Oct. 7, 2021

How to lead your organization through change to achieve hard to imagine results in uncertain and volatile times with John Kotter | Global Thought Leader

How to lead your organization through change to achieve hard to imagine results in uncertain and volatile times with John Kotter | Global Thought Leader

In this episode of Partnering Leadership, Mahan Tavakoli speaks with John Kotter, professor emeritus at Harvard Business School, co-founder of a management consulting firm Kotter International and a pioneer in organizational change. John Kotter is the author of 22 books on change, including his most recent book, Change: How Organizations Achieve Hard-to-Imagine Results in Uncertain and Volatile times. John Kotter talks about the struggles leaders and teams face when it comes to change and how to transform organizations to adapt to change effectively and rapidly.


Some highlights:

-John Kotter on the role of human nature on our resistance to change

-The essential components for initiating change in the organization

-Understanding the Survive and Thrive mode and how it impacts our ability to change

-The power of Guiding Coalition to help bring expertise, energy, and perspective across the organization

-The difference between management and leadership



Also mentioned in this episode:

Kelly King, Chairman, and CEO of Truist Financial



Book by John Kotter:

Change: How Organizations Achieve Hard-to-Imagine Results in Uncertain and Volatile Times


Connect with John Kotter:

John Kotter - Kotter International Inc

John Kotter on LinkedIn

John Kotter on Facebook

John Kotter on Twitter


Connect with Mahan Tavakoli:

MahanTavakoli.com


More information and resources available at the Partnering Leadership Podcast website: 

PartneringLeadership.com



Transcript

Mahan Tavakoli:

Welcome to Partnering leadership. I'm really excited this week to be welcoming. John Kotter, John is internationally known and widely regarded as one of the foremost authorities on leadership at change. He's been a professor and continues as a professor emeritus at the Harvard business school and he co-founded Kotter International which is a leadership organization that helps global 5,000 company leaders develop the practical skills and implement methodologies required to lead change in their organizations. 

Now I have read all of John's books and love his insights on leadership and change. Most, especially because John continues to add new research and new perspectives building on the many different frameworks that he has developed over the years, including ones that he introduced in leading change, which was a book selected by time magazine, as one of the most influential business books ever written. We spend most of our time in this conversation talking about John's most recent book Change: how organizations achieve hard to imagine results in uncertain and volatile times. 

I've really enjoyed this conversation and I learned a lot from John as I have throughout the years also. I'm sure you will enjoy the conversation too. 

I also enjoy hearing from you. Keep your comments coming. mahan@mahantavakoli.com. Leave voice messages for me on partnering leadership.com. There's a microphone icon you can use for that. Those of you that enjoy these episodes on apple. Don't forget to leave a rating and review when you get a chance and follow the podcast on your favorite platform of choice, that way you will be sure to get notified of new releases. Tuesdays with magnificent Changemakers from the greater Washington DC DMV region and Thursdays with brilliant global thought leaders.

Here's my conversation with Professor John Kotter

Professor John Kotter. Welcome to partnering leadership. I am thrilled to have you in this conversation with me.

John Kotter: 

Well, I'm thrilled to be here.

Mahan Tavakoli: 

Professor Kotter, for more than a quarter-century, more than half of my life. You have been a leading thinker on change. I remember studying you and studying your work back in business school, and you have written 21 books two fables. 

John Kotter:

Yes.

Mahan Tavakoli: 

I've read all of the books and fables and love them.

We'll spend most of this time talking about your latest book, how organizations achieve hard to imagine results in uncertain and volatile times. it is an absolute thrill and honor because you were talking about change when most people didn't expect the piece of change to be where it is right now.

John Kotter: 

Without question. And again, it was found through just the research studies that I did. I've always been interested in performance. That's where it started. Why do some organizations outperform others? 

My doctoral thesis was actually on big-city mayors during the 1960s. It wasn't on businesses, even though it was done at Harvard business school.

And one of the most striking outcomes of that work was finally recognizing that no matter how you measure end results of how well those 20 mayors did in their jobs- on the economy of the city, on their own reelection public health, et cetera, the distance between the top three mayors in terms of results and the bottom three was nothing less than galactic. It was hard to believe and I think that got me even more interested in trying to understand why some people ended up performing so poorly, but even more interested in how it was possible to produce results, which the average, well educated, thoughtful, intelligent observer would say are highly unlikely, if not just impossible. 

And those stories that I've been studying for 40 years led me to the topic of change. Because even back in the 1970s and early 1980s, the pace of change was picking up. You were seeing more strategic initiatives inside of companies, not just one, a decade. And the firms that handled those changes well were outperforming the others. And change took me to the topic of leadership because leadership- we decided was not management, they're two different things, both serving very, very important functions. But leadership is very much associated with change, innovation and leaps forward. And so that's become a part of the staple of the work I am doing and it's exciting.

I had a conversation with a former student from the class of '95 and what he has done over the last, I think, 17 years, into a finance job in New York. I'm not positive. He eventually came back through his firm which his father had started the 1930s. And this was you know, one office. He has taken that over, run it in a way that's very consistent with the stuff that I write about. And 17 years later, it's market cap. Isn't 25 million. It's not 50 million. It's not a hundred million. It's 3.5 billion.

Mahan Tavakoli: 

Oh, wow.

John Kotter: 

And that's just the economics. He's got what, 25 times the number of employees. He's got a huge number of customers that are very, very satisfied.

You bump into these exciting stories and what he was saying is much as you did in the beginning of this conversation- that he's been following my written material says he was a student and using those techniques and they're paying off in a way that seems in many ways hard to believe, but it's true.

And we need lots more of that in this world.

Mahan Tavakoli:

And you've contributed a lot to that Professor Kotter, but knowing that I have some mayors, including big-city mayors that are fans of this podcast that I've sent emails- can't let that go without understanding when you looked at the most effective mayors the ones that weren't that effective.

 What were some of your key findings that then led to your understanding of leadership and change?

John Kotter: 

Although I'm not sure how much I use the words, leadership vision, building network of relationships that go far beyond just the municipal bureaucracy empowering people and inspiring people in a sense, create a mass movement towards some vision of making the city a lot better, despite very, very difficult time.

We have. Riots going on in the late 1960s. They were hurting people, putting people in jail causing terrible property damage on the downside. 

And what leadership- which is what we got from the best mayors that was to not just try to minimize the damage. The mindset is what are the real opportunities at this time for this city that will make a difference in people's lives. People could understand talking relentlessly about it. Getting people bought in and enthused and mobilized, and then having the faith to let go, because all great leaders throughout history are not control freaks. It doesn't work. You don't create mass movements by trying to control everybody's actions. And that's what these mayors did. And what's interesting also thinking back right this minute is we're all very different personalities. So it's not a personality issue. It's a behavior issue. It's a mindset issue. It's a way of looking at the job. 

The worst Mayors saw the job as purely a way to further their own narrow interests. a bit up from that, people who saw the job and very much make the bureaucracy function minimally well, so I can get re-elected.

 

And then you kept taking steps up until you find people who are really seeing that even if it's not in the job description of the Mayor, the name of the game is to provide leadership, to find the opportunities and the challenging and changing environment, mobilize people to capitalize on those and achieve more than people think is possible. Exciting stuff.

Mahan Tavakoli: 

It really is professor Kotter. And one of the other elements that is really exciting is that in some respects, you have stayed consistent with some of your messaging, but you've added research and more information and in this latest book Change, talk about the three major root systems that define the science of change, and you go into the human nature elements of it than I think you had gone into in the past.

What role does the human nature and our resistance to change and our capacity for change in organizational change? 

John Kotter: 

One of the fields of science that has come a long way in the last 20 years and it has a long way to go is understanding of the human brain and the hormonal system and everything that kind of is our basic heart wiring if you will. 

And four years ago, I started at the consulting company that I've found. Co-founded a study group to look into that, to see if there was something that would help us go deeper in our understanding of why and how some people were able to bring about incredible changes that benefited the masses. 

We decided that indeed there was something there, it was sometimes hard to find when you talk to the specialist who are neurologists because they aren't business people or don't know much about organizations.

Insight number one, which has huge implications for all of us is we- all homo sapiens people have built into us a system if you will. like a radar that's going on probably 24 hours a day when we're sleeping that's looking for threats. And when it perceives a threat, it sends out chemical information that spikes our energy level that focuses our mind, like a laser on the threat and can get us to do really quite remarkable things very quickly to get away from that problem.

When it was originally being developed 200,000 years ago, to runaway from the fables, saber tooth tiger or whatever, and zip up a tree at lightning speed. That system still is in us and it is very powerful and the average person, including myself until I did this work totally underestimates how it plays into our lives today. Because today that same threat radar, doesn't just look for saber tooth tigers. It looks for anything that it's been programmed to believe could be a threat to our ego, to our job, to our salary and career, to our relationships.

And we live in a world today that is more complex and more volatile and more noisy than the world in which that system was developed 200,000 years ago, by a factor of who knows what- a hundred, 200. So, What that means is if only unconscious, somewhere in our bodies, all the time 20 times a day, 50 times a day, there's a little system going "ahhhh" threat chemicals are going out or feeling a little stressed as our body tries to figure out, okay, do I climb a tree? What do I do here? 

Now that system still, when it works well- because there are real threats in this world. Every time we crossed the street, you can be hit by a bus. And there are threats on the job that are problems that need to be dealt with quickly, with energy and with focus.

The problem is the world is so noisy and pandemics politics the economy in the stock market, cable TV news, the number of things that can set us off and after a point, what happens is the system doesn't work the way it was designed for it just overheats in a sense it's like a car was radiator is just run out of water and it just comes to a halt and it kills our capacity to not only be a with a threat, more importantly, any capacity we have to look for opportunities. Provide that leadership mobilize the masses, making important things to happen. It tends to get shut down. 

Now the good news is we do have another system on us that is oriented toward that latter set of actions. My best mayors. It helps us as a species thrive and it helps you and I, as individuals thrive by A- Looking for opportunities. B- Sending out different chemicals that raise our energy and make us feel excited, sometimes passionate about some issue. And as long as we can make progress for what we perceive to be progress on, whatever that opportunity is, then energy level can stay up for a remarkable, long period of time. It's not the peak and then exhaustion, then you fall asleep. And understanding that those two systems with this survive, one more power is at the heart of human nature has all kinds of implications for managing people, running organizations and the like, 

Mahan Tavakoli: 

And Professor Kotter for me, this was a real lesson to be learned because, over the years, eight steps start with creating a sense of urgency. And one of the mistakes that I see other leaders make is to create a sense of urgency based on fear. The fact that we are not going to be able to survive composition is getting bigger or stronger than us.

And the point that you make that really resonated with me is the fact that is exactly the wrong way of trying to create that sense of urgency, which is your step one in initiating change in organization.

John Kotter: 

This burning platform idea is based on as you just said so well raising fear, anxiety, and other kind of tension fills, stress fill negative emotions. In terms of producing change, in strategy, execution, digital transformation, or restructuring, you name it. That can possibly create and sustain the energy that's needed to make those changes happen.

It produces a blip and more often than not. Because it gets absorbed by an individual. You, me, as a threat to our survival, we define the problem how do I get out from underneath this problem? Which doesn't help at all.

If you look at how great leaders and great organizations create and maintain a sense of urgency, I see much clearer than when I first wrote that twenty-five years ago. It's all about opportunity. It's all about getting people excited about some possibilities. and it's all about that level of energetic passion that gets translated into people being alert on a daily basis as they do their jobs for just little things they can do to push a strategic initiative ahead.

That is what makes for a sense of urgency and keeps it up for enough time to achieve something really significant.

Mahan Tavakoli: 

Professor Kotter, what role does organizational purpose play in being able to create a positive thriving sense of urgency in people rather than a negative one?

John Kotter: 

Once you get some clarity on what your biggest opportunities are, the second question is, okay, it's still an opportunity, but what's the point? Capitalizing on that opportunity that could be done in ways that produce a variety of different kinds of benefits. So what's our objective? What's our mission? What's our purpose? 

And then with that in mind, you can take a step back and say, okay, if that's the mission, that's the purpose, what would this look like if we really made progress over the next year or two years or five years? And that's a vision which you can start articulating and talking to people about and making something less abstract and more concrete about how you would be treating, what kind of customers you are dealing with, how you be treating them, et cetera, et cetera.

So I think purpose is an important piece of it, but it's a piece that kind of sits in between opportunity and vision. a month ago, two months ago had an opportunity to talk to the gentleman who was the chairman and CEO of now the sixth-largest bank in the US.

His name is Kelly King. I have not met him face-to-face but I've had a chance to talk to him. He came into my life because believe it or not, he bought close to 28,000 books for his entire staff. And the general public, unless you're in the Southeast, would not recognize the name of this company because it's a new name of a function of a merger and in talking to him and in talking to his COO bill Rogers. 

When I asked them, how did you go about thinking about merger integration and where did you start? Kelly says " we started with purpose" and they got hit, with COVID like three months later but they have managed to do a remarkable job during this COVID period of bringing these two organizations together. Because they didn't do what is the normal M and a game, which is you've got a checklist of things that have to be done and you kind of check them all off.

And nobody thinks that are bigger sense or more human sense or recognizes the big problem that could come about, which is you got two organizations that don't ever grow together. You never get the one plus one equals three. You end up with two cultures that fight each other. And by talking about purpose and in very human terms for the entire bank they got the M and A integration off to a terrific start. and despite the problems of COVID and made incredible progress. 

Mahan Tavakoli: 

That's a wonderful example of professor Kotter and the reason I, encourage everyone to reflect on it is that a lot of times we forget when we were talking about change and change in organizations, it's humans in human systems, it is not structural. And the mistake, a lot of times people make even looking at your eight steps is that they approach it as steps on a PowerPoint slide rather than recognizing it's humans that need to embrace this. That's why the research and the thoughts that you shared with respect to how to incorporate that sense of purpose and a positive sense of urgency are in my view, some of the most critical thinking needed for organizations to be able to change. most change initiatives as you know, vast majority, almost 80% fail in part because that's exactly what they feel at doing.

John Kotter: 

There's no question- it's ultimately people that either make it work or end up in a survival mode and resisting change or passively undermining you. Not because they're bad people. They're just being human beings and you're not approaching them correctly in the way you go about trying to make the change.

Mahan Tavakoli: 

Yes. Now you build on that and you also talk about the challenge we have with modern organizations and their limitation. There is a management-centric design has been built at least over the past hundred years for reliability and efficiency. And those are not the designs that can take us into the future.

John Kotter: 

Most people I suspect don't realize that organizations, as we know them really were first built because of the industrial revolution and science in the late 19th century. The average business, before that, before the civil war had maybe five employees, it was a small farm or a small shop.

That was a huge business, a single textile mill with maybe 80 employees. That all began to change at the end of the 19th century. And what they discovered is that when you try to involve a thousand or 5,000 people at not one but 50 locations, the whole thing turns into chaos and so they had to invent and they did invent in the late 19th century something, which today, we call the management.

There were no management schools of business before the 1880s, they didn't exist, they weren't needed but the discipline’s purpose was to somehow coordinate all of these people doing different jobs in different locations, in a way that was efficient enough to make money for investors and reliable enough to give the service or product to the customer.

That was a huge innovation at the time and a hugely difficult task. Although if you look at a business around 1900 versus today, you would see a lot of differences that are a function of the fact that they didn't have cell phones, they didn't have TVs, they didn't have the kind of building that I'm in right now but the organizational form in terms of an entity, plans, and budgets, and it has a hierarchal structure and it has a system for bringing in and hiring employees and managing them. And the focus is on metrics. That was invented then still use today. But it doesn't produce outcomes of innovation leaping into the future, adapting quickly and agilely change that wasn't the purpose and it doesn't do it.

Now, can you take the basic organizational form that comes out of the industrial revolution of 150 years ago and make it something that can be much more adaptive, agile, etcetera? Yes, that's what we've been studying now for decades. And it comes back to leadership. It comes back to a variety of processes and behaviors that were not centrally important to most businesses 50 years ago, like creating and maintaining a sense of urgency.

And what the great businesses are doing today. And I would say public institutions too, is they're experimenting with how to not throw away the machine that makes sure that the trains run on time, so to speak. But they can have another piece that can work hand in glove together with the traditional form that can be innovative and adaptive is more leadership than management. It's more networks than hierarchy. It's more heart and mind, than  physical labor and everybody's going to have to go that way eventually. 

And right now I'm going to be talking to some people who run federal agencies in the US next week. I was just doing it prep before we started talking. And some of them have got real challenges their bureaucracies are just so slow, slow to adapt and so survive oriented- who's the next administration and what are they gonna do to us. And yet, if we can get those federal state level, and city-level bureaucracies into the 21st century, we are all going to suffer greatly.

But I go back to my mayors and I can say it can be done. We've seen it. It's amazing what can be done? Understanding what creates adaptive change, agile change to take advantage of the opportunities.

Mahan Tavakoli:

It is really hard. Professor Kotter. I'm as you know, out of greater Washington DC region and a lot of organizations, whether federal agencies or quasi-government organizations talk about the limitations, their board of directors and the structures and how hard it is, but part of what you talk about is the fact that there is need for leadership and there is need for greater leadership.

I love your quote you say leadership is not the problem of the few. The only way we can adapt to have lots of us lead.

John Kotter: 

The heart of the solution to our biggest challenge these days is getting more leadership from more people. The unusual suspects we have seen in our consulting practice again and again, examples that of people who the top executives have never heard of they're buried in the hierarchy.

We've got great stories about third shift manufacturing workers about young people that are on nobody's chart of high-potentials. About old people somebody that's five years from retirement that is assumed by the powers that be out of the past year, who, if you handled them correctly if you can reach in and help activate their thrive mechanism with good leadership, they turn into leaders for people around them and you get enough of those people leading and you get a mass movement.

I mean, If you go back The first high-tech organization in the globe was IBM. And if you look at the Tom Watson story, it's a fascinating story but even though it's set at a time, that's almost a century ago and in an environment that had no computers. That's post World War Two.

Nevertheless, if you look at his actions as the head of a business, they're not that different from the student I was telling you about earlier, who has increased the market cap on his firm by an unfathomably large amount He mobilized huge numbers of people within IBM to innovate at a time when innovation in his industry was not the norm and to work hard and be loyal and be positive during the beginning of the depression when most organizations were facing and created by the actions of the executive, the exact opposite- loyalty going down, depression going up, etcetera, etcetera.

Then now mobilizing more people to provide more leadership. I am absolutely convinced based on now what 15 research studies over 40 years- is the central key to a prospering organization and even broader to a prospering society and world.

Mahan Tavakoli: 

And Professor Kotter. The question is how you highlighted beautifully there is an element of nature. In creating a sense of urgency we need to appeal to the thrive rather than push people into survive that modern organizations need to be rethought with respect to a greater leadership and less management structures and then we need leadership all across the organization. 

So as leaders are listening to you, what do they need to do to make that a reality within their organizations to have more people lead the way you say it takes to lead change and organization?

John Kotter: 

Start small and let it grow organically. Do not put together a plan with 96-hour point slides that will put all your people to sleep. Seriously, start with yourself as an executive. What do you think are the big opportunities that your department or your division or your company? How well are you moving to take advantage of those opportunities? The answer if you're on us will be not as fast or as well as you could then all right, how can we get some discussion going on about that and not just about problems? Not to ignore problems, that's not the point, but more communication and more dialogue, and more hallway chatter an opportunity for us, then see who reacts to that. 

Everybody won't react in an enthusiastic and positive way. That's okay for those who do allow them into the discussion from informal network groups that start looking for ways to move projects along, faster and better. Don't stifle them with rules and how to run the task force or whatever. Let it be more organic. Be very careful to make sure that they actually do achieve some.

One of the things that we do at the consulting firm is show people how you can mobilize a group of people in 90 days to achieve much more than they believe is possible. And how that builds momentum, creates Credibility, pulls more people into this. Now you're getting a kind of a mass movement around whatever the initiative is.

There's no reason that everybody has to be brought in at the beginning. That's just not natural innovation comes from diversity. We know that when we set up a guiding coalition, what we call a guiding coalition, we always want to have a senior exec and an executive assistant. It's awkward at first because they're not used to being in the same meeting as peers, but you can teach people to do that and once they get used to it, it's so human it's so natural. They'll like it and they can start interacting in a new way with new information better information flows, which means more innovation. The fact that they're doing it and it's their ideas, they get more and more excited about it. 

Again, as you guide to make sure that they achieve something that will start to swell skepticism and start to get more people excited, you start to bill and you w ill, and over a period of time, you're going for maybe at first three, people providing leadership on this big opportunity to a time when hundreds or more.

I mean, the data is so clear when you look at how much the rate volatility complexity of change. It's been going on for 200 years with a big blip in the last 50 years and now in the last two, of course, COVID has thrown all kinds of wild challenges at us.

Who knows what will be the next thing that produces spike. But the curve is that way. And building change muscle, if you will, inside a firm, is essential and it can be done by actually doing it. 

Number one- watch out for people who are selling you a blueprint of exactly the way it should be in five years because nobody knows. The name of the game is learning. Trying things that are intelligent, which will require change, always and leadership learning, evolving.

Number two- taking a look at what you're doing that you didn't do before the pandemic and making sure that works better and making sure you don't lose this when you go back to work. Companies are going kind of stumble upon some habits that are actually better the way we used to work. We don't want to go back to that.

Three- be very careful that you don't pull back with the real estate and the face-to-face interaction and the normal way we add meetings, et cetera, some methods of operating that you should have probably gotten rid of 10 years ago, that the pandemic forced you out of, but never underestimate the power of history of pulling things back the way they were and search relentlessly for the opportunities that these awful two years present you. I have yet to see the business that I've had a chance to look at it in any detail one arena of activity that is open to them today for great promise. That literally was not available two years ago because of the conditions then everybody should be looking for those opportunities and getting their people to focus on them.

And finally, we've got to start using the time when we “go back to work”, which is going to require some changes. As not only a time to make intelligent changes but as a way of practicing building our change muscle, because we all need to have firms with greater change muscle, which relates to more people, providing more leadership for better results. To go back to the very first thing I said on this, I can see it coming because I've seen some articles recently. The future of work. Here's what it's going to look like in four years. Nobody knows. That's okay. Don't be afraid of that. As a matter of fact the fact that nobody knows means your competition doesn't know. Either the name of the game is evolving, changing, learning, and not making negative assumptions.

Again, if you look at the big picture over the last 200 years, humanity has made unbelievable progress. There is no reason why that kind of progress. If we handle our organizations, businesses and governments can continue for another 200 or 400 or 600 years. I think the possibilities for the human race and for my children, your children, our grandchildren are absolutely fantastic. 

Mahan Tavakoli:

They are and as you said, Professor Kotter changes one of those muscles that we need to develop for this future. parts of history we've required different skill sets to survive and thrive. is one of those. 

In addition to your own books, are there any books that you find yourself either recommending or you're reading now that you say are insightful books that I recommend to leaders? 

John Kotter: 

Well, I read all the time and usually not in my field. I'm reading a fascinating book, right now about the relationship of JP Morgan and Teddy Roosevelt a century ago, and how that relates to how the 19th century turned into the 20th century in America. I'm also reading a book about a publishing industry and all the changes going through and a novel about a mystery. 

But one of my favorite books to recommend is a big picture book and its title is Mandela and it's with some text about his life and some pictures from his life.

On the first page which is blank, in shaky handwriting is a note from Nelson Mandela to me, so long story about what created that but it reminds me that his autobiography is one of the great books. I think of all the times in helping us to understand something about leadership. there is so much in there. That you can pick up about the way a person like that sinks thinks the way he treats other people and the way he goes after opportunities. It's a marvelous book to read.

Mahan Tavakoli: 

So Professor Kotter, what's the best way for the audience to find out more about your own, consulting firm that, you have in addition to your books and other resources. 

John Kotter: 

Okay. If you go to www.kotterinc, so it's K O T T E R I N C.com. You will find a lot of free resources and stories from the feedback we've got, can be very helpful This is the new book. it's only been out two months and, it has, the latest of the studies and the recommendations and the stories from my work and that's available. through regular book sources. 

Mahan Tavakoli:

Professor Kotter I mention in beginning, you have contributed significantly to our understanding of change over the years and I studied a lot of your both in leading organizations and now in guiding organizations, in them and consulting with them. 

So I appreciate that and I most especially appreciate this new book change, how organizations achieve hard to imagine results in uncertain and volatile times, which we do live in. Primarily because as I mentioned to you, I hadn't married the concept of the urgency within the need for it to be a positive urgency as much and that really resonated. 

And the difficulty, but the necessity to have leadership at all levels it is not just the senior or most executive levels. will be the organizations that survive and thrive into the future. So I truly appreciate all of your contributions over the years taking your time to share some of your thoughts, in this, brilliant book and in the partnering leadership conversation.

Thank you so much, professor John Kotter.

John Kotter:

It has been my pleasure. Keep up the good work.