• Power or Organization Design
• Power of Strategic Alignment
• Power of Collaboration

Please feel free to forward this newsletter to others who would be interested in receiving it.

Tracy will be speaking on the topic of errors in organization redesign:

"When Reorganization Go South: An Interactive Case Study of Two Organizations."

The Fielding Graduate Institute
January 15, 2004
www.fielding.edu
 
South Bay Organization Development Network
February 2, 2004.
www.sbodn.com
 
Best In the West Conference
April 30, 2004
Fort Mason Center, San Francisco
www.baodn.org
 

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Background

While the term "tipping point" has been around since the 1950s, Malcolm Gladwell has catapulted it into common usage. You might say his book was the tipping point for the term.

So what made his views so readily accepted by normally cautious readers? The most likely reason is that the premise makes sense. Perhaps because Malcom Gladwell is a writer and not a professor, the book reads easily and skips all the academic stuffiness usually inserted to prove scholastic integrity. Gladwell currently writes for The New Yorker and had been a business and science writer for the Washington Post from 1989 to 1996. Even though the book is meticulously footnoted, many of his conclusions might be considered less than scientific, but they are logical and provide an acceptable explanation about why some ideas engage us, drawing us in, and others are nothing more than a blip on our radar screens. Whether you agree or disagree with him, you can't help but be challenged by and intrigued about what Gladwell says.

The Tipping Point: How Little Things Can Make a Big Difference

Malcolm Gladwell describes the book as "the biography of an idea." He says there are three characteristics that distinguish a tipping point and explains them using the analogy of an epidemic. First, the idea is contagious; second, big effects come from little causes, and third, change happens all at once, not gradually. For instance, notice how measles spreads through a classroom. One child gets the bug. Almost immediately, everyone else comes down with it. Two weeks later, everyone is healthy again. The "tipping point" is "that one dramatic moment in an epidemic when everything can change all at once."

In order for something to reach the tipping point, there are specific circumstances that must be in place. These are the three rules Gladwell says are essential to a product or idea reaching the tipping point.

Rule 1: The Law of the Few

In the first rule Gladwell identifies the three types of people who are crucial if an idea is going to be tipped into an epidemic or widely adopted. First, there are "the data banks," the Mavens who are fans of the idea and who understand and appreciate its significance. Second, there are the Connectors, "the social glue," who spread the idea throughout their wide circle of acquaintances. Think of the "six degrees of separation" theory. It postulates that you can reach anyone in the world in six steps because every person in the chain will know someone who'll bring you closer to the individual you need to meet. In the same way, the Connectors know lots of people, and they all know someone who knows someone else who can get to yet another, and in the process they spread the idea. Finally, the Salesmen promote the idea within their own circle. Salesmen are the "senders" who can persuade from the outside, almost instantly building emotional rapport. They influence the "carriers" who receive the message and act on it. If an idea is to be adopted by a wider audience, it takes at least one--and preferably more--of these maven-connector-salesman chains.

Rule 2: The Stickiness Factor

Stickiness is the packaging that makes an idea memorable and irresistible. Even the best idea will only be around for a short time, despite the mavens, connectors, and salesmen promoting it, unless there is a buzz, that elusive something that makes it stand out and stick in the minds of the consumer. It can be incorrect grammar in a slogan that catches our attention (e.g. "Winston tastes good like a cigarette should."). When that advertisement first appeared, Winston promptly surged ahead of its competitors.

The extraordinary television series, Sesame Street, owes a lot of its success to following the lead set by commercials. Television ads are about one product. Each Sesame Street unit was about one educational goal--for instance, learning an alphabet letter. The producers reasoned that if a one-minute commercial could sell a four-year-old a brand of cereal, it could also sell him or her "the letter Q." They also noticed that young children liked one-liners and had short attention spans, so they built those into the program.

But whether you're talking about cigarettes or children's television, the theory holds true. When you find the simple way to package an idea correctly, it will become irresistible in the right circumstances.

Rule 3: The Power of Context

"Epidemics are sensitive to the conditions and circumstances of the times and places in which they occur." Until the mid-1990s, Hush Puppy shoes, with their suede uppers and rubber soles, were considered nerd wear, definitely unfashionable. Then, teenagers in New York's newly trendy East Village started wearing them. Within months they were considered high fashion necessities in young people's wardrobes across the country and sales skyrocketed.

There are two factors to consider when talking about context, the environmental aspects and our social networks.

Gladwell contends that the decrease in crime in New York since 1990 has been the result of the power of context at work environmentally. If we live in an area that is neat, clean, and cared for, we will try to keep it that way, but if we live with squalor, graffiti, and crime, societal decay and lawlessness will flourish. He cites the Broken Windows theory developed by criminologists George Kelling and James Q. Wilson. Their theory is that if a window is broken and not repaired, the community assumes the property isn't cared for and no one's in charge. Soon other windows will be broken and other crimes will also proliferate.

In New York, the turn-around began with the hiring of Bill Bratton as head of the transit police. He immediately began cracking down on the graffiti artists and the fare beaters. He made it easy and rewarding for the police to arrest the perpetrators for what was previously considered a misdemeanor and not worth the effort involved. When Rudolph Giuliani became mayor, he appointed Bratton chief of police and the same kind of decisive action against criminal behavior was now seen on the city streets. There was suddenly zero tolerance for even the most minor infraction. When, in effect, the broken windows were fixed, crime decreased dramatically. The context in which criminals flourished had been significantly altered.

The second factor is the number of people each of us has around us. In cognitive psychology there is a concept called "channel capacity." It refers to the amount of information we can process, the amount of room in our brain to store information. Along the same lines, humans seem to have the ability to keep track of no more than 150 relationships between ourselves and other individuals in our immediate group. Among those, we have a more intimate connection with only about 12 people. Once we get beyond the 150 relationships, we begin to alienate people so as not to enlarge the group. Studies of both military units and nomadic tribes have shown they instinctively adhere to these numbers.

So what does this have to do with the tipping point? A great deal. If an idea is to become epidemic, you can't try and convince a stadium of 15,000 people. Most of them won't remember you by the time they get home. Instead, try and reach 100 of those groups of 150. That's where the power is because the idea multiplies in geometric progression.

Gladwell uses the examples of successful companies that adhere to the 150 rule. One is Gore Associates, makers of Gore-Tex fabric, Glide dental floss and a variety of other products for the automotive, semi-conductor, pharmaceutical and medical industries. This is a company without an executive suite of offices, titles (everyone is an "associate"), bosses (everyone has a mentor or a sponsor), organization charts, budgets, or strategic plans. Salaries are determined collectively. There are five plants in Delaware, and the late Wilbur "Bill" Gore used to say that when they erected a building they put 150 places in the parking lot. When people started parking on the grass, they built another building. For Gore, 150 was the magic number of people who could work well together. Incidentally, Gore has been profitable for over 35 years and has one-third the staff turnover rate of any other company in the country.

Lucent Technologies is also cited as a company that uses the 150 rule as a guideline but not as effectively as Gore. At Lucent, each department is separate and self-contained. The manufacturing people don't know the salespeople. There's peer pressure within the groups to be innovative, but there's little stimulation between the peer groups because they don't know each other. For instance, if you're in sales and need to push an order through manufacturing, you won't have a real knowledge of or connection to the other person's strengths, weaknesses, and passions. Meanwhile, at Gore, every plant includes every department so you actively know the people in R&D and shipping and product development. Without an obvious authority figure, the company hums along making money in an atmosphere of mutual respect and understanding.

Conclusion

The overall message in The Tipping Point seems to be that the ability to make a product or an idea into a national or international craze is in the hands of relatively few people. Intuition has to be constantly tested because the seemingly obvious isn't always the truth. We are highly motivated by what we see and hear, the context in which we live, and the number of people with whom we interact.

Direct marketers have known this for a long time. Every manufacturer who places their product in a movie understands the power of having a star drinking their coffee or using their computer or wearing their shoes. In the movie E.T., when the boy dropped Reese's Pieces to lure the alien from the tool shed, it transformed a relatively unknown candy into a best-seller overnight. Every kid who saw the movie recognized that those weren't M&Ms and thought they, too, could entice an extra-terrestrial if they had Reese's Pieces in their pocket.

Although the book was written for a general readership, the business community quickly adopted it. Today, almost three years after publication, the tipping point has become a standard term in corporate settings. You may not agree with every conclusion Gladwell reaches, but there enough food for thought to keep you chewing on it for a long time.

View from the Lighthouse on The Tipping Point

So how does this concept play out in the realm of organization change?  We can map the key concepts in The Tipping Point to a situation that requires a well-thought out change strategy and learn a lot about how to increase the likelihood that the change effort will be successful because the idea will have tipped.

Here's an example: At the direction of the vice president of the division, we set out to redesign an engineering and marketing unit to change it from a steep hierarchy to a team-based organization. While there was general agreement among employees that "more teamwork" was needed in the division, few had had much direct experience with what that really meant or entailed. The VP (and quickly, I, too) was the Maven. He was very clear about why this major change was essential to the business and technical requirements of the division. We started by engaging his direct staff. They created the foundation for both the project and the division to fundamentally change how it would do its core work. They, in time, became the first set of Connectors, as we proceeded to convert the VP's and their staffs to teams. Some of them also became Mavens as they experienced the benefits of the interdependence and collaboration among their colleagues and staff members. Mavens are analogous to Sponsors, Champions, and Innovators.

Next, we formed a cross-functional team that was chartered to create a model for teaming across the division. The team sponsor was a member of the VP's staff who had become a Maven, and those who were invited to be members were selected for having demonstrated superior team skills. And they were both Connectors and Salesmen--people who were well known and respected by others in the division and would be able to model and disseminate new ways of working. Connectors and Salesmen are analogous to Early Adopters, with the added ability to socialize and promote a concept or new behavior to later adopters.

We created stickiness in a variety ways. First, we developed and implemented a comprehensive training intervention in team skills development, specific to knowledge worker and technical teams. We trained people in intact work groups which allowed those who were quicker to see the value of the team approach to "infect" others with whom they were interdependent. People who participated in the training with one team were also members of other teams that had not yet been trained, and frequently, the several trained members of the untrained teams began to spontaneously to introduce their newly acquired skills to these teams. Because the skills worked, demand for the training was created--often from those who had been resistant to it initially. Second, we created several cross-functional teams chartered to address issues and opportunities that had been identified by division employees in a corporate survey. This was another way to expand involvement and teamwork in the division and to demonstrate that we were serious about it. Finally, we made modifications to the formal and informal reward and recognition processes to acknowledge the contributions of individuals to teams and of teams themselves, one of the most difficult components of the change process, but also one of the most critical.

In this case, Context was everything. The products and solutions being designed and marketed by this division were themselves becoming more integrated such that this level of functionality had to be engineered into them. This meant that the components had to be designed collaboratively rather than separately, hoping that when the pieces were eventually plugged together, they would work as specified. This is what drove the need for work to be done in teams. This is not necessarily engineers' preferred way of working, and without the technical and business drivers, this would have been just another change du jour for which it would have been impossible to create and sustain sufficient momentum.

Finally, there is one more key concept that's important to linking tipping points to organization change. It's about quantifying sustainability, something we all hope for in organization change, but all too often, don't achieve. Everett Rogers' model of change adoption predicts that the likelihood of a change effort being sustained is based on the percentage of the target population that has embraced the change over time. When 5% have adopted a change, it is said to be embedded; it will not go away even though it may never be completed. When 20% of a group have changed, completion is said to be inevitable--the effort cannot be stopped. So this is, perhaps, the Tipping Point. His model suggests that in organization change, where your business results may be at stake, there are advantages to introducing an intervention systematically to carefully selected sub-groups, building acceptance as quickly as possible to 5% and then 20% of the organization. Gladwell's concepts help show us how.
 

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RESOURCES:

The Tipping Point: How Little Things Can Make a Big Difference
by Malcolm Gladwell. Little Brown and Company, 2000.
Click here to buy this book 
 

Diffusion of Innovations, fifth ed., by Everett M. Rogers. The Free Press, 2003.
Click here to buy this book 
 

Doing Teams with Knowledge Workers: The Practitioner's View by Tracy Gibbons and Randi Brenowitz, 1995.

http://www.coastwiseconsulting.com/article_doing_teams.htm
 

Turnaround: How America's Top Cop Reversed the Crime Epidemic by William Bratton and Peter Knobler. Random House, 1998.
Click here to buy this book 
 

Fixing Broken Windows: Restoring Order and Reducing Crime in Our Communities by George L. Kelling and James Q. Wilson. Free Press, 1996.
Click here to buy this book 
 

Malcolm Gladwell's website: http://www.gladwell.com

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