THE PEOPLE WHO BUILT THE HOUSE CAN’T RENOVATE IT: BUILDING THE RIGHT TEAM FOR CHANGE

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Hey there, and welcome to Episode 46 of the No Bullsh!t Leadership podcast. This week's episode: The People Who Built The House Can't Renovate It: Building the right team for change. We talk a lot about building the right team, being a strong enough leader to get the best individuals onboard and then putting those people together so that all the ingredients are enhanced to deliver exceptional performance. This is not an easy task. When you’re brought into an organisation to deliver a turnaround, or when the CEO says it's time to make a major performance and culture change, it isn't going to happen by expecting the same people to do things radically differently. The trick, is to blend the best of the existing capability and culture with new ways of thinking, behaving and performing. What role do we as leaders play in that?

In this episode which further expands on the episode several weeks ago on building a balanced team, we explore how to put a team together that can truly change an organisation without breaking it.

So first up, I want to introduce you to my metaphor of the renovators dilemma. I'll move on to talk about the white blood cell phenomenon in organisations. I'll touch briefly on the need to work out who it is who will actually stickj, and I'll finish by covering off on how to approach this so the organisation doesn't flounder during the transition. So let's get into it!

I want you to imagine a young couple in their mid thirties, let's call them Matt and Amy. They've both had a little bit of career success and they're making good money. They want to start a family, but they want to get established first, so, they buy a block of land sensibly on the outskirts for major urban centre, and they design and build the house of their dreams. It is tailored to their exact expectations, needs and desires. And so they get established in the house and kids come along and they're happy living there for many, many years. But finally, as they do, the kids move out. Where on earth did the last twenty five years go? By now, the place is looking just a little dated, and with only the two of them as empty nesters, they decide it's time to downsize. They basically want to freshen up their dream home so that they can put it on the market and get the best price they possibly can. Guess who the very worst people are to design that renovation work? Matt and Amy. Do you know why? They're the couple who lovingly designed and built this house. They built it to suit themselves and they have loads of happy memories from being in that house just the way it is. If they try to design the renovation, they will always be hamstrung and held back, by their experience of twenty five years living in a house that they love.

So they need someone from the outside to come in and help them. Someone who has designed and renovated dozens and dozens of homes, someone who knows what's possible and doesn't have the same limiting beliefs that Matt and Amy do. Someone who knows what the current architectural interior design trends are. Someone who knows what other houses in the market look like and how their dream home compares. And of course, this is going to effect the price point. Someone who knows about the latest technologies in building materials, fabrics, tiles, fittings and so forth. Then and only then, can the needs of the potential buyers be met by taking the best aspects of the original design and the experience of Matt and Amy, and marrying that with modern day methods to create an exceptional outcome.

And so it is with organisations. If you want to make any significant change, the only way to do it is by largely ignoring some of the things that are conventional wisdom inside that business because the people inside it have got it to where it is now, and if you want to take it forward to a new place, you've gotta have different perspectives, different attitudes and different standards. I have absolutely no doubt in my mind that if you want to change the culture and performance of an organisation, the people who built the house cannot renovate it - well, at least not alone.

When you try to bring major change into any organisation there will be resistance from many of the people who like things ‘just the way they are’. And I've come across loads of expressions to describe these people. I've heard them called ‘root guards’, so in other words, they protect the root of the tree, the core of the culture, whether it be good, bad or indifferent. And they make sure that nothing gets to the root of the culture that exists in the organisation when you turn up. I've heard people called SQD’s, I like this one, SQD is an acronym that stands for Status Quo Defenders, and same deal, they'll do whatever they can to protect the culture the way it actually is. Now interestingly, when people are root guards or SQD’s they won't tell you to your face. They will subversively and passively aggressively do what they can to foil any change you try and make. I've got to say, though my favourite expression to describe these people is the organisation's white blood cells. I wanted to find the best way to explain what this is and how these white blood cells operate in an organisation, so thank goodness for the University of Rochester Medical Centre, because they captured this concept perfectly. And I’m going to quote from their website “Your white blood cells account for only about one percent of your blood. However, their impact is big. White blood cells protect you against illness and disease.” Now, illness and disease in this case is change. “Think of what blood cells as your immunity cells. In a sense, they are always at war. They flow through your bloodstream to fight viruses, bacteria and other foreign invaders that threatens your health. So when your body is in distress and a particular area is under attack, white blood cells rush in to help destroy the harmful substance and prevent illness.”

I think this just perfectly describes how some people operate within a culture that they don't want to change. So when you come in, they'll nod and smile and tell you they're friendly, “We are the ones who keep the organisation healthy”. But what they're really trying to do is to thwart any possibility of major change to that cultural bias. So I went into a large organisation once where I had to make some major change and I inherited a team of people who looked for all intents and purposes like they were very, very willing to move into the New World because we had to change. There was absolutely no choice. What did I find, though? As I said before, they will nod and smile and tell you they're going to do everything you want them to do and they're going to change and they're right behind you. But when push comes to shove, they won't actually do it.

Here’s a really good example. I said one individual once “I'd really like to you to get after this. I think we have a real problem in the organisation with X, and I really like you to go and get after it. So can you please go away and start working on it, put a team together and draw me up a project plan?” And so they said, “Yep, sure boss, no worries would love to do it”. Now, it all just went a little bit quiet for a while. And maybe it was two weeks where I hadn't heard anything. So I went back and had another meeting, I said, “Look, that thing we spoke about a couple of weeks ago, how did you go with it?” and they said “Oh yeah boss no worries it's underway, it's under control. No problems at all.” Okay, no worries. And it wasn't until much later where I said, “Look, I haven't seen any evidence of what's going on. I haven't seen a plan. I haven't seen resource requests, I've seen nothing. Can you tell me where you're up to?” And then I got the real news. “Oh, boss. Well I'm going to tell you why that never would have worked anyway. We didn't start it because it couldn't have worked.” And so I got the diatribe of all the reasons why a very, very simple request wouldn't be fulfilled, after I'd initially been told that they were all over it.

What I realised was that in this culture, they'd got used to bosses telling them to go and do something, and then never actually checking to see if it's been done. So of course, the Ronald Reagan quote I love and use quite frequently, “Trust, but verify.” Had I not verified, I would have been none the wiser number one, that what I wanted done was not getting done it all and number two, that I was getting this passive aggressive defiance from the people who are trusted the most. Now that's probably a fairly extreme case, but it does happen, and I want to give you just one other thing that's fairly extreme as well, because I said before that they won't tell you to your face. But you know what? Sometimes they are actually brazen enough to tell you to your face. And I remember when I first started at CS Energy I was up at one of the sites, and I was having a conversation with a guy who was a low level leading hand, and we were chatting away about stuff and he was quite amiable. But at one point in the conversation, he look at me said, “Listen mate, I've seen about four of you in the last ten years. CEOs come and CEOs go, and you're going to leave here, and I'm still going to be here, and nothing much is going to change.” Now, as shocked as I was that he was brazen enough to tell me that directly to my face, I've got to say, he did have a point. And that point was that the people there would do anything to protect the status quo and that they'd seen people come and go who didn't have the resolve to make real change. So I suppose he would have been quite surprised when he saw the clean out of the management team above him, happen at some pace.

One of most important things to do early on is to work out who will stick and who won't, once you bring in a new philosophy. And you've got to find that power base really, really quickly. The interesting thing though, is it's not positional, it's not based on the hierarchy, and it's certainly not the most senior people who hold that power base. It's opinion leaders right throughout the organisation in the funniest places. I've been in organisations where they have an ‘Admin Mafia’ where some of the people in the administration areas are the ones who decide what happens and what doesn't happen, because they are the ones who have access to all of the executive’s information. Those things are really, really hard to break, but it's the covert power base that is going to hold you back the most.

Many years ago I was on a trip to China and I visited a site run by a large builder Lendlease and I was talking to the Lendlease construction manager there, and he was telling me how on that site there was a People's Republic of China party member there who all of the other workers would defer to. But he didn't have any position or title, and this construction manager didn't know who that individual was. But for example, if one of the workers wanted to get married, he would go and talk to the People's Republic of China representative to get his blessing before he made a move. And it may have just been a leading hand, a trades person, a supervisor. He didn't know who it was, but that was a person anointed by the party. And people inside the organisation who are root guards or Status Quo Defenders or white blood cells are going to be sometimes as hard to spot as that.

So the bottom line is you need to give everyone a chance, but you need to watch and listen really carefully. And you need to be strong leader upfront about what you will tolerate and what you won't. So, for example, I would say things like “If you don't like where this is going, I really respect that. You need to make your own choice, but you'll very quickly find yourself at odds with the organisation's objectives and with my expectations. And you'll have to make a decision based on that.” If you're going to say things like that, you can't be afraid to free up people to allow them to be successful in another organisation when that's necessary.

So you're going to get a few different types of people to deal with. Some people are going to be thinking “How can I outlast this guy?” and they'll go to ground. Some will just roll with the punches and just say “Yeah sure, whatever boss”. But some will turn out to be your best leaders because as soon as you walk in and tell him what you want to do, they say, “Thank God you're here”.

Now we've worked out that the people who built the house can't renovate it, but we don't want to throw the baby out with the bathwater. So how do we make sure that we can make significant change quickly, without destroying the good things that are already there? So the first thing is, we’ve got to work top down. You deal with the leadership first. People at pretty much every level are doing what they think they're being asked to do. And so the leaders set the tone, the pace and the standard as I say frequently. But with multiple leadership layers, this is pretty hard, you've got to start with your direct reports and move downwards from there. And interestingly, apart from the very obvious cases, you can't do it yourself. You've got to set expectations for the quality of leader you want in the organisation and the pace of change, and then you've got to lead them to get on with it. But it's always been about integration of the old and the new. Work out what you absolutely need to keep first and foremost, because they were going to be some things that keep that organisation running that you will absolutely need to keep. Then think about what you don't sufficiently understand and there’s going to be a lot of stuff in this category. And the stuff you don't understand that could be quite high risk. So park it to the side until you understand a little bit better, and then of course you need to work out where you're obviously weak and bring those skills in.

So for example at CS Energy, when I turned up there it was almost devoid of commercial skills and commercial acumen. So that was the first thing I had to bring in. It had very, very weak leadership, and so that was an area that I had to build quickly. Look at who the good people are. Now remember, this is not about the front line, it's about the leaders. And quite often you've got a bunch of good people who have just been poorly led. But ultimately, if you're serious you'll be replacing somewhere between one third and two thirds of all the leaders below you. Because they either a) created the underperforming world that you're trying to change (i.e. they were the ones who built the house) and; b) they supported the development and perpetuation of that culture, or; c) they were too weak to do anything about it, which is a character flaw, and you're not going to get them to do anything hard when you're trying to make the organisation different.

So a lot of the good people in the organisation have the right values and intent but have just been poorly led. And poor leadership creates a number of other issues that have to be undone. For example, creating a low trust environment. Just bear in mind that you don't have to do this. You can easily sell the message those above you that you're a fan of evolution and not revolution, and there are many other cliches you can substitute that one with. So for many of you, this concept of making sweeping change will be really daunting. Just know, that if you choose not to pursue change this vigorously, your results will be slow and in some organisations, positively glacial. Incremental change with the people who built the house will never be truly effective, and you'll find that anything you do will revert to the path of least resistance. So don't kid yourself that change is actually being made.

Strong leaders are prepared to raise the bar on the standards for both performance and behaviour and then to put the leadership in place to make sure that this becomes an intrinsic part of the organisation's culture.

Alright so that brings us to the end of Episode 46. Thanks so much for joining us and remember, at Your CEO Mentor our purpose is to improve the quality of leaders globally. So if you're enjoying this podcast , please share it with the leaders in your network who you think will benefit, because that's how we improve the world of work.

I look forward to next week's episode; Common Leadership Misconceptions.

Until then I know you'll take every opportunity you can to be a No Bullsh!t Leader.