Why Organizations Struggle With Change

Photo by Peter Thomas

You sit with your leadership team. The conversation turns to AI, to sustainability, to what the market increasingly demands. Someone says, “This doesn’t fit how we work now.” Another responds, “But we can’t change everything at once — we still need to deliver.”

Both speak the truth. This tension lives in many organizations — the space between what you do now and what becomes possible, between the operational excellence stakeholders depend on and the strategic evolution the future asks for.

The Pattern Emerges

We work with organizations across sectors — from healthcare and financial services to manufacturing and technology. The context shifts: AI challenges land on your desk, sustainability moves from compliance to a value proposition, and customers ask how you collaborate rather than just what you deliver. The meaning of value evolves — from transaction to partnership, from providing to creating impact together.

These shifts ask something of how you function as an organization, of how you change. The tension emerges here.

Where You Feel the Tension

Your operational excellence — that reliability stakeholders depend on — you can’t release that. It forms the foundation of your reputation, of the trust you built, of the relationships you maintain. Yet you see those partnerships customers propose, those AI applications that could change everything, those sustainability ambitions that touch your value proposition. They don’t follow the same logic.

Two questions demand answers simultaneously: how do we do this better, more efficiently, more reliably? And what becomes possible if we approach this fundamentally differently? Both questions matter. You need both.

Understanding why this creates such difficulty requires distinguishing four forms of change. You change either your configuration (systems, processes, structures) or your paradigm (mindset, assumptions, values), or both.

MCH Change Qualification Matrix

Improve means you change within your current configuration and paradigm. You make what you already do better — more efficient, higher quality, more reliable.

Renew changes your configuration but keeps your paradigm intact. You implement new systems, adopt different processes, restructure — but within the same way of thinking about what value means and how you create it.

Most organizations carry years of experience with these two: lean initiatives, process redesign, and system implementations. You plan, you analyze, you execute. The rhythm feels familiar, the methodologies work. Organizations excel at this.

But increasingly, challenges arise that demand a different approach.

Transition shifts your paradigm while your configuration (for now) remains. Your mindset changes, your assumptions about what value means evolve, but your systems and processes stay the same. How do you help people release what worked while they continue delivering?

Innovation changes both paradigm and configuration. You develop something genuinely new with customers, something that requires thinking differently and working differently. How do you create space for experimentation when the schedule overflows?

The complication intensifies — you can’t choose. Release operational excellence? Customers leave, targets fall, the foundation shakes. Ignore strategic evolution? You miss opportunities, competitors advance, and those partnerships customers seek develop elsewhere.

You need both. Simultaneously. But how do you let both exist without suffocating each other?

What Works in Practice

Some organizations develop both capabilities by letting them coexist rather than choosing one. They discover that operational excellence and strategic evolution reinforce each other.

Two operating modes run in parallel.

One mode — often the existing hierarchy — ensures operational excellence. Daily operations run here, expertise lives here, you deliver what stakeholders count on. Improving and renewing belong here: analysis, planning, execution—the rhythms you know, the processes that work, the quality that stands firm.

Another mode — often organized as a network — creates space for strategic evolution. Transition and innovation emerge here: you experiment with customers, explore new partnerships, and develop meaningful impact. You explore, discover, and learn. You ask questions instead of providing answers, and make things possible instead of planning them.

John Kotter describes this as a dual operating system. As a certified partner of Kotter Training, we see how organizations work with this and what makes the difference: both modes reinforce each other rather than compete.

The hierarchy provides stability — this gives the network room to experiment. Without that reliable foundation, no one dares to explore. Customers trust you because they know operations continue running. Teams feel safe to think differently because they see the foundation holds firm.

The network brings new insights — these help the hierarchy evolve. That exploration with customers shows what becomes possible. Those experiments reveal where value lies. Those discoveries give direction to where operational excellence grows.

You don’t choose between stability and evolution. One organization develops both.

See This in Action

A healthcare organization faced rising turnaround times, dissatisfied customers, and teams feeling pressure. The usual response — analyze, plan, improve — failed because the complexity ran too deep and the causes intertwined too tightly.

Daily care kept running. Had to — customers count on it. Professionals delivered, systems operated, and operational excellence faced pressure but didn’t collapse.

Yet in parallel, something else emerged. Teams started building together — literally, with LEGO — to understand how processes worked. Not to analyze who failed, but to discover: when does it actually go well?

They discovered their knowledge of customer needs ran deeper than they realized, that connections between roles existed but stayed invisible, and that successful experiences followed patterns they could repeat. The strength already existed — just not connected.

Turnaround time dropped from 6 days to 1 day, not because someone imposed it but because the team discovered what proved possible. First-time-right increased, customers gave higher ratings, and teams felt more connected.

Operational excellence provided stability to explore. Teams dared to think differently because the foundation kept running. That reliability created trust to experiment.

Simultaneously, that exploration brought insights that improved operations. The network of people discovering together helped the hierarchy evolve. New ways of working emerged through operational excellence, which strengthened them.

Both reinforced each other.

Questions to Carry Forward

Which capability do you develop now — operational excellence or strategic evolution? Do you see room for both in your context? What shifts if they start reinforcing each other instead of competing?

Some organizations navigate this themselves, with the capabilities they have. Others discover along the way an appreciation for guidance — someone who walks alongside them as they both develop, who helps create space where both can exist, and who guides through the tension that inevitably arises.

The question isn’t what you should do. The question asks what fits for you, now, in your situation.

If a customer asks for a partnership instead of a transaction tomorrow, are you ready?