Andrew White:
Hello, my name is Andrew White. I'm from Said Business School and I'm delighted to be talking to you today about transformation on this special mini series of the Leadership 2050 podcast. I'm here with Adam from EY. Adam, do you want to introduce yourself?

Adam Canwell:
Yeah. Hi, I'm Adam Canwell. I'm a partner in EY, really focused on the people consulting space. Have had the pleasure of working with Andrew for about a decade now on different research initiatives, different work that we've done with clients generally, where we're bringing leadership into the transformational space to help drive transformation in organisations and in society. So this has been a fascinating journey so far, Andrew.

Andrew White:
It has. So what we wanted to do with this almost introductory episode is really give you, the listeners, a bit of an insight into the journey we've been on. Adam and I first came together, it must have been about two years ago, Adam, with a real question of transformation. Why is transformation important, particularly in this contemporary context we're in? Then COVID hit and it became even more of a bigger question and we've taken it from there, I think.

Adam Canwell:
Yeah. Back in the steady state days of 2019. It was a seriously big question even back then, wasn't it? Because you and I had been speaking for a while. EY had just rewritten our global strategy and at the heart of that, we'd said we really want to create a space for ourselves to be the number one transformation partner with our clients. By that, we meant people that could really work side by side with our clients to deliver challenging, complex programmes of work. The bit that we were all looking at and saying was that if you're going to be serious about this space, surely we should have a really hard look at this fact that we've all seen for too long. No more than three in 10 transformation programmes deliver success in their own terms.

Adam Canwell:
I think you were saying, "Why don't we actually put together a research programme that could try and answer that?" Obviously it's something we've struggled with for 25 years, so it's a complex question. It's not like it's going to have an easy answer, but I think the exploration of the past couple of years is starting to take us towards what are the things that you need to focus on to turn this around?

Andrew White:
I think you're absolutely right and I think it's a question that just isn't going away. Why are these transformations not going as well in many, many cases as they were intended to? But I think what we also noticed was that the Delta between where companies are and governments are, and let's call it the transformational challenge that they're facing is just getting bigger and bigger. Whether it's digital, whether it's climate change, whether it's the people agenda, these things are just driving more and more pressure onto leaders. So should I quickly go through what we did when we decided to get going? So in terms of the background or the foundation, we did a 2000 person survey. We looked at successful and unsuccessful transformation projects and we looked at leaders and we looked at workers. We then did a whole series of deep dive interviews and I think that's what we really wanted to talk about on the podcast was really set the foundation, what we saw coming through on that research here.

Andrew White:
For me, it's been so interesting, Adam. I mean, I think it's confirmed some things. It's surprised me. It's given me insights and I think we've set out to demystify something. I wouldn't say we've demystified it completely, but I think we've certainly taken a number of really big steps forward.

Adam Canwell:
We were looking at this and saying, is the clue to this, or is the answer to this, the people going through the transformation? There was a bit of face validity to that because if you spoke to most leaders who've experienced delivering significant transformation, most of them would say that the most challenging part of it is really taking your people with you, taking the workforce with you, taking your leaders with you. The answer set that we've got in the data is really starting to show that and bring that to life in quite a tangible way. What are the things that you really need to pay attention to? That this is a largely human dynamic process and what is it that you need to do as a leader to take your organisation through that I think starts to come through quite loud and clear. I think that would affirm what we both started with as our hypothesis. Certainly your work with leaders was pointing us towards that, wasn't it, as the key.

Andrew White:
Yeah, it was. But I think what surprised me was that journey began so vividly with the leaders themselves. Yes, there was another bit, which was about how they work with workers, but I came from research looking at disruption where people needed almost a raging fire beneath them to realise that their world was changing. I think that was back in the 2000s and really what I found with this bit of work when we went out and did the interviews was that there was a whole group of leaders who were seeing things coming five years down the road who were consciously separating from the status quo, the business, as it is today, and saying, "What might this part of the business look like in the next generation of its incarnation? What might this function look like? What might this programme look like?" and really going through that process of detachment in order to understand what's the purpose.

Andrew White:
That was almost a front loaded process that leaders put themselves through. Invested time and money and energy and, to be honest, with humility that they didn't have the answers. So to me, that's been a paradigm shift in terms of the types of leaders that we've got that are kind of ... it's not easy, but they're starting to go into that without having a crisis driving them there. Such an interesting starting point that then sets up the next phase for when you go out to workers.

Adam Canwell:
I think the point that I started to think we've got something really interesting here and something that was really grabbing my attention and surprising me was ... I totally agree, there's such a really interesting narrative here of the leaders who are leading in quite a substantially different way. When you look at the data and you look at the experience that workers go through when they go through a successful transformation programme versus when they go through an unsuccessful transformation programme, it really starkly brings to life what you need to do to manage an organisation through this or lead an organisation through this. It was that point where we started to look at it and say successful transformation programmes have got leaders around them who are constantly working on themselves in a really reflective, deep way, while at the same time leaning in, really leaning in.

Adam Canwell:
No matter what your transformation is, there will be a point where it gets really tough and it's not as easy as everyone expected. It's not as fun as everyone expected. You maybe hit the quicksand or whatever's happened. At that point you can see in the data, successful transformation programmes are led by leaders at that point who lean in, they look at themselves like, "What have I got to do differently? What have we got to do differently? How do I need to turn up to be there for my workforce?" Not to take the pain away, but actually to say, "What can we learn through the pain that we're going through to take us to a different space?" Whereas the unsuccessful programmes, you see it in this really slightly disturbing pattern in the data of leaders leading out and leaving the workforce to suffer and to struggle, that leaders lose their nerve. They try and get away from it. They remove themselves from it.

Adam Canwell:
Whereas the workforce are left in this really quite horrible, slightly psychologically damaging space. Then that lean out when the going gets tough and be there or lean out and be there for yourself is really vivid. When you look at the data that we've got, and it does require a selfless leader who is out there for everyone across the organisation, not just for themselves.

Andrew White:
I think you're absolutely right. There's no doubt that every transformation project, most of them start with some good emotion and then very quickly as the rubber hits the road or the reality bites, they go into a more difficult place. I love the way you talked about that critical moment, the leaders who are able to pivot that and use that and lean into it as you're talking about and listen to that emotion and work through that difficulty and actually turn that, because that's the foundation of success. Or it's the point at which it really drops into the abyss. I think what we've seen from the data is that's not just about one transformation. That either leads to a culture of transformation, a muscle, let's call it that, then becomes much easier for companies to do other transformations, or it goes the other way.

Andrew White:
It actually makes transformation become a dirty word or a word that we don't want to talk about. You and I both heard leaders say, "We don't talk about transformation here," because it's just got such a bad history about it. It's got a bad sense of feeling about it. So the leaders that can lean in that way, that's the really critical skill. What struck me, Adam, was that when I listened to what some of them were doing, it was like good psychotherapy. Then when you think what is good psychotherapy? It's just being a good human being. It's just listening to people. Listening and saying, "What I'm hearing you saying is this. You seem to be struggling like that," and giving people a space to process stuff. But in that processing, something happens and that's where the change occurs. So that listening skill is really, really key to when you're talking about that leaning in.

Adam Canwell:
Yeah. There's the piece about the workforce and psychological safety and what does that mean, and then there's also, I think, what we've started to hear is there's an implication for organisation as well as programme that we're starting to see. What's the organisation looking like that's embracing this? One of the things I found quite interesting as we've spoken to different leaders about this and different organisations about this, I remember quite visibly the reaction of quite a senior people leader who was really saying, "Wow, does this mean we've got to ask even more from our leaders? They're already overwhelmed. This is going to be really challenging." I think we both said, it's quite interesting because when you see leaders who are in this space of leaning in, leading others through this journey, they actually feel like much more grounded, almost peaceful leaders.

Adam Canwell:
They don't feel overwhelmed. They're leading from a different place, which is a much more creative, attuned space and they feel less overloaded, less pressured. They feel like leaders who are leading from a space that is creating energy rather than just endlessly having to push energy in and feeling overwhelmed.

Andrew White:
Yeah, and I think pretty much everybody we spoke to had some form of practise that gave them some renewal. I mean, it could be going for a walk in nature. It could be meditation. It could be Tai Chi. It could be their family. So if we could say that the work they were doing was the doing world, they also had a being world and they really were clear that they needed to go into a place of renewal in order to stay in a place of equanimity or groundedness or peacefulness when the storm was around them. They were coming with a higher sense of purpose in terms of their work in many cases. So it struck me on this research, it also struck me on the other podcasts that I'm doing, that there's a real ... I don't know. It's a subtle spirituality and I don't mean religion. I don't mean anything that's formal, but there's something about higher purpose coming through and there's something about vocation and there's something about people serving something.

Adam Canwell:
I think what you see is that the transformation process, to get to a transformed state where we're doing things really quite differently, that could be different products, different services, different organisation, different technology, but we've substantially shifted something material about our organisation, requires us to learn new things, to perform in a different way and that in and of itself needs ... to get there, you've actually got to go through a pressured environment, but then it's the how you create a space where that's okay? You compensate for it. You can see that again, can't you, in the really successful transformation journeys programmes. They use that heightened pressure to get to a different place, quite deliberately so. Maybe subconsciously, but quite deliberately leaders are leaning in and taking people to a different place.

Andrew White:
Exactly, and creating spaces for that emotion to come up. I think one of the quotes that we use in the white paper, I think, which really crystallises this point is where one of the leaders who was transforming a huge procurement operation. So when I went to people and told them that they needed to fundamentally change, what I thought I was doing was telling them there was a great vision for a future way of operating. He said, "In many cases, what they heard was I was telling them that they were doing a bad job and their defences came up and their passive aggression, sometimes not passive aggression." I think the good leaders recognise that. "Tell me what you're feeling. Let's go through it." In that listening, then you're able to let the storm calm down a bit and then move people and help them see that actually it's not about that, it's about something different.

Andrew White:
But that takes time. As you say, it takes leaning into some of these things. What struck me is that in very large organisations, one leader can't do all of that work. That has to be a culture and you have to use tech in some cases for that, particularly around the listening to the sentiment in the organisation really came through as well.

Adam Canwell:
The other piece that's really stuck with me is that partly what we are now seeing is success begets success, failure begets failure. What you're sighting to see is organisations, as we know, having to become much more agile, adaptive, constantly shifting, constantly changing to keep pace with the environment and changing customer, changing consumer, changing citizen needs. It was interesting because as we spoke to board directors particularly about this, I think they all went to what we're saying here, that this is part of the key to being a future agile organisation. Not agile as the way we organise, but agile just in terms of the pace that we shift and change at I think that is one of the things we're seeing, isn't it? The heart of this is how do we become more adaptive organisations that can thrive in this environment, not fail in this environment?

Andrew White:
If I go out on a bit of a limb, Adam, I would say that what we're seeing ... in the same way, if you think about, there are certain industries that are breaking down, the most vivid one is oil and gas and energy. It's going through a huge transition, but so many others are going through disruption as well. I think what we also might be seeing is the breaking down of, let's call it, the 20th century organisation. It was about order. It was about structure. It was about command and control. It was largely about how do you do good manufacturing largely in a steady state environment? Where transformation was there, but it was episodic, it was infrequent. If you think about where we are now, we're in a world that's demanding continual transformation and you know that isn't going to go away.

Andrew White:
I think that we need a different form of organisation and a different form of leadership that we're seeing emerging through the data. How do you stay in this continual play with this dynamic that's changing? It's changing because of tech, it's changing because of the environment, it's changing because of globalisation. So many more countries coming into the global economy and then potential barriers coming up as well. I mean, who wants to predict where we will be from a globalisation point of view in one year and three years and five years with some of the things that we've seen over the last couple of years play out? It's requiring a different form of organisation and a different form of leadership in order to thrive.

Adam Canwell:
So who are the guests then, Andrew, coming up on the podcast we've got coming out?

Andrew White:
So yeah, we've got some great people. They've been really honest, they've been open with us, given us real insight into transformation through the stories from their businesses. So we've got Ally who leads Roche in Australia, Rob, chief operating officer at Mercedes Formula One, Christiane, chief strategy officer at Boehringer Ingelheim, Jeff, who's chairman of L'Oreal in the UK and Ireland, Paul from Rico who leads their global services activity, and Gaude, senior vice president at Riot Games. So diverse industries, different types of roles, all having a strong focus on transformation, and we're very grateful to them for the insights they've brought.