The key to a successful transformation: People
April 1, 2022
Executing a successful transformation involves many elements, including technology, processes, planning, and partnerships. For Michael Lamb, Xcel Energy’s SVP of Transmission, the most critical element is clear—people are the force behind true transformation.
“The utilities industry and I go way back,” Michael says. “My fraternal grandmother spent several years working for the local utility in Lacrosse, Wisconsin. She was a single mom raising three young kids, but also extremely dedicated to her work.
On my mother’s side, my grandmother was always into business and also wanted all her grandchildren, including me, to have good careers. She encouraged me to write a letter while I was in college, congratulating the CEO of my local utility on the company’s performance while also asking him if there were any engineering internships available. He responded, and one thing led to another, including an internship for me. I’ve worked for that company and in the industry ever since.”
Accenture’s Chris Manshio and Kim Hartzfeld had the opportunity to chat with Michael about what utilities organizations—and leadership—need to understand and embrace for successful transformations.
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NSP field engineering staff (archival photo); Michael Lamb, second from left. Photo and usage permission provided by Michael Lamb.
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What do you think are the critical elements of successful transformation?
To be truly successful, transformation needs to be all about hearts and minds. Winning minds is relatively easy—you make your case, backed by logic and supported with data. But winning hearts is much more difficult. People can have emotional reactions to change, and you need to be able to build sincere emotional connections to win them over.
Leaders need to own their projects—the whole thing, not just the outcome. And demonstrating ownership means showing your own emotions and commitment to the transformation. It is also important to make it clear to your people that you, too, are vulnerable.
Here’s an example around our multi-year enterprise transformation called Productivity Through Technology, or PTT, that we launched in 2014. Our goals were to improve customer experience, drive operational efficiencies and embrace a competitive mindset. We enabled the “One Xcel Energy Way” across multiple business units and focused on a new general ledger and work and asset management solution. We deployed to our four operating companies and more than 14,000 stakeholders.
In a transformation like this, you are often talking to people with a technical background, and they understand the technological arguments for transformation. However, you may be changing or even completely altering deeply embedded ways of working, and these current ways could be the source of great pride. In this context, drastic change can be an extremely scary prospect for the workforce. It’s important to empathize with people and help them understand that you recognize how they feel and what they are going through. It is absolutely critical that you are genuine and sincere; this isn’t something you can delegate or fake.
Next, remember that you are talking to individuals, not groups. There is a unique case for change for each person involved in a transformation, and you must make that case on an individual basis. On PTT, there were about 20 key leaders we needed to win over. Once they were on board, they became advocates and transformation champions for another 20 or so people. This became a ripple effect. As a result, we created a coalition of leaders who carried the project through to success.
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It’s important to empathize with people and help them understand that you recognize how they feel and what they are going through. It is absolutely critical that you are genuine and sincere; this isn’t something you can delegate or fake.
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How do you get things started and establish momentum?
I can’t emphasize enough the importance of kicking off with some quick wins. We began PTT with a number of early releases that enabled process changes way before the technology was delivered. This made people realize not only that the project could work, but that the benefits would be immediate and meaningful. It also allowed us to flex our change management muscles and learn with small but impactful changes.
The word “intentional” has become a big part of business vocabulary in recent years, with good reason. I believe that you can’t just let things happen; the experience must be carefully crafted, and it is important to remember that change is a skill. Practice it and recognize that there will be some failures along the way. And that’s OK. In fact, one should plan for failure and create systems allowing for safe failure. The key is to fail quickly, and then recover even more rapidly. Trust makes that easier.
Xcel Energy’s PTT transformation launched prior to the pandemic. Could such a project be executed in this current working environment?
Yes, I believe it could, but I think it would require more intentional, deliberate in-person opportunities. Close personal contact—whether over coffee, lunch, or at some sort of outing—is a great way to win hearts. Not everything can or should be done remotely. For example, during our transformation, we held in-person leadership summits with our COO as the host and one key person asking the truly challenging questions. And the impacted business units, not the project team, planned and led the discussions around these questions. This was great because it forced people to be well-prepared when they participated in these sessions, and we saw increased ownership as a result.
Now when I talk with newer employees, they claim they don’t need the personal touch of being in the office and interacting with other colleagues. This thinking may be partly due to the more digital, low-contact cultural aspects of the younger workforce. Working remotely through the pandemic may be another reason people think this way. In any case, I’m skeptical, to say the least. While I believe there is great value in more flexible work environments, I don’t think we should let ourselves believe all in-person contact can be eliminated without ramifications.
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Can you talk about the role of external partners in executing transformation?
On a program of this size and scale, multiple partners are commonplace. You need a way to drive alignment to a common set of goals.
Everyone wants a successful outcome, but each partner has different perspectives and its own interests to promote. It is vital as a leader to actively spend time with each partner to drive alignment and get everyone rowing in the same direction.
Challenge each partner to focus on their own area of expertise while trusting the other partners to hold up their end of the bargain. That takes communication and transparency. It takes trusting relationships based in mutual respect. In our case, we emphasized a single definition of success for the program—we called it #OneTeamOneGoal—so our partners knew that the only way for each to be successful was if all were successful.
Looking back, what are some things you wish you would have known at the project outset?
First, recognize what is within your control, and what is not. Build in a certain amount of flexibility and “give” in your planning. No plan is perfect from day one, and ours certainly wasn’t either. We needed to be nimble and adjust as circumstances changed.
Second, I wish I had known more about change management. As an engineer, I knew about the technology and about how to run projects but didn’t have a full understanding of how to communicate, gain buy-in, and how to build support among team members. We learned by doing, with help from outside advisors.
Finally, we learned a lot about bringing IT and business unit organizations together to ensure success. If you present a project as a business project rather than an IT project, you have a much greater chance of getting in the win column.
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What does the future hold for the utilities industry?
In my career, I have seen great change within our company. That said, the change we are seeing now is, simply stated, giant. We are on the cusp of a material electrification of the transportation sector. At the same time, we are fundamentally changing our energy sources and how the grid works. I’ve never been more excited as we are helping solve true global challenges. It’s exciting, a bit scary and completely necessary for the industry to move forward in meeting our customers’ needs.
In thinking about how energy companies (utilities) need to navigate the challenges and opportunities of the transition, I believe many of the same elements I noted earlier will be key to its success. To reimagine how we generate, deliver and market power, we are going to need smart, motivated and dedicated people. And that means winning the hearts and minds of our employees, customers and partners. I can’t wait to see what we can accomplish, and I think my grandmothers would agree.
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