Channeling Change
August 28, 2008
Successful change management isn't as mysterious a process as you think it is. Sometimes all it takes is a knack for developing your company’s entrepreneurs.
By Caela Farren, Ph.D.
Change can be opportunistic or chaotic: it depends on your perspective. Do the trends and changes swirling around your organization spur entrepreneurial thinking or defensive action? Do you foster an entrepreneurial environment? Are there barriers in your organization preventing you from being entrepreneurial? What drives people to become entrepreneurs? How can human resources foster an entrepreneurial culture? What are you doing to support entrepreneurship in your organization?
The world is a system—more interrelated than we often think. Seeing this interrelationship, working across boundaries, and daring to have new ideas characterize entrepreneurs.
Cost of Change
Reactive organization change has a high price tag. Unfortunately, the automotive industry is a good example of not investing in the kind of research and development required to stay competitive. Reducing staff or increasing the effectiveness of manufacturing has not maintained our industry leadership. Thousands of people are being laid off or given early retirement as a way to stay the course until new technology and product designs are ready for the market. But being profitable and reducing costs cannot substitute for innovation. Why is it that Korea and Japan could see the needs of customers before U.S. automakers? And why were the great engineers who foresaw the need for fuel-efficient and hybrid cars not listened to until we lost our leadership position in the industry?
While the U.S. automotive industry sorts itself out again and concentrates on taking care of the needs/trends of consumers—fuel efficiency, global emissions, cost of gas, size of families, cost of manufacturing—we're paying a dear price:
• Loss of automotive sales
• Reputation in the global community
• Loss of U.S. jobs and companies in related channels (auto parts, tires, plastics, computers, etc.)
• Demise of company towns
• Passion and energy of leading engineers and designers
• Inability to attract talent
• Loss of competitive strategies
It might take a decade or more to regain the leadership in the automotive and automotive parts industry pioneered by the U.S. Why? Because automotive management did not respond to the many trends and changes surrounding the industry. Each year's earnings became more important than future earnings, sacrificing the future for present profit.
Building Entrepreneurial Thinking
Working with hundreds of thousands of managers and employees facing a massive organization change, I teach a seven-step methodology to foster positive change and entrepreneurial thinking. I call this the thinking required to become a CAPABLE Entrepreneur. This is the intuitive process used by entrepreneurs. It's not totally linear but rather, an organic and creative process:
• Catch the trends
• Anticipate new niches
• Propose realistic options
• Analyze the benefits
• Bolster your case
• Leverage your reputation
• Engage your services
Catch the Trends
A trend is a pattern of activity in a certain direction. It produces energy, electrical waves that have power. Trends are usually coming from a variety of vectors—customers, countries, organizations, think tanks, society, technology, etc. These trends, when caught and used, open the door for new creations. If not seen as patterns and recognized as seeds of opportunity, they become disruptive and chaotic. Any trend—growing fundamentalism, open-source code, increasing medical costs, talk of global warming, growing number of refugees, low cost of digital cameras, slump in housing market, explosion of the Internet, etc.—can be the platform for a creative entrepreneur.
Action: List three trends you believe will cause important changes in your profession, organization or industry in the next three years.
Anticipate New Niches
Widely known entrepreneurs not only recognize trends, but can anticipate specific new niches they could develop. They frequently use skills from several fields to create their new product or service.
For example, Scott Jones was steeped in the sciences of robotics, vision systems, optical storage, and parallel computing at MIT. He founded Boston Technology, Inc., in 1986, and created a voicemail system that was faster, more scalable, more reliable, more user-friendly, and 20 times bigger than those of competitors such as AT&T, Siemens, Northern Telecom, and others. Since that beginning in his mid-20s, Scott's resulting patented inventions have been implemented by nearly every major telephone company in the world and have enabled those companies to offer highly profitable voicemail services to hundreds of millions of their customers.
Action: Think of ten ways you could address one of the trends you've listed above with a new or improved product or service. If you get stuck, ask some people in your network.
Propose New Options/Solutions
Many people see opportunities, but few take the time to craft a novel and creative proposal. Be specific. Make a written proposal. (Writing helps us think.) Be sure you:
• Clarify the need you are addressing. Focus on only one niche. Choose a product or service you’re well positioned to offer.
• Identify your target market. Show how your offer meets specific needs.
• Make the offer to your organization. Craft the offer in a few short sentences. Engage their passion, be credible, and demonstrate you can deliver.
Action: Choose one exciting option from the above ten ways and craft a specific written offer, identifying your target group.
Analyze the Benefits
Research. Find out all you can about the company or target groups to whom you’re making the offer. Do at least a threefold analysis: 1) benefits to the company; 2) benefits to the customer; and 3) benefits to the industry.
Action: Write down your threefold analysis. Quantify when possible.
Bolster Your Case
Which of your prior accomplishments and experiences make your proposal credible? Have you delivered similar products or services? What competencies do you possess that will give others assurance? Catch their interest?
Action: List your accomplishments, experiences, and competencies, and make links to the proposal you're making.
Leverage Your Reputation
People who have already witnessed your accomplishments are your best public relations sources. Survey your network of people. Who will vouch for you? Current and former colleagues? Past employers? Customers? Colleagues in the industry? Who would be willing to put their name on the line for you? Who would fund you?
Action: List the names of people you can count on. Tell them about your idea and ask for their sponsorship or partnership.
Engage Your Services—Just Do It
Even before your proposal is accepted, think about what you need in return. What sort of environment do you need? Colleagues? Seed money? Hours? Location? Technology? Compensation—stock, bonus, percentage of profits, patent or trademark?
Action: Put your proposal in writing. Be clear. Be fair. Support your recommendations and have a fallback position
Once your idea has proved workable, look-alikes and feel-alikes will begin to emerge. By then, the entrepreneur may be starting the next business.
Sidebar: Entrepreneurship is on the radar screen for many foundations, universities, and venture capitalists. Which of the following practices does your organization use to foster entrepreneurship? Read "Five Ways Organizations Can Spur Entrepreneurship."
Caela Farren, Ph.D., is president of MasteryWorks, Inc., in Falls Church, VA. Her practice and company are designed to build strong links between changing trends in industries, changing strategies of organizations, and the talents and aspirations of individuals. For more information, visit www.masteryworks.com.
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