Updated: Jun 17
Creating an Adaptive and Developmental Culture
“It is not the strongest who survive, or the most intelligent. It is the most adaptable.” – Charles Darwin
The Adaptability Gap is the gap between an organization’s performance and the performance required for success in our turbulent, VUCA environment. The greater the gap, the greater the Adaptive Challenge.
Times are Changing
Any of us with even a tinge of gray hair can recall when markets shifted so methodically, we could make useful three, or even five, year strategic forecasts. Similarly, our organizational cultures – our ways of thinking, feeling and behaving – changed gradually, over a period of years, if at all!
Today’s market shifts are fast and furious. All markets are in flux and can be unexpectedly disrupted by a “Black Swan.” Very often, the current year’s strategic forecast must be revised before the end of the year, making the second year forecast of little value.
Similarly, the organization’s culture – its ecosystem – must rapidly respond to the evolving market. Most often, these challenges do not respond to the proven methods of the past, so new ways of thinking, feeling and behaving must be discovered.
Every organization must deal with its natural, cultural inertia when faced with an adaptability gap. Closing the adaptability gap is today’s universal leadership challenge.
Logarithmic vs Exponential Learning
Generally, learning new management skills, or discovering new ways of thinking, feeling and behaving, is not linear, but logarithmic. Initially, progress is rapid and then, as skills improve, further improvement becomes increasingly more difficult. (See Curve A above)
Conventionally, an organization’s culture follows a similar logarithmic curve; as successful methods of dealing with technical challenges accumulate, the organization calcifies; flexibility and versatility decline.
Market shifting, disruptive innovations, follow a very different path. Generally, progress is very slow until multiple discoveries and disparate elements coalesce. Then, all of a sudden, progress evolves rapidly, that is, exponentially! (See Curve B above.)
Many brilliant minds have focused on this issue for a long time. This increasing rate of change – and its disruptive nature — was first identified by Alvin Toffler, in his book “Future Shock,” (1970), when, in his understated way, he observed, “The rate of change is accelerating and will continue to do so indefinitely.”
The rate of change in our turbulent business universe appears to have no terminal velocity! More recently, Alvin Toffler claimed, “The illiterate of the 21st century will not be those who cannot read or write, but those who cannot learn, unlearn, and relearn.”
Adaptive learning is the ability to learn, unlearn and relearn.
We must include lifelong, adaptive learning in our threshold hiring criteria. Those not prepared for adaptive learning will soon become unemployable, (“illiterate”) regardless of their formal education or experience. The half-life of both formal education and experience is shrinking rapidly!
Emotional intelligence, creativity, the ability to collaborate – and plain old “horse sense and hustle” — will be short in supply and long in demand.
Closing the adaptability gap requires Adaptive Leadership, which begins with recognizing adaptive challenges when they occur within the organization.
I first encountered this concept in the book: “The Practice of Adaptive Leadership” by Heifetz, Grashow and Linsky, (2009). (We have embedded the essential elements of the adaptive leadership concepts in our Authentic Leadership Insights model.)
There is a clear distinction between an adaptive challenge and a technical challenge. In its simplest form, a technical challenge is any problem that can be solved by replicating a proven process within the existing culture.
Conversely, an adaptive challenge is one that does not yield to any established methodology. An adaptive challenge requires the team to discover new ways of thinking, feeling and behaving. This is an Adaptive Change. It is also the definition of a “culture shift.”
It requires creativity and innovation to successfully handle an Adaptive Change. Adaptive changes are ONLY solved by iterative experimentation in a safe – Temenos — ecosystem where “There are no mistakes, only lessons. There are no failures, only research.”
Adaptive leadership begins with high Social Emotional Intelligence (SEI) skills: curiosity, humor, humility, and vulnerability – A Beginner’s Mind.
One clear signal that a leader is dealing with an adaptive challenge is when the problem persists after multiple, carefully designed, technical fixes.
A second signal is the upward delegation of intractable problems. If the front-line people who are most closely connected to the problem don’t have the proven methodology to solve it, they have limited choices.
They can give up and ignore it, or delegate it up. It is always best to make it safe for the adaptive challenge to move out into the open where it can be effectively addressed.
Adaptability Gaps are more pervasive – and more difficult to close — than most leaders realize. Booz & Co. (now “Strategy & Business”) reports that over 70% of all strategic initiatives fail, and another 15% are only partially successful. Their research confirms Peter Drucker’s observation, “Culture eats Strategy for breakfast!”
An Adaptive Culture Closes the Gap
The principal reason for these failures is the Adaptability Gap. This is easily understandable. The purpose of an organization’s culture is to preserve and protect its institutional wisdom, traditions, and personality; that is, its identity or brand.
Change threatens a culture’s core belief system. The primary purpose of an organization’s culture is to resist change.
Existing cultures are only concerned about today in terms of yesterday’s success, not what they need to become to be successful tomorrow.
In the past, the market environment was stable, predictable, relatively simple and structured. It rewarded (and thus created) cultures which were efficient, predictable and reliable.
Today’s market environment is Volatile, Uncertain, Complex and Ambiguous (“VUCA”). Now, markets reward adaptability over efficiency, innovation over predictability, and agility over reliability.
The Speed of Adaptation is the new metric of competitive success!
This new cultural paradigm is rapidly evolving. The markets are signaling that cultural change must be more exponential and less logarithmic.
If an organization is to be successful, an emerging Adaptability Gap must rapidly close! The longer an organization waits to respond to this existential threat, the more disruptive and expensive will be the required culture shift!
An Adaptive Culture is in continuous accord with the expectations and needs of its market.
An (exponential) culture shift to close an adaptability gap is a complex and volatile undertaking. This volatile complexity is captured in just one line from the book: “Who Moved My Cheese?” (By Johnson and Blanchard, 1998):
“A change imposed is a change opposed!”
This is why so many strategic initiatives fail; they don’t consider the adaptability gap.
To successfully close the adaptability gap, we must rethink what we mean by “organizational culture,” what it is today and what we want it to be tomorrow. We must eliminate the cultural inertia that is the cause of the adaptability gap. We must evolve a working environment – an organizational ecosystem — that supports a culture that evolves in concert and congruence with its market.
The organization’s culture is “the employee’s most successful way of thinking, feeling and behaving.” If compliance with established procedures is rewarded over initiative and imagination in serving the customers, you will have one type of culture. If the reverse is true, you will have an entirely different type of culture.
Since management cannot directly control how employees think, feel and behave (except through coercion), management cannot directly control the organization’s culture. Management can only control the organizational ecosystem that calls forth and supports the desired culture.
Thus, the ability to gain and sustain Buy-In to the organization’s values, purpose, vision, and priorities is the essence of leadership:
The Essence of Leadership is gaining Buy-in through Influence.
The key to an Adaptable Culture is an innovative team of enthusiastically engaged leaders whose example permeates the entire organization, top to bottom. However, high employee engagement is not the norm.
The Gallup Company research on Employee Engagement is alarming. If your organization is typical, only about one third of your employees, including your executives and managers, are enthusiastically engaged and fully committed to your organization’s success. That is not enough for an organization to successfully close their adaptability gap.
“All-In” Employee Engagement requires an organizational ecosystem where honesty, openness and trust prevail, where all voices in the system are heard, and it is safe for all individuals to express their insights, however dumb they may initially sound.
How We Help
Our Authentic Leadership Insights model refers to these concepts as “HOT” Relationships, Deep Democracy and Authentic Communication.
Our Authentic Leadership Insights model focuses on developing the leadership qualities required to create an innovative, enthusiastically engaged team. This model can be scaled to cascade down through the entire organization.
In addition to working with the senior leaders and their leadership team, we are often invited to work with brilliant, technically trained — individual contributors — who aspire to leadership roles.
Often, these “high potentials” have nothing in their education, training or experience to prepare them for the ambiguities and uncertainties of a leadership role. We are “a guide at their side” as they make the transition from technician to leader.