This following blog post is an excerpt from Dr. Ichak Kalderon Adizes’ Founders Session speech, delivered at the 2011 Adizes International Convention in Vilnius, Lithuania. (This is part 4 of a 6 part series)

The Therapy

How long does it take? On my fortieth birthday, which was quite a long time ago, I went to a “fat farm,” where you go to lose weight and exercise. A teacher there was making us go through some aerobic movements—jumping and twirling around—but I couldn’t do it. I remembered that when I was a student, I used to do this as a warm-up for my folk dancing group. I went to the instructor and asked, “How long will it take me to get in shape?” He replied, “How long have you been out of shape?”

I had been out of shape for twenty years, but I wanted to get back in shape in two hours. It does not work that way. There is a ratio between how long you’ve been out of shape and how long it takes to get back in shape.

Some companies can do it fast. The Company of the Year today has actually done most of it in a year and a half. (That is why they’re Company of the Year.) Some companies take longer.

How long? When executives ask me whether we have ever failed, I respond, “Yes, we did.”

“Oh, what caused you to fail?”

“Our relationship,” I say. “You and me. The day you don’t trust us, we are out. And the day we don’t trust you, we are out.”

How can we work together? We’re not going to change you, and you cannot change yourself by yourself. Together, we will change the company. That’s a lot of togetherness.
The more togetherness, the faster it goes.

How long it will take to change depends on you. Our contract says that how fast the work will be done depends on how collaborative you are as a company. The more cooperative you are, the less money you’ll spend, and the faster you’ll do it.

Here is how the system works.

 

The Sequence

If a client says, “Our salesmen are not motivated. Can you design a reward system to motivate the salespeople?” What we are going to say? “Next year.” Putting a cherry on a pile of crap does not make it a cherry pie.

The whole company is a mess. The poor salesmen are isolated in the market, with nobody to talk to. The assembly department is making low-quality products. Production doesn’t listen to sales. Sales doesn’t listen to marketing. And the company wants a reward system? Please, save me. I don’t care how much money they are offering to pay us, we’re not going to do it because it’s the wrong thing to do. We would be solving the problem in the wrong sequence.

Sneezing then wiping your nose is the right sequence. Some people first wipe their nose, then they sneeze, and wonder why they look ridiculous. Sequence is very important. For forty years we have been developing the right sequence for our interventions, and we’re still working on it.

It took me three years to change Bank of America—the largest bank in the world at the time, with $120 billion in assets. What we learned there we used in reorganizing Royal Dutch Shell, one of the largest companies on Earth with $5 billion profits in a year. That restructuring was done in six months. We are learning how to do it faster and faster.

Still, it can be painful, because you are opening the can of worms and putting it on the table. Some people don’t like to look the problems in the eye. It is much more comfortable to hide. We don’t let you hide, because, like in a marriage, what will destroy your company is the subjects you don’t want to talk about.

The problems companies have, or that you have as a human being, are like shadows. If you run away from the shadow, the shadow chases you. Turn around and chase the shadow, and the shadow will run away from you. Face your problems. Don’t run away from your problems.

How do we help you face them? My best example is what we did at Bank of America. The president of Bank of America happened to listen to my tapes, called me, and said, “Dr. Adizes, we need you.” Most of consulting firms went crazy. Why was the largest bank in the world hiring the smallest consulting firm in the world? We are small, yes. We’re a boutique, and we’re proud of it. We don’t want to be the biggest. We want to be the best.

When I went to see Bank of America’s president he told me, “This is a very large organization and we are kind of arrogant. We don’t hire consultants who tell us what to do. But we need help. How do I turn it around?”

I asked him if we could get all the movers and shakers of the company, all the important people, in one room. People who row the boat don’t rock the boat. I wanted whoever could sabotage our efforts to be involved in managing change.

Who are the people who can rock the boat? Who can make a mess of our desired changes? Who can undermine the changes? Who are the driving, biggest forces? The president said he needed thirty people.

Please realize: Thirty people can change the whole company. You don’t need 100,000. Who are the key people that can rock the boat? Our job is to get them to rowing.

The president was worried. “They cannot agree on the day of the week. We are going to get them in one room? It is going to be a mess.”

“Trust me,” I said. This program takes trust. Anyone who is going to hire us first has to trust us, because they are putting their company in our hands. You need to trust us like you trust a surgeon. Like you trust a psychotherapist, a lawyer, your tax accountant. Otherwise, it cannot work.

So I told him, “Trust me. If you have any doubts, ask my clients. We have a track record.”

 

Make the Client Take Responsibility

At the meeting of the thirty people who could rock to boat, I gave a lecture about the lifecycle of an organization. (I have a book about the topic; I strongly recommend you read it: Managing Corporate Lifecycles, Volumes I & II, available from the Adizes store or www.Amazon.com.) For about half an hour I talked about how organizations grow, age, and die, and what is normal and abnormal at every stage. Then I asked, “Would you like to know where you are on the lifecycle?”“Oh, sure!” they said. “Where are we?”

“I don’t know,” I replied, “you know.”

I had them take some index cards and gave them three rules. Rule number one: Write the top three to five problems that your company has. One problem per card. Don’t share it. I told them I was not going to collect them. When they finished writing it was fine with me if they tore the cards to pieces. What was important was that they were honest with themselves. In bureaucratic organizations people play politics and do not say what is on their mind, so I had to overcome that.

Next rule: Each problem has to be controllable by the people in the room. (That is why all the movers and shakers were invited.) Otherwise this exercise is not a diagnosis, it’s a bitch session. Don’t write, our problem is that it’s raining, because that’s not your problem. You cannot control the rain. Your problem is that you don’t have an umbrella, you didn’t listen to the weather report, or that your roof is leaking. Don’t write, our problem is unpredictable interest rates. Unpredictable rates are the Central Bank’s problem, not yours. Say instead, we don’t have a strategy to deal with unpredictable interest rates. A problem has to be controllable by the people who make up the organization.

The final rule: It is forbidden to mention names. You cannot write, X is a bad leader. You can say, we have a leadership problem. Why? Because in the diagnosis we don’t look for who is wrong. That is a witch-hunt. We look for what needs to be improved.

After the people at Bank of America spent a few minutes writing down their problems, I asked them: “How many of these problems did you have last year?” I do not need to know what the problems are. The answer is always the same, all over the world, in 52 countries, in any industry.

The answer: All of them. Or at least 90% of them.

How many of these problems did you have two years ago? Same answer.

How many of these problems did you have three years ago? Most of them.

Now, the wake-up call. If you have not solved the problems you have in front of you in the last three years, what is the probability that three years from now you’re going to have these same problems, plus new ones? Change has a very interesting characteristic. It is either going to be better or it is going to be worse.

I can tell you why you have not solved these problems in the last three years, and what change you have to make in order to solve these problems in the next three years.

How many of these problems can any individual solve? People often point to the president of the organization: “Mr. President; you’re responsible for all this, right? Why don’t we give you all the problems and you solve them?”

Can he? Not if the organization doesn’t cooperate.

But if all the movers and shakers could agree, how many of these problems are they going to solve? By definition, all of them. Remember, the rule was that the problems had to be controllable by the people in the room. So the answer is that all of the problems will be solved if you work together.

Thus the problem is not what you have written on the card. What is on the card is a manifestation of the problem. What is the problem? You’re not working together. Instead of having one manager chasing ten problems, which is what usually organizations do, we should have ten managers chasing one problem at a time. We need the cooperation of everyone to solve the problems. You cannot solve the problems alone even if you are a top-notch executive. Integration is the answer.

The challenge is that every one of the thirty people has five problems. Some problems likely overlap, so net there are probably a hundred problems. Now you must decide which one of these hundred to attack first; and, conversely, which ninety-nine problems to solve later. You have to stop attacking each other and unite to attack the problems in the right sequence.

I can promise one thing, and this is an honest promise: If you follow the Adizes Methodology, within a year, many problems will disappear. If you don’t believe me for any reason, talk to clients that have experience. At minimum, 40% of the problems you have today will disappear. We’re not going to make that decision; you are. We don’t solve a company’s problems. The company solves them, with our tools.

Forty percent more problems will disappear within two years, and 100% in three years. Some companies solve 80% of their problems in the first year.

Does this mean that three years from now you will have no problems? No. You are going to have new problems! And, here is the good news: They will be bigger problems.

How can it be good news to have bigger problems? Because you are only as big as the problems you are dealing with. Small people deal with who drives what car, who has what kind of furniture in their house, and whether their wallpaper is the most beautiful and expensive. Big people deal with the future of mankind, the future of education, of the environment, and what’s going to happen with our children, and with our lives. Tell me what preoccupies you and I’ll tell you how big you are. In order to be a big person you need to get rid of the small problems that preoccupy you.

This year you are dealing with small problems. Next year you’re going to deal with bigger problems, and the year after that, even bigger problems. I once had a New Year’s card that went to all our clients saying: I wish you bigger problems next year than this year—that you can solve.

This year the problem is how to deal with sales. The next year it is how to grow from a local company to a regional company. The year after that, how to be a multinational company, and the year after that, how to solve the problems of the community in which you live.

Do you see what is happening? That’s growing. Having fewer problems is not growing, it is dying. People who are dying have only one problem: they’re dying. People who are very much alive have a lot of problems. The more alive we are, the more problems we have. That you, yourself can solve. So, are you growing or are you dying?

Just thinking.

Ichak Kalderon Adizes

Stay tuned for part 5 next week.

Read part 1 here.
Read part 2 here.
Read part 3 here.