Making That Big Change Stick

Making That Big Change Stick

Two articles/news items worth noting.

Tony Hseih at Zappos moves to Holacracy, a decentralized management structure.

Dan Price at Gravity Payments raises the minimum wage for his 120 employees to $70,000.

I’ve heard commentary on both events that range from “worst decision ever” to a “generational shift in how companies are run.”  Here’s how I see it, both events are big ideas. Both reflect culture changes. And both decisions are worth viewing through the lens of fit.

So let’s focus on fit, as in, I have a big idea I want to put into place, a big bet I want to make, Greg, give me your thoughts on how to make it “fit,” because that’s what you do, right?

Yes it is.

Jumping in, Tony Hseih says this in a quote from Quartz magazine in regards to his culture, “We want Zappos to function more like a city and less like a top-down bureaucratic organization.” Tim Kane, an economist from Stanford says of Dan Price’s move, “This is going to be great for his business,” goes The Times quote. “It will reduce turnover, increase morale and help him build an even greater company,” and let’s assume that’s his goal.

As CEO, you have a vision. An ideal outcome imprinted on your brain. A reason to get excited that makes you want to shake trees and move mountains. Now, how do we make that happen?

Here are three of many considerations I take into account when designing business practices that my clients can live with.

First, your roll out is going to be a challenge. One of my clients was approached by a firm interested in purchasing his company. He invited me in to help with the evaluation. We spent days and weeks going over spreadsheets, interviewing key players and drawing up contingencies along with preventative measures. To call it a journey is minimizing the transformation we went through. The decision was made. The deal was struck. It was time to communicate the message, and we knew it was going to be a challenge because we were transformed by the exercise we just went through, but they were stuck in time. Outside of seeing me in the office every day, nothing had changed in the previous month.

We tried to meet their mindset, or at least come close. Tried to imagine what they would think and how they saw the world. We made the best presentation possible and it was a disaster. Rolling out a big decision is a challenge.

Second, your vision will be easier for a newbie than an oldie. Change is hard for everyone. Unless you’re new. If you’re the new girl, the change is nothing but hearsay. When I facilitate management training, I spend a lot of time discussing the best way to get changes to take root. Inevitably, the manager is going to be met with resistance when they get back to their post. The savviest elders may even warn the new people to be ready for a new directive because it’s coming. “Don’t worry,” they’ll say, “just go along with it and eventually things will go back to the way they were.”

How do you combat this? Do nothing, I advise. Start imperceptibly slow. Change internally, and then work on the newest members of the team. Get them on board. Invite the savvy elder to join you when they’re ready.

Thinking about where change takes root can be a big advantage. Go where the soil is fertile. That’s going to be with your newest employees. The veterans will come along. Sometimes.

That brings me to my third point, not everyone’s going to come with you on your journey. Much has been made of the defections from Zappos and Gravity Payments in light of these new changes. Some claim that the defections prove that the change is too dramatic, others claim that there’s bound to be some breakage along the way to a brighter future. Here’s what I know. You’re going to be surprised by who leaves and not all turnover will happen at once. Looking for work isn’t easy, so the first to go will be the most capable of finding their next post. A second group will put out feelers, and a third group will vow to make a change at some point in the future. Just know that going in.

If your idealized future includes keeping your most capable employees, plan accordingly. If you’re going to be heartbroken that the company you’ve become didn’t bring everyone along, keep that in mind. If the outcome you desire does not depend on the group you have surrounded yourself with, understand that too.

It all comes down to fit. The ability to look oneself in the mirror each morning and be comfortable with the actions you’re taking. I have no idea if Mr. Hseih or Mr. Price are living easy with their decisions, but I know this: as Gen. Patton once said, “A good plan, violently executed now, is better than a perfect plan next week.”

Good stuff.