SUMMARY

Choosing the right strategies to help your organization navigate change requires you to first recognize the kind of workplace change journey you are on. Some organizational changes are like hiking through a dense forest. You need a compass in situations where you can't see 10 feet ahead. Others require you to move swiftly on a more defined path; a journey for which a map is most appropriate.

Using a compass: The case of Starbuck’s transformation

When Howard Schultz returned to Starbucks as CEO in early 2008, he told staff, "I will do everything in my power to restore the company to the greatness we have known in the past. But understand, this is not a one-person job… [We need to be] honest and open that we have serious challenges, and we need serious people to help solve them. And I commit myself to be in the front of the line leading the way." *

The challenges Schultz saw may not have been evident to everyone. At that time, the company was the market leader in the specialty coffee industry, opening an average of four stores per day. Recent financials reflected 20% annual revenue growth.

Even still, Schultz sensed the company was in trouble — warning in a memo of the "commoditization of the Starbucks experience". The human connection in stores was waning, coffee quality was uneven, pressure from competitors was growing, and the internal culture at headquarters was seen as indecisive and lacking creativity.

While Schultz was alarmed by the situation, at the outset he didn't have a clear sense of the necessary solutions to the problems he saw. Schultz noted: "You can't get out of [a crisis] by trying to navigate with a different road map, one that isn't true to yourself."

Over time, the organization developed and unveiled a “Transformation Agenda”. Rather than a detailed plan, it outlined strategic goals, such as: "Be the undisputed coffee authority" and "Ignite the emotional attachment with our customers." While the company was looking for significant transformation, it aimed to balance innovation with respect for core traditions. Importantly, when unveiling its transformation agenda, the company also outlined what wasn't changing, such as employee healthcare and stock benefits.

Starbucks leaned hard on principles rather than step-by-step work plans to achieve its strategic goals. As one leader shared about the company’s efforts to reconnect with customers: "We created not a tool kit but a new way of behaving, of being proactive and creating ways in which…we could become a relevant, trusted source rather than a promoter of products or ideas..."

To lead transformational changes like the one at Starbucks, sometimes called adaptive change, requires a "compass" mentality. In such transitions, you set clear cardinal directions and boundary conditions to provide high-level guidance to the effort. But, it’s only through persistent experimentation and learning over time that you develop the detailed routes that lead to performance gains.

Using a map: Model changeovers at Toyota

In contrast, other types of change are much more conducive and appropriate for a "map" mentality. A good example comes from Toyota, specifically related to how it introduced new vehicle models in its US manufacturing plant in the 1990s.**

Model changes could involve the redesign or replacement of 60% to 90% of all components in a vehicle, impacting both internal and supplier processes. In the mid-1990s, such changeovers often shut down production in American car manufacturers for up to 80 days. At Toyota's North American plant, it took just five days. 

Toyota experienced no less significant changes than its American competitors. What was different, was how it enacted the change. Toyota had developed its employees' expectations and ability to tackle these changes in a more predictable way.

While staff could not anticipate exactly what would be required to introduce a new vehicle model, they could foresee that model changes, in general, would happen. This enabled the company to develop shared expectations and straightforward ways of working — a map. This map supported Toyota to achieve performance goals relatively quickly, despite the significant degree of change undertaken when producing a new vehicle model. 

It did this by developing "meta-processes" to guide how such changes would be managed. These were used to guide collaborative work to design the changes required, regardless of the specifics of any model. The company also developed specialty teams, including front-line plant staff, charged with developing new processes.

In addition, Toyota had a long history of "enriching tasks" for its manufacturing employees. Rather than undertaking day-to-day, routine tasks in a rote manner, all employees were encouraged to look for and implement improvements continuously. In this way, staff were regularly primed to be adaptive and therefore may have been more adept at navigating larger-scale changes when they arose.

Optimize your change approach by first identifying your type of change 

As these case studies demonstrate, different types of change require different tools and strategies. Understanding the type of change you are undertaking upfront will better enable you to design an appropriate leadership and change management approach for the change.

Importantly, it can also help you shape realistic stakeholder expectations about what lies ahead. Should they anticipate a detailed map to guide the way, or will this be a more creative and flexible process requiring a compass?

Various characteristics signal the type of change you may be dealing with, including:

Map

• Shorter timeframe

• Required or self-evident rationale for change

• Tight and defined scope

• Performance goals

• Less uncertainty

Compass

• Longer timeframe

• Change rationale may not be obvious to all

• Boundary conditions clarify what’s in and out

• Focus first on learning, then performance goals

• More uncertainty

Consider ‘both/and’ versus ‘either/or’ approaches

Importantly, one type of change is not better than the other, although many writers in the popular business press suggest otherwise. The types of change are simply different and require different approaches and mindsets to execute effectively. Most organizations will be required to undertake both types at some point, or even to use both mindsets on the same change.

Indeed, success may lie in viewing the types of change as falling along a spectrum and taking paradoxical mindset. In doing so, you use both a map and compass mentality at some point in your change journey, but with varying levels of emphasis depending on the need at the type.

For instance, for a five-year transformation, you may organize your efforts in phases. At the outset, you may be able to develop a detailed plan for the first phase, but only provide guideposts for the subsequent phases. As you near the end of each phase, you can create more detailed expectations for the subsequent phase. For shorter-term changes, you may be able to develop a fairly detailed guide for the overall effort, but need to pull out a compass to navigate unexpected changes that arise along the way. Experiment with both mindsets and related tools to develop your ability to appropriately and expertly apply them in varying contexts.

References

*Starbucks case study: Koehn, Nancy F. "Starbucks Coffee Company: Transformation and Renewal." Harvard Business School Teaching Note 314-143, June 2014. (Revised March 2016.)

**Toyota case study: Adler, P. S., Goldoftas, B., & Levine, D. I. (1999). Flexibility versus efficiency? A case study of model changeovers in the Toyota production system. Organization Science, 10(1), 43-68.

The map and compass metaphor has been used by various thinkers in organizational leadership from Stephen Covey to Susan David.

Photo by Alex Andrews from Pexels

Graphic: Wendy Hirsch