← Leading Organizations That Matter
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- [00:00]
Jim Carlow
Foreign.
- [00:10]
Ray Spadoni
Welcome to Leading Organizations that Matter, a podcast about how we find meaning, purpose and impact in our work. I'm your host Ray Spadoni, and today's topic is Change Management versus Managing Change. I talk about change a lot here on this podcast and in my writing and speaking, mostly because I've been around it all of my career and now help clients and leaders as they're in the process of going through it. So I'm happy to share the mic today with another individual with some similar experiences. Jim Carlow speaks, writes and consults on the topics of leadership and changes, with perspectives drawn from his 25 plus years of experiences as a C suite leader in the healthcare industry. This has included as CEO, COO and Executive VP roles in operations and sales of organizations such as Health Trio, Access Healthcare, Cognizant Technology Solutions, and Perot Systems. He has had a lot of success building, scaling and revitalizing companies, and today he shares some of what he has learned with us. Welcome to the podcast, Jim. Thank you for being here.
- [01:32]
Jim Carlow
Well, thank you for having me. I'm really excited to be here today.
- [01:35]
Ray Spadoni
Awesome. I notice in your work you discuss organizational change quite a bit, which is also something that I tend to focus on. And I note that you distinguish between change management and managing change. So let's start there. What's the difference and why does that matter?
- [01:56]
Jim Carlow
It matters because the outcome is going to be totally different. When I say change management or versus managed managed change to me is somebody changing the chairs on the Titanic by moving things around, but the ship's still going to sink. And they do that to hide from their own inferiority issues and failures as a leader. So when I say people manage change, they're managing change around them to make it look like other people have been the problem. Change management, though, is when you're strategically going to change the business process or the organizational structure to better adapt your your organization to the market and be more responsive and gain efficiencies and other things that you can that you're targeting to do at the same time, whether it's budget driven, financial driven, whether it's efficiency driven, any of those things, it's going to be more of a formal approach, maybe even with an outside consulting organization helping you get through that process. So that's how I distinguish the two of them. And in my career I've seen a lot of managed change organizations and even in sub organizations within a larger or you know, within a larger company. So for example, an IT company may have a healthcare division, that division leader may Be, you know, managing change by moving the leaders in and out around them to hide from the fact that they maybe aren't, aren't. Aren't getting the job done.
- [03:32]
Ray Spadoni
I see. So have you had experiences where it's either one of two situations, it's change for the sake of change, because some personalities are actually attracted to change and so maybe seek it. Or alternatively, you mentioned the rearranging the deck chairs on the Titanic. Is this pretextual? An organization may not know necessarily what to do about the hull breach, but they do know how to rearrange deck chairs, and so that's what they do. Have you seen either of those situations?
- [04:09]
Jim Carlow
I've seen the first. I haven't seen a lot of the second, which is probably a good thing, but I've seen the first in that regard. And a lot of times what I think people miss is you need to measure the gain from the results of what you're doing to really determine whether or not you, you've completed the task at hand or whether you've gotten partway there. Now you need to go further. So I think it can be in components as well.
- [04:39]
Ray Spadoni
Okay. If you're working with an organization that is either going through change or contemplating change, how do you start off on the right foot? Or what do you suggest they think about and do to make sure that they are more likely to be successful down the line?
- [05:00]
Jim Carlow
I think it's important to identify what they do well today, because what they do well today, you want to do better in the future, but you also don't want to break what's working. So. And again, I think that's where you have to be careful, because you could go through an organization and you could see things from the outside looking in and say, hey, this is working really well. Why are we messing with it? Maybe it needs a tweak, but it's working well. So I would have any organization first have a session and let's just document everything we do well, and then let's document the things that we think we do. Okay, but we could probably do better at it, and then start to build your planning around those two pillars per se.
- [05:52]
Ray Spadoni
So as that organization is looking in the mirror, do you sometimes allow for organizations to say, what do we do poorly? You know, what's our deficiency here?
- [06:04]
Jim Carlow
I would also cover that as well. Yes, but I would start with the positives always and make sure that they're well documented because you really don't want to screw those up.
- [06:15]
Ray Spadoni
Have you seen that happen where an organization will you know, undertake some type of a change and they, they lose the plot, they, they shoot the horse they rode in and so to speak, and that they are no longer excelling where they had previously.
- [06:32]
Jim Carlow
I have, and I've seen it also ruin people's careers where a leader has taken just the initiative of saying, the leadership I've inherited, I don't want. And so we're just going to get rid of them whether they do a good job or not. And unfortunately, I've seen some people who have been riffed who didn't deserve to be riffed because they really did do a good job. They really did make a lot of improvements in their organization and in efficiencies. But just to go in and have this kind of attitude of I just want to wipe everything out and start fresh, and I've seen it happen where the organization has actually gone backwards as a result.
- [07:17]
Ray Spadoni
All right, so if the organization is going to do some inventorying and they don't want to stop being successful where they are successful, but they do acknowledge where they need to improve, what next? How do you ensure that someone is actually managing change?
- [07:36]
Jim Carlow
I think you need to have a project owner for it, and that project owner has to keep people on task with whatever they're doing and within a reporting mechanism, back to the executive team as to the progress that's being made as it's being made. I think there needs to be that check and balance in place. So it doesn't necessarily need to be somebody from the outside that comes in to manage that. It could be somebody internal, but somebody has to have ownership for the project itself. And then that ownership has to report to the executive team on the processes that they're changing, how they're changing and evolving them, and what the outcomes are going to be. And then at the end of the day or at the end of the project, you know, come back with, okay, let's see where we are today in terms of output and in terms of efficiency or whatever the component is to make sure that in fact they've gotten to end of job.
- [08:34]
Ray Spadoni
And I assume you distinguish between a champion or an owner versus traditional project management functionality. Is that correct? Is that a distinction you think about?
- [08:48]
Jim Carlow
Yes, I would absolutely, if it was my decision to make. I would want someone who's a true PMP certified project management person who's going to be able to do that. And then you're going to have your champions, which could be your department heads or your department chairs, whatever you have, whatever you call them, or some subset of leadership that you can call on when things are not going the way they need to go in terms of accomplishing the tasks that have been identified. So you, for example. Right. You could be the champion. And if I'm the project manager. And yet I'm not getting cooperation from your team. I would come to you first, after I've tried to get the team to be cooperative, and then ask for your assistance in working with your team.
- [09:35]
Ray Spadoni
Great. In episode 43 of this podcast, I had an opportunity to talk to Lisa DiTullio, who's a project management expertise, someone who I got to know during the Harvard Pilgrim turnaround in the Boston area some number of years ago. And we kind of went into some level of detail on formal project management. And I know that Harvard Pilgrim was an organization served by an organization you're very familiar with, and so I know you're no stranger to project management. What about project reporting, tracking? You know, sort of the ongoing work of measuring progress, that's got to be.
- [10:24]
Jim Carlow
A component of it. If you're not a. If you're. You've got to make sure that you're measuring your results and you're reporting those consistently back up the flagpole. You won't know if you don't do that. You'll never know when you're. When you've made the right decisions or made the right decision turnaround or accomplish what you set out to accomplish. Because let's face it, on day one, we could make an assumption based on what we know we do well and what we don't do well, and say, well, this piece over here that we don't do well, we're going to do these six things. Well, in the middle of that, you may find that that 6 is now 12 or that 6 is 3. And so documentation has to be consistent and it has to be detailed along the way so that everybody understands, so that somebody could come in from the outside and up that project book and understand exactly what transpired. There's got to be a formal record of that. And in fact, I could see that being turned over to a board and saying to the board, this is not. This is the conclusion of what we just did for the last 12 months or 18 months or whatever the time frame is, and it becomes an artifact that. A referenceable artifact. So anyone coming in, if somebody, you know, if. If the whole executive team gets hit by a bus, somebody can come in and say, here's what the organization went through.
- [11:55]
Ray Spadoni
So, you know, bringing it to the board, there's a level of transparency. There but there's also, it's also an exposure issue. And so you mentioned the after the fact reporting. Do you like to recommend that there be such high level reporting earlier in the process so that the lights are brighter and shining on the work as it's about to kick off and then is happening?
- [12:25]
Jim Carlow
I think that depends on the organization. But I think I would tend to say yes, this is the process we're going to go through. We're going to periodically give you updates as to what's transpiring or whether we're on plan so that there is some exposure to that at the board level. I think that's very appropriate. I think the thing that as a leader you'd have to be careful of. You don't want the board managing the project. Right? Right. So you've got to give them, and I'm not suggesting that you mislead the board, I'm just saying that you, you don't go too deep with the board that they think that they're, you know, they can come in here and come in and just start to pick up that project and direct it.
- [13:05]
Ray Spadoni
Is that a tightrope sometimes where you want your board to be involved and engaged and aware, but as you said, you don't want them feeling as though they need to manage it and to you, you know, because that can then become onerous, just sort of managing the board, frankly. And so there's gotta be a sweet spot somewhere in there. Do you find that that is, that falls into place more often than not without a lot of elbow grease or is that something that has to be actively managed?
- [13:34]
Jim Carlow
I think it actually falls into place rather easily. I don't think for all of the boards that I've ever interacted with. I've never had a, I've never sat in a board meeting where I felt that the board was, was taking the step of trying to tell me how to do my day to day job or my day to day activity. Do they ask questions? Absolutely. Do they have a right to ask questions? Absolutely right. And they can certainly provide input or guidance or whatever or hey, did you happen to think about this? And I think that's appropriate.
- [14:12]
Ray Spadoni
Let's talk a little bit about the organization's culture. And I, and I, I know you have some thoughts about culture, but what I'm specifically thinking about here is accountability. And you know, just recently I, I did an episode specifically on building a culture of accountability and ways you can jumpstart that. But as you're working with organizations and have worked with organizations Going through significant change. Are there times when the culture will facilitate the change versus times when it's an obstacle to the change?
- [14:45]
Jim Carlow
I think there are. There are certainly times that there are obstacles, but there shouldn't be uniform obstacles throughout the organization. It's interesting you talk about accountability. I just finished reading Extreme Ownership and great book. If anyone wants to read a good book on being committed and ultimately owning everything that you need to own, that's a great book and I highly recommend it. And I think they just came out, same authors with a second book, but I haven't read that yet. But I think accountability is just like they say in extreme ownership. You have to own your responsibility, you have to be accountable, you have to accept the fact that your job is these three things and you have to make sure that you perform them as best as you can.
- [15:40]
Ray Spadoni
Great. I'm just. Do you remember who the author is of Extreme Ownership?
- [15:46]
Jim Carlow
I actually have it right here. Jocko Willink and Leaf Babin.
- [15:56]
Ray Spadoni
Ah, okay. Oh, there you go. They are. It looks like it's some Navy SEALs are going to talk about leading and winning. Something that Navy SEALs might tend to know a little bit about. So.
- [16:07]
Jim Carlow
Correct.
- [16:08]
Ray Spadoni
So, yeah. Good. So thank you for the, for the, the recommendation. It looks like they've got a, a companion book, Extreme Ownership companion book. And yeah, looks like they've built an industry around this concept and so they must have been very successful with it.
- [16:26]
Jim Carlow
Yeah, they have been. And in fact, I think this book sold more than 10 million copies. Their first book. For some reason, I want to think that somewhere I read that.
- [16:38]
Ray Spadoni
Well, if that's right, that's pretty good. That's success for sure. I wanted to ask you a little bit about, as we've talked about, about culture, there's also a leadership culture dimension and I know we're going to pivot in a few minutes to talking about the attributes of great leaders, also something that you've written and spoken and think quite a bit about. But I want to ask you about change leadership and whether or not you feel that that's a distinct competency of some leaders who are more natural and more naturally suited to lead change, or whether or not this is a more fundamental expectation of leadership and that it can be sort of trained into someone or developed into someone, regardless of whether or not they have the inclination.
- [17:35]
Jim Carlow
I'm a firm believer that a lot of things, including leadership, are learned. I don't believe the old adage that people, people are quote born leaders. I think there is some genetic evidence that a lot of leaders have some common gene. But in fact I think that the leadership process is a never ending learning process. And I look at my own career and I look back at my first management job and I was horrible. I couldn't believe people would work for me. When I think about how I've evolved over 30 plus years in industry, I am completely different today than I was back in 1983, that's for sure.
- [18:21]
Ray Spadoni
Well, that's great. So you've, you've learned to become a more effective leader. And as it I just mentioned a few minutes ago, you, you have given some thought to the characteristics or the attributes of great leaders. And you, you describe the fact that there are six essential attributes. And I think you've painstakingly narrowed that list down quite a bit over the years. Can you talk a little bit about what the list is, how you came up with that list and what's on the list?
- [19:00]
Jim Carlow
So the list is actually the offshoot of mentoring a number of people over the last 25 years. And what I found with these leaders was while as intelligent as they were, they lacked the ability to really understand the people they were working with and how to manage them. My six pillars are not rocket science, but they are key attributes that have helped me build high performing teams. And those six attributes are integrity, which to me is non negotiable. Anyone who knows or has worked for me knows that integrity is important. And I think great leaders operate with a great sense of integrity not just in themselves but in their organizations. The next two pillars are empathy and compassion. And those are two very different things. And I think that's an item that a lot of leaders struggle with. And a lot of leaders that I've worked with, you know, they've struggled with being able to know when to be empathetic or when to be compassionate and how to handle that. Then becomes stability and focus. Again, two similar but different items. If you know, when I think of stability, I think of Warren Buffett. Warren Buffett is very stable and methodical about his actions and does the same thing every time he pursues an organization to buy. That sense of stability transcends not just him, but his entire organization. And so in even focus, when you think of focus, I think of Amazon. Jeff Bezos. Since the mid-90s he's had one singular focus and that's establishing himself as a world leader in retail. I say retailing, but he's in essence putting malls out of business by allowing us to order things through Amazon that get delivered to our door. And we don't have to get in a car and go somewhere. So those are all important. And the last one that I considered as a pillar is humor. I think great leaders. And when I say humor, I don't mean be a comedian. I think I use, I don't think I use humor to diffuse tense situations, disagreements between people or to just get people back to the same table or to open up a session and to get people relaxed into what we're going to do. And I've used it quite effectively. But again, it's not about standing up and telling jokes and a lot of times it's just I'll find something funny that or something that I did. And more self deprecating humor than anything. And I think people respond to that very well and it humanizes, humanizes the relationships a lot more.
- [22:10]
Ray Spadoni
Okay. Integrity, focus, empathy, compassion, humor and stability. So keen intelligence, decisiveness, persuasion. I mean there are other attributes that someone might argue are also important. How'd you narrow it down to six and these six?
- [22:34]
Jim Carlow
So my initial list was I think somewhere north of 15. And I said if I put a book out and focused on 15 things, could it be actionable? And I didn't think it could be actionable. And so what I did is I looked at the list and I said which are the ones that I see most people struggling with? And that I think that we. And I don't see. It's not that I saw people struggling with integrity. Integrity to me has always been a non negotiable thing. But the other five pillars are things that I saw leaders were missing. And so. And I also just firmly believe in leading with integrity and have since I entered the business world or at the age of 23 graduating college.
- [23:24]
Ray Spadoni
Okay, let's talk about teams. I know that's another area you've focused in on and done some writing about. But you know, teams are key. Obviously work groups are the building blocks of progress and so having strong and effective teams is important to any organization in general. And then more specifically those are going through some significant change. What are the keys to building strong, effective teams in your experience, Jim?
- [23:57]
Jim Carlow
I believe being able to demonstrate to your team that you're there for them and for their success. And along the way using the framework of the pillars to emphasize that. Let me give you an example. I once worked for a technology company that you know of and we were sunsetting a claim platform. It was the old green screen technology. Remember those days? No mouses on the computers.
- [24:32]
Ray Spadoni
Yep.
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Jim Carlow
So I had to tell these people that we were going to be sunsetting the product and their jobs were going away, and I had to tell them that. But I also had to find a way to keep them because I couldn't afford for them to leave until customers transitioned. So I struggled. And I thought for a long time, what do I tell them? And I made a list of three things that I would want if my boss came to me and told me my job was going away. When I met with them, the first thing I told them was that they were valued and that even though their job was going away, I would give them each as much notice as physically possible as to what the potential date was. Some was going to be three years away, some might be three months away. But if I knew we were losing two customers in 90 days, that we would be making adjustments to staff. So promise number one was you would have as much notice as feasibly possible. The second thing I told them was for anyone who wanted to take the time to learn the new technologies we were building, I would make time available for them every week and trainers available to them to help learn the new products and technology, the coding language and everything there was to know about that product so that they could transition over as customers, transition to the new technology. The third promise I made to them was that if they wanted to find a different job in the organization, I would personally help them find a job in the organization best suited for them. And then I went on and said, if you decided that you don't want to work for the organization, I will personally help you on the outside find a job for yourself that fits your needs and your family. Two things happened from that experience. The first one is what I was hoping for, and that was nobody left before their position was set to go away. So some people stayed till the very, very end, while others took on new roles. The other thing that happened that I did not expect that was for that three year period, that team had the highest employee satisfaction rating in the entire organization. When HR came to me and showed me the first year of the scores, they said, how did this happen? These people are losing their job. And I said, I would never have expected that. I would have expected them not to be happy about the fact that they were losing their job. But I believe they felt committed because they knew I was committed to them and I would work for them to help secure their future. And I think that's what made that successful. So when you talk about building a team, I think that's a great example of a team that to this day I still hear from These people have gone on to other careers, but I, they still keep in touch. But I think it's when you have a leader that invests their personal time and energy into helping you, even in times of, when times are bad or things bad things can happen, I think you build that loyalty and I think you build that commitment to the, to the cause with them. And so there's, you know, and that's just showing empathy and you show compassion as well. People, people want to feel secure and, and those, those basic characteristics help people feel secure.
- [28:27]
Ray Spadoni
Well, it's further evidence of the, the power of treating people right. And it's also, you know, quite reminiscent of a conversation I had recently with Gina Maza on servant leadership. And you know, your example, I think is a good, is a good one related to the call to servant leadership, which is really more of a mindset and a way of self identifying. I mean, if a leader sees themselves as a servant leader, first and foremost, they will do the sorts of things you did and more often than not have the kind of results you had, whereas those who don't, it's not part of their framework, it's not how they approach the world. In fact, they might even find it to be quaint or unnecessary to act as servant leaders do. But your example to me is an example of exactly that.
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Jim Carlow
I totally agree with you. Totally agree with you.
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Ray Spadoni
Great. So maybe going back to this notion of managing change, I know that you have identified mistakes that leaders can make in the pursuit of change. I think I saw that you have five mistakes, common mistakes that leaders make in the quest to try to transform an organization. Jim, do you mind ticking through those and telling us what those mistakes are and then how do we avoid them?
- [30:00]
Jim Carlow
I think the biggest mistake people make often in change management is not having a plan that is so, or just coming to the table and saying, okay, we need to reorganize, we need to change and not have any thought about what you're going to do or how that's going to be done. So the first thing is have a plan. The second thing is I would also make sure that everyone knows what the expected outcome is. And I think a lot of leaders make the mistake of saying, hey, we're going to go through a little bit of change here, it's going to be okay, but not give them any indication as to what you think the outcome is going to be. The third mistake I think leaders make also in this regard is they fail to properly communicate during the transition and the activities that are taking place in the change management process. I think it's important for employees to be not only bought in, but fully addressable as to where we are in the plan, what's happening with the plan, where are we winning, where are we losing? Because it's impacting everybody. And if you're not communicating consistently with everyone on your team or your organization, they're going to become restless and distrustful. And when that happens, they start looking for a job. And that's not what you. Well, unless you're looking to shed half of your workforce, maybe you do that, but other, but typically that's not why it's done. And so there's four items right there that I think most leaders, if you can avoid them, will be highly successful at the change management. And the fifth one is the leader needs to own the process and publicly own the process and be able to speak about it and to be able to talk about what in fact they're doing and what they see happening and how they feel the process is going for everyone. Let's face it, when people are faced with change, they sometimes get negative about it. The more you can communicate with your team about everything that's going on and what you're trying to achieve, the more successful you're going to be, especially with their buy in.
- [32:22]
Ray Spadoni
Great. Okay, any, any last words of advice to the leadership team or maybe the governance of a, an organization? Let's say it's a mission driven organization that's focused on not only meeting the, the mission of an organization, but they're taking the real long view and focused on also the durability of the organization and sustainability of that mission over time. But they know they have to change, they have to adapt and maybe even fully transform themselves. Any words of advice to them if they are mulling this over but are intimidated by the prospects of doing so?
- [33:05]
Jim Carlow
What I recommend for all leaders is to have at least one mentor that's external, someone that you can confide in, that you trust, that can give you input and help you reflect on what, what you need to adapt or change. Nobody likes to be told, well, nobody likes to be told you're a horrible person, bad example. But nobody likes to be told you're a horrible person. So if, if you know you've got some rough edges and you can work on those, the best person to help you with that is someone who's not in your work environment, somebody external to you. And so I encourage all leaders. I have probably two or three different mentors that I call on periodically when I'm, when I'm struggling with something that I'm trying to figure out and I do it in return for a number of people. And it's very gratifying to be able to talk to somebody who's not directly involved in your day to day business and get their perspectives and ideas, whether it's how to handle a problem employee, whether it's, you know, how do, how would I reshape my, you know, my finance department or whatever. So I encourage that and I also encourage a culture where the company supports mentoring programs for newer employees so that they can create a career path at the organization.
- [34:37]
Ray Spadoni
That's great and that, that really ties well into some of the themes that I've covered on this podcast and in my own work. I sometimes like to refer to Dr. Atul Gawande, his comments on mentoring and on coaching. And he's, you know, he's a surgeon in the Boston area. You know, he's authored books like Being Mortal and you know, written several articles for New Yorker and so forth. And so he's a pretty well known person who talks about the business model of coaching is people tend to see it as problem solving, as an intervention, as situational, as something that you, you do and then move away from versus the, the sports version of coaching, which is that you will have a coach at all times, you will continue to work with a coach. And even, you know, players like Tom Brady, who was, you know, quite a successful quarterback, always had a quarterback coach, even though he was operating at the highest levels of the sport, that he benefited by having an objective third party. As you're describing, Jim, observing what he was doing to build awareness, discover patterns and so forth. And so I, I like that Atul Gande perspective because I think it's, it's applicable and particularly for leaders who are undergoing a change, maybe even one, you know, that is existential for their organization and even for their careers, having that third party participation can be a game changer.
- [36:15]
Jim Carlow
Absolutely, absolutely. And I believe, well, if it wasn't for my mentors and some of the great leaders that I've worked for, I wouldn't be the person that I am today. I truly, that's where my learning came from. A lot of it was, you know, learning by working with some really, really great leaders.
- [36:38]
Ray Spadoni
That's great. We covered a lot here today. Jim, if folks are interested in learning a little bit more about who you are, your work, some of the things you've spoken and written about, where can they find you?
- [36:55]
Jim Carlow
The best way to find me is obviously on the Internet. I do have a website. It's very straightforward. It's www.jimcarlo.com J I M C A R L O U G H dot com. That's the best way. My phone number is there. You can reach my email there as well. I am on social media, LinkedIn. Please reach out on LinkedIn and connect with me. But yeah, and if I can be of any help to you if you're struggling finding a mentor, call me. I'll help you find a mentor.
- [37:28]
Ray Spadoni
Great. That's. And, and I'm glad you made that last point, Jim, because you mentioned it's great to have a mentor, but to have someone whose objective third party maybe isn't directly involved in the same situation you are involved in and maybe then, you know, can have a higher degree of objectivity. That's. That can be very valuable, but it also can be hard to find. So, so thank you for your willingness to help for, for folks to, you know, sort of look for you and see if you can help with that. That's great.
- [37:59]
Jim Carlow
Thank you.
- [38:00]
Ray Spadoni
Thanks for listening. Leaving a positive review and letting others know about this podcast will help a great deal. My mission is to help empower organizations that matter by supporting those who lead them. I offer coaching, mentoring and consulting services. You can learn more about me@racepadoni.com.