On this episode of Modern Digital Business, Lee invites Ken to discuss organizational design principles and the importance of aligning teams and leaders to drive desired outcomes. The conversation covers various topics such as the Kubler-Ross change curve, company culture, and the "Valley of Despair" during a migration or transformation projects. They also share practical guidance on implementing Agile methodologies and how to articulate the value of that to higher-ups.

This episode announces the new book, Business Breakthrough 3.0, written by Lee Atchison and Ken Gavranovic. Lee and Ken emphasize the importance of effective communication within organizations.

Quotes

Creating Dynamic Organizations: "If you can really think through those patterns, not only do you build a highly profitable, fast moving organization [...] but it's also a win for the employees, because when you create that kind of dynamic organization, customers love the business, and employees simply love their job."

— Ken Gavranovic 

"Measuring Organizational Improvements: Companies often make one of three mistakes when they determine what data they want to measure. They either measure not enough data, measure too much data, or just measure the wrong things."

— Lee Atchison

The Importance of Instilling Company Values: "If you think about employees that say they're engaged, the quality of work that they do, versus somebody who feels they're just a cog on the wheel, they're just going through the motions. And the efficiencies are night and day at all scales of organizations."

— Ken Gavranovic

The Power of Subconscious Mentality: "When I think of in our own subconscious minds, the thing that comes to mind the most is when you see commercials for restaurants showing you pictures of food that make you hungry, and you're more likely to spend more money, the more, the hungrier you are."

— Lee Atchison 

"The Importance of Organizational Design: if you have poor organizational design, you're going to have poor results."

— Ken Gavranovic

"Organizational Structures: If you want to have your organization respond in a certain way, you want to organize it in a way that allows that response to occur."

— Lee Atchison 

The Importance of Instilling Company Values: "If you think about employees that say they're engaged, the quality of work that they do, versus somebody who feels they're just a cog on the wheel, they're just going through the motions. And the efficiencies are night and day at all scales of organizations."

— Ken Gavranovic

"The Valley of Despair": "But so many companies will actually stop right in the middle of that valley when things are worse than they were before and won't finish their project or won't finish the migration because they've lost track of what they really valued in the migration and frankly, why they started doing it in the first place."

— Lee Atchison

Q&A

1. What is the importance of organizational design in driving desired outcomes?

Answer: Poor organizational design can lead to unhealthy friction and frustration. Therefore, it is important to be intentional about organizational design and set up people processes to drive desired outcomes.

2. What are the consequences of lack of alignment between teams and leaders?

Answer: Lack of alignment between teams and leaders can cause friction and misalignment in the organization.

3. What is the Federated direct line reports center of Practice?

Answer: Detailed principles like Federated direct line reports center of Practice can help with organizational design.

4. Why should leaders be careful about what they measure and display?

Answer: People always do what they're incentivized to do; leaders need to be careful about what they measure and display. Measuring activity doesn't necessarily drive behaviors, and companies can fail if they focus on activity over outcomes.

5. How can companies ensure that everyone is aligned with the outcome?

Answer: Teams should be focused on outcomes and measurements should be visible to employees, so everyone knows how they're being measured. If teams are aligned with the outcome, they can work together and pivot on the strategy as long as they achieve the outcome.

6. What is the Kubler-Ross change curve?

Answer: The Kubler-Ross change curve is a model of the different stages people go through during change. These stages include shock, denial, disappointment, pivot, and acceleration, and can be applied to any transformation.

7. What is the importance of culture in a company?

Answer: Culture includes values, mission, vision, and how it's practiced in a company. Leaders who overlook toxic behavior by top performers are not living the culture and can harm the company, causing good employees to leave. It is essential to define and live culture purposefully.

8. What is the "Valley of Despair" in relation to migration or transformation projects?

Answer: The "Valley of Despair" is a period in transformation projects where the disadvantages tend to show up before the advantages, resulting in a dip in the application's performance or other negative effects. Many companies tend to lose focus and forget their objectives during this low point, which causes them to measure and focus on the wrong things.

9. What is the benefit of implementing a strong company culture?

Answer: Implementing a strong company culture can lead to a 30% to 40% increase in the efficiency of the organization and a 30% to 60% increase in employee engagement and job satisfaction.

10. Why is effective communication important in organizations?

Answer: Effective communication within organizations leads to success. Siloed mentality and walls occur when communication is not successful.

Timestamped Overview

[00:02:16 ] Organizations have a subconscious mentality influenced by stimuli such as food commercials leading to more spending, similar to how individuals react subconsciously.

[00:04:35 ] Culture needs to be purposeful, defined, and lived out, as it encompasses a company's values and how they are implemented. Failure to adhere to the culture, such as allowing toxic behavior to go unchecked, can be detrimental and cause the best people to leave.

[00:07:14 ] Two thirds of US employees are not engaged at work, causing both personal and company inefficiencies. Proper implementation of culture can lead to up to a 40% increase in organizational efficiency and employee engagement.

[00:09:45 ] Measure outcomes over activity, be careful what you measure and display, and make it visible to employees. Teams should focus on outcomes and pivot autonomously to achieve them, leading to better alignment and collaboration.

[00:14:14 ] Change is difficult for people and organizations, but with the right strategy and communication, it can lead to transformation, empowerment, and fulfillment. This applies to various situations, such as IT projects, personal transformations, and turnarounds in business or teams.

[00:19:44 ] Focusing on individual tasks without a bigger picture can lead to counterproductive results in an organization. A person's focus should be broad enough to encompass the organization's goals.

[00:21:50 ] The text discusses the importance of structuring teams to avoid inefficiencies and miscommunication. It includes examples of companies that struggled due to poor structural alignment and emphasizes the need for clear leadership and customer focus.

[00:25:45 ] Effective collaboration leads to success, discussed in book Business Breakthrough 3.0, available in a variety of formats. Expert guest Ken Garadovich thanked for his contribution to Modern Digital Business podcast.

Key Topics

Organizational Design:

- "You get what you design for"

- Lack of alignment can cause friction and misalignment

- Federated direct line reports center of Practice can help with organizational design

- Importance of being intentional about organizational design

- Outcomes over activity should be the focus

Transformation and Culture:

- Kubler Ross change curve can be applied to any transformation

- Culture includes values, mission, vision, and how it's practiced in a company

- Toxic behavior by top performers can harm the company

- Importance of defining and living the culture purposefully

- Valley of Despair in relation to migration or transformation projects

- Providing practical guidance on implementing Agile methodologies and how to articulate the value of that to higher-ups

- Two-thirds of employees in the United States are not actively engaged in work

- Implementing a strong company culture can lead to a 30%-40% increase in the efficiency of the organization

- The speaker believes that uncovering patterns of success can be crucial for a business to scale

Communication:

- Successful communication within organizations leads to success

- Siloed mentality and walls occur when communication is not successful

Book Recommendation

- "Business Breakthrough 3.0" by Lee Atchison and Ken Gavranovic talks about marketing strategies such as product-led growth and sales lead growth

- The book is available in various formats on Amazon and other platforms

Conclusion:

- The podcast host thanks Ken for being a guest and working on the project together

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