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How Good Is Your Company at Change?

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As they deal with a business landscape that is evolving constantly, rapidly, and unpredictably, executives all over the world are full of questions about change: "How much?" "How fast?" "How sustainable?" And sometimes just "How?" They can't hope to answer those questions unless they understand their companies' capacity for change--but they've lacked good tools for measuring that. To address this problem, Michels and Murphy, partners at Bain, devised a way of systematically measuring what they call "change power." In this article they explain how they devised their system, describe the nine main factors that they believe determine a company's change power, and present data suggesting that companies that rank high on their Change Power Index tend to perform remarkably well financially and have more-satisfied employees. Most organizations have a change-power profile that corresponds to one of four archetypes. Using company examples, the authors suggest a specific approach to improvement for each one.
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