Role (2) Making Change Sustainable Making sure that once the change is started, it endures, and that learning in one part of the organization is transferred to other parts of the organization, accepting that change will evolve and adapting the plan to reflect learning. Measuring and Communicating Progress Making sure that progress is real, that realistic benchmarks are set and achieved, and that indicators are established to recognize increments and major milestones; communicating progress and learning broadly across the organization. Applying the Tools Making sure that all the drivers of organizational alignment are being worked with a set of practical tools that define and reinforce the expectations for behavior and performance across the organization. Leading Change The never-ending mission of communicating the vision and strategy,and securing trust and commitment from all stakeholders; knowing enough to know what one doesn’t know and doing something about it.

Creating the Need and Assuring Readiness To assure that the change creates value, the planning process must place priority on defining the need and shaping a realistic view of the change required. Additional data in the following areas is key.

Shaping the Vision

Mobilizing Commitment

Making Change Sustainable

Measuring and Communicating Progress

A Starter List of Proven Leadership Actions That Have Accelerated Change And Led to High Performance For each dimension of the vision, a specific tool set will need to be developed and applied in a systemic manner. Tools and programs include: A highly inclusive process that produces shared values that are the grounding for company decisions and behavior with visible consequences for compliance Strategic planning process that assembles diverse leaders to debate options and shape the future Performance management and compensations systems for setting goals, reviewing progress, coaching, measuring results against plans and rewarding performance Inclusions of “status of change” as a standing agenda item on Board and executive operating committee meeting agendas Competency models that define and communicate accountabilities and expectations Alignment of formal organizational structure and governance models with the strategy HR and Organizational planning and development strategies that recruit assess and develop leadership talent including mandatory business leadership curricula for business and functional heads Analytical frameworks and decision support processes that are meaningful Team development models that facilitate new and productive relationships across the enterprise that are practiced and reinforced by key leaders Internal communication processes that assure understanding and timely issue resolution Management processes that assure unwavering focus on the customer