1. Leading Change
John P. Kotter

2. Transforming Organizations:
Why Firms Fail
 Allowing too much complacency
 Failing to create a sufficiently powerful
guiding coalition
 Underestimating the power of vision
 Under-communicating the vision

3. Transforming Organizations:
Why Firms Fail
 Permitting obstacles to block the new
vision
 Failing to create short term wins
 Declaring victory too soon
 Neglecting to anchor changes firmly in the
corporate culture

4. Related Consequences
 New strategies aren’t implemented well
 Acquisitions don’t achieve expected synergies
 Reengineering takes too long and costs too much
 Downsizing doesn’t get costs under control
 Quality programs don’t deliver hoped-for results

5. Successful Change and The Force
that Drives it
 Globalization of markets & competition
 The Eight Stage change process
 The importance of Sequence
 Projects within projects
 Management versus Leadership

6. The Eight Stage Change Process
1. Sense of Urgency 5. Empowering Action
2. Guiding Coalition 6. Generating Short-
Term Wins
3. Vision & Strategy
7. Producing More
4. Communicating the Change
Change Vision
8. Anchoring New
Culture

7. 1. Establishing a Sense of Urgency
 Examining the market and competitive
realities
 Identifying and discussing crises, potential
crises, or major opportunities

8. 2. Creating the Guiding Coalition
 Putting together a group with enough
power to lead the change
 Getting the group to work together like a
team

9. 3. Developing a Vision and
Strategy
 Creating a vision to help direct the change
effort
 Developing strategies for achieving that
vision

10. 4. Communicating the Change
Vision
 Using every vehicle possible to constantly
communicate the new vision and
strategies
 Having the guiding coalition role model
the behavior expected of employees

11. 5. Empowering Broad-Based
Action
 Getting rid of obstacles
 Changing systems or structures that
undermine the change vision
 Encouraging risk taking and non-
traditional ideas, activities, and actions

12. 6. Generating Short-Term Wins
 Planning for visible improvements in
performance, or “wins”
 Creating those wins
 Visibly recognizing and rewarding people
who made the wins possible

13. 7. Consolidating Gains and
Producing More Change
 Using increased credibility to change all systems,
structures, and policies that don’t fit together
and don’t fit the transformation vision
 Hiring, promoting, and developing people who
can implement the change vision
 Reinvigorating the process with new projects,
themes, and change agents

14. 8. Anchoring New Approaches in
the Culture
 Creating better performance through customer-
and productivity-oriented behavior, more and
better leadership, and more effective
management
 Articulating the connections between new
behaviors and organizational success
 Developing means to ensure leadership
development and succession

15. Management vs. Leadership
 Planning & budgeting  Establishing direction
 Organizing & staffing  Aligning people
 Controlling &  Motivating &
problem-solving inspiring

16. Sources of Complacency
 Absence of a major & visible crisis
 Too many visible resources
 Low overall performance standards
 Organizational structures with narrow
functional goals

17. Sources of Complacency
 Internal measurement systems focusing
on wrong performance indexes
 Lack of sufficient external feedback
 Human nature, with its capacity for denial
 Too much happy talk from senior
management

18. Establishing a Sense of Urgency
 Pushing up the urgency level
 The role of crises
 The role of middle and lower-level
managers
 How much urgency is enough

19. Creating a Guiding Coalition
 Find the Right People
 Position power, expertise, & creditability
 Strong leadership & management skills
 Create Trust
 Through carefully planned off-site events
 With lots of talk and joint activities
 Develop a Common Goal
 Sensible to the head
 Appealing to the heart

20. Why Vision is Essential
1. It clarifies the general direction for
change
2. It motivates people to take action in the
right direction
3. It helps coordinate the actions of
different people

21. Characteristics of an Effective
Vision
 Imaginable – conveys a picture of what the
future will look like
 Desirable – appeals to the long-term
interests of employees & stakeholders
 Feasible – comprises realistic and
attainable goals

22. Characteristics of an Effective
Vision
 Focused – is clear enough to provide
guidance in decision-making
 Flexible – is general enough to allow
individual initiative & alternate responses
 Communicable – is easy to communicate;
can be successfully explained in 5 minutes

23. Communicating the Change Vision
 The magnitude of the task
 Keep it simple
 Use metaphors, analogies, and examples
 Use many different forums

24. Communicating the Change Vision
 Repeat, repeat, repeat
 Walk the Talk, or Lead by Example
 Explicitly address seeming inconsistencies
 Listen and be listened to

25. Empowering Employees for Action
 Removing structural barriers
 Providing needed training
 Aligning systems to the vision
 Dealing with troublesome supervisors
 Tapping an enormous source of power

26. The Role of Short-Term Wins
 Provide evidence that sacrifices are worth
it
 Reward change agents with a pat on the
back
 Help fine-tune vision and strategies

27. The Role of Short-Term Wins
 Undermine cynics and self-serve resistors
 Keep bosses on board
 Build momentum

28. A Successful Change Effort
 More change; not less
 More help
 Leadership from senior management
 Project management and leadership from below
 Reduction of unnecessary interdependencies

29. Why Culture is so Powerful
 Individuals are selected and indoctrinated
so well
 The culture exerts itself through the
actions of many, many people
 All of this happens without much
conscious intent and thus is difficult to
challenge or even discuss

30. Anchoring Change in Culture
 Comes last, not first
 Depends on results
 Requires a lot of talk
 May involve turnover
 Makes decisions on succession crucial

31. The Organization of the Future
 A persistent sense of urgency
 Teamwork at the top
 People who can create and communicate
vision
 Broad-based empowerment

32. The Organization of the Future
 Delegated management for excellent
short-term performance
 No unnecessary interdependence
 An adaptive corporate culture
 Getting from here to there…

33. Mental Habits that Support Life-
Long Learning
 Risk-taking
 Humble self-reflection
 Solicitation of opinions
 Careful listening
 Openness to new ideas