“If an organization is getting certain results, it’s because it’s designed to get those results. So if you want to have different results, then we need to design the organization to deliver different results.”

This week on Be Customer Led with Bill Staikos, we’re having a deep conversation about organizational change with Ken Thompson, principal partner and CEO of AlignOrg Solutions. In his current role, Ken has led multiple successful strategic organization transformation initiatives with Google, FedEx, Adobe, and many other global industry leaders. Throughout today’s episode, Ken shares his expertise in organization design, operational efficiency, and strategies for organizations to win in a highly competitive marketplace.

[01:13] Ken’s Story – We start the conversation with what led Ken to start his company and how his military experience shaped his career path.

[04:31] AlignOrg Solutions – What strategic organization design is, and how Ken’s firm, AlignOrg Solutions, helps its clients build a winning strategy.

[08:35] Reasons for Struggling - Why many organizations struggle to design their organization in a way that allows them to get the results they want.

[12:55] The Starting Point – How to start making changes that would benefit the business, its employees, customers, investors, and other key stakeholders.

[17:44] Good and Bad Customer Experiences – We talk about some of the customer experiences we’ve had and the lessons businesses can learn from these experiences.

[23:10] Mastering the Cube – We dive into the core content of the book published by Ken’s company, Mastering the Cube: Overcoming Stumbling Blocks and Building an Organization that Works.

[27:03] Change Management – Ken talks about the approach AlignOrg takes when looking at change management for its clients.

[31:45] Inspiration – Ken’s sources of inspiration and why Ken loves the exposure he gets from books.

Resources

Connect with Ken

Phone: 801-232-1442 (M)

Email: ken.thompson@alignorg.com

Website: www.alignorg.com

Ken Thompson on Organizational Change and Impact on Customers & Employees

Welcome to be customer led where we'll explore, help leading experts in customer and employee experience are navigating organizations through their own journey to be customer led and the actions and behaviors, employees, and businesses exhibit to get there. And now your host bill stagos.

Just to rattle off a few of, you may have heard FedEx, Google Chick-fil-A for those in the United States. I'm a, well, I'm a huge Chick-fil-A fan. So are my kids whose kids are not. Ken also spent about 25 years in the us army, which is pretty cool. So he's got a really interesting journey that we're gonna talk to him about.

Ken. Thanks so much for coming to beat customer letter. Really appreciate your time today.

[00:01:12] Bill Staikos: pleasure to be here. All right. We're gonna get into some, a really cool topic and one that is really just near and dear to my. And others have kind of talked, have heard me talk about this.

Just organizational change and impact on customer and employees before we get into the topic. And you've written a great book about this. Like all this we're gonna get into that too. Just tell us about your journey, Ken, what led you to kinda leading a align org solutions? Again, you've got this really incredible and rich history with the us army.

Just like, how did you get into where you know what you're doing?

But a little bit about my background right after college, I went active duty military. I was assessed at the aviation branch, which was kind of a lifelong dream line since I. Was a little boy. I grew up in Northern Utah and in my room, I had a pitcher, of thorough Bailey who was a famous jazz player, jazz forward from the basketball team.

And he was standing in front of a Cobra, helicopter, squishing, a basketball, and, and that sat there and I was always just a big fan. So I always wonder, sometimes did that subliminally, kind of leave me as like, Hey, I wanna go fly attack helicopters or something. I'm not sure. But, I did want to, to go fly attack helicopters for the army.

And, yeah, after 18 years I went to, into the reserves so I could finish up my 20 and, then joined a couple companies as the first one. I was in a, a logistics company as a CEO and, and member of the board of a rapidly growing mid-market logistics company. Now is a top 20 in the us. So it's, it's continued to grow very rapidly.

the other one was a manufacturing warehousing company that, was in the red and was upside down on, on the brink of, of going out of business. And I did a hired gun CEO stint with that for a year and got that company turned around. And in the process of that, I was looking for my next opportunity.

And we'll just do a lot more of 'em instead of just being in one organization, you can do a whole bunch. And so I said, let me come try it out. And I tried it out for a few months. Immediately fell in love with the type of work and the quality of people that we get to work with and meet, and, watching the success of, of our transformations has just kept me going.

And, it's been super fun. Haven't really looked back since frankly. That's

how do you guys work with clients and, the type of transformational change that you guys look to, to drive?

and what that means is we help organizations. Define their strategy, how they're going to win in the marketplace, what capabilities are needed to support the strategy mm-hmm . And, and once we have those figured out then how to design and build the organization to support it or enable those capabilities in that strategy.

That's.

Let's align the organization around that. If that's what we're, if that's what they're gonna do and deliver. When do you guys seek executives, kind of raise their hands and say, you know what? We actually need help here. And we. Is there like a trigger or is there like a point maybe even a company's kind of evolution where they're like, you know what, we're not set up for success here.

We think we've got the right strategy, but we're not set up for success in the right way.

And so if an organization is getting certain results, it's because it's designed to get those results. So if you want to have different results, then we need to design the organization to deliver different results. And that will often begin a conversation, with a C level about what results do you want to see?

Is it clear in your organization, what your strategy is and how you're going to win and be chosen over your competition, or if you're even a function leader or co leader inside of your business, is it really clear what the purpose is of your organization? Why does the enterprise rely upon your COE or your function to help the enterprise succeed as a whole and making sure that we deliver those, those specific results?

And when we know what those results are, we know what our current environment is, our current capabilities. Then it's a matter of bridging the gap. And so that's when we'll start to design the organization to its more ideal future state and then build a roadmap on how to, to implement that. The second piece that we often see is, is areas of really internal misalignments.

Often it it's around work. It's, the chaos of the day to day. Running the business compared to who is watching out and managing the more strategic stuff, because we know that the day to day necessary work is still very important and critical for the organization, but it will often overrun those competitive work activities that are so much needed for that long term play for the organiz.

And so helping leaders understand how to separate these and, and how to then build the organization out so that you have teams and people and pockets within the organization that are doing and managing that competitive work. And it's managed with deliberateness while the rest of the organization is driven for efficiency to manage that day to day necessary.

Kind of work. And so when we can help separate those things and then build a structure that does it with its appropriate decision rights and all the other components to bring the full organization into alignment. that's when we see that the leaders start to really reap the benefits of, of this work.

Is that this is not necessarily new. Right. But companies still get it wrong a lot. You know? Why do you think that is? Like, what is your, I mean, you've seen a lot of companies now kind of given you work. Why do companies still get it wrong? Like, is it just because it's really hard to do, and there's not appetite that drive the, or go through the type of change or maybe they don't have the stomach to do the type cut type of change that's required or, why do you

So I think there's probably a couple contributors to, to that particular problem. First and foremost, what we often see is leaders or organizations don't necessarily know how to articulate a strategy. just as a quick example, we were helping a, a rapidly growing, company who went public some time ago.

So they, but they, this was before that time and they were still struggling. And so they hired us to come in and, and kind of help them adjust a few things and get where they wanted to be. So, as I was getting ready to, to travel to this, headquarters to this particular company, I'd still been asking for some, read aheads, tell me some information I'd like to, what is your strategy?

Because mm-hmm the CEO said, yes, we have a strategy. Everything's fine. It's probably just some other misalignments that, that we need some adjustments on. And I said, that's great, but please send me what you have as I'm getting on the plane. It was a very long plane ride. he excitedly called me up, says, Ken, check your email.

I just sent you. We had an executive retreat. We came up with our strategy. I set you the doc, read it. And we'll talk when you. and he was coming to pick me up at the airport. So, I downloaded this strategy document. It was 72 pages long, and I read it five times cuz it was a very long play. Right. It was an international client, was picked up by the CEO and he came up to Jason, Ken.

So, so what'd you think? And I said, it was, there was a lot of really good stuff in there. There was mission statements. There was vision, there was key aspirations. there was some motivational stuff. There was everything in there. There was financial performance. But I didn't see any strategy.

He's like, well, isn't that stuff strategy. I said, all those things help build and support a strategy. But no, that, that is not really a strategy I said, but don't worry. We'll help you with that. So articulating a strategy and actually knowing what that means and, and how to integrate that into the organization is probably one of the biggest things.

And then I would say the second reason why we often get called is sometimes people just. Process facilitators, I'm not an expert in any one particular field. So I can't come in and say, Hey, this is how you should, engineer this product, or anything like that. But, but what I am is I'm a process expert.

So I can take an executive team through a process and assure that they ask the right questions to the right time and build out the right things so that it makes sense so that we get this strategic blueprint for their organization. That can now be implemented and integrated into, into what they do. And because we like to do this very collaboratively, so we'll encourage the CEO or the C level and, and many of their direct reports, key strategic mind, people in the organization, key customer representatives and so on to be part of this design session.

And, and because we do it, it's a very collaborative process. and we make a lot of trade offs and, and have a lot of difficult candid conversations about many things. We decide what we're gonna do and not. But in the process of that, we decide together on how we're gonna build this organization and the power of that buy-in and collaboration is invaluable because as we then go into an implementation stage, those key leaders that help build this are now the ones that're leading out on these smaller, more vertically integrated, processes that we need to, to capture and continue to build out.

But they know why, instead of them just being told, this is what you should do, they help create. And we know that leaders will always better support what they helped help

It's not just I'm punching in and out every day, cuz this is what my boss told me to do. I'm always fascinated by the courageous individuals in companies that say, I think this is wrong and, and they stand up. and, and. And help kind of be a catalyst for change. So if you are a leader or even an employee in your organization, and there certainly could be, listeners, even though there's show thinking about this and certainly in, in a customer experience function, you like to think of yourself as a catalyst for CA for change on behalf of the customer, even behalf of the employee.

If you believe that there is a change that needs to be made, that would benefit. The primary stakeholders of an organization, investors, employees, customers, partners, you name it, the business overall, where do you start? What questions or how would you counsel the individual listening? Who's maybe in that position?

What questions should they be asking themselves or their leadership maybe to kind of start that off?

If it is something that clearly distinguishes and should distinguish the organization, Then I would expect to have conversations around then what critical capabilities or special capabilities, and blending of capabilities does your organization have that delivers this unique, differentiated customer experience?

But for many organizations, a differentiated customer experience is not necessarily necessary. And many times just having a very efficient, streamlined customer experience is really all the customers want and need. And they may choose to differentiate by the product itself or the service itself or something else like that.

So really, I think one of the first key decisions that leader should make is, is the customer experience. Is that something that we should. Differentiate ourselves from the competition on or not. And then based on that decision, then, we would attack that completely differently based on the answer of that decision.

[00:15:29] Ken Thompson: Great question. When we get to that point, in the stage. And we want to start to say, okay, if you are choosing to differentiate in your customer experience, what specifically about it is it that we want to differentiate and what capabilities drive that differentiation?

often it's not just one capability. It's a blending of many capabilities brought together into the offering. That make a differentiated customer experience. And so, we wanna, first of all, make sure do we understand what those critical capabilities are and how they come together to deliver.

and then I would start to ask questions like then, do we know how all of these D. Parts, in this value process of our customer experience, how do they come together and who owns them? And is it clear where the handoff points are? Do we have the right dashboards and systems to monitor this, to ensure that we're doing good and, and that we can make improvements?

[00:16:57] Bill Staikos: I really appreciate your point around effectiveness. And I think that a lot of companies get productivity, efficiency and effectiveness wrong.

Right. They kind of conflate those terms sometimes. Right? You can produce a hundred widgets, but if your customers don't wanna buy them, what's the point of producing a hundred and you can produce those even efficiently as well. Right? Absolutely. But if you're not efficacy for me is around. You produce a hundred widgets and your customers want all 100 every day of the week, all year long.

And it's a, it's a sustainable business, right? So not to be law. I just wanted to highlight that because that's a really, I see that a lot in business today where people say, we need, we wanna be more productive or, we should be more efficient in how we do things. Is it really that, or do you want to be more effective in how you do?

And to me, it's almost like productivity times efficiency equals effectiveness on some level, right?

[00:17:54] Bill Staikos: No, go

If, if you have a good or bad one that maybe you wanna share, we could discuss for a moment. But I think of actually wrote an article about this a few years ago. So, I bought a pair of jeans, at a store. That's a national chain here in the us. And absolutely love these jeans. It's one of the first times in many years that I wore these jeans and actually wore them out.

Usually I outgrow them or they become outta style or something like that, but they just fit so well, but it was about four or five years later that I realized these jeans are about shot. I need to get a new pair. And so I went back to the store and said, Hey, I bought these jeans. I don't even know what brand they are, what they call, but I kind of started describing them a little bit.

To go back and look at at old purchases. And so here we are, and this is probably 20, 19, 20 20 looking up a pair of jeans that I bought five, six years ago. Not only did it have of it showed where I bought 'em. It showed a picture of the jeans. So I could confirm that these were the jeans. Now, unfortunately, that particular brand and, and model of jeans were no longer in stock, but their system recommended three different types of other brands that were very similar.

And then the associate went out to the store. Brought all three of these jeans out and I was able to try 'em on and find a pair that would just as good as the original pair that I bought. So when I think of the customer experience as a, in a good example, all the different capabilities that this particular chain brought in to bear to deliver this customer service, I thought was exceptional.

They knew where those critical touchpoints are with the customer, and that's where they chose to invest organizational capabilities to deliver those. And I

A not so great experience because I swear that they put bacon in the frames. I had a lab that ate a pair of prescription sunglasses and a pair of prescription, just regular glasses, both Warby parkers, and I called customer service and they're like, wow, I'm really sorry. please go to like, go to like a store, cuz your prescription is outta date center analyst.

Okay. That's fine. They actually sent me a, a stuffed, a dog to. Of a, like of a dog toy wearing Warby park of glasses, which is, I thought was kind of interesting, fun. But then when I went to the store, they, they must have pictures of their customers. Somehow. I have no idea how, like, so I walk in and I, well, I guess I had an appointment, maybe that's how they knew it.

So like, Mr. Stagos, we're really sorry about your experience. We're gonna give you $20 off of each frame or maybe it was more. And I thought isn't that nice. Like I call customer service, but in the store they've got the same information and they've set up those organizational capabilities. So whoever the associate is on the phone in person, whatever that is, they know me, they know what I've purchased, they know what my problems have been.

They know what my, compliments have been and the survey scores that I've given. And I think that is so important to be able to share and democratize that information across a business. So every employee can engage with a customer one on one in the same way, which is really critical. And to me, that's effectiveness.

Like, can you deliver the same experience on the phone, in a store, wherever that is. So I feel like I'm a customer, a good one, no matter where I am and who I'm talking to.

So many organizations still struggle to deliver this very, component of, of customer experience. I think just one piece to kind of dovetail into your last comment. If you look at any customer journey in many organizations, there's probably anywhere from 20 to 30 touch points between the customer and the organization.

And, and another thing that I think a lot of organizations tend not to, to really understand. All of those 20 or 30 touchpoints that they are different and not every one of them need to be designed for differentiation. If, if say there's 20 touch points between the customer and the organization often we'll see that there's only three or four critical touchpoints that really need to be driven for high impact high value.

Or what we call effectiveness. The other 17 can probably be driven for efficiency. It just needs to be accurate. It needs to be timely. it needs to be consistent and that's what the customers expect. And so as you look at that customer journey, picking out those critical points and then really delivering value in those and then driving efficiency and all the rest is, is always.

Key to success in, in this business.

And if you can improve those, just those two points, your chances for repeat business, like on an order or magnitude, higher. Let's talk about, about the book. Your, your company published a great book, mastering the cube. It's a book about overcoming what you see as the stumbling blocks to success and creating a thriving organization.

So one of the stumbling blocks that you highlighted and really it really resonated me, frankly, was the secret society versus the building block of co-creation. My one question is coming out of this was how do you scale co-creation.

So we'll spend a fair amount of time with the sponsor of the transformation project, really picking out and figuring out who these key stakeholders are that we want to help. Co-create it, it's not necessarily the direct reports of the, of the particular CEO or. Oftentimes, it's a sprinkling of some direct reports with a bunch of others in the organization to help ensure that we build this strategic blueprint that's going to work.

so we do spend a lot of time to get a lot of voices heard. And of course we also do some diagnosis up front, interviews and other things. And so we form this, this design. And this is the design team that we'll take them through and we'll articulate the strategy and the capabilities. And then we'll start to make organizing choices about how we want to enable these capabilities and the strategy of the organization.

We maybe shifted some work activities from this part of the organization over to here, we stood up a COE. We did other things all based on, on getting the results that we want to get or creating differentiation, our offering or whatever. our objective is . And because there's other areas that have changed so much, we now need a sponsor that was on that initial design to then put together another team and build it deeper into the organization of those that are impacted by that particular part.

Of the organization. And oftentimes that will happen 2, 3, 4, sometimes even seven times of of seven different subordinate work streams with subordinate, collaborative teams building out this stuff, we call it nesting, nesting, these capabilities deeper into the organization. And so by the time we're done and, and this is still just building out the, how we're going to do it, and we haven't started implementation yet, but even by then, we probably already have dozens and dozens of key leaders that were involved and help build.

And co-create this process. So when it comes time to change management and the implementation piece, quite frankly, we still do it, still put a lot of effort into it, but we find that we run into a lot less roadblocks along the way because leaders aren't just being given. The secret book of answers, they, they helped create it.

And so, that change management piece tend to go a lot smoother as well.

I, if I hope you don't mind, if I could steal it, I love that you're, you're already moving past the early adopter phase by going deeper in the organization and setting. These multiple teams and, and being able to do that, it makes the, it makes the change process incredibly easier after that. Do you follow ad car or, or caught, like, what's your preferred kind of change management process?

I'm curious.

we know that it works. It's been tested improvement over many, many years. and frankly I think it's just a streamlined, very good way of, of capturing that change management process. Yeah.

Is there a stumbling block or are there stumbling blocks one or two? Maybe. That you see most often in organizations. And if so, like how do you kind of counsel companies to think about them differently?

And they think that the magic answer is to go move people and boxes around and org charts. And so if I could just change and move this person over here and shuffle some teams around and then present that back to my organization, that's gonna magically fix everything. And unfortunately that really doesn't work.

structure is an element of organization design, but it's just an enabler. And, because it's just an enabler. It's not going to directly solve these other problems that that structure should be designed to deliver the critical capabilities of the organization, which should then be designed to support the strategy or the purpose of the organization.

And it just causes a lot of frustration. So we see that a lot. when we go through our process structure is actually one of the very last things that we do. So, we might be designing, we might be on our fourth or fifth day of, of designing towards the. Now we're gonna start to talk about what structure will best support the strategy of this organization.

And even then we do it without names. We do it by heads of capabilities, key roles, things like that, so that we can take the personality and agendas and all of those things out of, of those key decisions that we have to make.

And the business

[00:29:56] Bill Staikos: got two more questions for you. Ken one is, from a professional industry perspective. Who do you look up to in business?

And I think there's a few traits that set them apart from the other. So maybe I'll just focus on that a little bit. Yeah, that'd be great. When I see an organizational leader. That can provide purpose direction, motivation while at the same time express empathy and understanding for their team. They are already setting themselves far and above, your average leader.

So, those are some things I look for very quickly and anytime we have a leader that is not good at those things, trying to lead a transformation, it can be a little bit challenging. And so often our team will find ourselves doing a little bit of one-on-one conversations off to the side and help them go through this process.

So I think that's very critical as, as leaders are leading a transformation.

I've got one final question for you, Ken, where do you go for inspiration?

And so I love to just bury myself with a good. And, if I want something a little more entertaining, I'll do a Malcolm Caldwell. Yeah. If I want, something a little more business oriented there's there's hundreds of 'em. Yeah. So I, I spent a lot of time just reading other books and, and I'm certain that many thoughts throughout all these books and read, help inspire us and, and how we deliver our value to our clients.

Otherwise you get stuck in this rut of, this is the way I'm gonna do it and I'm right. Cuz I've done it for 20 years and I've been successful.

I want to go pat him on the back and say, you're doing really, really good here. And there's other times I, I, I wanna go choke the CEO and say, I don't know if you know this, but there's a lot of things that are pretty messed up in your organiz. let's talk and let's go fix it. But, we certainly don't recruit, from our customer experience, but it is just interesting on how stark, how starkly different the customer experience can be from one company to the other.

Yeah. Some really get it some don't and some just sit there and, and kind of flutter a lot in that, in that messy middle.

But I'm always thinking like that CEO is eating pizza right now. you know yeah. And there's, and there's motor oil down here, so

And without that, then you are subject to, whatever kind of spin and, and such that may be presented to you. I think back of, I mentioned I did a hired gun CEO for a year on a, on turning a company around when I went to my first, executive meeting there probably a week into the job, had all of my direct reports there, meeting many of them for the first time.

and they're reporting on the status of their particular organiz. Every single person started with the, the words I feel. and, and not that we can't have emotion, in our conference rooms, but there was very little data that was being presented and we've probably spent the first 90 days just getting away from, I feel to what does the data show and where do we get the data that, that shows trends and key metrics and so on so that we can make decisions off of that.

[00:35:14] Bill Staikos: I love that when, when I was at chase, I had a great boss. She would, she was the CEO of the, home lending business. And whenever there was a, a meeting about driving some kind of change or whatever, it was not like, like a one on one or anything.

But she, first question always let's get the facts on the table that or what were the facts, right. And, or what are the. And I always appreciated that because it just got people grounded very, very quickly in what do we know? What do we need to know what don't we know? Right. And who's gonna, and who can help us get that information.

It was just a great way to kind of set the tone and not go into this is how this, you could talk about how this is, how this makes me feel, but just grounded in facts and what Ken, where can people find you if they wanna get in touch?

I'm also on LinkedIn, under Ken Thompson. I'd start both of those places. our website has all kinds of articles, executive guides. I personally wrote about a 30 page executive guide for kind of C level leaders on the customer experience. I think it's called, how to build a differentiating customer experience.

But we also have executive guides on metrics, organizations on transformation on COEs. We could go on on. So there's a lot of helps there and I really recommend people just go there, go to our resources tab and, check out some of that material and see if it can help them as they go through their, their transformation.

[00:36:48] Ken Thompson: Thank you, bill. It's a pleasure to be here.

Thank you for the great questions. And for allowing us the opportunity to share a little bit about what we

[00:37:00] Ken Thompson: listening to be customer led with bill stagos. We are grateful to our audience for the gift to their time.

Be sure to visit us@becustomerled.com for more episodes. Leave us feedback on how we're doing or tell us what you wanna hear more about until next time. We're out.