by Laura Rowley
In his book "Managing at the Speed of Change", Atlanta-based consultant Daryl Conner writes, "The key difference between equilibrium and chaos is...the degree to which one's expectations are met. Some of the most frightening situations are those in which we not only lack a sense of control over our environment but we are shocked that this lack of control could occur."
The past 18 months in the financial markets have been characterized by a shocking disruption of expectations -- the housing and financial market meltdown, vanishing credit, rocketing unemployment, money-manager scandals. Conner, a former counselor who facilitates organizational change for companies, has studied change for 35 years, and he argues that there are universal traits and behaviors of people who are successful at change. Here are the highlights of our recent interview:
Q: Millions of Americans have lost their jobs; their homes and retirement savings have declined in value -- and this has been true for people who did the right things as well as those who made irresponsible choices. You write that most people learn "victimization lessons" from their change experiences. How can someone make a negative change an empowering experience?
A: The typical experience is that change is something that happens to me -- I didn't ask for this, I didn't orchestrate it; it's not anything I have control over. Add on top of that the sense that ‘I did everything you were supposed to do and this happened to me, it's unfair' -- that adds to the sense of victimization, and it continues to spiral. Victimization is when I'm trapped in a negative situation and have no options. But I'm not trapped; I'm in a situation I hate, and none of the options are preferable. The tendency of victims is once they see that none of the options are good, they fold into ‘therefore there's nothing I can do.' But by making a decision among horrible options, the person has the ability to regain some sense of control.
Q: You have found that resilient people handle change in a more positive way. What's different about their strategy?
A: The resilient person faces exactly the same circumstances -- they are not protected from the trauma of life -- but their first reaction is, ‘How am I going to get around this thing?' Their basic DNA is optimistic rather than pessimistic; so when a negative change happens, they don't have a clue how they're going to come out of it in good shape, but their sense is that they will. Resilient people are very focused, very mission-oriented. They are flexible and creative.
Change blows you off course, but that's the whole point of change. They know what the course is -- they are clear about what they are trying to do with their lives -- so they know how to get back on course. They might say, ‘Even though what I thought the next five years were going to mean for my retirement has changed, I have a core sense of where I'm headed.' They go into problem-solving mode rather than blaming mode. Low-resilient people take a great deal of energy being lost.
Q: You say that resilient people are also organized.
A: It has nothing to do with what your closet looks like at home. This is a psychological organization -- the ability to walk into a chaotic environment where nothing makes sense and quickly determine what's relevant and what's noise. When faced with chaos, resilient people go into categorization -- this is relevant, that's not -- and they start moving toward the adversity. Victims pull away. The victim's reaction is, ‘I don't think I'm going to succeed, I'm not sure where I'm headed, this has been so disruptive, I'm overwhelmed with the chaos -- fetal position is not such a bad option here.'
Q: You suggest that the loss of control is the most disorienting aspect of change.
A: We have the highest control need of any animals on the planet. That's what allowed us to float to the top of the food chain. We are addicted to control -- physiologically and psychologically. When you have direct control, you know what you want and you know what button to push to make it show up. The trouble is, in a changing, turbulent environment, it gets harder and harder to have direct control -- you're not sure what buttons to push because the buttons you pushed yesterday don't work today.
Q: Are there ways to increase your sense of perceived control in situations such as job loss or financial loss, such as the Bernie Madoff scandal?
A: Rather than telling people what they should do or say, let me tell you the patterns that people apply who typically succeed with this. This is a little zen, but the people who self-counsel typically say three things to themselves: It is what it is. It is as it should be. It is in my best interest.
‘It is what it is' is a wake-up call for me not to make this bigger or smaller than it is -- don't add drama or deny what has happened: ‘I lost my money. I did not lose my life.' Secondly, ‘It is as it should be' tells me that in order to get through this I have to learn some important lessons. What are those lessons?
The third is the kicker -- ‘It is in my best interest.' The idea is, let me think back on every negative thing that's ever happened to me. How many turned out to my advantage? This doesn't excuse the horrible person or event. I don't have to like what's going on to believe that it will be yet another example of how a negative situation turned out to be positive. Can you go into the change with that attitude?
I've seen many successful people do this. Some do it from a spiritual standpoint, for some it's just practical. They say, ‘There are some important lessons in here for me, and I will operate through it as if it's in my best interest.' It's a kind of mindfulness. The antithesis of mindfulness is reactive: I'm angry or resentful. Clearly I have a great case to be angry -- but when I look back, that anger or blaming doesn't help me very much. What if I were to make a decision to go in a different direction? That's the difference between being mindful and reacting to the moment.
Q: Your research has found the volume, speed, and complexity of change has continued to increase every year. What does that mean for personal finance?
A: In past eras we have mostly had periods of stability punctuated by significant change -- now it's kind of an ongoing blur that may occasionally be punctuated by a sense of calm. What's particularly sobering is there is no evidence all this is going to slow down. We've found that nimble organizations are calibrated toward non-equilibrium. Losers in the change game get surprised by change -- they waste time and energy saying, ‘How could this happen?' Winners are not surprised when they are surprised by change -- they say, ‘Now what am I going to do about this?' because it was in their expectation that change was going to happen.