The Awful Law of Unintended Consequences
The law of unintended consequences states that any change will be accompanied by a set of consequences that cannot be completely predicted. The reason this law is awful is that the consequences have a strong tendency to destroy all the value of your planned change. The problem stems from two sources: the objectives of the change and the process.
Major programs of change are often begun for unpopular reasons – downsizing, business process reengineering, and takeovers all seem unattractive and threatening to staff. The process is often unpopular because it disenfranchises people within their own organization. Morale sinks, productivity drops, people lose their trust in management, and the value of the change is lost. If a company must avoid these problems in its programs, it must understand the underlying causes and design its process so that management can reorganize the company without destroying its soul. The four mental traps that need to be followed to avoid the awful law of unintended consequences are enumerated below:
Four Mental Traps
People versus Performance: Many change programs are stuck in the old paradigm of improving despite people. Successful companies recognize that you can only improve through people. This recognition comes from two main forces. First, the move toward a service economy and the growth in the value of intangible assets mean that these days the people are the organization – you can’t change without changing them.
Structure versus System: Many change programs are overtly focused on rearranging the formal organizational structure. The change will only be effective if the structure is part of a broader systemic transformation. In a ten-year survey of companies, structure was one of the several levers (with strategy, execution, culture, talent management, leadership, innovation, and growth through successfully managed mergers and acquisitions) that led to a dramatic performance improvements.
Us versus Them: The role of the leader in crafting a transformational process is to create an environment in which people can take leadership of the changes wherever they are able. Talented people are motivated by freedom, autonomy and the opportunity to rise to challenges. They can bring your transformation to life, particularly if you have a strong story they can dramatize. This is more engaging and compelling than their simply rolling out your program for you.
Concurrent versus Consecutive: Because the elements of the transformation program are complementary, you cannot achieve successful change by tackling them one at a time. Improvements to leadership, culture, and management processes will reinforce the changes you make to customer management, operational processes, and organizational design. Effective transformations work simultaneously on more than one element of the change to unfold a sequence of related chapters in the program.
These principles are based on the observation of organizational changes, they encapsulate lessons learned from the successes and failures of others. For the whole of the last century most companies were collectively stuck in the paradigm that insisted the role of leadership is to drive hard for performance and brush aside resistance. The time has come to abandon this limiting model. Research on motivation and performance is conclusive: the best people are turned on by a strong ethic and an open, trusting, and supportive culture. Performance orientation and people orientation are not opposites. They aren’t even choices. Instead, they are the two components that will enable us to achieve outstanding sustainable results.
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