Evaluation Design

International Journal of Global Business, 9(2), 102-110, December 2016 102

Change Management and Theory U Leadership Victor S. Sohmen, Ph.D., Ed.D. Drexel University, Philadelphia, PA, USA [email protected]

This paper is rooted in the enlightening concepts of Theory U Leadership as propounded by Otto Scharmer (2009). This revolutionary theory urges the leader to suspend superficiality, judgmental attitudes, and preconceptions. The leader is encouraged to delve deep into the self and unravel the ‘blind spot’ of leadership to reveal the true source of the inner self. This is best accomplished by deep and empathic listening with an open mind, open heart, and open will to ‘presence’ (presence + sense) the emerging future even as it occurs. This essay abstracts a critical aspect of leadership—that of leading organizational change—and applies it to key tenets of Otto Scharmer’s Theory U Leadership. The foray is based on the premise that there is an essential symbiosis between change management and Theory U Leadership. This change has to be inclusive, collaborative, and sustainable in order to have optimal impact in the ecosystem and in the global arena. For future research, a deeper understanding could be sought of the application of Theory U Leadership to leadership tasks for innovative, inclusive, and sustainable change through systemic and systematic change management. Keywords: Theory U Leadership, presencing, open mind, open heart, open will, systems thinking

International Journal of Global Business, 9(2), 102-110, December 2016 103 “A leader is best when people barely know he exists; when his work is done, his aim fulfilled, they will say: we did it ourselves.” (Lao Tzu, 605-531 B.C.)

Introduction Historically, the perennial adventure of leadership has been fraught with excitement, chaos, uncertainties, and what may be coined herein as a metamorphosis of reality. Leaders courageously transform present reality into a new and altered state of envisioned reality. This change in the environment is made possible by the drive, dynamism, and determination of the leader to convert vision into reality. Thus, the destination of the leader—and those who follow— is a picture of irrevocable and often unrecognizable change in the world within the leader’s sphere of influence. It is obvious then that leadership is a deliberate endeavor actuated by vision, ambition, purpose, and values—and even a deep sense of destiny. The ensuing change is a corollary to this endeavor, indeed a consequence for better or for worse. The most commonly recognized source of leadership involves the influence that leaders exercise over their followers to effect salutary change (Neck & Manz, 2013, p. 2). In view of the reality of rapid change around us, this paper seeks to identify how change management links with several concepts in the literature supporting Theory U Leadership by Otto Scharmer (2009): sustainability, systems thinking, presencing, and globalization. Further, the relationship of change management to an identification of issues to be addressed will be presented in conclusion for future research on the application of change management to Theory U Leadership. The Essence of Change Management The leader is a traveler with a personal vision and sense of destiny who attracts followers to a compelling cause. The leader’s choices are fueled by the ‘creative tension’ (Senge, 1990) of the leadership persona resolutely negotiating the chaos and messiness of the process of change to a relatively stable destination (Wheatly, 2007). As leaders, we are constantly standing at the crossroads of a future we can rarely predict or control—but can only imagine through the mediation of our mental models (Johnson-Laird, 1983; Norman, 1983). Especially in times of opportunity, chaos, uncertainty, and danger, leadership becomes manifest. We know this from the Situational Leadership theory. As the person with the right mixture of vision, courage, competence, and sense of urgency who emerges, the leader attracts followers and shepherds them to a new destination. The process of change from the old order to the new is not easy, as our future is strongly rooted in our present and past. The status quo is all too dear to us! Kenneth Craik (1943) even suggested that the mind constructs small-scale models of reality that it uses to anticipate events based on the past and present. Yet, changing these mental models is necessary to articulate change within ourselves and in others. This process is greatly aided by visioning possibilities of change through

International Journal of Global Business, 9(2), 102-110, December 2016 104 creativity as a catalyst to a transformational mindset. Indeed, the power and creativity of a transforming vision through models of reality drive sustainable change (Burns, 2008, p. 313). The paradox of change—why change is a constant Over the centuries—and especially in recent decades of technology-infused developmental surges—society has magically rearranged itself into radically different scenarios of the 21st century. Change, in both its less threatening incremental forms, and in its turbulent manifestations as propounded by Schumpeter (1951), has significantly altered our environment. When we consider the paradoxical cliché that change is indeed a ‘constant’, it is surprising that people resist change, as suggested earlier. This dilemma is graphically captured in the theories of chaos and organizational change by Margaret Wheatley (2007). In our prevailing, volatile global environments—political, technological, sociological, cultural, legal, and economic—uncertainty, chaos, and rapid change are the order of the day. We just need to reach out and embrace them! The tirelessly inquisitive Greek philosopher Socrates said that the secret of change is to focus our energies, not on fighting the old, but on building the new. It is undeniable that change is inevitable, and the key is how to handle it successfully. Consequently, initiated change has to resolutely travel through organizational barriers and time, deploying resources to diffuse this change sustainably for lasting impact. This is supported cogently by many theorists. Fullan (2011) in his pragmatic Change Leader has asserted that the essence of the change process is the capacity of organizational leadership—in light of uncertainty, chaos, and rapid change—to generate organization-wide energy and passion through action. Change is action-oriented and not merely a theoretical concept: it has to be pushed persistently with a forward momentum by the leader who initiates and spearheads the change (Kotter, 1995). Despite pockets of resistance, relentless and enthusiastic actions, as well as constructive and efficient dissemination of information, are needed. The paradox of change is that even when the benefits become discernible, change is not easy at any level. Indeed, people resist change due to cynicism, fear, assumptions, and pre-judgment: they are afraid to fail or face the unknown and the uncertain. The status quo is therefore preferable to the less adventurous who fear embracing an entirely new perspective. Change management is by default also a process that intuitively involves learning, with due allowance for some failure as a catalyst in this learning process. After all, change cannot take place without the participants learning about what should be the outcome, thus outgrowing what prevails today. As business becomes more complex, challenging, and globally competitive, excelling in this dynamic environment requires more understanding, knowledge, pragmatism, and collaboration than one person’s expertise and experience alone can provide (Senge, 1990). Collaboration is thus critical for change to gain momentum. For lasting impact therefore, astute change leaders examine and drive their own, and others’ best practices.

International Journal of Global Business, 9(2), 102-110, December 2016 105 Leveraging leadership for successful and sustainable change Despite the classic but simplistic unfreeze-change-refreeze model of change popularized by Lewin (1947), leveraging leadership for successful and sustainable change is indeed complex. This is partly because it is anything but linear. In his eight-step model of change, Kotter (1995) debunks ineffectual attempts at organizational change in the industry, and expands on the paramount need for sustained momentum of the change process. He underscores the essential urgency, dynamism, vision, synergy, and empowerment needed to enable change to percolate and travel throughout organizational layers towards permanency. This not only demonstrates the complexity of the change process, but also the need to leverage the change through sustained and tireless leadership efforts. In The Six Secrets of Change, Michael Fullan describes how “good theories travel across sectors of public and private organizations, and they apply to geographically and culturally diverse situations” (Fullan, 2008, p. 14). To understand the process of leveraging leadership and change, we will need to weave strands of theory that overlap and interact to enhance our understanding of sustainable change. By integrating visioning, systems thinking, mental models, the learning organization, and sustainability, we begin to see the tapestry woven in the complex organizational phenomenon of leading and sustaining change. For this, adaptive and transformational leadership processes are brought to bear on the leadership task. Theory suggests that mental models are deeply ingrained assumptions, generalizations, or even pictures of images that influence how we understand the world and how we take action. We are constantly seeking ways to improve a plurality of mental models—and thereby enhance the quality of dynamic decisions on which they are based. (Johnson-Laird, 1983; Senge, 1990). Mental models are thus essentially incomplete and parsimonious knowledge structures with fuzzy boundaries, and that allow an individual to construct perceptions of a discernible system (Craik, 1943; Johnson-Laird, 1983; Norman, 1983). These mental models or images cannot remain hidden for long, but have to be impelled by “training wheels” if necessary, to become visible through necessary pragmatism (Senge, 2012, pp. 164, 177). In the process, we often convert objective evidence from observation into subjective assumptions which could distort reality and result in incorrect decisions and actions. It can safely be surmised therefore that the leveraging of change through leadership for constructive transformation of reality in the organization involves concretizing the leader’s and followers’ mental models through energetic and actionable reality. It is therefore necessary to suspend judgment (Scharmer, 2009), enter into collaborative dialogues, and then make our decisions. As a consequence, we foray into the evolving future as it emerges. Leveraging leadership for change demands sustainability. This is the “capacity of a system to engage in the complexities of continuous improvement, consistent with deep values of human

International Journal of Global Business, 9(2), 102-110, December 2016 106 purpose.” (Fullan, 2005, p. ix). Unfortunately, the sustainability initiatives in general appear to be internal and focused on the present (Senge, et al., 2008, p. 159). Therefore, the key to true sustainability is for our actions to be future-oriented. Thus, according to Theory U Leadership, we need to practice “presencing” by borrowing from the future to understand the present more deeply. Indeed, we may thus shape the foreseeable future by deep listening in such a manner as to avoid negative environmental effects or jeopardy for future generations. The Importance of Leading Change in the 21st Century Successful leaders who lead constructive change in the 21st century will be those who have the ability to learn—and simultaneously create an organization of learning. Fullan’s Secret #Four of the six secrets of change is: The Learning is the Work. The essence of this fourth secret concerns how organizations address their core goals and tasks with relentless consistency, while at the same time learning how to get better at what they are doing. (Fullan, 2008, p. 76). Life creates more possibilities as it engages with windows of opportunity. (Wheatley, 1996). Indeed, when these opportunities proliferate within the system, countless possibilities are spawned. The nature of human systems is to ultimately find a semblance of order through the resulting maze of chaos. To achieve this, systems thinking is needed for leaders of the 21st century to leverage successful change in their organizations. Systems thinking is a cohesive model that views all critical processes in an organization as interrelated and interdependent (Senge, 1990). Understanding such networked relationships is important in helping leaders implement change in organizations. They can thereby produce desired goals and achieve a shared vision. Systems thinking can be used to alter leaders’ perspectives on their organization, their assumptions, and their ways of thinking. Thus, organizational effectiveness is improved. These are important skills for 21st century leaders to manage in the world of ever-changing challenges. Integration of the Change Process into Leadership In Managing Transitions, Bridges & Bridges (2003) propose three phases for transition to guide change agents through the uncertain journey of change: (1) Ending, losing, letting go; (2) The neutral zone; and, (3) The new beginning. After people have let go of the past, they enter the neutral zone—a juncture of risk, creativity, and opportunity. This is reminiscent of Lewin’s transition phase between unfreezing and refreezing. This is therefore also a period that has to be carefully managed to move into the new beginning phase which would “refreeze” the organization into the novel state. In these three phases, Bridges & Bridges (2003) consider the psychological, cognitive, and emotional transitions that must take place for members of an organization or a process improvement team to change their behavior and navigate the process of transformation. As Heifetz (2009) avers in terms of the adaptive challenge required herein, Bridges & Bridges (2003) also focus on the emotional intelligence necessary to guide people in organizations to make the relentless transitions required in the change process.

International Journal of Global Business, 9(2), 102-110, December 2016 107 This aspect of emotional intelligence also finds harmony with Senge’s (2012) thesis that we live in a ‘web of interdependency’. This is a practical application of systems thinking towards a better understanding of the interdependent structures of dynamic systems. In essence, systems thinking means: “stepping back and seeing the patterns that are, when seen clearly, intuitive and easy to grasp.” (Senge et al., 2000, p. 23). It also allows leaders to see their complex organizations as a network of interdependent constituents. The concept of the “learning organization” resonates with respect to sustainable change leadership. Senge (1990, p. 14) defines a learning organization as an organization that is continually expanding its capacity to fashion its future. In a learning organization people continually expand their capacities to create the future results they truly desire (Scharmer, 2009). We can consider the tenets of Theory U Leadership highlighted in this paper to build the learning organization—where innovative and creative patterns of thinking and practice are nurtured (Bass, 1985; Burns, 2008). In an organizational environment we can inculcate and model collaboration as a way of organizational life (Fullan, 2011), where people celebrate their interdependency in a systemic network for continual learning (Senge, 1990). In this context, the five disciplines that should ideally work as an ensemble are: systems thinking, personal mastery, mental models, shared vision, and team learning (Senge, 1990). The first three are personal, and the remaining two have plurality of application. Organizational learning through systems thinking has the distinction of being the ‘fifth discipline’. It is also the cornerstone of continuous improvement and feedback loops as it serves to make the results of the other disciplines to work together beneficially (Senge, 1990). The classic 1957 film Twelve Angry Men was used to illustrate the concept of “cooking the conflict” because a stream of challenges can push a dynamic organization into disequilibrium and a state of flux; by calibrating the heat levels, the leader “cooks the conflict” until the conflict is dissipated (Heifetz & Linsky, 2002, pp. 111-116). Change can thus be leveraged effectively. The leader needs to ask tough questions, get people to come out of their comfort zones, and actively encourage positive change. The strong leader also needs to delegate wisely, breaking up seemingly insurmountable problems into smaller and doable parts by assigning clear roles and using short time-frames. (Heifetz & Linsky, 2002, p.111). Transformational leadership inspires followers to perform “beyond their expectations” (Bass, 1985). It is necessary to articulate and leverage sustainable change in a progressive organization. Further, transformational leadership involves integrity and credibility on the part of the change leader. The traditional view of leadership with a results-at-all-costs orientation is on the wane, as contemporary theorists are underscoring the responsibility of leaders to ensure standards of moral and ethical conduct. Leadership geared to lasting and salutary change must not only be based on competence, but also on strong ethics while transforming a diversity of people toward a mindset of sustainable change (Resick, et al., 2006).

International Journal of Global Business, 9(2), 102-110, December 2016 108 In this regard, deeply and empathic listening with an open mind, open heart, and open will as propounded by Scharmer (2009) should impel sustainable change. This approach precipitates the deep empathy with followers that supports inclusiveness, accountability, and collaboration. Good change leadership therefore involves not only competence, but also deeper, empathic engagement and presencing—which enables us to connect to the deepest source of our self and will to act from the emerging whole of the evolving future. In this context, discovering the ‘blind spot’ of leadership, or the deep inner source from which we operate and relate to this emerging future, becomes of key importance. In the process, followers are entirely on board with the leader in a symbiotic relationship to effect change that is fully supported by all those affected by it. Change Management and Leadership: A Symbiosis Leadership involves change management as the leader takes followers from the present to the future. Thus, there is a symbiosis between the two social phenomena of leadership and change management. Development of personnel, introduction of technology, reorganization of resources, commissioning of special events, and strategizing for market position—all these involve change management. Enhanced understanding of Theory U Leadership (see figure below) and how it is utilized can indeed be helpful in planning change management in emerging leadership roles. To amplify this, we learn that silence can indeed be golden. Observing in silence and listening deeply and empathically with an open mind, open heart, and open will would be necessary to understand the points of view of others who will be affected by the contemplated changes. Through generative listening—the highest form of listening, much like tuning an instrument— we drop our existing knowledge and beliefs, as well as attachment to any specific outcomes. We thereby allow a new and changed future to emerge. Thus, the three impediments to listening— voice of judgment, cynicism, and fear—are eliminated. The ‘blind spot’ of leadership, or the aspects of leadership that are as yet unrevealed and deep within us, will become clearer to enable more effective change management.

International Journal of Global Business, 9(2), 102-110, December 2016 109 Theory U Leadership

Source: Scharmer, O. (2009). Theory U: Leading from the future as it emerges. San Francisco, CA: Berrett-Koehler.

Conclusion Inasmuch as change is fluid and dynamic, leadership itself is anything but a static mental model: we evolve in our leadership skills and behaviors. Studying best practices will certainly serve to nurture and hone our leadership abilities. With experience we begin to recognize the complex nature of leadership and change, and the art and science behind leading masterfully. Indeed, leadership can be nurtured through training and learning across a wide range of personalities. The best leaders are visionaries and change agents who are dissatisfied with the status quo. As reflected in Theory U Leadership, they suspend judgmental attitudes, listen empathically, and practice presencing to tap into the emerging future. In the final analysis, leadership that leverages amazing and sustainable change cannot happen by accident: it calls for vision, purpose, courage, resoluteness, and a sense of destiny. For future research, a deeper understanding could be sought of the application of Theory U Leadership to leadership tasks for innovative, inclusive, and sustainable change through systemic and systematic change management.

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