My favorite insights from

“XLR8” (Accelerate)

by John P. Kotter

Maarten Cannaerts – 1/5/2014@maartenc

Images from www.sxc.hu

The world is changing at a rate at which the systems, structures and cultures built over the past century can no longer keep up.

Incremental adjustments to how you manage and strategize, now matter how clever, are not up for the job.

This book answers the question how to stay competitive and grow profitably amid this increasing turbulence and

disruption…

… by identifying two necessary operating systems companies use in their operations and change work.

A combination of these both operating systems is necessary to be successful as a company.

Operating system 1 (hierarchy)

With a well structured hierarchy and with managerial processes that are

driven with skill, this mature organization can produce incredibly

reliable and efficient results on a weekly, quarterly or annual basis.

Such an operating system lets people do what they know how to

do exceptionally well

The limits of this hierarchical system (operation system number 1)

• You find yourself going back again and again to the same small number of trusted people who lead key initiatives.

• Communication across silos does not happen with sufficient speed or effectiveness.

• Information from top to bottom and vice versa is slow.

• Policies, rules, procedures become barriers to strategic speed.

• People cling to their habits and fear los of power and stature.

It is easy to blame the middle management, but the reality is that this problem is systemic and directly related to the limitations of

hierarchy and basic managerial processes.

A management driven hierarchy systematically creates

competitive complacencyand, when the pressures are great, false urgency.

Silos limit access to information about the big picture, and certainly any big picture opportunities or threats.

Narrow job parameters send the message that as long as you are doing your little job today, you are fine.

Managerial processes tend to focus people’s attention inward – on the budget, the plan, the staff, and the metrics.

Great communication – no matter the topic – always connects with people’s feelings and with what they find meaningful.

But the management driven hierarchy does not even try to connect with feelings. Even if it tries to communicate information about a Big Opportunity, it will have an inclination to do so by making a “business case” for it.

What we need is a second operation system, which is

organized like a networknext to the existing hierarchy.

This network based operating system complements rather than overburdens the hierarchy, freeing the latter

to do what it is optimized to do.

Informal networks of change agents

operate under the hierarchical radar to make something new

happen faster.

The processes in this network look less like management and

more like

mobilized leadership

The dual system organization has on the one side the hierarchy, on the other the network.

The network organization contains no bureaucratic layers, command-and-control prohibitions, and six sigma processes, the

network permits a level of individualism, creativity, and innovation that the hierarchical organization simply can not provide.

The network liberates information from silos and hierarchical layers.

The network organization needs to be seamlessly connected to and coordinated with the hierarchy in a number of ways, chiefly through the people who populate both systems.

The executive committee must launch the network, explicitly bless it, support it, and ensure that it and the hierarchy stay aligned.

The network organization works best when no one

tries to project-manage it.

That means it is not carefully controlled. There may be no one in

senior management who can list even 5% of the activities going on.

The volunteer army

5 to 10% of the managerial and employee population in a

hierarchy is all you need to make the network function beautifully.

Modest but aligned actions, taken by many passionate people who bring them wish insight from all levels and all silos, imbue the network with the power it needs

to undertake smart, strategic action.

PRINCIPLES of the dual operating system:• Many people drive important change, not just the usual few appointees

(you need additional people, with their own particular windows on the world, and with their own particular good working relationships with others, in order to truly innovate).

• A “get-to” mindset, not “have-to”

• Action that is head & heart driven (not just head)

• More leadership, not just management

• An inseparable partnership between the hierarchical organization and the network(constant flow of information; volunteers in the network also have jobs in the hierarchy)

Eight accelerators should be in place• Create a sense of urgency around a Big Opportunity• Build and evolve a Guiding Coalition• Form a change vision and strategic initiatives• Enlist a volunteer army• Enable action by removing barriers• Generate & celebrate short term wins• Sustain acceleration• Institute change

But how do I hold the people in this network accountable for what they do? How do I measure individual performance? In the right-side organization, it is urgency, passion, open communication, empowerment, a “want to” operating principle, and leadership from many that are at the center of success.

People hold each other accountable for playing their roles.

The network organization is driven by lots of people focusing their energy and action on a Big Opportunity. This Big Opportunity should be rational (why us, why now why…), emotionally compelling (a sincere, positive, authentic appeal to the heart), and memorable (clear, short, no jargon).

What is the role of the ‘guiding coalition’?

• Making sure the network has a change vision aligned with the Big Opportunity

• Agreeing on the strategic initiatives of the network, and ensuring these are aligned with the hierarchy-side of the organization

• Keeping tight communication with the executive committee

• Monitoring (not controlling) activities in the network

• Looking for wins and celebrating them

• Keeping the eight accelerator processes running well

Our people are already stretched in their time. How can they do even

more?

People’s energy levels are not a zero-sum number. It is not the case if people spend 20% of their energy on network

activities, that only 80% of energy remains for their hierarchical job.

Should all strategic initiatives be handled by the right side (network organization)?

No – all activities not requiring massive change, remain on the left side (hierarchy).

High-stakes initiatives, where speed is important, or there are ambiguities, or where innovation and agility is needed, should go on he right side (network).

Where is the budget for the network organization controlled?

It is the job of the volunteers and the guiding coalition to find resources,

when they need them, and to convince people on the hierarchical

side to allocate money for initiatives.

More information?• Read the book! (XLR8 – John P. Kotter)• “Leading change” (HBR login required)• XLR8 Book review