Innovation, Organizational Culture

Your Organization’s Realignment #1: From Inside-Out to Outside-In, Inventive Thinking

Chapter summary from my book: The Demand Perspective Leading From the Outside Suppose your organization is experiencing attrition. Do you focus on symptoms and tactics—improving your “message,” revving up your communication or investing in a cool new website, for example? Or do you uncover and remedy the roots, such as the value of your benefits no longer being relevant to what matters to your customers? Ironically, while many executives would impatiently scoff at the title of this chapter, dismissing it as “soft” stuff, such choices spell the difference between obsolescence and survival. Suppose that while you sweat over how to improve or add to your current programs, an opportunity comes along that is outside your usual categories. Is your organization equipped to recognize and act on it? Would Amazon have evolved into a global e-commerce giant had it not been able to visualize a future beyond an online bookstore?   Whether you are Amazon or a 3-person organization, it is the same modes of thinking that will get you unstuck and allow you to come up with constantly new bases for competitive advantage. This is why an organization’s thinking emerged in my research as the key determinant of its outcomes and so it is the first realignment in my book The Demand Perspective. (See introduction to the 6 organizational re-alignments for member/customer centricity). The Tyranny of Entrenched Assumptions and Habits of Mind The greatest obstacle to change I have encountered in my research and consulting practice is the inability of conventional, inside-out organizations to extricate their thinking from habitual assumptions and look at familiar things from an entirely different perspective—that of the customer. Why are millions of hours of association staff time each year squandered on unproductive activities such as endless meetings, revisions of policies and procedures, etc., that do nothing to increase member value and engagement? Why are committees the go-to mechanism for addressing just about anything when many committees spin their wheels for months on end trying to figure out what they are even supposed to do? Why are association practices and decision-making processes slow, tiered and elaborate when the rest of the world is fast-moving? Why do associations favor interminable, abstract planning, while successful organizations learn by doing? Because mental habits become so embedded in an organization’s culture that we come to consider them as the face of “normalcy” – the irrefutable way associations do things.” Without the outside-in logic of the customer’s success driving every aspect of the business, an internal logic is established that bears no relationship to market and customer logic. Over time the focus on an organization’s own products, processes and procedures becomes crystalized as the “normal” perspective on the world, creating an ever-widening distance between association and members. At a time when successful competitors eliminate anything that encumbers their intense focus on customers, associations are devoting the bulk of their time and capital on products and processes that revolve around internal and personal agendas and add little or no value to members. “Association Think:” Confusing Assumptions with Facts You simply cannot get to the future on autopilot. The toughest and most critical capability to cultivate is this: re-examining your own, most common and accepted assumptions and regularly challenging the logic of what comes to represent “normalcy.” Take a look at the guidelines for starting an association posted somewhere on ASAE’s website. How often are accepted truths (left column) questioned, and their underlying assumptions (such as those on the right column) identified?

General Guidance Underlying Assumptions to Question
“It is also wise, however, to see that the core group represents all factions of the constituency the new organization will serve.” Associations are quasi-political entities with criteria for defining a customer base based on political representation rather than stakeholder value.
“You’ll want to set the dues for each membership category at this stage.” Without a question, running an association means that you have dues-paying members.
The “organizational plan is fleshed out [when] you have a well-defined structure, membership categories, a program of benefits and services, a draft budget, and an operating blueprint in your bylaws.” There is a set blueprint for association architecture. You first design your structure and products and only then do you go after customers to get sales (rather than developing the products and business models that best respond to customer needs).
In my experience and research, one debilitating obstacle to effective change is that even the most ambitious change strategies do not challenge the fundamental building blocks of association-driven architectures and the hidden assumptions that undergird them. Without capabilities for engaging in a different mode of thinking, no amount of improvement, product innovation, or investment can make a significant difference to an organization’s ability to remain relevant to what matters to its clients in a fluid and unpredictable environment.