A friend of mine runs a 3D printing lab, and I asked him recently what type of people use his lab the most. He said his two largest customer groups are retirees and students. I then asked which of these two groups are the most innovative, and he surprised me by saying the retirees. Many, including myself, would have guessed the students.
Why would there be such a high level of innovation among the retirees? Maybe it has something to do with their freedom at this stage in life—freedom from traditional business mind-sets and structures designed for stability and control, rather than innovation and change. Many likely spent most of their careers in this type of environment and once removed from it, they are free to explore their ideas and come up with innovative concepts.
Since 2015, our clients have been telling us that they are in a constant state of disruption and that change has become an everyday occurrence in their business. Fifty-seven percent say the level of disruption is at a moderate—not a minor—level. Further, 76% say that change is requiring them to evolve their business model—i.e., they need to make fundamental changes to how they operate, the products and services they deliver, and the partner ecosystem within which they do business.
So, how should they deal with this increasing climate of change? Traditionally, the typical approach to change has been project based. Many organizations have handled change as a one-off project requiring specialized capabilities, such as change management. The assumption has been that, for the most part, we build organizations for stability, control and economies of scale. However, special situations might arise requiring change. As a result, we adjust our management processes as a special project to help the organization move from state A to state B—from stability to stability.
Today, however, there is constant disruption across sectors, and this requires constant (and fast) innovation and adaption. In this context, we need to build organizations for agility, not stability. They need to become agile in responding to change quickly and as a normal part of business.
To become agile, organizations have to rethink how they work. Their structure, governance, systems and processes need to evolve. Overall, what they require is an agile operating model that enables change to become business as usual. They can no longer handle change as a special occurrence requiring one-off projects managed by a few (and often poorly). Rather, they need to manage change as a part of everyday life.
This approach toward change is fresh and motivating. Change becomes something organizations no longer fear; instead, they embrace and enjoy it. They become comfortable with change and empower their people to adapt quickly on an ongoing basis.
In the past, organizations have stereotyped people as being resistant to change. However, people are actually good at dealing with change and can adapt to it well if they are in the right environment. They need an environment that encourages them to explore and innovate and removes traditional hindrances to innovation—hindrances such as performance management processes that discourage risk-taking, or hierarchical governance processes that delay ideas, or mind-sets that limit collaboration internally and externally.
When organizations move from a focus on stability and control to a focus on innovation and agility, change is no longer a threat, but an exciting opportunity. It is something their people welcome instead of resist because it is a normal part of doing business, and they are intricately involved in managing the change (as opposed to specialized teams). Change becomes part of the organization’s DNA and a key driver for success.
In my final blog in this series, I’ll dive into what an agile operating model is and why it’s so important to empowering organizations to innovate and change. In the meantime, feel free to contact me with any questions or for further discussion on change and its impact on your organization.