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Leading Change Changes Leaders The Power of Social Capital in Planned Organizational Change
Dr. Zara F. Larsen (520) or (877) toll free Text DrZara to 69852
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Agenda The Paradox and Study Questions
Background Theory and Research Methods Findings Implications for Leadership Practice Summary 2
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The Paradox Organizations often hire leaders from outside the organization (Outsiders) to lead major change initiatives - Proven “know how” - External networks or “know who” - Unencumbered by internal ties - Opportunity to increase the firm’s change capacity Despite successful project outcomes, Outsiders often and Insiders sometimes leave. Why? Different reasons for leaving? Are Outsiders and Insiders different in who they are, and how they lead change? Assuming a desire to retain the change leader post change, what can the organization do? the change leader do? 3
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“Cannot live without them, but cannot live with them?”
The Paradox “Cannot live without them, but cannot live with them?” 4
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Study Questions Are leaders of high impact change projects different from those who “sustain” organizations? Are Insider and Outsider change leaders different? Does the type of project (radical change or continuous improvement) make a difference in retention of leaders? Does organizational culture (authoritarian/prescriptive or open/collaborative) play a part? How do social networks impact the outcome of projects and the outcome of the leader? What role does sponsorship play in the outcomes? 5
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Background Theory Social Networks – information highway, nodes, ties, spans Social Capital – strong personal relationships for access to information, influence, power, integration, reciprocity; networks are but a part of Bonding Social Capital (Network Closure) – embeddedness within a structure of group relationships; protective; by nature drives out variation Bridging Social Capital (Brokerage) – cross-cutting connections, access to new ideas; competitive advantage; speed (aka cost) Which is better? It depends. Ties that bind can blind. 6
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“Know Who” can be as important, if not more important than,
“Know How” and “Know What” 7
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Research Methods Interviews with 30 executive level change leaders, primarily from multi-billion dollar commercial enterprises 60-90 minute “inter – views” to an 18 question (50 probe) semi-structured protocol based on a conceptual model Balanced sample of: Insiders and Outsiders Radical and Continuous Improvement change projects Successful, neutral and/or unsuccessful projects Hierarchical/top down and Open/collaborative cultures Total of 42 high impact projects discussed Over 650 pages of transcription open coded using an iterative, grounded theory approach 8
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Findings – Identity Topology
Beliefs Values and Guiding Principles Doing what is right Commitment/loyalty Owner operator/Autonomy Change is positive Personal accountability Change team Change is a way of life High standards Teacher Transform Future focus Develop others Will to succeed Push change (command) Learning End justifies the means Pull change (enable) Motivation Behaviors Attributes Challenge Entrepreneurial Enthusiastic Unknown/pioneer Enterprising Inspirational Excitement Maverick Communication skills Fun Risk taker Decisive/confident Big impact Prone to action Persistent/assertive Fulfillment Personal sacrifice Self-sufficiency Altruism People astute Self-awareness Note: Blue 80% of all Insiders/Outsiders; Green Outsiders only 9
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Findings – Context Type of Change Project – Difference!
Radical Change – Time, risk mitigation as forcing functions Outsiders – Contending with negative attractors Insiders – Relying on trusted colleagues Continuous Improvement – Patience and strategizing Organizational Culture – No Difference! A “crisis is a crisis” Career Planning and Career Network Development while leading change – Not Relevant! Not consciously done by either Insiders or Outsiders Outsiders – My career has taken care of itself Insiders – Assignment was a “job” 10
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Findings – Insiders and Outsiders
Insider Outsider Assignment Orientation Bounded; “Job”, series of tasks; Sustainable outcome for affected unit Unbounded; “Role”, one amidst series; Venue for launching big things; Transfer capability Sphere of Influence Local; Loyal to the enterprise and unit Global; Loyal to change profession; Dedicated to enterprise Sponsorship Passive; Legitimization, Voice, Roadblock removal Active; Access, Entrée, Value most obvious when lost Social Capital Relationships; Bonding, some bridging Information; internal networks for a purpose; bridging for counsel Source of Ideas Inside; Outside for special skills Outside; Inside to co-opt and learn history 11
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Findings – Change Leader/Project Outcome
Successful Unsuccessful or Neutral Insider Personal Model for Change; Bonding social capital leveraged/expanded, long-standing; Bridging networks for ideas; Sponsorship assumed, invoked for radical change Lack of internal bridging; Reputation only within unit; Project lost sponsorship (not necessarily the leader); Externality perceived as cause of project failure Outsider Personal Model for Change, External know how and awareness; Bonding social networks; Bridging social capital expanded; Sponsorship invoked as bonding social capital Bonding social capital not built; Exclusion; Leader lost sponsor; Change model not in harmony with the organization; Externality should have been addressed by change leader 12
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Findings – Change Leader Outcome
Insider Afterwards Outsider Afterwards High bonding social capital protects against negative attractors; “One of Us”; Transformed beyond ability to regain social capital; Renegade; Insider Onset of Project Learned new skills, personal development regardless of project outcome; Expanded networks in and out; Willing to lead sustain effort Legacy of how, not what was done; Means may have caught him in the end; Bridging networks attract to leave Outsider New change leader role in firm; Expanded internal networks, some bonding social capital; Strong sponsorship as protection; Acute self-awareness; Transformed to fit build social capital; Behaviors rationalized as being driven by situation; Legacy of how, not what was done; Means caught him in the end; Lack of bonding social capital leads to exclusion and rejection; Loss of sponsorship 13
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Implications for Leadership Practice
Bonding Social Capital is critical for successful change leader outcome In absence of sponsorship, Outsiders seldom become Insiders post radical change due to social capital destruction Bonding social capital serves as insulation from the negative outcomes of leading change Consider “warming up” Outsiders via leadership of continuous improvement before radical change Surround Outsiders with respected Insiders Senior sponsorship is necessary, but not sufficient 14
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Implications (continued)
Leading change changes leaders The mission can become bigger than the person Personal transformation can lead to “outgrowing” the organization Personal sacrifice to lead to personal growth Passion to lead change can mitigate interest in sustaining the change regardless of project outcome Acute self-awareness recommended via routine, honest assessment, feedback, coaching 15
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Summary Leading change changes leaders
Leading change and retaining leaders calls for social capital, not just social networks From the Eyes of the Organization Insiders and Outsiders are different Increasing Change Capacity influenced richly by both categories of leaders Hiring Outsiders and “risking” Insiders calls for careful discernment of Radical vs. Continuous Improvement Projects, Coaching and attention to the Roll Forward process (project exit strategy) From the Eyes of the Change Leader Leading change changes leaders 16
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Recommended Readings Burt, Ronald S Brokerage and Closure: An Introduction to Social Capital. Oxford University Press. Klein, Janice A True Change: How Outsiders on the Inside get Things done in Organizations. San Francisco, CA: Jossey-Bass. for three related research studies (references embedded) Dr. Zara F. Larsen (520) or (877) toll free Text DrZara to 69852 17
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