One of the hardest things about business transformation is convincing employees to accept change. Often the new direction for the company jars with its historic identity and purpose, meaning longer-standing workers in particular can refuse to buy in to it.
Some companies manage to do this better than others, and a team of European researchers set out to understand why.
The subject of their case study, published in the journal Strategic Organization (paywall) was a large German telecommunications and electronics company whose real name they would not reveal*.
Over its 30-year history, this company had successfully undergone several significant strategic pivots and even changed its business model, while retaining the founding team and key employees.
After a number of interviews, the researchers found an intriguing attitude prevailed that they argue underpins its ability to adapt to major changes. Employees tended to define the company not by what they thought it was, but by what they thought it wasn’t.
One employee said: “They told us that we are selling antifreeze and coffee machines now. […] It is very hard to imagine when you are coming from the telecommunications direction. However, then I started to think that this is actually a logical step, because we are not a plain corporate distributor only looking to get the maximum out of a client. For us, it is the relationship and the maximisation of value creation that counts.”
By defining themselves as not x rather than as y, employees never became too invested in what the company used to do. “Because the anti-identity was at the core of the organisation, employees never felt that they were losing something essential” when change occurred, write researchers Sarah Stanske, Madeleine Rauch, Anna Canato.
Anti-identities - such as Uber’s “we’re not a taxicab company” or countless credit unions' “we’re not a bank” - could therefore be a useful way for companies to understand their purpose and to ensure flexibility in the face of future changes.
(This company was founded in 1985 by two students in their parents’ living rooms, the founders are still there and it’s now one of the leading telecommunications and electronics distributors in Germany with revenues of ca$400m ...which company could it be? Answers on the back of a postcard/via Twitter.)
Image credit: Paul Faith/AFP