Johanna Rothma n @johannarothma n www.jrothman.com Lead an Innovative Organization: From Change Management to Manage FOR Change

© 2021 Johanna Rothman @johannarothman Your organization wants innovation . How do they act? 2

© 2021 Johanna Rothman @johannarothman Does Your Organization Demand: • Detailed plans : • Estimate s • Schedule s • RO I • Upfront planning 3

© 2021 Johanna Rothman @johannarothman Does Your Organization Offer: • An opportunity where you know : • The value of your wor k • The goal for this versio n • Trust for you to do the right thin g • Request for demos on a regular basis 4

© 2021 Johanna Rothman @johannarothman The Demand for Unknowable Data v s The Offer for Great Work 5

© 2021 Johanna Rothman @johannarothman Don’t blame the managers. They are part of a greater system of work. 6

© 2021 Johanna Rothman @johannarothman Common Innovation Problems • Want to “manage change” instead of embrace chang e • Managers work in silos • Lots of planning at all levels—too little strateg y • Bureaucracy burdens worker s • Mechanistic view of managemen t • Conservators (conserve the status quo) outnumber the experimenters 7

© 2021 Johanna Rothman @johannarothman Want innovation ? Innovate management/leadership practices. 8

© 2021 Johanna Rothman @johannarothman Consider These Suggestions 1. De fi ne “why” for the organization 2. Reduce management decision tim e 3. Shorter feedback loops to reduce all planning burde n 4. Reduce policies and procedure s 5. Encourage change : A. Make it easy for people to disagre e B. Make small mistake s 6. Eliminate performance management 9

© 2021 Johanna Rothman @johannarothman 1. “Why” for the Organization • Why is your strategy: Why does your organization (products & services) exist? • Return $ to shareholders is an outcome of satisfying customers . • Strategy answers these questions : • Why this product/service ? • Why now ? • Strategy has nothing to do with slogans 10

© 2021 Johanna Rothman @johannarothman Some Strategies • Help people retire better . • Help patients check out of the hospital faster . • Help people order groceries . • Value-focuse d • Customer s • Societ y • Offers options for many products and services 11

© 2021 Johanna Rothman @johannarothman Portfolio of Products & Services • Organize all products and services into these buckets : • KTLO: Keep the lights o n • Grow current busines s • Possible transformatio n • Assess how many projects are in which bucket s • My suggestions for an innovative organizations : • 10% KTLO; 40% Grow; 50% Transformation 12

© 2021 Johanna Rothman @johannarothman What If You’re Not a Top Leader? • Build your portfolio up from the various products and services your team(s) deliver and suppor t • Bucket into: KTLO, Grow, Transform bucket s • See if you can generate the “why” from thos e • Assess the percentages in each bucke t • Look for allies for change 13 Strategy Deliver

© 2021 Johanna Rothman @johannarothman 2. Reduce Management Decision Time with Management Teams • Do your functional managers/leaders collaborate ? • Organizations based on individual rewards : • Reduce management collaboratio n • Create slow decision s • Optimize too low 14

© 2021 Johanna Rothman @johannarothman Fast product experiments lead to more innovation . That means fast product development feedback loops and fast management decision time 15

© 2021 Johanna Rothman @johannarothman Hierarchical Decisions Take Forever 16

© 2021 Johanna Rothman @johannarothman Management Teams • Senior leadership teams already exis t • Many orgs have a cohort at one leve l • Why not have cohorts at each level? 17

© 2021 Johanna Rothman @johannarothman Resource Ef fi ciency vs Flow Ef fi ciency • The more managers work in fl ow ef fi ciency, the faster all the work fi nishe s • Once managers work in teams, they can also address the why for the organization 18

© 2021 Johanna Rothman @johannarothman (Mgmt) Delays Often Outweigh Work Time 19

© 2021 Johanna Rothman @johannarothman Evolve Management 20

© 2021 Johanna Rothman @johannarothman 3. Reduce Planning, Especially Based on Estimates • Too many “plans” depend on estimates or forecast s • Those estimates or forecasts don’t take cycle time into accoun t • The longer the cycle time, the longer everything takes—even simple things 21

© 2021 Johanna Rothman @johannarothman Reduce Feedback Loop Duration • Cliff looked at the time from T2 to T5 (cycle time ) • Started at 2-5 week s • Reduced to a few day s • Projects fi nished inside of 6 month s • Time from T0-T2 regularly a year or mor e • Management asked for estimates every single time they replanne d • Article is here: https://www.jrothman.com/ proj-delays 22

© 2021 Johanna Rothman @johannarothman 4. Reduce Policies & Procedures • How many policies, procedures, rules, and other things that impose friction on people ? • Ask for vacation or sick tim e • Imposed “standard” agile approac h • Imposed boards and other tool s • How few rules do you need ? • Guidelines and constraints (as few as possible ) • Delegate problems and outcomes, not tasks 23

© 2021 Johanna Rothman @johannarothman 5. Make Disagreement and Mistakes Easy • Product development requires learnin g • How easy is it for you to : • Disagre e • Make mistake s • Work togethe r • Mistake-proof the outcome s • Experiments create short feedback loops 24

© 2021 Johanna Rothman @johannarothman Small, Safe-to-Fail Experiments Work • Reframe “Fail Fast” to “Learn Early ” • Allow safe-to-fail experiment s • Need at least one hypothesis for change 25

© 2021 Johanna Rothman @johannarothman 6. Eliminate Performance Management • Performance management does not wor k • Ranking doesn’t wor k • Comparing people or teams doesn’t wor k • Competition doesn’t wor k • Feedback, especially reinforcing feedback, does work 26

© 2021 Johanna Rothman @johannarothman Create Engagement • Learn why each person works (one-on- one) and see if you can offer them opportunitie s • Explain the why (organization, team/ group, product, project ) • Encourage autonomy, mastery, purpos e • Encourage fl ow ef fi ciency at all level s • Create an opportunistic culture, where people discover new and interesting work, skills, collaboration, and more 27

© 2021 Johanna Rothman @johannarothman Lead an Innovative Organization 1. Clarify your purpose (you, team, organization). 2. Build empathy with the people who do the work. 3. Build a safe environment. 4. Seek outcomes and optimize for the overarching goal . 5. Encourage experiments and learning. 6. Catch people succeeding. 7. Exercise your value-based integrity. 28

© 2021 Johanna Rothman @johannarothman Manage for change: Optimize to learn 29

© 2021 Johanna Rothman @johannarothman Let’s Stay in Touch • Pragmatic Manager: • www.jrothman.com/ pragmaticmanage r • Please link with me on LinkedI n • Modern Management Made Easy: https://www.jrothman.com/mmme 30