Three Principles of Effective Transformation

From three years of inten­sive work on the agile trans­for­ma­tion in the BMW Group IT, I see three essen­tial suc­cess fac­tors. First, the trans­for­ma­tion always starts with the why and the way towards it, i.e. the how and what, is nec­es­sar­i­ly unclear in the begin­ning. Sec­ond, lead­er­ship delib­er­ate­ly does not try to give the right answers imme­di­ate­ly but instead pro­vides an envi­ron­ment in which employ­ees as adults and intel­li­gent peo­ple can find these answers togeth­er. And third, lead­er­ship is part of change and ques­tions itself.

Start With Why

In his book “Start With Why” (Ama­zon Affil­i­ate Link), Simon Sinek explains how great lead­ers inspire action. He uses a mod­el known as the Gold­en Cir­cle. In the mid­dle is the pur­pose of the orga­ni­za­tion, i. e. the rea­son why peo­ple go to work in the morn­ing and why cus­tomers and soci­ety val­ue the orga­ni­za­tion. (A lit­tle tip on the side: that’s not prof­it, which is rather the con­se­quence of the right pur­pose). One cir­cle fur­ther out is the how, that is, what the orga­ni­za­tion does par­tic­u­lar­ly well and what dis­tin­guish­es it from oth­ers. In the out­er­most cir­cle is the what, i.e. the prod­ucts or ser­vices that the orga­ni­za­tion offers. Simon Sinek illus­trates this with many exam­ples in his TED-Talk: 

Effec­tive lead­ers always start with the why. This applies in par­tic­u­lar to change process­es and to every form of trans­for­ma­tion. Unfor­tu­nate­ly, orga­ni­za­tions usu­al­ly think and com­mu­ni­cate the oth­er way round, from the out­side to the inside of the gold­en cir­cle. Much is there­fore being said about what and how and too lit­tle about the why.

He who has a why to live for can bear almost any how.

Friedrich Niet­zsche

I there­fore always moti­vate the agile trans­for­ma­tion of the BMW Group IT (inter­nal­ly as well as exter­nal­ly) for three years based on the term VUCA with tan­gi­ble exam­ples at a polit­i­cal lev­el (e.g. Brex­it), at an eco­nom­ic lev­el (new com­peti­tors, low­er mar­ket entry hur­dle) and at an entre­pre­neur­ial lev­el (new busi­ness mod­els through mobil­i­ty ser­vices). Then fol­lows the how as our unique approach of trans­form­ing the cor­po­rate IT of BMW into a 100% agile prod­uct orga­ni­za­tion in order to increase adapt­abil­i­ty and respon­sive­ness. And final­ly, in the third step, the con­crete fields of action, such as struc­tur­al changes, process mod­els, etc., fol­low. Last year at the Dig­i­tal Lead­er­ship Day in Bre­genz this looked like in this (unfor­tu­nate­ly only Ger­man) video (of course no com­par­i­son to Simon Sinek!):

Treat Co-Workers as Adults

The why is the basis for shap­ing the trans­for­ma­tion togeth­er both in terms of how and espe­cial­ly in terms of what. In many change process­es, how­ev­er, the affect­ed co-work­ers are unfor­tu­nate­ly com­plete­ly inca­pac­i­tat­ed and this inca­pac­i­ta­tion is mas­quer­ad­ed as pro­tec­tion against over­strain­ing. They can­not exert any or just lit­tle influ­ence and thus they become mere objects of change. This request for change, how­ev­er beau­ti­ful­ly pack­aged it may be in the con­text of so-called change man­age­ment, inevitably leads to rejec­tion. Not only with employ­ees, my two daugh­ters react to this already in the preschool age quite allergic.

Peo­ple don’t resist change; they resist being changed.

Peter Sen­ge

The sto­ry about the trans­for­ma­tion of the BMW Group IT from why to how to what sounds log­i­cal in ret­ro­spect, but the red thread only emerged after our joint jour­ney. Much of the how and even more of the con­crete what was cre­at­ed or at least sig­nif­i­cant­ly influ­enced by the affect­ed per­sons them­selves. In the begin­ning there was only the why and the vague idea of a 100% agile prod­uct orga­ni­za­tion as how. And a lot of trust in adult and clever people.

Be a Role Model

Par­tic­u­lar­ly in trans­for­ma­tion, the role of lead­er­ship is not so much to give the right answers, and cer­tain­ly not all the answers, but rather to ask the right ques­tions and offer a set­ting in which solu­tions can be sought joint­ly and fear­less­ly. This is best achieved when there is no doubt that every­one is in one boat and that it is not just a mat­ter of some­how opti­miz­ing the work of the employ­ees (agili­ty as con­cen­trat­ed feed), while every­thing remains the same for the management. 

Lead­er­ship there­fore always means being a role mod­el. This starts with small vis­i­ble signs, such as Klaus Straub as CIO of BMW Group IT mov­ing into an open-plan office with his man­age­ment team. In the past, you had to pass the assis­tan­t’s office to get to the indi­vid­ual office of a vice pres­i­dent, but since the move, the door to the shared open-plan office is now open to everyone.

In addi­tion to these vis­i­ble signs, the role mod­el func­tion means in par­tic­u­lar the will­ing­ness to ques­tion one’s own role as a man­ag­er. At Novar­tis, Vas Narasimhan as CEO does just that and rad­i­cal­ly puts the trans­for­ma­tion under the title Unboss. In the course of the agile trans­for­ma­tion of the BMW Group IT, we have there­fore been inten­sive­ly con­cerned since the begin­ning of 2018 with the new role of lead­er­ship against the back­ground of the agile basic prin­ci­ples of self-orga­ni­za­tion and sub­sidiar­i­ty. And the Man­i­festo for Human(e) Lead­er­ship emerged pre­cise­ly from this process as the first attempt to sum­ma­rize the com­plex answers.

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