Transformation: Going Where Other Approaches Can’t

In developing Value Management, we’ve factored out and organised into levels the five stances that people take when it comes to today’s business challenges. Each level has an associated default approach, but only one level and approach works. Here, I show you why and how that level is Transformation and why Value Management is the only approach that can succeed.

Over the years developing Value Management, we’ve realised that there are only five stances adopted in response to the challenges of today’s Complex world:

1. Blindness
2. Acknowledgement
3. Mitigation
4. Adaptation
5. Transformation

As we’ll see, each stance – or “level” – comes with an associated default approach.

We’ll also see that each stance requires a higher level of insight and a higher level of change than the previous one – such that it is an “improvement” on the previous one in some way – and that rapid progress through these levels and their associated approaches is possible, including the potential to skip levels.

However, each “transition” to the next level involves making a significant conceptual breakthrough and overcoming both “passive” and “active” resistance…

…and, despite the levels being presented above in a sequential list, they are not linear and incremental.

The Differences (That Make a Difference) Between Levels

There are four key differences that destroy the illusion of linear and incremental progression through the levels.

Firstly, they should be organised into three groups:

1. Doing nothing: 1. Blindness and 2. Resignation
2. Doing the “wrong” things: 3. Mitigation and 4. Adaptation (despite their possibly “promising” names, they involve persisting with the status quo)
3. Getting it right: 5. Transformation

There are therefore key decision points between groups – doing something (3-5) vs doing nothing (1-2), and doing the right things (5) vs doing the wrong ones (3-4) – and these decision points have two implications:

• Transitions from one group to another are even more significant than the transitions within groups.
• “Skipping” levels is easier when also moving from one group to another, and in particular from doing nothing (2) to doing the right thing (5): as we will see, this is far easier than switching from the wrong things (3-4) to the right ones (5).

Secondly, and developing this point further, there is a “fault line” between (a) levels 1-4 and (b) level 5, and this “fault line” is far more profound than the transitions between levels, or even than the decision points between groups of levels.

This is because everything up to and including level 4 involves working with existing approaches and/or assumptions – read more about this fault line and how our logo reflects it – but 5. Transformation is of a completely different nature to the other levels:

• It is where existing approaches and assumptions run out of steam, creating a “ceiling” which cannot be operationally breached or bridged –
• We accept that we need to go beyond the known / knowable to also encompass the unknown / unknowable.
• We consciously move from the linear, hierarchical and bounded to the networked, interdependent and fluid.
• We embrace and harness how change is no longer proportional but exponential.

Something truly new is needed.

Thirdly, the resistance to progress is particularly strong at 3. Mitigation and 4. Adaptation, and most people and organisations therefore currently end-up stuck in one of them – whether through choice or by running out of steam – and the longer they stay there, it becomes even harder to make the necessary progress to 5. Transformation.

This is then a major problem because fourthly – and perhaps most crucially – 5. Transformation is the only level that is effective: whilst very few people and organisations reach it, this needs to be the goal; the others are all sub-optimal at best and disastrous at worst.

To understand all this in more detail, let’s now look at all of the levels within their three groups – beginning with doing nothing.

Doing Nothing: Failure and Despair

We begin with the first two levels, where what separates them – the second acknowledges reality whilst the first denies it – pales in insignificance to what unites them: nothing gets done.

In the face of today’s challenges, the resulting DENIAL and RESIGNATION just aren’t tenable, and failure and despair will follow sooner or later – most likely sooner.

(Just look at our Expectations Curve.)

1. Blindness – default approach: DENIAL (5-10%)

This is where, despite today’s challenges being obvious – which makes this a minority position – they are unseen or wilfully ignored.

This blindness could be passive – due to a genuine lack of visibility or a failure to understand what’s happening – or active, where it’s too uncomfortable to face reality for whatever reason.

Resistance to progressing to the next level – 2. Acknowledgement – typically sees any challenges (wrongly) considered to only affect others and/or to be temporary and exceptional, with things likely to return to “normal”.

Either way, the resulting default approach is the same: DENIAL – things are “fine”, and no challenges are properly acknowledged.

2. Acknowledgement – default approach: RESIGNATION (20-30%)

This is where today’s challenges are recognised – they are directly experienced realities – but they are just accepted and nothing is done.

The breakthrough from the previous level is that reality has dawned – things aren’t fine – and this breakthrough is typically made by one or both of two groups:

• Internal specialists, typically realising from their transaction processing data that things are getting harder.
• External consultants called in to assess the situation.

However resistance to the next level – Mitigation– can then be passive, active or both:

• Passive: a stoic sense that the only way is to soldier on.
• Active: what needs doing seems just too difficult – even impossible.
• Both: there just aren’t resources available to do anything.

Either way, the resulting default approach is the same: RESIGNATION – the status quo is accepted as something to make the best of, and nothing is actively done to really try and overcome today’s challenges.

Doing the Wrong Things: Struggling and False Dawns

Next, we look at where things ARE done – an improvement in some ways over the first two levels – but where, whilst these things may differ greatly, what is consistent is that they are the wrong things.

In the face of today’s challenges, the resulting DOUBLING-DOWN, SHORT CUTS and LONG CUTS will at best lead to some initial incremental improvement, but the ceiling of what’s possible without true transformation is soon reached.

The problem is that the huge investment in resources and political capital by this point make it even harder to change course.

3. Mitigation – default approach: DOUBLING DOWN (40-50%)

Here, effort is made to respond to today’s challenges, but that effort is on trying to consolidate the system using existing methods.

The breakthrough from 1. Blindness and 2. Resignation is that the need and capacity to do something now are established.

This usually follows reaching a level of explanation not just of what the challenges experienced are, but also patterns between them – including why they exist – which in turn sets in motion the search for solutions

As with 2. Resignation, this breakthrough can be made either by internal specialists – particularly cross-functional ones this time – or by more insightful external consultants that are called-in not just to report back what is happening but to try and explain and solve it.

However, the emphasis here is on “try”, because without the full understanding that only comes at 5. Transformation – of just how profoundly different today’s challenges are – the starting point is with existing methods: typically things like standards, contract management, capability training, behavioural training, etc.

The problem is that whilst existing methods have their place, they have been shown to not be fit for purpose as overall solutions.

Nevertheless, the problem here is that they are treated as such, being applied more forcefully, more widely or both: usually at huge cost.

Failure to progress to the next level can again be “passive” – people sticking with what they know and averse to doing something new – but is then more likely “active”:

• Over-confidence in what they’ve always done.
• Scepticism or cynicism, perhaps having been burned in the past by a promised panacea.
• Over-investment of resources and reputation, such that these “solutions” just have to work.

Either way, the resulting default approach is DOUBLING DOWN: even when results don’t significantly change, this is put down to the application of these existing methods – not the methods themselves – and so a repeating cycle of struggle and diminishing returns ensues.

4. Adaptation – default approach: SHORT/LONG CUTS (15-25%)

Here, in trying to respond to today’s challenges, people realise that existing approaches aren’t working and that something new is needed.

This “something new” usually gets things partially right – latching-on to a correct general principle of what needs to be different (“digital”, “people”, etc) – but fails to see the whole picture and is usually light on detail (or, in many cases, deals primarily in slogans, platitudes and inflated promises).

The new approach adopted – typically technology, but often an organisational shakeup or consultant-led programme – is seen as leading to inevitable success, even if it isn’t exactly clear how (e.g. how AI is said to free up time for more value-adding activities, but what those value-adding activities will be isn’t specified – just that there is more time for them, so value must surely follow).

From here, note that this level is unique in that it can be – and usually is – combined with the previous one: whilst realising that “something new is needed“, this is often to augment or “unblock” the existing approaches of 3. Mitigation that haven’t yet worked (and that can’t work).

This has three important implications:

• Ultimately, it is an extension of 3. Mitigation, continuing the assumption that challenges are problems that can be “solved”; it’s just the tools that are different.
• New approaches are typically “bolted on” , meaning that business as usual continues elsewhere, creating fragmentation and scope for resistance.
• There is a uniquely strong gravitational pull in the combination of 3. Mitigation and 4. Adaptation – together, they incorporate everything that is familiar in conventional management wisdom, and the investment of resources and political capital is doubled.

Failure to progress to the next level can therefore again be “passive” – believing the promise of the proposed panacea – but is usually more “active”: people have bought into the promise of what seems “sensible” and/or are too committed to back out.

Either way, the resulting default approach is SHORT CUTS and/or LONG CUTS: getting “stuck” in attempts to “get round” the challenges faced by “changing the game” but without ever really understanding it or focusing on specifics, leading to a series of false dawns and disappointments.

Getting it right: success through Value Management

Lastly, we look at where a recognition of the need to act is finally fused with doing the right things.

5. Transformation – default approach: VALUE MANAGEMENT (<5%)

This is where a systematic and thorough understanding of today’s challenges systematically changes how people and organisations operate.

The breakthrough here is the most profound one, and it is one that very few have made – presenting both a huge challenge and a huge opportunity.

As with 4. Adaptation, it is recognised that something new is needed, but that – instead of a bolt-on addition (especially one that is vague and/or only emphasises one general principle) – what is needed instead is a specific, actionable and systematic approach that:

• Directly harnesses the causes and nature of today’s challenges to effectively respond to them.
• Works bottom-up to “bake in” rather than “bolt on” change, such that it truly emebds, spreads and scales.

In other words, it needs to be something that is:

• Complexity-Aware: understanding and incorporating the dynamics of the Complexity behind today’s challenges – and, in particular, how technology fuels them – such that Complexity itself can be harnessed. This then means being…
• People-centred: empowering People (who are the fundamental “root” of Complexity and the source of creative responses to it), fostering discernment, and achieving engagement, motivation and change. This then means being…
• Value-led: understanding Value in its widest sense as the driver of engagement, motivation and change, and using it to shape all decision-making and activity – optimising effectiveness and maximising benefits.

We have such an approach, which we propose as the default – VALUE MANAGEMENT – which, unlike the snake oil and smoke-and-mirrors ‘solutions’ out there, is the only approach that:

• Truly understands the nature of today’s challenges and therefore how to effectively respond to them.
• Systematically and thoroughly sets out what to do and how through the assembly of its five elements (Things That Matter, Value Coding, ARC Diagnostics, Value Modes and Ecosystem & Lifecycle Postioning) into Value Journeys.

In this way, 5. Transformation transcends all the other levels, and breaks through the fault line preventing progress beyond doing the wrong things.

Putting it all together

This table summarises everything we’ve seen in this article:

Level	Entry Point	Obstacles to Progress	Default Approach	Results	%
1. Blindness	–	Ignorance, discomfort, lack of visibility	Denial	Failure	5-10%
2. Acknowledgement	Facing reality	Feeling overwhelmed, resources	Resignation	Failure	20-30%
3. Mitigation	Deciding to act	Familiarity, complacency, self-preservation	Doubling-down	Incremental improvement… Failure	40-50%
4. Adaptation	Deciding to change	Naivety, self-preservation, lack of systems thinking	Short / Long Cuts	Some improvement… Failure	15-25%
5. Transformation	Fusing reality, action and change	–	Value Management	Exponential improvement… Success	<5%

Which level are you at now? Which level do you want to be at?

Consult our Expectations Curve to see how these levels play out in practice.

Then consider the following question: are you ready, willing and able to start transforming your approach and results through Value Management and accept the challenges and rewards of being one of the visionary minority?