Three Principles of Effective Transformation

From three years of intensive work on the agile transformation in the BMW Group IT, I see three essential success factors. First, the transformation always starts with the why and the way towards it, i.e. the how and what, is necessarily unclear in the beginning. Second, leadership deliberately does not try to give the right answers immediately but instead provides an environment in which employees as adults and intelligent people can find these answers together. And third, leadership is part of change and questions itself.

Start With Why

In his book “Start With Why” (Amazon Affiliate Link), Simon Sinek explains how great leaders inspire action. He uses a model known as the Golden Circle. In the middle is the purpose of the organization, i. e. the reason why people go to work in the morning and why customers and society value the organization. (A little tip on the side: that’s not profit, which is rather the consequence of the right purpose). One circle further out is the how, that is, what the organization does particularly well and what distinguishes it from others. In the outermost circle is the what, i.e. the products or services that the organization offers. Simon Sinek illustrates this with many examples in his TED-Talk:

Effective leaders always start with the why. This applies in particular to change processes and to every form of transformation. Unfortunately, organizations usually think and communicate the other way round, from the outside to the inside of the golden circle. Much is therefore being said about what and how and too little about the why.

He who has a why to live for can bear almost any how.

Friedrich Nietzsche

I therefore always motivate the agile transformation of the BMW Group IT (internally as well as externally) for three years based on the term VUCA with tangible examples at a political level (e.g. Brexit), at an economic level (new competitors, lower market entry hurdle) and at an entrepreneurial level (new business models through mobility services). Then follows the how as our unique approach of transforming the corporate IT of BMW into a 100% agile product organization in order to increase adaptability and responsiveness. And finally, in the third step, the concrete fields of action, such as structural changes, process models, etc., follow. Last year at the Digital Leadership Day in Bregenz this looked like in this (unfortunately only German) video (of course no comparison to Simon Sinek!):

Treat Co-Workers as Adults

The why is the basis for shaping the transformation together both in terms of how and especially in terms of what. In many change processes, however, the affected co-workers are unfortunately completely incapacitated and this incapacitation is masqueraded as protection against overstraining. They cannot exert any or just little influence and thus they become mere objects of change. This request for change, however beautifully packaged it may be in the context of so-called change management, inevitably leads to rejection. Not only with employees, my two daughters react to this already in the preschool age quite allergic.

People don’t resist change; they resist being changed.

Peter Senge

The story about the transformation of the BMW Group IT from why to how to what sounds logical in retrospect, but the red thread only emerged after our joint journey. Much of the how and even more of the concrete what was created or at least significantly influenced by the affected persons themselves. In the beginning there was only the why and the vague idea of a 100% agile product organization as how. And a lot of trust in adult and clever people.

Be a Role Model

Particularly in transformation, the role of leadership is not so much to give the right answers, and certainly not all the answers, but rather to ask the right questions and offer a setting in which solutions can be sought jointly and fearlessly. This is best achieved when there is no doubt that everyone is in one boat and that it is not just a matter of somehow optimizing the work of the employees (agility as concentrated feed), while everything remains the same for the management.

Leadership therefore always means being a role model. This starts with small visible signs, such as Klaus Straub as CIO of BMW Group IT moving into an open-plan office with his management team. In the past, you had to pass the assistant’s office to get to the individual office of a vice president, but since the move, the door to the shared open-plan office is now open to everyone.

In addition to these visible signs, the role model function means in particular the willingness to question one’s own role as a manager. At Novartis, Vas Narasimhan as CEO does just that and radically puts the transformation under the title Unboss. In the course of the agile transformation of the BMW Group IT, we have therefore been intensively concerned since the beginning of 2018 with the new role of leadership against the background of the agile basic principles of self-organization and subsidiarity. And the Manifesto for Human(e) Leadership emerged precisely from this process as the first attempt to summarize the complex answers.

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