Masami: I’m good. I just got back from a trip to Boston where I celebrated one of my closest friend’s 30th birthdays.
Rick: That’s so cool. I think everybody needs to be celebrated at least once a year, probably more than once a year. So, I always love birthdays.
Masami: Yeah, it’s a great time of year and I think 30 is a big milestone, you know, as a young person, you’re entering the next phase.
Rick: I can barely remember back that far, but I trust you.
Just kidding. Just kidding. But hey, the conversation with Kendra and Kelsey is very cool. So, they’ve just completed some research on what it takes to be a future relevant organization and are finalizing a diagnostic so we can actually look at our organizations and prioritize where to invest.
Masami: Love it. I can’t wait to hear more.
Rick: Well, let’s go.
Kelsey, Kendra, welcome to the show.
Kelsey: Thanks, Rick. Thanks, Rick. Great to be here.
Rick: Kelsey, what’s going on in the big city these days? Are you in New York?
Kelsey: Still in New York. Right now, top of mind for me is we just finished planning our vacation. We’re gonna do some scuba diving. So, I’m very excited and anxious for that.
Rick: Oh, very cool. Where are you going?
Kelsey: We’re going to the Bahamas. So, it’ll be the trip to finish our certification. Hopefully that will lead to many more around the world.
Rick: Love it. Love it. How about you, Kendra?
Kendra: Well, I am in San Francisco. And first I have to say that SCUBA is my favorite acronym of all time. So, I’m really excited for Kelsey’s adventures.
In San Francisco, what’s top of mind for me, at least this weekend, I’m going to an art exhibit for one of my favorite artists that’s in town. His name’s Kendi Wiley. He does portraits. He did the Obama portraits, for example. And so, yeah, he’s at the de Young Museum for a little while.
So, I’m excited to check out the exhibit.
Rick: Very cool. Let’s jump right in today. What do you mean when you talk about future relevant organization and where did the concept come from?
Kelsey: A lot of it came down to the client conversations that we’ve been having. And we know from what we’ve been discussing with our clients or what we’ve heard in the news that disruption of all kinds is top of mind for CEOs across a variety of industries.
Many of these things, you know, we’ve been talking about for a while, but a lot are becoming more mainstream. I mean, just the notion of chat GPT is something we probably now hear on a weekly basis. And I know BTS now even has policies around it, at least for me on the East Coast, specifically for clients around healthcare, AI is driving a lot of the innovation with how they analyze various data sets from the trials that they’re doing.
And I know what’s top of mind is different for Kendra out on the West Coast.
Kendra: In the West, we’ve seen disruption come in the form of uncertainty of what the future holds. We’ve seen continuous waves of layoffs in tech, as well as other industries. Also after SVB and we’ve all been watching closely as other banks have collapsed in the last month, there’s uncertainty about employment and morale, market competition, the ability to obtain funding and how that affects long term budgeting and planning among other things.
What’s top of mind for CEOs now is the need to develop greater adaptability and resilience.
Rick: I was working on an article this morning and was thinking most organizations are somewhere on the continuum between uncertainty and chaos. What has been the response?
Kelsey: First? I love that – continuity. Rick, it reminds me of how we started to separate out the different needs as we would see them initially between companies that might be more proactive in response to all this disruption.
They’re uncertain of exactly what first steps they have to take and companies that would be more reactive because maybe chaos is already ensuing across the company. So that did frame how we thought about, one, what is the need, and two, how are our competitors reacting to this disruption with their own unique solutions.
And so, we actually began the research last fall with the goal of exactly trying to figure out what was already out there. So, what we saw was that many firms have responded to these needs in different ways that don’t go far enough from our perspective. They were falling into either the bucket of looking purely at kind of a recurrent state of health.
More of that internal lens on business capabilities. That’s only looking at a snapshot in time, or they were looking purely at future readiness, that external perspective on what it takes to meet new market demands, but not really set within what the actual cultural or strategic context of the exact company is.
Kendra: We believe healthy companies are those that are future relevant. They have a balance focused on that current health and the future readiness. So, by looking at the overlap, we’re thinking about health in a way that’s customer backed and answers the question, healthy for what purpose? Why do organizations seek to be healthy if not to be relevant for their customers and people now and into the future?
When we were developing this work, we consulted with Andy Atkins, who’s our VP of executive and team performance, and he prompted us to use a helpful analogy. So, imagine if we just considered health for athletes. Say we had a sprinter and a wrestler. We could not say that you’re healthy overall if you have strong upper body strength and weak lower body strength.
That might not make the sprinter successful. Yet it might enable the wrestler. So, we have to consider health in the context of the athlete’s needs and what they’re trying to achieve. We have to consider that these athletes play in different fields, with different teams, at different times. So, when we as BTS think about organizational health, we believe that health must be considered in the context of future readiness, both where we are and where we’re going.
And because we’re using both an internal and external lens to determine future relevance, we’ve grounded our definition of future relevance in our point of view of culture and strategy.
Kelsey: So as some of you, if you’ve listened to our previous Fearless Thinker podcast, you might remember that we talked about that point of view on strategy culture, what we call the strategy culture pyramid.
This idea that strategy and culture must be mutually reinforcing or they will be simultaneously defeating. So, stay with me here and visualize that we have people and culture on the left side of a pyramid. And then we have strategy and strategic intent on the right. There really needs to be alignment across for an organization to successfully transform.
And so, this was really the foundation, as Kendra said, of how we thought about a future relevant organization being one that continuously aligns strategy, culture, and ways of working to deliver their business outcomes in an increasingly uncertain future. And we deliberately added the words continuously and uncertain to our traditional definition of strategy, culture, pyramid to reflect the fact that our view on health is that it should be continuously and constantly evolving to meet the demands of an environment of constant change to your earlier point, Rick, and one that might have both uncertainty and chaos, because as we see it, health should be dynamic rather than static.
Rick: How do I know if my organization is future relevant?
Kelsey: That was a million-dollar question that we embarked on in the fall, right? How do you even tell? What are we doing here? Well, after lots of iteration, we came down to what we call six indicators of health, what we’re calling our next practices. And we wanted to create measures that would be predictors of an organization’s health in the future.
When market demands are uncertain and to be honest, most likely very different, these next practices when managed well, they help organizations navigate nonlinear paths to achieve their business outcomes. Fundamentally, they’re necessary for any organization considering future relevance. And if we think back to the pyramid and the fact that we need alignment across people and culture and strategy, the next practices are meant to be representative of where strategy, culture, and ways of working meet. We’ll start kind of with the broad general term of what they are. So, a lot of words, and we can go into more detail on each of these. The first two that underpin it all, what we call this notion of number one, planning and pivoting, and number two, leading with others.
So, this will have an impact on alignment of an organization’s purpose. Direction and action, and then we would move to number three, which we’re calling creating shared accountability and number four, collaborating in the ecosystem, which are really looking at alignment of direction and action in an organization. And then finally, number five, accelerating talent. And number six, simplifying systems.
Rick: Why these six and not others?
Kelsey: Kendra can attest we went through many iterations of what this looks like and permutations. But as mentioned earlier, our team started with a lot of research and that was comprised of more of a literature review of academic research and other articles on organizational health to identify how it is currently defined, looking at what are seen as the components of a healthy organization.
What are the various causes of poor health? And then we did some external benchmarking to see what currently exists in the market that we mentioned earlier. And we compare this with some of the additional components. So today we’re going to be exploring six key elements of a future ready organization that we found in the research and through our own client experience and distill those down into the six that we shared, and what you’ll find is you explore these further or what we hope you will find is that there are elements that show up in all six of these indicators.
So, for example, because we started with the idea that change is constant, our point of view on change readiness and elements of adaptability were a foundation that we built on holistically across all the indicators. So that will be very present. A second one is that you’ll notice we don’t intentionally call out DEI or diversity, equity, and inclusion in the point of view itself, but rather we speak to factors of DEI in each of the indicators.
We wanted to evoke this idea that DEI not being called out separately is important because it should be incorporated into everything that we do. And then last, but certainly not least, is that we really grounded our point of view in this notion of customer obsession. So, customer being at the core will be present in all six as well.
Rick: You’ve used a term a couple of times now that I’m sure some of our listeners out there scratching their heads saying, I know best practices, but what are next practices?
Kendra: Next practices are the evolution of best practices. Best practices allow you to be successful now. For example, setting direction as a best practice that companies are familiar with to the next practice.
The first one that Kelsey mentioned, we’re calling it planning and pivoting. Okay. This next practice acknowledges that the act of planning is a better predictor of success than the plan itself. It’s about the process and the agility to leverage new data, because data is never complete, and respond quickly to constant changes in the environment.
Another example, a best practice of developing talent, something that we’ve all heard, we’re all familiar with. To our next practice, one of six as accelerating talent, the best practice of developing talent to serve the business must evolve to accelerating our people as humans. So as Kelsey mentioned, these are the six next practices that when done well, can help an organization navigate nonlinear paths to achieve those business outcomes.
Rick: You guys are loading me up with so many great insights today. I want to get half of them printed on t-shirts, especially inclusion over assimilation. I think that was great. So, I can’t fix everything at once. How do I know where to focus?
Kelsey: So, we are creating a way to assess just that. Our future relevance diagnostic will actually launch in a few months and it will look at future relevance.
Transcripts from the six next practices that we discussed today in the context of an organization’s unique strategy, ultimately, it will help to determine the strengths that can be leveraged to further enhance their future relevance or identify what are the biggest roadblocks that they’re facing. So, for our clients who may or may not already have a challenge that they’re dealing with.
Ultimately, our hope is the diagnostic will reveal what is that source of chaos or dysfunction that’s holding them back from executing that strategy. Or for clients who just recognize that they have a need for greater agility and adaptability, the diagnostic will evaluate possible points of chaos and dysfunction, so that clients can get ahead of them. Definitely stay tuned for more info on that coming and a deeper dive on some of the next practices and how we’ve seen them addressed with some of our clients.
Rick: Cool. Well, so this is that point that I take on the mind of one of our listeners out there who may not have the positional power to drive change, but they’ve heard what you said today and they want to do something.
What’s your best advice for them?
Kendra: Take a look at your organization in the context of these next practices. You can find these in an infographic that we created with our descriptions. Take a look at your organization within that context. For example, one of our next practices is collaborating in the ecosystem.
So, start to look at the description and think about, okay, how many cross functional teams am I working on? We also really encourage folks to consider what they own, what they have power to do to set expectations on their teams or for a certain project, and think about those things within the context of next practices as well.
Kelsey: As we said, change readiness is really a factor in how we define the next practices of future relevance. And part of that is this belief that every leader is a change ready leader. And so, in that you have more power than you believe to create change within any of these next practices. So, if upon your evaluation, as Kendra suggested, of certain areas, you see somewhere that you can make a key difference, it starts with you and your team, whether that’s a team of three or a team of 50 and from there you can start to see hopefully greater change across the rest of your organization.
Rick: Again, great insights. I guess I’d like to thank you both for taking so much time with us today. Looking forward to the diagnostic and you coming back and us chatting more.
Kelsey: Absolutely. Thanks again for having us, Rick. Thanks so much. Looking forward to talking soon.
Masami: If you’d like to stay up to date on the latest from the Fearless Thinkers podcast, please subscribe. Links to all the relevant content discussed in today’s podcast are in the show notes, or you can always reach us at bts.com. Thanks again!
