“A well-designed program to promote productive behavior and skills can not only energize an organization’s workforce but also become an essential element of any successful transformation.”
When it comes to enterprise-wide transformations, we know that most companies miss the mark on capabilities during their initiatives. While the majority of organizations recognize the importance of a skilled and motivated workforce, many don’t devote enough time and resources to developing one. The priorities lie elsewhere, and an irreplaceable opportunity is missed. For others, foundational capability building sounds too simple—we are already doing this, a CEO might think. But in our experience, what sounds like common sense is rarely common practice across an organization, and that leaves opportunities to better performance on the table.
Capability building goes well beyond traditional training of employees: it’s about fundamentally changing how the work gets done. It’s also one of the best ways to energize people, from the C-suite to the factory floor, to support the transformation in the first place. Without that energy, achieving and sustaining a successful transformation becomes exceedingly difficult—perhaps impossible. But with effective capability building, companies develop the mindsets and behaviors to deliver transformational gains and add to these gains over time, embedding an execution engine for continuous value improvement.
The Building Blocks of An Effective Capability-Building Program
Capability building changes the way people go about their jobs. It strips the workday down to its most basic components and rebuilds it, embedding new habits around timeworn tasks. The lessons can be basic (for example, how to hold a meeting in 30 minutes instead of an hour and how to write the most effective emails) or more sophisticated (for example, how to prioritize responsibilities and how to anticipate, and thus ward off poor project outcomes).
Many of these core ideas sound like common sense, but we’ve found that they are rarely common practices consistently applied across an organization. Because this disconnect is ultimately behavioral, we turned to behavioral science for solutions. Three key elements are necessary for an effective capability-building program: leadership role modeling, widespread employee engagement, and virtual delivery.
Research tells us that people mimic—both consciously and unconsciously—the actions of the individuals and groups around them. One of the best ways to drive the adoption of new mindsets and behaviors is by ensuring that senior leaders model the desired change.
1. When employees see highly visible colleagues behaving differently, it reinforces the new way of working and signals a commitment to the transformation. Indeed, when senior leaders role model the behavior changes they’re asking employees to make, transformations are 5.3 times more likely to be successful.
2. Survey results and further discussions showed that many employees lacked trust in top management as the organization’s financial position deteriorated. Leaders weren’t communicating their goals or progress clearly, and no one was accountable for results. By role modeling new norms, senior leaders helped rebuild trust in the organization and the transformation itself—capability building included. By changing their own behaviors, they signaled to the organization that this change was real, thereby building trust.
Widespread Employee Engagement
For capability building to occur, transformation-program participation must be sufficiently widespread. Even when propelled by top-level buy-in, capability building still needs to be scaled well beyond a few rounds with a chosen few because employees who aren’t included in a transformation feel disengaged, disconnected, and left behind. Anything less than broad engagement defeats the purpose.
3. In other words, by engaging at least 25 percent of employees, the critical mass of the workforce can overturn deeply embedded behaviors within the organization and enable transformational change to scale across the enterprise. To inspire behavioral change in all levels of an organization, a capability-building program ought to start by targeting the organization’s top influencers. Those people, whatever their rank, should be among the first to go through it. The idea is that these influencers will serve as evangelists for the new ways of working. Influencers can inspire their colleagues to change through the use of personal anecdotes and compelling arguments.
Shaping A New Learning Environment: Virtual Delivery
Shaping the learning environment is another essential part of capability building. In the age of the COVID-19 pandemic (and in all likelihood, going forward), that means capability building must be deployed primarily through virtual means. Fortunately, capability building easily lends itself to virtual learning. Moreover, there is evidence to suggest that virtual environments can deliver experiences that are equivalent to or better than those of traditional in-person programs and workshops. Some 87 percent of participants in newly adapted virtual experiences in recent months agreed that the programs were at least as effective as in-person events would have been.
4. Perhaps the most significant aspect of a virtual capability-building program is the opportunity for global reach. At multinationals, it’s paramount that as many employees as possible, in every geographical nook and cranny, have the opportunity to learn and embed new skills. In the more traditional in-person workshop protocol, as meritorious as it is, that’s very hard to achieve because of logistics and cost; imagine flying thousands of people in and out of regional hubs.
Chat functions in videoconferencing platforms enable participants to converse easily and ask real-time questions in ways that would be too disruptive in a conference room setting. Virtual formats also allow for configuration and tailoring. When the transforming manufacturing company launched its digital program, lessons were translated into multiple languages, reinforcing, once again, the underlying message: management is investing in you.
Capabilities And Transformation
Typically, there are four sequential capability-building steps in supporting a successful transformation. First, individual employees learn new capabilities. Second, teams apply them, and capabilities and behaviors change. Next, the organization begins to see improving effectiveness. Finally, the company achieves its financial aims and other goals. Knowing this, it would seem that adopting a capability-building program would be common sense. However, as noted, it’s not at all common practice. Unfortunately, the reasons that companies don’t prioritize capability building—the learning outcomes are too basic or too distracting or a key C-suite player just isn’t interesting—amount to lost opportunities and leave the outcomes of transformation programs to chance.
On the ground, the issues with accountability and business-unit communications that were at the forefront of the company’s problems both changed for the better. Newly engaged employees generated almost 5,000 ideas for improvement, many of which impacted the company’s bottom line. Those ideas for improvement brought great value to the corporation and vested more people in its success. As the company’s former chief transformation officer put it, “We can’t see everything from up here. Great ideas often come from other parts of a company. Through capabilities, management can give frontline employees a process to take an idea, champion it, and get recognized for the work.”
Transformations are difficult to execute and even harder to sustain. Tens of thousands, sometimes hundreds of thousands, of employees need to be engaged and aligned, regardless of where they live, the language they speak, or the culture they know. Effective capability-building programs enable organizations to develop the mindsets, behaviors, and skills needed to power a transformation and achieve their full potential.
The key to sustaining a transformation is to embed what we call an “execution engine,” a replicable process that fundamentally changes performance rhythms and decision-making in the business. It’s about raising sights beyond the strategic choices and daily initiatives to change how the organization works. We believe there are five broad ways to build this engine: