A Client Case History
Prepared by Clark Wigley, Certified Adizes Symbergetic Consultant
A $600 million 3,000-person engineering services company was a prematurely aged Aristocracy. Financial performance was excellent, but senior leadership was concerned with long-term declines in growth, and long-term customer complaints about too much red tape, higher prices, and declining quality.
Adizes was engaged to work with senior leadership to reorganize the company. Four key objectives were set for the assignment;
- Improve the quality of work and value delivered to customers.
- Improve workforce productivity, reduce redundancies, and reduce unproductive conflict.
- Increase both the quality and speed of decision-making.
- Rejuvenate growth.
The assignment was a challenge because the organization was unionized and highly resistant to change. An internal effort to reorganize the company 2 years prior had failed due to strong resistance from the workforce and key customers. A $5M 3-year investment in Lean Six Sigma had also failed to produce any material impact on organizational behavior.
This two-year engagement involved work in seven main areas:
1. Governance. The first step was to establish a POC (a Participative Organizational Council) to direct the transformation program at the enterprise level. This team was carefully composed to include key union leaders plus experts who deeply understood the needs and wants of key customers. Similar POCs were started in each of the major business units. The POCs were responsible for executing the organizational transformation projects, which included successfully implementing the new structure.
2. Strategic Planning. The next step was to get the top 30 leaders reconnected with the reality of their marketplaces and the six key customers that generated 80% of their revenues. This step created a strong sense of urgency to reverse customer discontent and begin the process of changing to a customer-drive culture.
3. Syndag Workshops. To create widespread energy for change and dissatisfaction with the status quo, 15 Syndag workshops (two to three day workshops where all top management and those it needs to implement change, like trade unions, collaboratively diagnose the company) were held. These engaged a critical mass of over 400 key movers and shakers from all areas and levels in the enterprise transformation effort. This step established widespread understanding and acceptance of the need to reorganize.
4. Reorganization. The reorganization project began with the top-level design, which was systematically cascaded down to lower levels. Rather than mandating a one-size-fits-all structure, the POC in each business unit was allowed to design the structure best suited to its mission. In addition to architecture, each design team spent a significant amount of time discussing responsibilities, accountabilities, delegation of authority, and the business rules that would define how the new organization would work. With this “wind tunnel testing” approach, most of the bugs were addressed prior to implementation. The new organization went live at the beginning of the fiscal year; the customers loved it. The expected push-back from the two unions never materialized and the transition to the new structure was successfully completed relatively painlessly over a 9-month period.
5. Metrics. The organization had extensive financial metrics, but very little visibility on non-financial key performance measures. A small set of common leading and lagging KPIs were designed and implemented to provide a more balanced view of enterprise performance.
6. Incentives. The existing bureaucratic annual review process was replaced with a new process wherein each employee was measured and incented based on 3 to 5 stretch goals that were set and evaluated quarterly.
7. Culture. All work was conducted in a way that deliberately and systematically drove the organization to be to become more customer-driven and more innovative, and to build a strong and robust culture of mutual trust and respect.
Collectively, this work produced what one senior executive described as “the most important changes we have made in the last 35 years.” The senior executive who guided the transformation effort was subsequently promoted to lead a $6B 18,000-person organization. Several other senior and mid-level managers who took a leadership position in the transformation were also rapidly promoted.