"Our Way Forward" - Leading an Organizational Transformation

Background: Established in 2000, the BC Pension Corporation operates on a not-for-profit basis under the provisions of the Public Sector Pension Plans Act.  The Pension Corporation's board of directors, the "Pension Management Board", governs and oversees the management of the Corporation.  The BC Pension Corporation is one of the largest pension benefit administrators in Canada, and the largest in British Columbia.  It provides pension administration services on behalf of BC’s College, Municipal, Public Service, Teachers’ and WorkSafeBC pension plans, serving more than 1,000 plan employers and just over 426,000 active and retired plan members.  The Pension Corporation also administers the Members of the Legislative Assembly Pension Plan for BC’s provincial government.  In addition, the corporation administers pension plans on behalf of clients through agreements with individual plan sponsors, such as the Workers' Compensation Board (WCB).

Beliefs at the Starting State: Laura Nashman assumed the role of Chief Executive Officer of the British Columbia Pension Corporation in December of 2008.  Having studied organizational design and change management, Laura very quickly recognized that the Corporation was stalled in stage two of Richard Daft’s four stage organization life cycle model.* She immediately began to establish the groundwork to create an ambitious business transformation aimed at moving the organization forward in its evolution and ensuring that the Corporation would meet the changing needs and expectations of plan members, employers, trustees, and staff.

Laura observed many examples of stage two characteristics.  Most profound was a strong belief in collaboration.  She noted that teamwork and a heavy reliance on collaboration and consensus sometimes took the place of timely and effective decision-making.  While there was much good discussion taking place, successful execution was being hampered.  Projects tended to linger and to not be completed on time, on budget, or within scope.  Most significantly, individual accountability was not at the level it needed to be.

In Laura’s words, “The prevailing beliefs seemed to be: There is safety in numbers and if everyone is included in discussions and decisions no one person will be held individually accountable; teamwork is good and necessary all of the time and the more teamwork the better; teams work well when they spend a great deal of time together, whether that time is quality and value-add time or not, and; the bigger the team the better since more people will produce more ideas which will lead to better results.”

Laura also noted that, “In addition to a culture of extensive collaboration and the beliefs that supported it, there were also beliefs at play that produced overreliance on the corporation to solve problems.  These included that: Risk-taking is bad; decision-making is for a select few (the executive team); there is always another day; project delays are inevitable, and; formalization and bureaucracy are bad because they create constraints that inhibit the nimbleness needed to respond to ever-changing client needs/demands.”

Through extensive consultation with her leadership team as well as many key influencers at all levels in the organization, Laura began to formulate a vision for the future.  She came to believe that, while there were many positive attributes of the prevailing culture that could be leveraged, some cultural attributes and beliefs needed to change.  She believed that success would require promotion of the good aspects of the prevailing culture and ways of doing business while at the same time it would require change in the cultural attributes that were holding the organization back.  Laura vetted her ideas with the Corporate Board as well as other key partners and stakeholders in order to test her beliefs and the ideas she was proposing.  After several months of detailed work with her team, Laura successfully gained approval for a strong change agenda which would set the stage for the creation of a nine-year strategic plan.  This plan became known as “12-21: Our Way Forward”.

Beliefs about the Target State Laura’s vision was that, over time, the cultural attributes that were impeding progress would be deemphasized and slowly eliminated.  People would thrive while the organization would realize its full potential.  Laura’s vision included the emergence of beliefs that: “A culture of accountability is essential for success; saying what you will do and doing what you say are essential; outcomes are important; the corporation must always remain a people-first organization characterized by strong client service and care and attention to staff; innovation is essential, and; decision-making must be well-informed and timely”.  It was Laura’s strong conviction that the target state would draw on the positive aspects of the prevailing culture, including a strong client orientation, a powerful work ethic, respect for others, teamwork, and a commitment to “getting it right”.

Beliefs about the Change Process At the highest level, Laura believed that leaders must inspire trust and confidence among their staff if they are to be successful leaders and change agents.  And she knew that conviction and communicating with confidence would inspire the trust that would be necessary to lead effective change.  Laura also believed that she would need to be a visible leader and that all leaders in the organization would need to agree on core leadership behaviours in order to effectively implement the ambitious change initiative.

Laura also believed that she needed a strong team around her to bring about such a large scale change and that she must put this team in place in the early stages of the effort.  In her words, “the transformation must start with me but expand to include many other leaders.  There must be a coalition of change champions throughout the organization.  Change must begin with the leader but must soon become everyone’s change.”

With this in mind, and well before Laura and her team architected the 12-21: Our Way Forward initiative, she undertook a deliberate cultural change process to ready the organization to embark on the ambitious program of business transformation.  Laura believed that “any successful change agenda starts with the culture”. She believed that culture is the foundation upon which business change happens and that, without the right culture in place, business goals could not be achieved.

Laura outlined the desired culture, including what people believe about the organization, as “a culture that is supportive of and aligned with the business vision and objectives”.  In order to fuel the change process Laura wanted people to see, that is she wanted people to develop the belief, that “the organization is capable of much more including more productivity and more value-add service for all those we serve”.

Laura undertook a structured approach to beginning the cultural and organizational change process.  First she sought to develop an understanding of the organization and to determine how best to add value.  She listened, learned, and took stock.  She focused on what was working well and on those processes and cultural attributes that needed to be eliminated, changed, or improved.   Laura listened to the stories people told, learned from those around her, and built trusting relationships with key formal and informal influencers in the organization.  Along the way, Laura conducted an “early observations” session with the executive, the management team, key staff groups, and the Corporate Board to ensure that stakeholders believed that she was on the right track.

Laura’s next step was to brand the cultural transformation by giving it a name and associated attributes.  Laura chose to name the transformation “Phase 3” so as to provide a strong message that the organization was moving from one phase of its development to the next phase, and that the evolution would continue.  Phase 3 was promoted as a program to “develop, strengthen, and improve the corporation”.  With that program were new cultural norms including clear lines of accountability, productive collaboration, faster decision-making, and constructive risk-taking.

Laura created a change team and developed a Phase 3 communications and change management plan with deliberate messaging, strong visuals, and launch events.  Laura’s intention was to engage everyone in the change through staff events and team meetings and to bring all to the true and accurate belief that “everyone was part of Phase 3”.  She built a coalition of champions for the change program which included key leaders and influencers to whom she assigned crucial responsibilities for communicating essential messages.

The main thrust of the next phase of the change process was, in Laura’s words, to “stop talking about it and just do it”.  Laura believed that there was a need to show tangible examples of how the organization was going to develop, strengthen, and bring a new culture to life.  This meant instilling new beliefs and educating leaders in new ways of doing business.  It also meant ensuring that leaders demonstrated new behaviours including those of emphasizing accountability, managing within time, scope, and budget requirements, engaging in deliberate and structured planning, and demonstrating transparent action with staff.

Laura believed that, through the transformation process, it would be important to measure the impact of changes as well as the degree to which employees understood and accepted the changes that were already taking place and being proposed.  Key measures were established to gauge staff understanding, acceptance, and engagement.  Within this context, Laura initiated new projects to identify an optimal client service delivery model and to determine those technology changes that would be needed to facilitate the change agenda.  Also, new initiatives were launched to address business processes that were no longer effective or efficient.

At the same time, Laura strongly believed that all staff needed to “feel” the change if they were to believe it.  She held a strong view that staff needed to see and experience their leaders behaving differently, sharing more information, making real commitments, engaging in less committee work, making faster decisions, and moving decisions “down” to the level where they should be made.  She also believed that leaders needed to engage staff in Phase 3 by encouraging them to move forward with their own ideas so that they could experience the fruits of their labour in a series of “quick wins”.  Laura strongly believed that such behavioural changes and associated gains would signal that the Pension Corporation was indeed in a new phase of its development.

Finally, Laura’s efforts were focused on reinforcing the change.  She introduced new mechanisms to disseminate the central messages.  She remained visible and encouraged other key leaders to continue communicating the core messages in order to “keep the brand alive”.  In Laura’s words, “The effort was to ensure that the new culture became the real culture, the new reality.  It was to ensure that it was no longer thought of as something new, but rather, the way we behave and the way we do business”.

Beliefs Emerging during the Change Process As the change took place, several beliefs emerged – some anticipated and some not.  Laura notes that “for the most part, and among almost all key influencers, there was a firm belief that what was being proposed in terms of cultural and business process changes was right for the organization.  However, Laura also notes that there was some resistance.  “Mostly it was in the form of ‘dis-belief’.  There was a sense that what I was suggesting was not doable.  Some believed that I just did not understand the organization, its clients, its history, its budget, its people, and its culture.  They believed that, if I did understand, I would see why what I was proposing in terms of culture and business transformation was not possible”.  There was also some scepticism in the form of a “we have been there and tried that” belief on the part of some longer-term employees.

Laura dealt with the resistance she encountered in a head-on manner.  In her words, she believes that “it was my confidence, my conviction, my honesty and integrity, my willingness to work hard, my sound plan of action, the reasonableness of what I was suggesting, and the liberation I was promising to deliver that won the day.  In fact what really won the day was that I was suggesting the very change that staff had articulated, that they were hoping for, and that management and staff had defined when the dialogue first began in early 2009.  And sceptics came to ‘believe’ that it was possible, especially when they began to see and feel tangible improvements”.  As a result, a strong belief emerged that the changes must take place – that the transformation must be pursued.

Beliefs about the Current State Evidence that significant change had occurred emerged from the 2009 staff survey results with an unprecedented and unusual gain of 15% in staffs’ sense of having a “clear and promising direction” and an outstanding gain of roughly 40% in “confidence in leaders”.  The results remained strong in 2010.  At that time, 86% of staff reported that they “believe that BC Pension Corporation’s strategy and goals are the right ones”.  Also, 86% of staff reported that they believe “The CEO is open and honest in communications to employees”.  These results have remained strong in the years since, along with a robust commitment to the corporate direction.

By 2011, all accounts were that there had been significant shifts in the culture of the Pension Corporation and that the necessary foundation had been laid to create and then execute “12-21: Our Way Forward”.  Conversations changed as staff were encouraged to be innovative and to be the initiators of change.  Anecdotal feedback from staff, clients, and the corporate board indicated that “things were different at the Pension Corporation”.  In Laura’ words “It has simply felt different when you walk down the halls”.

In 2012, buoyed by the new culture, Laura and her team created an ambitious plan of business transformation which was to become known as “From 12 to 21: Our Way Forward”.  In Laura’s words, “We knew we were ready.”  The plan was approved by the Board and as of 2013, Laura and her team have completed year one of a nine-year business transformation process.  The organizational culture that she continues to shape and the beliefs that have been generated within the new culture continue to serve the organization well as the corporation’s strategy is being brought to life.  Laura continues to this day to pay close attention to the culture and to the beliefs embedded within it to ensure that those beliefs continue to be aligned with organizational goals.

When asked about what she might have done differently, Laura states that she believes that “there is not much point in looking back… what is done is done…. and it is good”.  She notes that “lessons were learned along the way – mostly to communicate often, keep everyone in the loop, know when to push harder, and know the signals that tell you when to lighten the load; know when you have enough information to make decisions, and know when to wait”.

Laura’s attention is now on what is ahead – continuing to execute the strategic plan, deliver on commitments, and bring the 12:21 plan to life.   She comments that “I believe that at the Pension Corporation, employees are leaning into the strategic plan, eager to see it unfold, and excited to be part of it.  The challenge remains that while we are preparing for the future by transforming the business, we must also remain in the present and perform today – delivering quality service to all stakeholders.   Doing both is proving to be difficult, but it is what we must do”.

* (Richard L. Daft, Understanding the Theory and Design of Organizations, first edition 2007, ISBN 0-324-42271-7) Each stage of the Richard Daft model is characterized by specific features and challenges. The model begins with an Entrepreneurial stage wherein the crisis to be overcome is a need for leadership. Stage two is the Collectivity stage wherein the challenge to be faced is a need for delegation. Stage three is the Formalization stage wherein the key issue is to rationalize the work being done and create mature business processes necessary for effective and efficient administration. In the fourth and final stage, the Elaboration stage, the need is for revitalization.

Laura Nashman, CEO
British Columbia Pension Corporation

Dr. Robert Alan Morton
Psychologist, Leadership Coach