Transition Management Fuels Innovation

By Jim Azumano and Jeff Kuechle

“The difference between a vision and a hallucination,” says corporate change expert Terry Paulson, “is the number of people who see it.”

Encouraging innovation is a key component of our mission at the Northwest Food Processors Education & Research Institute. Quite simply, we focus on giving food processors the resources they need to improve their innovation capacity because, without ongoing innovation, our industry cannot survive. Enterprise-enhancing innovation can come from any employee in your organization. But it is in a corporate culture that embraces change management from the top down that innovation thrives best. That requires vision, not hallucination.

A 2002 McKinsey Quarterly study, “Change Management That Pays,” evaluated the efforts of 40 companies engaged in change management efforts. Among its findings: that an ROI of 143 percent was achieved when a well-executed change management program was part of a strategic initiative or project. In other words, every dollar spent on change management strategy returned $1.43.

Business innovation – the successful commercialization of new products, manufacturing practices and marketing tactics – is the most important factor in the continuous prosperity of any commercial enterprise. But innovation requires change. Without strong leadership that is unafraid to manage the risks of transition, it’s probable that any effort to instill a culture of innovation will not succeed.

“The true spirit of change management is enabling all employees to express and apply their knowledge in a way that benefits each of them and the organization,” writes Susan H. Cramm of CIO Online. “If you really want to create a better tomorrow, you have to engage the heads and capture the hearts of your people before the hands of the organization can be mobilized.”

Dr. W. Edwards Deming, considered the Father of Modern Quality, argued that achieving the highest level of corporate performance required more than a good philosophy – it required the organization to change its behavior and adopt new ways of doing business. The eighth of Deming’s famous “14-Point Plan for Total Quality Management” says simply, “Drive out fear.” Fear is one of the thorniest barriers to improvement and can take many forms within an organization: fear of change, fear of learning a new and better way of working, fear of loss of status or employment. Only through effective management can such phobias be overcome.

Former General Electric CEO Jack Welch, one of the most revered and successful leaders of transformational corporate change, offered the following prescription for the process:

• Business is simple – don’t make it overly complicated
• Face reality
• Don’t be afraid of change
• Fight bureaucracy
• Use the brains of your workers
• Discover who has the best ideas, and put those ideas into practice
• Remember the “Three Ss:” Speed, Simplicity and Self-Confidence

“An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage,” Welch said. “…Giving people self-confidence is by far the most important thing I can do. Because then they will act.”

Effective transition leadership is a key component of the innovation process, but one that seldom receives the attention it deserves. If you’d like to encourage a healthier innovation infrastructure, begin by elevating your own leadership style to encourage successful transition management. The role of a leader in this process is to authorize the organization to engage in a new era of innovation and productive transition. There are hundreds of successful innovation models available. But results depend on strong, courageous leadership.

Here at ERI, we have a variety of tools available to help you shape a dynamic transition management process. If you’d like to know more, please contact me directly at 503-327-2213 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it .