It was a beautiful, sunny day in Miami. Inside a darkened auditorium, however, 3,500 senior executives of one of the world’s largest financial companies, flown in for just this purpose, sat awaiting their new CEO. The scene resembled the beginning of a pro basketball game: Loud rock music set the beat, and laser images peppered the crowd and the stage. As the audience members stomped their feet and swayed with the music, the CEO appeared on stage. His task? To pitch his newly minted enterprise vision to the already energized crowd.
His speech, as well choreographed as the buildup, was brief and upbeat. The message was simple: “We will become ‘the breakout firm.’ And to achieve breakout status, we will rely on the three I’s of innovation, integration, and inspiration.” Given the tight schedule of events for this one-day meeting, the CEO took no questions. But the speech had caught the executives’ attention, and the new vision created a buzz of excitement.
Months later, the buzz had worn off. Reality had intruded, as it always does. The company, successful for more than a hundred years, had always proceeded conservatively. Its organizational culture was anything but “break-out.” It wasn’t innovative; its businesses, products and customers were not integrated; and its leaders were not known for being inspirational.
In short, following their initial enthusiasm, the company’s senior executives were having a hard time reconciling the new vision with day-to-day realities as they met in planning sessions with the next levels of management and front-line employees. Within the top executive team, there were few role models for the three I’s, and there were no signs of rewards for behaving as breakout leaders.
Within a year, the term “breakout” had slipped quietly into the background. Few senior executives could even remember the three I’s. About two years after the speech in Miami, the CEO declared victory and went on to lead another company. But the confusion sowed by the unrealized vision cost the company both market share and the harder to quantify elements of trust and momentum with employees and customers.
This gap between inspiration and implementation is a common one. We set out to find out why, and what CEOs and their top teams could do to translate bold visions into operational realities.(See “About the Research.”) In this article, we’ll first explain several common reasons behind the derailment of bold visions.
1. See, for example, J.P. Kotter, “Leading Change: Why Transformation Efforts Fail,” Harvard Business Review (March–April 1995): 59–67; L. Bossidy, R. Charan and C. Burck, “Execution: The Discipline of Getting Things Done” (New York: Crown Business, 2002); D.A. Ready, “Leading at the Enterprise Level,” MIT Sloan Management Review 45, no. 3 (spring 2004): 87–91; D.A. Ready, “How Storytelling Builds Next-Generation Leaders,” MIT Sloan Management Review 43, no. 4 (summer 2002): 63–69; J.C. Collins and J.I. Porras, “Building Your Company’s Vision,” Harvard Business Review (September 1996): 65–77; M.A. Roberto and L.C. Levesque, “The Art of Making Change Initiatives Stick,” MIT Sloan Management Review 46, no. 4 (summer 2005): 53–60; C.K. Prahalad and G. Hamel, “The Core Competence of the Corporation,” Harvard Business Review 68, no. 3 (May–June 1990): 79–91; M. Beer and N. Nohria, “Cracking the Code of Change,” Harvard Business Review (May–June 2000): 133–141; D.A. Ready and J. Conger, “Make Your Company a Talent Factory,” Harvard Business Review (June 2007): 68–77; E.G. Chambers, M. Foulon, H. Handfield-Jones, S.M. Hankin and E.G. Michaels III, “The War for Talent,” McKinsey Quarterly 3 (August 1998): 44–57; D.C. Hambrick, “The Top Management Team: Key to Strategic Success,” California Management Review 30, no. 1 (fall 1987): 88–108; and G. Probst and K. Marmenout, “Deutsche Bank: Becoming a Global Leader With European Tradition,” European Case Clearing House no. 306-529-1 (Geneva: University of Geneva, 2007).
2. Probst, “Deutsche Bank.”