New Siemens CEO Joe Kaeser has a problem. Not a little, inconvenient, nagging problem. He has a massive, seemingly intractable problem of leadership. There’s no question that Siemens is stuck. The question is whether a 33-year insider can shock the organization into making the changes it needs to make. The odds are against Kaeser. The only route to success is driving fundamental cultural changes.
Siemens situation is well documented. As Maria Sheahan laid out in Reuters, recently ousted CEO Peter Loescher tried to outgrow General Electric and Philips by expanding into new business lines from ultra-sound to ultra high-speed trains to ultra-clean energy. Growth didn’t come fast enough to offset the costs leaving Loescher with profit problems that the main board found so upsetting they finally pulled their own ultra card and fired him. He leaves behind a company in disarray.
Kaeser’s Onboarding Framework
A leader’s approach to onboarding into a new role can be guided by a combination of the situational imperative to change and the culture’s openness to change. He or she has four options: assimilate in (A), converge and evolve fast or slow (CE), or shock the system (S). The most appropriate approach dependes on a few factors:
- If the culture is open to change and there is no need to change, the leader can assimilate in over time. (A)
- If the culture is not open to change and there no need to change, the leader can converge and evolve slowly so that he or she can lead change from the inside when needed. (CE-slow)
- If the culture is open to change and there is a need for change, the leader should converge and evolve quickly, building on existing momentum. (CE-fast)
- If the culture is not open to change and there is a need for urgent change, the leader needs to shock the system into action. (S)
Siemens 166-year old culture of 400,000 people is not open to change but desperately needs to become so.
Recommended Approach for Kaeser
Kaeser’s biggest obstacle is his former self. After three decades in the company he is what Ajay Banga would call “Mr. Inside”. After appropriately supporting the recently outsted CEO over the past few years, Kaeser is intimately associated with the decisions that have led to the current problems. This can either be a strength or Kaeser’s greatest weakness.
Kaeser must learn from Shakespeare’s Henry V and convince people to “Presume not that I am the thing I was; For God doth know, so shall the world perceive, That I have turn’d away my former self…” The key for Kaeser is to lead through his actions, thinking Be – Do – Say.
Of course Kaeser is going to preach change. He’s going to try to say the right things. But no one is going to believe him.
As Kaeser starts to make changes, some people will believe he means what he says. But during this time, his early actions will be particularly important as they will set the tone for what follows. Even so, some people won’t believe him. They’ve known the old Kaeser too long.
The first fundamental change is for Kaeser to convince himself of the need for change and the need to change Seimens’ culture because culture is the only sustainable competitive advantage. He needs to believe it himself and then re-look at Seimens’:
– Environment, where it chooses to play
– Values, what really matters for its future and in its future
– Attitude, how it wins across strategy, posture, and culture
– Relationships, how it connects internally and with customers, suppliers, allies
– Behaviors, focusing on the few things that will make the biggest impact
This is a good example of step 2 of The New Leader’s Playbook, Choose How To Engage the Context and Culture
Context is a function of the business environment, organizational history and recent business performance, informing the relative importance and urgency of change. Culture underpins “the way we do things here” and is made up of Behaviors, Relationships, Attitudes, Values, and the Environment feeding into readiness for change. Crossing context and culture helps you decide whether to Assimilate, Converge and Evolve (fast or slow), or Shock. Choose your way. Then map contributors, detractors, and convincible watchers so you can move each of them one step by altering their balance of consequences.
The New Leader’s Playbook includes the 10 steps that executive onboarding group PrimeGenesis uses to help new leaders and their teams get done in 100-days what would normally take six to twelve months. George Bradt is PrimeGenesis’ managing director, and co-author of The New Leader’s 100-Day Action Plan (Wiley, 3rd edition 2011). Follow him at @georgebradt or on YouTube.