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An Interview With John P. Kotter


John P. Kotter is Konosuke Matsushita Professor of Leadership at the Harvard Business School. He is a graduate of MIT and Harvard, and has been on the Harvard Business School faculty since 1972.

Kotter is the author of six management books, including Corporate Culture and Performance (1992, with Jim Heskett) and The New Rules: How to Succeed in Today's Post-Corporate World (1995). He has also created two executive videos, Leadership (1991) and Corporate Culture (1993). Kotter's most recent book, Leading Change, was recently released by Harvard Business School Press.

QD: Why should companies initiate change when most are struggling with unprecedented levels of upheaval?

Kotter: Many people look at the current business environment as a tornado or a hurricane. They are, therefore, quite rationally it would seem to them, either running around boarding up the house or shuffling all the children and valuables down into the basement. But the strong winds they are feeling, winds that are creating a lot of activity and anxiety, are not associated with traditional hurricanes or tornadoes. Instead, the basic business climate is changing in some fairly fundamental ways, and strong, powerful winds are increasingly becoming the norm instead of the dreaded exception.

This shift is being driven, at least from all I've seen, by the globalization of the economy along with associated technological and social changes-forces that will only grow larger over the next few decades. The only sound response to this is to build organizations that not only can withstand these more powerful winds but will turn the new climate into an opportunity. Building these new organizations that will survive and prosper in the new climate requires a great deal of change. Incremental adjustments are insufficient. Defensive maneuvering is insufficient. Not even competent "management," from well-meaning people, will do.

QD: How is the program you outline in Leading Change different from the experience of many who have been part of restructurings, mergers or other dramatic change in their own companies?

Kotter: The track record to date for reengineering, quality programs, the implementation of major new strategies, acquisitions and cultural change efforts is not very impressive. Attempts at business transformation often have achieved only half of what had been desired and even then at unacceptably high financial and human costs. Based on my analysis of experiences in nearly 100 organizations, Leading Change explains why this is so, what the most common errors are that even very intelligent people make, the eight stages that are always found in a successful change, and the key force behind successful transformations-leadership, which is different from high quality management.

QD: By "leadership" do you mean one strong charismatic person?

Kotter: The notion that all you need is one Lee Iacocca is a very dangerous idea. Competent leadership from the top is a necessary but insufficient condition for the kind of change increasingly needed today. In successful transformations, a committed team of leaders and managers guide the effort, but large numbers of people at some time need to play a helpful leadership role in their domain of activities. Only with the combined force of all this leadership can the huge barriers to meaningful change be overcome. Only with this leadership team can a powerful vision be formulated and widely communicated, all employees be empowered to act on that vision, sufficient short-term wins be created to give the transformation credibility and momentum, sufficient changes be made to cope with the new economic climate, and all new practices be anchored securely in the organization's culture.

QD: Why is the "managerial mind-set" dangerous for business?

Kotter: By a managerial mind-set, I refer to a set of attitudes-very common attitudes that virtually anyone who has worked for a living will recognize-associated with controlling activities, taking few if any risks and planning everything possible in detail. If an organization has good people and products, and is operating in a slowly changing environment, such a mind-set can pervade the culture and be quite helpful. But today, and even more so in the future, few organizations will be operating in slowly changing environments.

In a more rapidly changing world, people with only a managerial mind-set, even if they try to transform their firms, almost always make a predictable set of mistakes that ultimately hurt stockholders, employees, customers and others. They allow too much complacency, don't create enough teamwork, ignore the power of the vision or don't communicate it well enough, quit before the full job is done or fail to anchor changes adequately in the organization's culture.

QD: Why do you think so many corporations can't recognize that they have a culture of complacency?

Kotter: The forces that foster complacency in organizations are many and powerful. Too much past success, too many visible signs of wealth, too little externally provided feedback going to too few people, internal standards that are based on history instead of current competitive realities, too much "happy talk" from senior managers, a general lack of candor in meetings, a general human tendency to settle into comfortable routines, and many other factors can easily add up to an attitude of "things aren't that bad" when in fact the opposite is true. And once all this settles into the culture, it can become invisible to most insiders, just as water is invisible to fish.

QD: Why is it so important for a company to anchor change in the culture?

Kotter: New ways of operating that aren't well-connected to an organization's culture can be remarkably fragile after the initiators move on or shift their attention elsewhere. Anchoring change means getting it into group norms and shared employee values so it will stick. Because culture is such a soft and fuzzy concept, people with only a managerial mind-set often ignore it-to their peril. For when the pressure to implement change lets up, even just a little, the company culture will always reassert itself, and the transformation program will derail.

QD: With more companies focusing on strong leadership, are managers a thing of the past?

Kotter: No. Management and leadership serve different functions. The former keeps things under control while the latter launches you into a shifting future. Both are necessary. The problem today is that too many organizations are overmanaged and underled. What we need is for more senior executives to delegate managerial responsibilities to lower levels in the hierarchy, to train those people to handle their new assignments well, to give them the proper information technology to help with the managerial processes and then to use the freed-up senior management time for leadership. The very best firms around today are doing just that.

QD: You paint an exciting portrait of the corporation of the future. What will it look like?

Kotter: It will be less bureaucratic, with fewer levels, with many more people playing a leadership role and management delegated to lower layers. There will be many fewer irrelevant policies and procedures, much more performance information from external sources going to far more people, more externally oriented, more empowering, faster in decision making, more candid in communication and more willing to take calculated risks. I agree that this can be exciting. Very powerful macroeconomic forces are creating this new organizational form-forces that ultimately will overwhelm opposition from those with a big stake in the status quo, including parochial governments, overpaid executives and narrow, self-serving labor unions.