This story comes to us from The Business Pundit. Here’s what they had to say about a spectacular failure due to an unclear future image.
Obviously the dot-com boom of the 90s encouraged some of the most spectacular expenditures on the most bone-headed business ideas, so let’s start getting some of the more hilarious examples out of the way. Webvan was founded in 1999 with a simple idea you think would take off quickly in the Internet age: we have all this Internet shopping, why not allow people to buy groceries online? A few massive infusions of capital later, and Webvan was off, quickly building facilities 10 US cities, guaranteeing a delivery time of 30 minutes or less, and greedily eying another 16 markets.
Hoping to copy Amazon’s success as a first-mover in the space (i.e., the first major player can scoop up market share and hedge out future competitors), Webvan’s executives spent like there was no tomorrow, gobbling up warehouses and delivery trucks. There was just one, tiny, itty-bitty problem: no one had any freaking idea what they were doing. None of the executives had any experience with grocery stores or retail food sales at all. And this led them to miss one all-important detail that you think would have come up in earlier discussions when people were throwing millions of dollars at them: Profit.
Grocery stores, as opposed to the hodge-podge of items being sold on Amazon, have razor-thin profit margins―some of the lowest of any business in the world. And they can’t leave a product on a shelf for weeks, or even days, hoping that someone will buy it. Webvan went from tens of millions to hemorrhaging millions within the span of a few months.
Developing a clear future image involves many elements. In the Webvan story the failure was one of failing to understanding how people think when they are buying groceries. In organizational change management this would be like failing to understand how people in an organization are likely to react to a planned change. Having a clear future image means seeing the planned change in such detail that you can reasonably predict how key stakeholders and implementers of the change are likely to see the change from their perspective.
Here’s a little neuroscience. The brain tends to see the future as an extension of a single (or very few) perspective(s). The future is often conceived in broad strokes, big ideas, broad generalizations. Yet, it will be lived based on practical realities that involve many practical and detailed perspectives. To form the concept for a future state someone’s brain has usually taken a single idea and extended it along some single axis of possibility. For example, one of the simplest axes of possibility is “more” – to do something that has been done and simply do more of it. Another simple axis of possibility is “same deal, different location” – doing what has been done but simply doing it in a different place. These are fine ways of imagining. Not too difficult. Yet, the application of even these simple ideas requires that the fully realized future implementation must work in its entirety. Ideas might “sound good on paper” but fail to work in the real world. An idea might sound good to leadership but be impractical for the followers.
When leadership says something like, “This is what we want to do. Now, you figure out how to get it done”, be worried. This is a predictor of inadequate leadership, sponsorship, and potential change failure. If leadership does not (or will not) have a very clear idea how the future might unfold it is difficult to be precise, consistent, and focused. Followers will each begin to have their own ideas. The project can easily veer off course. Daryl Conner would call this a failure of intent propagation. Followers with good intentions may implement tactical details that can turn out to be at odds with the overall intent for the organization.
The Summary Message
Leadership must have, or be willing to create, a clear future image of a planned change, including reasonable insight into how others will see it.
The Change Management Action Plan
How can good change management help this situation? One of the best ways to clear up a future image is to imagine the future state in detail, as if it is seen through the eyes of others. Imagine the plan as if trying to explain to others how it will be to live in that future state (such as the sponsors throughout the organization will need to do). Imagine how people may react. Imagine the dream as if a manager who needs to ensure that the processes work correctly. Imagine the dream as if someone from HR who needs to address training, re-training, hiring, or terminations associated with the change. Imagine as if a front-line worker producing the products of the future state. The dream needs to work in the details as others will see it. Then, if there issues, ask questions to see if anticipated issues have been considered by leadership.
Certainly, all of this does not happen at the time the change is first conceived. Everything cannot be anticipated. The company cannot enter paralysis while the future image is conjured. However, as much as possible and practical a planned change needs leadership bearing a clear future image. Good change management can mean helping to consider how an unclear future image may hamper execution.