Pilot projects or a corporate-wide initiative? Yes.

Let's not jump too quickly to conclusions.

Published on 13 June 2017 by Isaak Tsalicoglou.

One of the biggest dilemmas of managing change might be none at all.

The recent article "Agile vs. death-by-committee", coauthored with IMD Prof. Carlos Cordon, raised questions, including this one by a reader interested in copying a "winning approach" to change:

"How did the two companies implement the necessary change? Did they follow a phased approach with initial experiments in small teams, or a corporate-wide initiative aiming at all teams at once?"

The question is straightforward, and those with an agile mindset would be quick to yell "phased!". After all, Agile is also about experimentation and adaptation, right?

Not so fast! Since we know nothing about the reader's organization, we could also be jumping too quickly to misleading conclusions with dire consequences. Progressive experimentation in pilot projects from the bottom-up might be a losing approach in his organization, whereas a top-down push for change by an imposing corporate initiative might be more appropriate.

The decision for a phased vs. a "big-bang" approach requires first and foremost a solid understanding of the organizational context. There are many strong opinions on this dilemma that forgo this basic requirement. This is especially the case when dogma (i.e. "this is not Agile") is used as the main justification.

In reality, a strong choice of A over B (or vice versa) might not be as conducive or significant to successful change as many think. Why? Because, copying a different company's approach might lead you to mimic only the "phenotype", instead of evolving your own "genotype" of success. So, let's explore first what can safely be avoided: extremism.

Extreme positions that neglect human nature

Some cynics believe that nothing ever changes if "they" (i.e., the management) don't push down from the top. In the curiously-adversarial mental model of the cynics, people need to be convinced rationally or "by volume" that the new is better than the old. More accurately, that _their _view is better than others' view. The only path (not really a choice), is to change accordingly. Failing that, they need to be forced by authority or coerced by extrinsic factors to do things differently – or else! Human motivation seems to not matter at all to the cynics. One could sometimes wonder what they have been through to hold such views so vehemently.

Others, more romantically, have grown fond of the idea that change can only succeed if it springs entirely from the bottom-up ("grassroots", "organically"). Even better, if it comes from within each person (don't forget to go "ohmmmmm"). In fact, the most extreme view is that any kind of top-down drive is coercive, and to be avoided at all costs. This may well be an inspirational (also naive) idea that makes romantics feel "warm and fuzzy" inside. Nevertheless, it too – ironically – neglects human motivation. Most importantly, it disregards the immense role that human nature and group dynamics play in getting an idea to jump from mind to mind, and thus fly, or die.

A moot point about irreconcilable differences

These extreme viewpoints are valuable in that they reveal that people with either mentality do exist in organizations. The two polar opposite groups of people represent different "customer segments" in the "business model" of a change initiative, for which valid value propositions need to be crafted. Beyond that insight, these viewpoints stir debate that primarily helps us understand what to avoid, instead of providing insights to set a course.

Neither of these extreme mentalities helps much in getting an organization to change. It is, therefore, a moot point to argue in false dichotomies, such as top-down vs. bottom-up, phased or big-bang.

An entirely top-down, authoritarian initiative relying on pure "management push" is as unlikely to bear fruit as an entirely bottom-up, go-with-the-flow approach relying entirely on "people pull". Why? Because no two organizations are the same with regards to their composition, culture, markets, strategy, value propositions, etc. And, not even a single organization can be considered a constant. Much like Plutarch's story of the Ship of Theseus, an organization today is not the same as it was a year ago. Markets change, products get launched, people come and go, moods swing, fads catch hold – everything is in flux.

Under this light, even if a top-down approach had worked marvelously some years ago, it might utterly crash and burn, if attempted today. Moreover, some well-meaning gurus' simplistic plea to "find a middle way" is a red herring. Read through the two extremes again. They are fundamentally irreconcilable.

A or B? Yes.

The role of a change agent is not to strike an impossible balance between two poles that represent dogmatism and wishful thinking through differently-colored glasses. It's to help an organization deal with complexity by navigating between the two extremes, while pragmatically keeping an eye on the business objective to be achieved. When navigating in uncharted waters or uncertain weather, you frequently adapt your course.

Therefore, the answer to the reader's question is: yes.

Meaning: the choice between this or that, and the extent to which each option is pursued, are entirely situational. Furthermore, these decisions are dynamic, not set in stone. They are subject to the recurring question of what it is that you want the organization to achieve, and at what cost and "pain". Often, business leaders even fail in setting crisp targets and boundary conditions. In such cases, arguing about this or that is an academic waste of time.

In reality, what some nowadays call a "transformation" would benefit or even require both approaches, at different times in its life-cycle. This isn't a nagging inconsistency or a mismanagement of expectations. It's merely the reasonable, pragmatic realization that attempting change means that you are perturbing a complex human system from within, with some consequences being predictably unpredictable.

Relying on waterfall project plans and a stubbornly held vision is known to often fail in innovating with products, by preventing the organization to tackle change dynamically. Why then pretend that a predetermined, black-white approach could ever work in getting entire interconnected organizations to essentially innovate on their own behaviors?

But isn't phased experimentation more agile, anyway?

It's true. A phased experimentation intuitively represents the iterative and incremental spirit of Agile better. However, let's also be honest. This approach is often pursued in order to cop out of the difficult homework of leading change. This homework includes, but is not limited to identifying sticking points, managing expectations, and aligning stakeholders on all levels.

Instead of doing so, visionary romantics then start experimenting in their little microcosm. Actually, this is a valiant, desirable approach in general, since you can only change yourself, anyway. However, if it's done under the guise of a bottom-up, gradual but silent “revolution”, it's unlikely to lead to results beyond a single person or pilot project.

More likely, it will lead to point improvements of a single person's work, friction with others who work in different ways within or beyond the team, and eventual disillusionment for the visionary. Unfortunately, not everyone who can apply great ideas productively within his/her own area of responsibility also has the skills, stamina, or personality to lead change in a larger context. And, often, those who do, tend to want to carry the world on their shoulders.

Additionally, a phased experimentation might not be a realistic option for all companies out there considering Agile. Busywork is waste, and tiring pilot projects with methodology without a strategy or outlook of expanding influence is busywork. Depending on the opportunity cost, pursuing change without being able to fulfill basic preconditions to successful change might be worse than doing nothing at all. There are only so many hours in a day, only so much attention people can pay to work, and only so much budget to spend.

So, let's look at a counter-example; that of a large, rigid, "stuck" organization that attempts (in vain) to establish Agile by pursuing change from the bottom up.

Good luck getting started

Such an organization is typically rigidly organized in impermeable functional silos, hence why it gets "stuck" whenever it needs to change. These silos perceive a command-and-control leadership style as absolutely normal, even desirable. In this case, a phased approach with pilot projects would have a very tough time even to start up. It would take a faith-based effort by highly-motivated, individuals to cross the silos' boundaries.

These daring people would need to question how things have historically been done. Interestingly, some of these quixotic individuals can already be at odds with the organization's legacy approach, to begin with. This could make persuasion and influence of colleagues and supervisors almost impossible.

Good luck scaling up

Even if a pilot project started up in this environment, it would then have a tough time spreading to other opportunities. This would require traversing the chain of command seeking approval for pilot projects. Yet, the chain is full of people who preserve the status quo; ready to say "no", and unable to say "yes" without higher-level agreement, without even higher-level agreement, without even stronger higher-level agreement, and so on.

Furthermore, even if approval were to be given from the top, you can expect that the Agile experimenters would be "the weird ones". Agile pilot projects would be operating in ways unfamiliar to the rest of the organization. They would be orthogonal to the dominant culture and facing uncertain outcomes. Meanwhile, the rest of the organization would be caught up in cranking widgets out in a predictable manner, with predictable financial outcomes.

Like a startup under the microscope

In more ways than one, pilot project teams would find themselves in a situation like the challenge highlighted by Steve Blank. I.e. that of pursuing startup-like innovation from deep within the bowels of an incumbent. However, the incumbent has grown to execute a known business model – not always efficiently, but most definitely predictably.

In that light, pilot project teams would be under intense scrutiny by everyone else. They would be hard-pressed to "prove that they aren't an elephant" (as we say in Greek). And, they would have to withstand the doubts of the nay-saying "Old Guard of the Waterfall". In the worst of cases, the latter might even desire the pilot projects to fail, so that they can be proven eternally wise ("told you so!").

Such situations make experimentation, organizational learning, and development only possible with a disproportional effort by the pilot team members. This is doubly true when the management isn't able or willing to support or lead the change.

Top-down not so top-down, after all

In such an organization, a corporate initiative might work much better, as long as it doesn't devolve into the authoritarian dystopia of the cynics. A well-led top-down push could help create some room to breathe for experimentation and change. And, leaders could provide a secure base to the experimenters, which is crucial for experiential learning.

In fact, this top-down approach would ideally rely on a wide array of pilot projects with the official permission to experiment and learn. Instead of being few, disconnected, and left alone to fend for themselves against doubters, these should then learn from each other across the corporation and help accelerate impact.

Is that top-down? Bottom-up? Phased? Corporate? Again: yes.

Do your homework, carve your path

Whichever approach or combination thereof you pursue or switch to, dynamically: as a change agent, you still cannot skip doing your "change homework". A top-down approach is wasteful when it's limited to high-level theories and vague managerial goals without hands-on practice by the ultimate users of the new ideas – let alone when it's based entirely on wishful-thinking mentalities akin to Deft.

And let's not forget the factors that are realistically desirable in all change management situations, though almost always in scarce supply. Ultimately, even an approach that blends more bottom-up, phased change still requires the self-explanatory: a clear mandate from senior leadership and strong involvement, support, and resources on all levels.

So, don't get stuck debating or copying other organizations’ homework. Do your homework and then carve a path that fits your own organization and situation.

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