For just about every ESG and sustainability initiative, there are myriad starting points, limitless ways to invest time and money, and frustratingly few endpoints. How do companies actually decarbonize products and operations? What does it mean for managers to deliver on diversity, equity, and inclusiveness? What if there is a safety program but the numbers are still moving in the wrong direction? Implementing ESG and sustainability strategies in mid-sized and large organizations can be a complex undertaking.
That’s where Dr. Mary Lippitt’s “Managing Complex Change” model comes in. The framework, which dates to 1987, is simple yet powerful. Things were different back then. The New York Giants were Super Bowl champs, Nintendo released The Legend of Zelda in the U.S., and Def Leppard released chart-topping hit “Pour Some Sugar On Me.” Lippitt’s model is another one of these 80’s gems. We apply it all the time in sustainability consulting. Its simplicity holds the key to planning successful, frictionless ESG-linked corporate initiatives.
Lippitt’s model identifies five crucial elements for successful change
- Vision: A clear, compelling vision of the future state
- Skills: Developing people and knowledge within the workforce
- Incentives: Aligning rewards and recognition systems
- Resources: Providing funding, technology, tools and the business mandate for each
- Action Plan: A detailed roadmap outlining specific steps, timelines, and responsibilities
Managers who ignore elements of the model do so at their own peril
Skipping steps increases the odds that well-intentioned programs get derailed by one of five common management dysfunctions. Lippitt’s model shows that neglecting any of the five key elements will result in a partial win, at best.
Without a clear vision, associates may be confused about the goal and how or why they play a role. Lack of skills leads to poor quality execution and anxiety, both of which impact morale. Misaligned incentives may breed resistance and infighting between teams, not to mention slow progress as other priorities take precedent. Insufficient resources can frustrate goal owners who are already stretched too thin. The absence of an action plan leads to false starts – often in the form of chaotic, piecemeal activities where people are more likely to remember friction than celebrate success.
Why this matters for success with ESG and sustainability implementation
Imagine a professional services company that aims to significantly reduce its operational greenhouse gas emissions. They invest in renewable energy (resources) but fail to educate key employees on energy conservation best practices (skills) or update building management systems to optimize lighting and HVAC schedules (action plan). Somewhere along the way, the goals and rationale were not effectively communicated to stakeholders (vision), leading to a lack of recognition and failure to convert a sound financial and operational decision into brand equity. Their efforts, while well-intentioned, may fall short of their full potential.
By applying Lippitt’s model, organizations can proactively address potential roadblocks. This leads to tangible benefits, including:
- Reduced risks: Taking action on environmental and social risks before they manifest as costs.
- Increased efficiency: Successfully optimizing resource use and reducing forms of waste.
- Innovation: Driving development of products and services that are competitive over the long run.
- Happier, more engaged employees: Fostering a sense of shared purpose and commitment.
How to tell if an ESG or sustainability initiative is a form of complex change
- Are multiple departments and spheres of influence involved?
- Will the consequences of success or failure be visible to stakeholders or impact the business?
- Does the issue have a nuanced definition that can mean different things to different people?
Importantly, not every activity involves complex organizational change. Activities that live within a single department or sphere of influence can be accomplished successfully without all five elements. For example, managers can get a waste reduction program off the ground or organize one-time events without worrying about having all the elements of Lippitt’s model in place. The model is most applicable for the tougher cross-cutting decisions with a number of variables and potential roadblocks.
Take-aways for managers
Lippitt’s “Managing Complex Change” model, first published in the 80’s, provides a valuable framework for organizations seeking to embed sustainability principles into culture and operations. By systematically considering vision, skills, incentives, resources, and the action plan, managers can more confidently navigate the complexities of any ESG or sustainability transformation.
The model is easiest to apply to specific topics, actions, or activities where the individuals involved share an understanding of the definition and general scope of potential priorities. Organizations may benefit from consulting support to help achieve internal alignment or to sort out competing priorities in the leadup to taking action.
