Are your people truly ready for change?

If there’s a bright spot in the data for me, it’s that CEOs and employees agree on one thing: there is an urgent need to reinvent. In fact, for many companies, their very survival depends on it. Among CEOs, 39% say that their organisation will not survive 10 years on its current path, and the number is nearly as high among employees (33%). 

I believe that large change programs can succeed only with a workforce that’s empowered to take risks, speak up and directly engage in the process. Get that right, and your reinvention program stands a much better chance of hitting its goals. Get that wrong—and our data suggests many companies are—and your employees will simply go through the motions and tell you what they think you want to hear. People tend to adopt what they have helped to create, so if you involve your employees in the transformation, they will feel ownership and help drive the change required.

How to do better? I think companies can improve their culture and become more reinvention-ready only if leaders and managers apply a humanistic approach to engaging with the workforce. This is one of the key characteristics of a transformative leader.

• Take a genuine interest in your people. This one should go without saying, but in my experience, leaders get it wrong all the time, for a host of reasons: executives are busy, they’re used to Zoom calls and trying to be hyper-productive, or they simply take their people for granted. I'm here to tell you it’s imperative to authentically show interest in your people, because if you don’t do that, the other things on this list won’t matter. Listen to your employees, not just about their current workload but about what’s going on in their lives. Take the time to understand how they work, what motivates them and where they want to go in their careers. Establish trust on your team by being trustworthy yourself. 
• Show humility. Acknowledge your limits and talk openly about situations where you don’t have all the answers or relevant expertise. It may seem counterintuitive, but you can build credibility through candour. Research backs this up—managers who admitted mistakes were more effective at building a culture of learning and generating helpful input from their employees. 
• Create safe environments for feedback. Make sure that all ideas are heard, and create an environment of psychological safety. Ensure that everyone gets a chance to contribute and knows their suggestions will be valued. In some situations, this may mean managing team dynamics and establishing (and reinforcing) norms for how people on your team treat one another. For example, if one person consistently talks over others or belittles suggestions in meetings, leaders need to call out and correct that behaviour. Similarly, rather than focusing on “best practices”—which implies that further improvement isn’t possible—work toward “better practices” by encouraging your people to question why something is done a certain way and to suggest alternatives.
• Restructure incentives to reward experimentation. Change performance metrics, evaluation processes and incentives to encourage experimentation. Set guard rails to clarify which processes need to be strictly followed—for example, certain ones in regulated industries, or those that could prevent exposing the company to risk—versus those that allow employees greater latitude to experiment. Some organisations set up sandboxes: self-contained environments that let employees try new things using real data and applications but without any interactions outside the company. 

Businesses face an existential threat from disruptive change. To respond, they need to reinvent, which requires that they put the right culture in place for everyone to contribute. Many CEOs think they have this kind of culture in place, but, as our data shows, that may be optimistic. The smart ones will take steps to ensure that they really do.