The Five Factors of Change

Why is it so hard for organizations to change? I ask myself this question frequently. Having helped build and invested in dozens of companies throughout my career, I’ve seen first hand how challenging it can be to drive real organizational transformation. Advising and coaching on organizational change can be even more difficult because every organization is different. No two are alike. The people are different. The cultures are different. The markets are different. The incentives are different and so on.

Earlier this week, I received a newsletter from my friends Noah Brier and James Gross. Noah and James are the co-founders of Percolate and recently founded a new company called Variance. Most of their time these days is spent thinking about how organizations solve real business problems and drive digital transformation through the adoption and utilization of software. For anyone familiar with Noah and his work, you know that he’s a connoisseur of frameworks and mental models.

As I was reading their newsletter, I was captivated by this framework which was introduced by Timothy Knoster in his 1993 white paper, ‘Reflections on Inclusion at School... and Beyond.’ Knoster applied his framework to driving change within educational institutions but I believe it’s relevant to organizations of all sizes and sectors.

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I spend a lot of my time coaching leaders on personal and organizational change so this mental model really resonated with me.

When I was digging into Knoster’s framework, I was struck by its power and simplicity. Organizations are complex systems with numerous moving parts and interdependencies. Knoster framework clearly shows that change isn’t driven by just one variable but a number of variables including vision, skills, incentives, resources and planning. He also shows that you need to make all of these things work together in order to drive change. For those of you out there who have led an organization, you’ll know that getting all of these to line up is no small feat.

If you have skills, incentives, resources and a plan but no vision you’ll get confusion. If you have all the elements described above but not the skills you’ll get anxiety. I think you get the point. Driving real organizational change is clearly multifaceted and complex.

In true Noah fashion, he took Knoster’s model one step further and made a compelling argument that leaders should think about each of these attributes as a slider rather than a binary switch:

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Noah provided an excellent example using incentives to reinforce the interplay and sensitivity between these levers of change: “You don’t always need to dial up incentives to fix that problem. In fact, often it might be impossible, especially if those incentives are financial. So instead you may need to push up another one of your sliders to make up for the position of incentives. One particularly useful slider in these sorts of problems is vision: Helping people understand the larger context for why they’re being asked to do something that they may not be directly incentivized for can help them get over that issue. By doing that we can get ourselves back into equilibrium.”

If you’re a leader and you’re looking to drive transformation within your team or organization, I encourage you to experiment with these two frameworks to help you brainstorm, assess and implement potential solutions. I believe it will help you gain greater understanding of the drivers in your organization, design pragmatic solutions and help your change initiatives gain more momentum out of the gate.

To sign up for the Variance newsletter and receive insights like this from Noah and James click here.