Conventional businesses will not survive at scale.
In this case Conventional means businesses that pursue a fundamentally unchanging business model and rely in incremental improvements over time.
The future belongs to Post Conventional businesses.
Post Conventional businesses being those that are able to be both reliable in pursuing a business model and transform to new business models at the same time.
Medium and large Conventional businesses that want to survive must become Post Conventional.
The dizzying rate of change created by the three Megatrends of Digitisation (everything that can be digital, will be), Decarbonisation (everything that can be electric will be) and Ageing (the global north and south are already old. The only young places are around the middle), mean that if all you are doing is managing reliability, you are managing decline.
Two of our clients, for example:
A fuel retailer with hundreds of petrol stations in a part of the world that has committed to banning the sale of combustion vehicles in 10 years time.
A global FMCG manufacturer, who have sold the same product for well over 150 years whose category sales are declining at 19% per year to a game changing product.
Any organisation that has enjoyed success for a generation with the same business model will have developed a culture, philosophy and capability focussed on reliability and cranking the handle. Management will be the key skill and leadership will be discouraged. Because, leadership is fundamentally about change and if you are focussed on reliably cranking the handle, people who insist on change are annoying.
These organisations have extremely limited capability for change, let alone transformation, and have tremendous cultural and structural resistance to it.
So, what can be done? How can a Conventional organisation become Post Conventional?
The first thing is to be honest around the context. What are the threats to our business model? What are our capabilities around change?
The second is to explore the cause (vision, mission and purpose) that can create opportunity for the organisation. (Conventional organisations don’t need a vision, because they are not going anywhere).
The third is to define, create and curate the conditions (culture, habits and systems) that will enable the cause to be achieved.
The precondition for any of this to actually happen is leadership. Someone or a number of individuals who have the combination of skill, courage and vulnerability to engage a wider group of people with the idea that things have to change.
In the two cases above it was an individual, relatively new to the business and relatively senior who had the courage to say the unthinkable. To articulate that the current game is over and it is time for a new one. In both cases this leader worked with their senior team and with specialists to articulate a vision and a case for change.
In both cases the leadership team chose to transform the existing organisation culture and systems rather than create a new organisation to pursue the vision and run down the old.
The transformation involves the changing of many systems – both in an HR sense, the systems of reward and recognition, reporting lines, structures, recruitment etc and the operational systems, because what the company does is fundamentally changing.
And the culture, typically the culture has to shift from obedience, competition, conformity and deference to creativity, collaboration, autonomy and experimentation.
And yet, at the same time, the existing business model is not done yet. First it has to be optimised still further in order to continue to generate the cash that can pay for the transformation.
There is a truth about such transformations, which is that, on the whole those who are less than 10 years from retirement are rarely the best suited to leading it. They have more invested in the old and less incentive to change personally than younger colleagues. Therefore it is often wise for the longest serving team members to focus on optimising the old and delegate the task of transformation to the next generation.
There is a further truth that such transformations are best led by visionary and authentic style leadership, which is primarily motivated by purpose and is committed to delivering sustained success by supporting a diversity of colleagues to be the very best version of themselves most of the time.
Boss and Ruler style leadership, primarily motivated by their own status finds articulating a cause that is inspiring to all stakeholders very difficult. The inability to deliver results without stealing from the future and the preference for loyalty over competence makes long term success unlikely.
If you are in a medium to large conventional organisation and facing existential threat, the first step is to find the authentic and visionary leaders who are already there and get to work.
Holos specialises in the enabling the cultural shift from Conventional to Post Conventional. If you are interested in this area you may also be interested in two events we have coming up.
Post Conventional Facilitation – is a course for those already working as coaches and facilitators to take their practice to the next level and enhance their ability deal with the complex and ambiguous requirements involved in helping clients on their transformation journey. Contact us for details at firstname.lastname@example.org
Holos Faculty Conference – Post Conventional and Beyond – 22 and 23 January, London. A gathering of coaches, facilitators and change agents exploring the challenges and opportunities presented by the shift to Post Conventional. More information here
At Holos our vision is Universal Authentic Leadership. We specialise in enabling authentic leadership in organisations and even in organisations in crisis.
Holos helps make change easy. We help organisations develop their leaders, map out and deliver the changes required to achieve sustained success even in a highly disrupted environment.
At Holos we have been studying change leadership and leadership training in the crucible of reality for years. We know what great leadership looks like and we know the journey to achieve it. We have developed a suite of diagnostic tools to understand where companies and teams are on this journey and how to take them from there to sustained success.
Holos has a wealth of specialist leadership and culture coaches and consultants with decades of experience working with a huge variety of leaders. Holos can help you or your organisation to upgrade it’s leadership to flourish even in a challenging business environment.
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