Factors that Obstruct Managerial Judgment

Additional factors that obstruct managerial judgment over the need for change and the inability to develop constructive visions for future action have been highlighted in both the business and academic press. Ram Charan and Jerry Useem summarized such factors in their 2002 Fortune magazine article on the role executives play in organizational failures:

They have been softened by past success. They see no problems or at least none that warrant serious change. This can be both internal and external blindness. They fear the CEO and his or her biases more than competitors. They overdose on risk and play too close to the edge. This is often tied to systems that reward excessive risk taking. Their acquisition lust clouds their judgment. They listen to Wall Street more than to employees and others who have valuable insights they should attend to. They employ the “strategy du jour”—the quick-fix flavor of the day. They possess a dangerous corporate culture—one that invites high-risk actions. They find themselves locked in a new economy death spiral—one that is sustained and accelerating. They have a dysfunctional board that fails in its duties around governance.

Developing a well-grounded awareness of the need for change is a critical first step for change leaders when helping organizations overcome inertia, rein in high-risk propensities, address internal and external blind spots, disrupt patterns of groupthink, and view their environment in ways that open organizational members to change.

So far, this chapter has outlined the variety of perspectives that will exist regarding the need for change. It emphasizes that the perspective of the change leader may not be held by others and that often change leaders need to develop or strengthen the need for change before trying to make specific changes. One of the ways to enhance the perceived need for change and begin to create focused momentum for action is to develop a clear and compelling new vision.