Is Your System Ready for Change?

By Susan Letterman White

Implementing culture change for organizational goals of increased revenue and  profit, actual inclusion and equity, or stronger capabilities and productivity never happen unless the collective organization system is sufficiently ready.

One of my first consultation projects was for a professional services firm that had hired another consulting firm to create a strategic plan, which sat on a shelf, collecting dust. This was before the digital revolution. Recently, in the local news, I read of a city (not our client), whose leaders were criticized publicly for not making the changes recommended in the city’s diversity, equity, and inclusion strategic plan delivered over 18 months earlier. These cases demonstrate the complexity of a culture change project and that even the best strategic plans do not spur people into action if collectively, they are not ready. But, when is the system ready for a culture change?

Over forty years ago, Beckhard and Harris developed a cost-benefit formula to explain change readiness. (1) It asked the question:

Is the collective dissatisfaction with the status quo plus the clarity and desirability of the vision for the future plus the knowledge of what to do to change, greater or less than the personal cost of change or points of resistance to change?

Impediments to organizational change readiness may be logistical barriers or psychological barriers. Often, both are present. 

Logistical readiness means that an organization has sufficient resources, capabilities, information flow and a low level of competing demands on the people expected to design an implementation strategy and then execute it. Sufficient resources means that the organization has enough empowered leaders to serve on a Steering Committee to design an implementation strategy, and also sufficient resources to follow through. Capabilities are sufficient when people tasked are able to distill goals into discrete actions, develop implementation plans that clarify who will do what by when and how, and have the ability and desire to create the changes anticipated. Information must be available to the people who need it when they need it and they must be able to use it effectively and efficiently. Finally, because time is the most precious resource, if there are competing demands on the people involved, their ability to design and executive the implementation plan will be split and diluted. 

This is what typical implementation planning involves. Someone convenes an Internal Steering Committee that may decide to seek perspectives and assistance from an External Steering Committee. Committee members design the implementation plan details and after roles and responsibilities are assigned, execution begins. At some subsequent time, data is collected to assess the progress toward the goals of the original strategic plan. The process iterates or is scaled up. Logistical readiness means people have the resources and capabilities to make specific changes happen. How strong is your organization’s collective confidence that people have the necessary resources and capabilities to implement the complex organizational change envisioned?

Psychological readiness is more complicated. It’s about people’s emotions and beliefs. Changing those is much more difficult than changing a single process. In fact, changing collective beliefs and feelings may require multiple, simultaneous changes (2) to the organization context combined with powerful, prolific, and persuasive communication. 

A typical implementation process for organizational change requires collective action by many people. When people are not similarly and strongly committed, problems arise and resistance may grow. (3) Additionally, because people generally process change as a loss, the organization needs an “adaptive” or “growth” culture to overcome resistance flowing from the fear people have of making a mistake and embracing anything that is new and different. 

The emotions and beliefs related to commitment flow from how important, beneficial, and worthwhile changes are perceived to be. How strong is the collective belief that the changes proposed are urgently needed, solve an important organizational problem, or will produce benefits for them personally? Do the changes resonate with the collective core values? Are the changes clearly and obviously supported by the collective’s formal leaders, opinion leaders, and peers?

An organization’s culture will

“align effort, engender shared sensemaking, increase predictability, and encode organizational lessons” through a  “shared set of values (what we care about), beliefs (what we believe to be true), and norms of behavior (how we do things).”

An adaptive or growth culture encourages motivation, passion, taking risks, being curious, making and learning from mistakes, tenacity, and resilience. Unfortunately, many organization cultures have a fixed theory of intelligence, a belief that intelligence is a stable trait based on sheer brainpower and IQ. This is a serious source of resistance to creating a culture of equity and inclusion, physical or psychological safety, or innovation of any sort. What do your policies, processes, and procedures signal to people about embracing any culture change? What criteria are being used formally and informally to evaluate performance? 

As an organization leader, when your goal is to change culture, begin by assessing system readiness for change and developing a strategic plan to increase readiness well before it is time to design the implementation strategy.  

(1) Beckhard, R. and Harris, R.T. (1977). Organizational transitions: Managing complex change. Reading, MA: Addison-Wesley Publishing Company.

(2) Weiner, B.J., A theory of organizational readiness for change, Implementation Science (2009).

(3) Id.

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Creating a Diverse Organization with a Culture of Equity and Inclusion

By Susan Letterman White

Advice on creating diversity, equity and inclusion in any organization usually begins by directing an assessment and following with changes to meet minimum legal standards followed by training. Although arguably necessary, this formula falls short of being sufficient. After all, what is the formula for transforming ordinary leaders into leaders, who drive the creation of diversity at all organization levels and a culture of equity and inclusion?

Certainly this type of systemic change requires leaders capable of respectful interactions, curious about people’s capabilities that often go unnoticed or discounted, and a willingness to help people achieve. But, even this disambiguation begs the question of why organizations and society-as-a whole are not making enough progress. This article spots the common snags that hold back systemic change to create a more diverse organization with a sustainable culture of equity and inclusion and shares solutions.

The Equity Assessment Snag

Equity assessments often skip measuring cultural indicators of system motivation and readiness for change. Motivation and readiness measure state of mind and emotional power to drive or block change efforts. Equity assessments must assess these measures in three groups of people; those who have the power to make necessary changes, those who have the power to affect the thinking and emotions of others in the organization who can either block or drive necessary changes, and those who will be affected by and involved in change implementation.

Equity assessments are usually quite detailed in what needs to be different and better, but unaware of informal networks where people share and reinforce their values. These networks entrench current attitudes and behaviors and are obstacles to motivation and change readiness. Knowing the opinion leaders and their opinions and the people who have the power to connect people and integrate different values is a data point often overlooked, yet the one that will drive change forward or block it. [1]

Some assessments include a stakeholder analysis; however the definition of stakeholder does not include informal influencers. When defined as a person with vested interest in something and who is impacted by and cares about how it turns out, it excludes those who are not at all interested or are interested in maintaining the status quo. Often, change leaders are unaware of the identities of informal influencers.

Indicia of motivation and readiness to change include assessment of why this change is personally important and degree of willingness to try using new behaviors and the tenacity to continue practicing them when mistakes are inevitable. Equity assessments that investigate organizational culture regarding a growth mindset or individual values regarding equity are rare.

The Talent Cycle Snag

Although it is easy to get experts to agree that people influence organizational performance, those same experts often forget that employee performance is overwhelmingly driven and reinforced by each distinct process in the talent cycle. A detailed review of each process with analysis of its effect on how people think, feel, and act is barely given adequate attention. Similarly, little thought is given to the behaviors considered indicative of capability.

Talent cycle processes, including the identification of decision criteria, are:

Recruiting,

Hiring,

Onboarding,

Performance evaluation,

Development,

Advancement,

Reward and recognition,

Engagement and wellbeing, and

Termination.

Capable performance is often detailed as skill only, yet motivation is equally important. “Expertise, knowledge, and skills will not produce great results if employees are unmotivated.” [2] Instead, people need to understand how their behavior influences a performance measure that personally affects them and they need to care about the personal effect.

If your organization’s talent cycle integrates values that are unimportant to the people you need to drive a change effort or fails to integrate values that are important, motivation wanes where it cannot. When an organization espouses values that are not integrated into the talent cycle, skepticism and distrust enter the culture and undermine change efforts.

Solutions

Find the disconnects between assumptions by top leaders and the beliefs of key groups of employees. To do this, first accurately identify through effective interviews or network analysis three groups of people; those who have the power to make necessary changes, those who have the power to affect the thinking and emotions of others in the organization who can either block or drive necessary changes, and those who will be affected by and involved in change implementation. Then ask the questions that matter. For example, if you were to ask top leaders whether and why creating diversity at all leadership levels of the organization is important and then asked employees the same question, what would you discover? If you discover a lack of alignment, the first step is a strategy to increase motivation for the changes contemplated.

Do a detailed analysis of the effect on employees of each process in each point of the talent cycle. Are any processes causing employees to think, feel, and act in ways that will undermine or fail to catalyze efforts to create diversity at all leadership levels of the organization and a culture of equity and inclusion? If you discover aspects of the talent cycle that are creating skepticism or failing to motivate employees effectively, then overhaul the talent cycle to create the motivation necessary.

Eagerness to engage in training before sufficient system motivation and readiness is a waste of time and money. Even worse, it can worsen the culture by increasing skepticism. All too often, employees consider training to be a “check-the-box” activity for meeting the minimum standards set by law. Instead, avoid this ending by first building sufficient motivation and readiness for change.

[1] P. Gray, R. Cross, M. Arena, “Use Networks to Drive Culture Change,” MIT Sloan Management Review, November 30, 2021 https://sloanreview.mit.edu/article/use-networks-to-drive-culture-change

[2] E.E.Lawyer, “What Makes People Effective?” in Organization Development (Joan V. Gallos, ed.) 2006

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USE THE RIGHT MEASURES WHEN DEVELOPING YOUR INCLUSIVE AND EQUITABLE CULTURE

Every private company, governmental agency, or non-profit organization I work with to develop a culture of inclusion and equity agrees that integrating regular measure of key performance indicators is a critical piece of the strategic plan. Now, new research from Glassdoor sheds new light on the importance of not only making sure to gather the right data, but to also be certain that you are collecting the data from a diverse group and correlating data with social identity indicators.

Measuring gaps in inclusion and equity satisfaction surveys by correlating data points with employee race and ethnicity showed a very different climate than generalized data synthesis did. Not shocking, but easy to overlook, were data showing that “even within the same workplaces, employees from different backgrounds routinely report different views of how equitably (or not) employers are acting toward underrepresented groups.” An aggregate of all data points may incorrectly imply that an organization has a healthy culture of workplace diversity and inclusion. This limited approach may obscure the reality of possibly large gaps in opinions among similarly situated employees from different demographic groups. Glassdoor discovered that in fact, on the question of how inclusive and equitable the culture is within a variety of different organizations, “Black or African American employees in particular are experiencing or perceiving a stark diversity and inclusiveness crisis [with] little evidence, in their view, that the situation is improving.”

The research looked at 12,435 ratings collected between early 2020 and the present and found that the average individual employee rating of their company’s culture was 3.73 out of 5 stars. Black or African American employees’ ratings were nearly 8 percent lower, at 3.49, while Hispanic/Latinx employees’ ratings were above average at 3.80 and Asian employees’ ratings were even higher, at 3.98. These data makes demonstrate the likelihood of a blind spot in climate surveys that report only aggregated data from all employees.

The Glassdoor data suggest another area of concern regarding traditional DEI training programs. The gap uncovered has been growing since 2019, “expanding from 0.2 to 0.6 stars (on a 1 to 5 star satisfaction scale) despite many employers increasing investments in D&I programs in the last two years.” Too often training begins and ends with developing awareness of unconscious bias. This is necessary, but far from sufficient to develop a sustainable inclusive and equitable culture.

DEI programs should focus on the broader skill set of developing culturally competent individuals in addition to making structural and process changes to the organization itself. Cultural competence requires awareness of unconscious bias and more. Training and development also should focus on awareness and sensitivity to one’s own cultural heritage, curiosity, acceptance, and respect for cultural differences, a variety of conversation skills, relationship-building skills, and advocacy skills.

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