We examine this difficult issue of leading a change effort when your formal power is not clear. After looking at one of the most impressive executives I've ever had the pleasure of working with, we analyze various power forms and phases of change.
Chuck Pardee's Appointment
Indefatigable Mutual Insurance is a large national company with more than 10,000 employees in the fifty states. The firm was founded ninety-nine years ago by a group of northeastern manufacturers to insure their property and employees. Over the years its insurance lines and customers expanded to selling a fairly complete package to the general public, although sales policy attempted to restrict policyholders to those considered "preferred risks." Each divisional vice president had access to the president Thomas Achison if so desired, but most communications between the field and home office were with the functional vice presidents who set policy and monitor performance in their respective functional areas. The two senior vice presidents acted as staff to the president in their areas of expertise with one in actuarial and statistical matters, and the other in investments and finance. Neither had extensive staffs reporting to them. They were approximately the same age as Achison. In general, Indefatigable Mutual Insurance has been a highly centralized, regionally dispersed organization with primary power vested in the home office functional vice presidents for underwriting, sales, claims, legal, and operations.
Charles Pardee has had exceptional success at Indefatigable. After experience primarily in sales, Chuck was appointed vice president of the Middle Division at age thirty-five, the youngest such appointment in the company's history. An annual report contained an individual picture of Chuck (the only divisional vice president so honored) with a caption describing him as an example of what young people could accomplish at Indefatigable. In general, however, most division vice presidents were substantially older.
After eight years as division vice president, Chuck was recently promoted to a newly created third senior vice president position and transferred to the home office.
At first, Chuck thought he had no problem. After all, he had been given a significant promotion. Nonetheless, he was concerned because he feared resentment from others and was unclear what the president wanted. Chuck had recently attended a university executive program where they had discussed a case entitled "The Dashman Company" which described a new vice president who utterly failed to exert any influence on his firm. Accordingly, Chuck decided to see Professor Eagleson who had conducted various management training programs for Indefatigable.
During the conversation, Eagleson pointed out that there was wide disparity in the managerial styles of the various division vice presidents. For example, when conducting a training program for managers in the Northern Division, he had the divisional functional managers from memory draw an organization chart. When sitting in the Northern Division vice president's office one day, a division claims manager had come in with a problem about how to treat a certain policyholder. The vice president had asked the manager to read the relevant home office regulation and then suggested that the functional manager adhere exactly to the home office rule (even though it didn't seem to fit).
By chance, Professor Eagleson had once been sitting in Pardee's office when a similar event occurred. After listening to the divisional manager and reading the home office regulation, Pardee had advised the manager that the regulation didn't exactly apply, so they were free to handle the matter as they deemed best. If headquarters would later complain to the manager, Pardee promised to say the action was his responsibility. In general, Eagleson felt that the Northern Division vice president's behavior was more typical of division vice presidents than Pardee's.
When Pardee asked Eagleson what he thought the president expected of the new position, the professor said he wasn't sure, but when he had recently seen the president about company training programs, Achison had expressed concern about his age, next year's 100th anniversary celebration of the firm's founding, and the company's automobile insurance losses. He had remarked during luncheon that the only thing wrong with the company was that field personnel "just didn't follow home office rules." As a result, he argued that Indefatigable was losing money on automobile insurance policies because field sales staff were selling to undesirable risks. This was contrary to the company's traditional strategy of only "preferred" risks. The president said he had decided that the sales staff had to be reduced by some 600 people.
Pondering these points, Pardee wondered if he should resist the president to protect the field staff or whether he should pick a fight with one of the home office functional vice presidents in order to impress the division vice presidents with his willingness to battle on their behalf. "In the long run," Chuck said, "my objective must be to change the mind set of the division vice presidents so they exercise more initiative in encouraging the best business decisions for their regions. I remember reading in my naval history course that back in World War I, the head of the Royal Navy, Lord Fisher, chewed out one of his overly cautious admirals by saying something like, 'In war, the first principle is to disobey orders. Any fool can obey orders.' That's the initiating spirit I would like to develop at Indefatigable--and it may well mean shifting a bit of the power out of headquarters to the field."
Why is Pardee worried?
Success in middle management can propel you to a potential break-through promotion into a position with ambiguous authority. The ability to tolerate this ambiguity and to create viable power is critical.
At first reading it appears that Chuck has no problem. He is a winner whose success has brought him early recognition and now a promotion to a newly created senior vice presidency. President Thomas Achison is aging and is probably no longer capable personally of controlling the wide span of control over the fifteen people who report to him. Some even see Chuck as the heir designate to Achison.
Nonetheless, Chuck is concerned about ambiguity in the message announcing his appointment and fears that if he tries to exercise power he might discover it lacking. The appointment notice is confusing (and be assured, this is exactly how the firm sent it out; no words except individuals' names have been changed). The first sentence is very weak. Chuck's "transfer" to the "President's staff" sounds like at best a lateral move, not a promotion suggesting that he will be an adviser to the president and not a line executive.
The second sentence seems to verify that he is to be another set of eyes and ears for the president policing adherence to home office rules. "Pardee will be responsible to the President for achieving division performance in accordance with company policies and objectives." Unfortunately, this role runs counter to Chuck's opinion that home office rules excessively constrain field personnel initiative.
The third sentence, "Mr. Pardee will assist Division Managers in obtaining well-coordinated efforts by all departments and will establish and use measurements of results for each division," is a bit stronger but would cast him in a monitoring and advisory role to the divisions.
The fourth sentence, however, is most powerful: "Division Vice Presidents will report to and be responsible to Mr. Pardee." Legitimate power, the authority of a position in a chain of command, is clearly defined here, at least over the division vice presidents. Unfortunately, nothing is said about the home office functional vice presidents (claims, underwriting, sales, and so on), so it appears that he doesn't possess formal authority over them, in spite of his title as senior vice president.
Immediately talking to President Achison to get a clearer position description would be a logical recommendation to offer Pardee. But Chuck doesn't want to do this; he fears that the president's response would prematurely limit the new position's potential by overly focusing on a police and hatchet man role of cracking a whip to reduce automobile insurance losses by firing field staff. As his own division manager experience had verified, he feels the company should loosen home office ties and encourage greater autonomy, flexibility, and initiative in the field- a course of action not likely to please Achison.
Before considering what Chuck might do, we need to examine the various forms of power on which he might draw when attempting to change behavior at Indefatigable.
Power and Influence
Americans are often a bit skeptical about those who desire to wield power. It is as if Lord Acton's famous warning "Power corrupts" has been turned on its head to "Anyone who strives for power is corrupt." I once served on a university search committee seeking a new dean. Faculty, alumni, and students shared in the deliberations at our first meeting when one member observed, "We don't want anyone who enjoys exercising power!" We all nodded sagely, visions of Lyndon Johnson and Richard Nixon dancing in our heads. But what nonsense to appoint someone who dislikes influencing others to a leadership position that demands the exercise of power (no wonder academia was in such poor shape back in the 1970s). Even senior corporate executives are said to "too often shrink from the exercise of power or display ambivalence about it".
Forms of Power: Power is essential to influence others for evil or good. When someone successfully influences another, we infer that the influencer possesses power. Thus, influence implies power and power is necessary for influence. Power, however, takes several forms.
- Coercive power is based on a potential follower's perception that the influencer has the ability to punish with some action that will be unpleasant or frustrating to some need.
- Reward power is based on a follower's perception that the influencer has the capacity to reward with some action that will be pleasant or satisfying to some need. Both coercive and reward power depend on the potential influencer controlling resources such as money, equipment, or knowledge that is valued by the potential followers.
- Legitimate power (sometimes called authority) is based on the follower's internalized values which convince him or her influencer has a legitimate right to influence, which he or she has an obligation to accept. This is at the core of a traditional bureaucratic influence system in which leadership positions are endowed with formal authority.
- Referent power is based on the follower's identification with a charismatic leader who is followed out of blind faith. The identification and influence can be maintained as long as the influencer manifests behavior and attributes esteemed by the followers.
- Expert power is based on the follower's perception that the influencer controls information or has personal knowledge or skills that can be useful in satisfying follower needs.
- Representative power is delegated upward to a leader by a group which implicitly agrees to follow as long as the leader consults the followers and generally leads in a direction that satisfies their needs.
In each of these power forms, the follower is crucial. In order to influence anyone and be a leader, you must appeal to their needs. If you are holding a loaded gun to my head and you communicate a willingness to fire, the chances are that I will do what you ask. The odds are stacked in your favor. But certainly, history demonstrates similar situations in which people have chosen not to obey. So influence depends on the potential follower as much as on the leader-manager. The follower must make a decision to respond. Perhaps he or she doesn't have much choice, but a decision must be made. Although traditional power forms like coercive, reward and legitimate authority are still used, modern management increasingly draws on expert and representative power. For example, although legitimate power may be historically the most used form of power within business, today in the United States it appears to be the least used (and least effective) form. American managers and their subordinates seem to feel that using positional power as one's primary influence is a sign of weakness. This reluctance about using formal authority is consistent with American skepticism about authority figures that dates back to our colonial era. Early and late immigrants to the New World were fleeing disrespected authority in their old countries. And however much they tried to maintain authority within their families, the new society's pressures tended to undermine even parental power. Young men particularly could simply leave their father's homestead and move to empty land or, better yet, go to the labor-short cities that characterized the United States until well into the nineteenth century. This was probably the first country where a son could tell his father to "go to hell" with relative impunity. For daughters it took a bit longer.
Using Referent Power: Influence through referent power involves blind faith, a kind of Alexander the Great or Joan of Arc syndrome. We respond to the great leader who has "charisma". To the ancients, charisma was God's gift of heavenly grace or magical powers to a few favored humans. Only fools would not respond to such a charismatic leader. Today of course we have a bit less faith and substantially more skepticism about charisma, but we still tend to respond to the leader who has characteristics we admire-the person who is a super model of what we would like to be. We respond out of strong emotional attachment, even love, for a leader with whom we identify. The relationship is personal rather than general, for charisma is not simply an attribute of the leader but the fit between his or her characteristics and our values. Betty Friedan and Gloria Steinem were both charismatic leaders in the early women's liberation movement, but they tended to appeal to different groups-the older Friedan to more traditional homemakers, the more glamorous Steinem to independent career women. Further back in history, T. E. Lawrence possessed charisma for the Arabs in World War I, but his dramatic, stylistic behavior offered no appeal to postwar Britons who did not support his political bid. Winston Churchill's brand of charisma was not felt until his country faced extinction in 1940 and his personal attributes matched the people's concerns. Yet, these characteristics became less relevant to voters with the end of the European war in 1945 when his government was quickly voted out of power as public concern shifted from survival to jobs.
Eighty years ago much management literature stated that one was born either a leader or follower. Either one had natural leadership qualities or one did not. We have less belief in this argument today because charismatic natural leaders seem all too rare. They do exist in business, but we cannot depend on their being in abundant supply. We now believe that many people can develop into effective managers through education and experience. Nonetheless, business still seems to want some attributes associated with "natural leadership" and "command presence." Witness a finding at one university that corporations hired men over six feet tall for $1,000 per year more than graduates under that magic height!
Since charismatic leaders influence people through personality not position, they often bring themselves in direct interaction with many people throughout their organizations. They bypass management levels because they want to tie people to themselves. President Franklin D. Roosevelt was often criticized as being a poor administrator because his delegation was sloppy and he evidenced little respect for government structure. He would personally contact people throughout the system and give them projects unknown to their peers or superiors. He cultivated individual, personalized relationships. Similarly, Robert Johnson as head of Johnson & Johnson would descend by helicopter on his plants unannounced, bypass the senior manager and move directly to individuals whom he cultivated. Both Roosevelt and Johnson were striving to get candid information unfiltered by management hierarchy. Such behavior can be upsetting to bureaucratic managers, but it can promote identification with the top and willingness to sacrifice that can be very powerful.
The most charismatic business manager whom I ever met was Joseph Wilson who transformed an old family company called Haloid-Anderson into the modern Xerox Corporation. At the time I was a young engineer at Eastman Kodak Company enrolled in the evening MBA program at the University of Rochester. Wilson was chairman of the board of trustees of the university (as well as president of Xerox) and he talked about a revolution in American society that his new technology would initiate. Organizations of all kinds would become much more democratic and decisions stronger because xerography would allow much more information to be shared and more people could participate. And (not incidentally) if you hitched your career wagon to his company's star, you would experience great excitement and perhaps make a lot of money. He had a neat knack of combining the sacred and the profane in his motivational pitch. And it induced many bright young 1960s professionals to leave the predictable security of Kodak to join the chaos that was the fledgling Xerox.
Using Expert Power: The last active United States Marine from World War II recently retired with the observation: "... the young men and women of today, when you give them an order, they want to know why. There is no more of this dumb order: go charge. But as long as you give them a legitimate reason, they'll charge all day long."
If as a fly on the wall we could observe all of the influence incidents in modern organizations, the most frequent would draw on expert power reflected in the follower's agreement or rational faith. Expert power is the most used power form and more managers identify with using persuasion as their primary mode of influence, even with subordinates. Followers respond because they believe the leader knows what he or she is talking about, based on evidence of knowledge and ability. Under rational agreement, the followers understand and agree with the proposed action. Under rational faith, the followers may not totally understand this particular proposal, but they agree because of the leader's successful track record.
Most managers spend more time communicating with people outside their chain of command than they spend supervising their subordinates. In influencing peers and diagonal superiors, possessing valued information is key. Based on his analysis of political parties many years ago, Roberto Michels formulated his famous "Iron Law of Oligarchy" (the "law" that Joseph Wilson felt xerography might repeal) which states that hierarchies emerge in the most democratic organizations because it is impossible to keep everyone equally informed. Only a few can monitor the necessary information flows and know enough about what is going on to participate in organizational decisions. Those who occupy critical communication points accumulate expert power and emerge as leaders who make decisions that affect others.
Since access to information leads to power, the formal organization chart is not a sufficient indicator of where real power rests. Influence diagrams describing the decision sequence (whose decisions precede others) would be a better indicator of power. Lower-level personnel often have greater power than what is formally assigned to them because they are closer to the action and have information not readily available to higher officials.
People located at the boundary between an organization's inside and outside can be especially influential without formal authority. Their ability to monitor the external world gives them access to critical information before those more internal are aware of it. And ignorance is not bliss; it is a source of stressful uncertainty. People who have privileged information that allows them to reduce ambiguity tend to amass power.
The widespread use of persuasion even at the ultimate executive level is well illustrated by the words of President Harry S. Truman:
And people talk about the powers of a President, all the powers that a Chief Executive has, and what he can do. Let me tell you something from experience!
The President may have a great many powers given to him in the Constitution and may have certain powers under certain laws which are given to him by the Congress of the United States; but the principal power that the President has is to bring people in and try to persuade them to do what they ought to do without persuasion. That's what I spend most of my time doing. That's what the powers of the President amount to.
Using Representative Power: Most influence is reciprocal. To control, one must be controlled to some extent; the influencer must be able to influence. The fear-dispensing dictator must punish insubordination or lose credibility. Charismatic leaders expecting blind faith must give of themselves by allowing followers to see, hear, and even touch them. Thus, every form of power implies a two-way interdependence.
This mutuality means that influence can be expanded and that power can be created out of nothing. Power is not a fixed pie that can only be divided; it is not a zero-sum game requiring a manager to lose influence when a subordinate gains. Both may acquire increased influence as they mutually benefit from a relationship. Influence downward may be enhanced rather than reduced by upward influence. Both managers and workers in more effective organizations perceive themselves as possessing greater influence.
In a three-tiered hierarchy, A down to B and then to C, B's effective power to influence those at C level is increased by his or her willingness to represent C's needs upward to A. The greater B's upward clout in winning resources or concessions from A that are valued by C, the greater C's willingness to respond to B's influence. To the extent B successfully goes to bat for C upward to A, the C level creates power which is delegated upward to B.
Using representative power has a certain poker-game aspect. By successfully representing subordinates upward, a manager amasses chips that can then be expended on extraordinary demands on subordinates. When I was a young ensign on a U.S. Navy destroyer, my primary assignment was as antisubmarine warfare and torpedo officer. My collateral duty was as ship's morale and recreation officer. Once when we were in port in Massawa, Eritrea on the Red Sea, at my commanding officer's direction, I had arranged for a softball game and beer party for the ship's company. Since no alcohol is allowed on G.S. Navy ships and we were in the Middle East, obtaining the beer (and ice) required some ingenuity. I was much lauded. Unfortunately, I couldn't allow my six-man torpedo gang to partake in the party because we had to prepare weapons for possible firing the next day when we were to go to sea.
Listening to the beer-inspired shouts of fun from the beach, we sweated in 100-degree heat over our torpedoes. At sundown, however, when the crew returned to the ship (and we had finished preparing the torpedoes), I felt it essential that I request special permission for my gang to leave the ship and enjoy some beer for a couple of hours to compensate them for missing the party. The captain agreed with the proviso that I allow them only half a case of beer. Silly as it sounds in retrospect, I knew that this limit would disappoint the torpedo men so I ran a risk and provided two cases without clearing it with the commanding officer. This action restored my credibility with the men and earned me some chips. Luckily, the captain never found out.
Spending the chips, however, tends to be faster than earning them. Thus, using representative power is limited in duration and frequency. It should be restricted to important issues because a middle manager like B faces some risk in picking a battle or going to bat for subordinates. He or she can lose and be rejected by A. This tends to undermine his or her credibility with subordinates who may see him or her as a friend, but no longer as a viable avenue for upward influence. And if the middle manager takes subordinates' side too frequently or argues too strongly, his or her boss may see this as one having sold out, of becoming just a mouthpiece for the troops-a problem often confronting the young junior military officer. It is imperative, therefore, that a manager carefully select the limited issues which he or she will represent upward and present them rationally rather than as ultimatums (what has been called "tactician" style as opposed to being a "Shogun" attempting to usurp the Emperor's power).
Managing Change
Chuck Pardee's core challenge will be using power to change Inde-fatigable Mutual Insurance Company's culture and modify the behavior of key managers. He will inevitably encounter some resistance. The most profound cause of change resistance is past success because it seduces us into being satisfied with what exists.35 Therefore, attitudinal and behavioral change begins with the premise that dissatisfaction must precede change.
Creating Dissatisfaction: To achieve dissatisfaction, a change agent/ manager could do nothing--just wait until people become dissatisfied with the consequences of their behavior. Aware of impending trouble, one might still decide not to warn the organization because you feel it would be too much of a shock, or that you simply would not be believed. After the outbreak of World War II, President Franklin D. Roosevelt was accused of not warning the American people about a possible Japanese attack, but he may have thought he wouldn't have been believed anyway, that the country was so committed to isolationism that only an actual attack would generate disenchantment with existing policy. So, he waited until Pearl Harbor. (He actually thought an attack on Manila or Singapore was more likely.) If war was inevitable, the United States was fortunate that the attack was on Hawaii because it was so much closer to the American psyche, producing near unanimous attitude change toward the war. We were also fortunate that our aircraft carriers missed being attacked while our battleships were effectively removed from the war. This forced the (United States Navy to recast its strategy toward airplanes and carriers.38
Thus, change classically is precipitated by a catalytic (and often cataclysmic) external event that produces crisis. Unfortunately, simply waiting for such an event could lead to total disaster such as losing the war, business bankruptcy, or product loss. In the early 1960s I was working on the construction of a new paper mill for Eastman Kodak's Verifax process office document reproduction equipment. Verifax dominated the market and the new mill represented a multimillion dollar investment in continued growth. Unfortunately for Kodak, at just this time its upstart Rochester neighbor Xerox announced the first commercial application of xerography, the dry-process duplication system developed at the Battelle Institute. Almost instantly, Kodak management realized that the technological advantages of this new machine were so dramatic that Verifax would quickly die. And Kodak had no replacement under development. Work on the paper mill ceased and it essentially became an extremely expensive warehouse. It took Kodak almost twenty years to get back into the office duplication business. A smaller less diversified company might not have survived.
Because of its risks, therefore, most leaders avoid such passivity as their approach to fostering dissatisfaction. Rather, they try to generate fear. Arguing that the past is irrelevant, they define looming external threats that will cause everyone to suffer unless comfortable habits are changed. Such a Cassandra-like approach puts a premium on leader articulateness and credibility. In the 1930s when he was out of office, Churchill warned Great Britain about the growing menace of Nazi Germany, but few listened because most did not want to give up the appeasement behavior they mistakenly thought would guarantee "peace in our times." Even his oratorical and literary powers were not enough to change opinion.
Timing is very important in generating fear of unchanged behavior.
Some environmental symptoms must verify the leader's warning. They must be real. In 1977 President Jimmy Carter gave what his aids referred to as "the sky is falling speech." Sitting before a roaring fire in the Oval Office, clad in a thick cardigan sweater to communicate informality, the president described the energy crisis confronting the country. He defined the Arab petroleum suppliers and the multinational oil companies as the enemies and called for conservation and sacrifice from the American public. But he was not believed. The public did not buy his problem analysis nor his recommendations because he lacked credibility and, most of all, the "crisis" was believed to be phony (as in the "Tale of Chicken Little," he is the only one who believes the sky is falling).
The power of an enemy to unite a group (and the problem of lost cohesion when the enemy withdraws) is well illustrated in Fidel Castro's lament about lost ardor in the Cuban revolution:
Is it because we have let down our guard? Is it because the absence of an enemy has caused us to lose our faculties? Perhaps in a certain way we have been needing an enemy. When we have a clearly defined enemy, engaged in hard-fought combat, we are more united, energetic, stimulated...
Among American business executives, General Electric's Chairman Jack Welch particularly has drawn on this enemy metaphor to spur his firm. He has argued that the United States in general is in an "economic war" with Japan and other newly emerging nations, but that Q.E. has a special opportunity to show that Americans can compete and win.
As another method of initiating stress, the creative change agent/ manager could create hope by articulating the possibilities of a better tomorrow if behavior were changed. Even if people are satisfied with existing behavior, performance, and rewards, the leader might be able to generate hope for an even more rewarding state. Such a change agent would produce a sense of opportunity cost from the gap between what exists and what might be. To his admirers, Martin Luther King, Jr. espoused a dream for black and white America; attempting to make us all feel dissatisfied with the present in comparison with the more humane society that might be. Transformational leaders manifest this talent to redirect followers away from personal concerns to unifying objectives.
These examples of Churchill, Carter, and King are all testimony to the difficulty of creating a precondition for change when free people are not dissatisfied. Unfortunately, most people are more sensitive to threats than to opportunities. It is a bit easier where organizational members are not free to leave or have voluntarily committed themselves to staying as, for example, military recruits.
Unfreezing: Unfreezing involves removal of support for old attitudes, saturation with new values to be acquired, and minimization of threats against change and strong encouragement of change in the desired direction. The change agent/leader strives to manipulate and control the data about the world that potential followers must draw on in making a decision to change.
Consider the young recruit undergoing basic military training. The recruit has little choice because leaving is difficult. His or her sergeants exert pressure. The recruit is isolated from families, friends, and indeed the outside world for a time. Even their civilian clothing may be forbidden and they are restricted to the base. The instructors drill into the recruits that their self-centered, civilian habits are bad; that individually they are weak and only through adopting military behavior can they succeed and be rewarded. It can be a powerful message to young eighteen-year-olds, many of whom are away from home for the first time in their lives.
If changes can be physically isolated and communications to them monopolized by the change agent, unfreezing is difficult to resist. Debate has raged over just how difficult. In the 1950s, many were upset with the apparent "brainwashing" of American prisoners by the Chinese during the Korean War. Some captured American prisoners appeared to collaborate with their captors by talking more than allowed in our uniform code of military justice. Critics argued that Americans had gone soft, lost patriotism and moral courage. The problem was less dramatic, however. Captured as isolated individuals in the rout of American forces after the Chinese unexpectedly crossed the Yalu River and entered the war, young American soldiers had no informal buddy groups to guide them on what was acceptable or not acceptable in response to interrogation. And the Chinese played on this isolation by randomly transferring prisoners so cohesive groups could not develop.
Another version of this debate was played out in the trial of Patty Hearst. Kidnapped by a radical group called the Symbionese Liberation Army in the 1970s, a University of California student, Hearst was supposedly brainwashed into joining her captors' cause. She was seen participating in robberies. At her subsequent trial, her defense included a psychiatrist who argued that the unfreezing process was so powerful because the kidnappers controlled all communications to her. She could receive no messages counter to what they suggested. His conclusion was that very few people could withstand such pressure. The prosecution also produced expert testimony, however, which argued that internal communications with oneself cannot be eliminated and so a prisoner with a strong sense of personal values can withstand unfreezing pressures.
Life in business thankfully is less dramatic, but even modest isolation in a resort or university training location where daily job communications are eliminated can be quite conducive to unfreezing.
Overthrowing a central organizational cultural symbol can be a particularly powerful unfreezing tactic. Such action generates stress and dramatically communicates the need for new symbols and beliefs. A former colleague of mine recently became president of a large mid-western university renowned for its basketball prowess. The coach was the state's most famous citizen and a campus icon. However, he was also a source of controversy because of his violent temper and intemperate language. The new president sought to change the institution's culture to make academic achievement more central than athletic success. Firing the coach outright would have been a dramatic message, but the political cost to the president undoubtedly would have been too high (he might not have survived the backlash). Fortuitously (or unhappily depending on one's point of view), the coach provoked a crisis by making crudely chauvinistic statements about women so the president was given an opportunity to make a change. His approach was more creative, however. Rather than firing the coach, he issued a quiet ultimatum that he would be willing to protect the coach from those crying for his head if the coach would publicly support the president's campaign to upgrade university academics. The coach did so, apparently enthusiastically. Nothing could have had a more powerful symbolic impact. And if the coach lapses into his old injudicious mode, it will be much easier for the president to dismiss him than upon first arrival.
At General Electric in the 1980s, Jack Welch also attacked central cultural symbols of the old G.E. in order to communicate dramatically that a new set of competitive attitudes and behaviors was required. Drastically reducing the size of corporate staff (so renowned a company asset under Welch's predecessor Reginald Jones) produced much empty headquarters floor space and saved salary expense, but more fundamentally said to the far-flung decentralized operating divisions that they too were overstaffed. His staff personnel reductions earned him the nickname of "Neutron Jack" (after the neutron bomb that destroys people, but not buildings). But whether said in bitterness or jest, the name itself reinforces the cultural change message Welch was trying to convey.
Change through Modeling. Your second-grade teacher, angry with un-desired "childish" behavior, might have pointed to polite little Homer and asked why you couldn't be like him, sitting quietly at his desk with pencils neatly in place and folded hands. It was implied that you would be happier if you were like Homer, and the teacher would see that you'd be miserable if you weren't. In the military recruit training example, actual change begins with the introduction of a model to be emulated-usually a noncommissioned officer whose appearance and behavior are the epitome of what the recruits are to become.
To the harried young military recruit, an impressive example can be powerful. I well remember my United States Marines platoon sergeant, even after thirty-five years. He was not the stupid or sadist stereotype of some war movies. Rather he was a gray-haired sergeant-major who had won the Navy Cross and was twice selected as enlisted man of the year. He was immaculate in appearance, wise in judgment, and gracious in demeanor. His toughness was cushioned by compassion. He appeared to live a stable and moral life. (1 never even heard him utter an oath!) To my group of confused teen-aged midshipmen, he was an admirable model who obviously knew how to behave and was rewarded by the system. Most of us tried to be like him.
It is not farfetched to similarly understand the substantial pressures on the young graduate who enters a New York law firm, Big Six accounting company, or prestigious consulting partnership. Working hours and professional demands are so great that the young professional essentially becomes isolated in an all-enveloping environment that generates enormous stress. Anxious recruits seek models of successful partners who appear to represent the attitude and behavior that work.
Change through Internalizing. Emulating a model is helpful, but change is not likely to persist unless it is internalized. A change agent could design a learning experience, so through trial and error a person learns needed behavior. For example, if the sergeant wants to teach the recruits to keep their heads down while advancing, he can set up machine guns that fire live (if plastic) bullets at a height of 36 inches above the path. After showing the recruits how to cradle their weapons and crawl on knees and elbows, he has them traverse the path so they understand why they should keep their heads down. More complexly, the military training group can design a mock battle problem in which soldiers who persist in self-seeking behavior are captured (symbolically by having a bag of flour broken over their heads). If the exercise is properly executed, the trainee will internalize the lesson through improvisation: to survive, one must be part of a team whose members look out for one another. Some insurance firms put their new recruits through a similar exercise (albeit in a boring airport hotel) sometimes titled "hell week" at which they are to experience intensely the need to coordinate various insurance functions in servicing a policyholder.
To persist for very long, any new behavior must become personally satisfying, not on an intellectual level as much as on a gut basis. Consider a program I attended which was designed to change the behavior of middle-aged executives in order to reduce their incidence of heart attacks. At the first session, a trainer showed a film depicting an overweight fortyish man playing tennis on a hot summer afternoon. He walks off the tennis court, inhales deeply on a cigarette, gets into his Continental and drives about a mile to his home where he proceeds to have two beers, a rare steak, and a gooey fudge dessert. The screen fades to black. The next scene shows his shrouded form being loaded into an ambulance.
The change agent was striving to generate fear based on identification with the unfortunate film hero. Nonetheless, many in the audience laughed at the final scene-partly to put emotional distance between themselves and the sad events, and partly because the film's attempted manipulation was too blatant.
At the second meeting of the executive group, a physician in a white jacket gave a lecture complete with slides that summarized data on the causes of cardiovascular disease including the benefits that could be de-rived from exercise. The emphasis was on facts and rational persuasion. At the end of the session, a therapist distributed little movement meters called pedometers that he asked the executives to attach to their clothing and to carry at all times as they went about their normal activities in the subsequent week.
When the participants returned for the third week, the therapist had listed all their names on a blackboard where he recorded the readings from their pedometers. He then singled out the person with the least movement during the week to explain (for example, why he drove a mile to the train station every day rather than walking, why he took the elevator to his third floor office rather than climbing the stairs, and so on). Similarly, the change agent asked the person with the greatest pedometer reading what he did to integrate exercise into his normal routine. Thus, negative and positive models were defined along with modest ridicule and praise.
But not having a heart attack is insufficient feedback for newly learned exercise behavior to persist. It must work on another level. The therapist observed:
If people say they're doing it for their health, I know they won't stick with it more than a week. The only thing that will make a person succeed is pure narcissism. If you can get someone to admit that, he or she is hooked for life. People will do anything to get in shape if they feel it's going to make them look good and be sexy.
In my executive group, this took the form of a stout participant who along around the sixth week exclaimed his happiness with the program because "for the first time in fifteen years I feel in touch with my stomach!" Before, rather like Mount Everest, it was just there. But now he was beginning to develop sufficient muscle tone to gain a sense of control over his abdomen-a portion of the anatomy linked to a mature male's sense of virility and attractiveness.
Refreezing: Once a conversion process has occurred and the training has concluded, a change agent/manager faces another difficult task: re-freezing the new attitudes and behavior. The change must be supported and rewarded for continuing the new behavior. After leaving the intensive and isolated recruit training, the soldier moves to an assignment where he is less separated from civilian life. He can leave the base in street clothes and may even live elsewhere. Old friends and family may not appreciate his new military attitudes. Indeed, they may even ridicule the soldier's hair style and polished shoes. This presents the service with the problem of continuing to support the values inculcated at basic training. If it does not, and especially if even military colleagues criticize the military way, attitudes and behavior that have been painfully learned will fade.
Refreezing is particularly difficult following treatment programs for alcohol or drug abuse. After an intensive insulated change experience at an isolated treatment center, reentry into the world can present irresistible cues to revert to old self-abusive behavior. In business, however, refreezing newly learned attitudes and behaviors is more likely if they immediately and reliably contribute to greater individual effectiveness and organizational performance.
What Chuck Pardee Did
In assessing the power that Chuck Pardee could draw on to implement change, he clearly possesses legitimate power over the division managers. He has the authority to issue directives to them and they would have an organizational obligation to obey. Chuck probably also has some reward and coercive power over the terms of the division manager's employment. He could issue a directive calling for changed behavior on their part. And such approaches do sometimes work when the desired behavior is explicit and narrow so that compliance can be measured. If closer adherence to home office rules (as the president wants) were his objective, this approach might work.
But Pardee's ambition is different-and greater. He seeks a broadening of division behavior, a more creative exercise of leadership in the regions so that functions are integrated and actions taken in the best interests of the firm under the local conditions. He wants division vice presidents to feel "empowered". For managers who have been trained mainly to follow instructions, such a vision could be threatening.
Chuck undoubtedly also benefits from his successful track record and the aura of expertise and personal charisma associated with a winner. He considered picking a fight with one of the functional vice presidents to demonstrate his power and gain loyalty from the division vice presidents. If he could find a home office rule that bugged all of the field staff, perhaps he could order them to ignore it in return for his promise to protect them from home office retaliation. Many field people felt that the home office rules were obsolete or not applicable to the special conditions in the different regions. Chuck even found an especially silly home office rule forbidding sales of home, fire, and casualty insurance to "any household that has empty beer cans on the front porch." Perhaps an old analysis in the home office region had indicated a link between such empty cans, careless smoking, and house fires. But many field personnel maintained that it didn't apply in their area, that New England is not the United States, and perhaps the best families in Milwaukee have empty beer cans lying about.
If Pardee and the division vice presidents had succeeded in such a hopefully more substantive challenge, it could have been a dramatic and symbolic event building his representative power. In the actual situation, however, Pardee concluded that discretion was the better part of valor. He did not provoke such an open challenge to a functional vice president because he feared that the offended vice president would have appealed the matter directly to the president who, given his orientation toward control, would probably have sided with the home office executive, thus undermining Pardee's standing.
Rather than issuing an edict or provoking confrontation, Chuck Pardee pursued a more gradual course of expanding awareness and lifting aspirations. Here are some of the steps he initiated:
- Upon accepting the new position, he immediately called all of the division vice presidents to express his excitement about the new position and its possibilities for helping the field perform more effectively. He invited each of them to a week-long planning retreat which he was scheduling at a resort in New Hampshire (their families were invited to join them on Friday afternoon for the weekend at Chuck's expense). In the meantime, he asked the division vice presidents to talk to a consultant who would be coming to interview them to gather information for discussion at the retreat.
- Chuck wanted to avoid having the interviews simply be an occasion for griping so the questions followed a sequence: (1) What are your dreams for your division? How would you like to see it vis-a-vis your regional competitors in five years? (2) What resources, particularly from headquarters, are required to fulfill this aspiration? (3) What existing home office policies and procedures might hinder fulfillment of your plan?
- Chuck ran a small risk in inviting such speculation by division vice presidents. He implied that he would listen and try to change some home office conditions. Inability to show enough progress on this front would undermine his position. More subtly, there is some risk in asking the bureaucratically minded division vice presidents to think about ambiguous possibilities. Some might well become anxious and want out.
- At the retreat Chuck led a discussion of the interview results, encouraging everyone to participate in a nonthreatening climate. He tried to present himself as a model not afraid to deal with unpleasant facts or uncertain opportunities. Because the division vice presidents had never really talked as a group (and they certainly had never been treated in such a first-class manner by the firm), a sense of shared destiny and group spirit began to emerge.
- Chuck invited each of the home office functional vice presidents to talk individually to the group of division vice presidents. This provided the first opportunity in memory for the field managers collectively to exchange views on the organization with the functional executives.
- Chuck asked the president to come on Friday and be the featured speaker at the evening dinner dance that would include all division vice presidents, functional vice presidents, and spouses. He asked Acheson to talk about the upcoming centennial, the glorious history of the firm, and its buoyant future. Chuck specifically asked the president to refrain from talking about the problems in automobile insurance or the plan to prune the field staff. He assured Achison that he would have taken care of the matter prior to Friday evening.
- O Chuck could have fought the president on the firing issue, perhaps by asking for time in which to develop an alternative solution. He chose not to do this. Rather, during the retreat he presented a series of speakers to the division vice presidents: an attorney commenting on the rise in jury damage awards in automobile accidents, a repair shop owner describing his increasing parts and labor costs, a major car company executive analyzing the increased production costs from government-mandated safety features, and a former state insurance commissioner explaining why company proposed rate increases were no longer automatically ratified (partially because some state commissioners were running for governor). All this testimony demonstrated that the losses in automobile coverage stemmed not from field personnel disobeying home office rules, but rather from changes in the essential business. Therefore, temporarily reducing car insurance sales and reducing the sales staff emerged as a prudent answer to a business problem, not as punitive punishment. Those unhappy people dismissed were not mollified, of course, but the climate of those remaining was affected less adversely.
Other than entertaining them at the retreat, toward the home office functional vice presidents, Chuck took a slower approach. He did not provoke early confrontation over obsolete rules. He chose to patiently and persistently try to educate them on the field perspective. "Accidentally on purpose" he tried to be in the vicinity of each functional vice president two or three times a week to simply pass on something he had heard from the southwest or southeast vice president about what the "crazy" competitors in that region were doing. More formally, he had lunch with each functional vice president at least twice a month to chat about regional developments. This gentle upward representation of the field in time encouraged a more flexible posture among home office executives. . With respect to the division vice presidents, Pardee's essential objective was to convert them from a kind of surface-of-the-cone role to power-axis functional integrators within their regions. Mot all of the managers he inherited were able to make this transition even with Chuck's support and encouragement. Consequently, where necessary, Chuck began to "encourage" some early retirements and to replace these division vice presidents with people more in his own image-those who were comfortable with ambiguity and who saw opportunity in the inadequacies of the home office rules.
Clearly, Pardee was a master in utilizing multiple power forms including reward, legitimate, referent, expert, and representative. He well represented the definition of power attributed to Harry Hopkins, President Franklin D. Roosevelt's extraordinary aide: "Power is the ability to do a job, not the ability to dominate." Coordination skills loomed larger than hierarchical authority. Just as impressively, Pardee drew on the phases of change to lift executive aspirations, generate fear if practice was not changed, present himself as a model of modern flexible management unafraid of ambiguity, but most fundamentally orchestrating an experience where initially the division vice presidents and eventually the home office functional vice presidents learned how to work together more effectively.
Pardee's subtle style of dealing with ambiguous power paid off for him personally. Within two years, his title was changed to executive vice president which confirmed his seniority over the functional vice presidents and senior vice presidents (even though his job description was not modified). And not long after, he became president of Indefatigable.
Advice on Leading Change in Spite of Ambiguous Authority
- Recognize that a clear position description is not always a virtue if it would limit your power and responsibility below what is necessary to improve your organization's performance. The key is to focus on what is necessary for organizational improvement, not on simply expanding your own empire.
- Remember that limited formal legitimate power is not always a debilitating handicap in your capacity to influence behavior and exercise leadership. Explore the other power bases on which you can draw: What resources or information do you control? What personal friendships can you draw on? What potential follower values can you manifest in your behavior? What expertise do you possess that others might recognize? What follower wants might you represent upward?
- Recognize the imbalance in upward representation: that you run a risk of losing so that battles should be limited to high-win or extremely important issues; that you will probably lose more often than you win on the important matters; and that expenditure of political capital occurs faster than amassing it.
- In a new position, unless the situation is a crisis, begin by spending considerable time gathering information and developing relationships. Take on any low-cost/high-payoff tasks first-that is, tasks that require little power to implement, but have the possibility of yielding high returns in power.
- Be aware that most organizations are a bit hypocritical in that managers who violate rules but are unsuccessful in performance are often punished, but that good performance usually leads to rule violations being ignored.
- Fight the illusion of painless change by recognizing that all change begins with stress that you may sometimes have to create. But be honest in your threats and promises. Nothing will undermine your credibility more than lack of personal consistency or verification by external events.
- Recognize that to lead change, you must be willing to change your own behavior. Power to lead implies interdependency with those you are trying to change. You should be willing to serve as a personal model of the attitudes, behavior, and performance you are trying to create.
