In The Classroom: Leading Change & Organizational Renewal

This is the first in a series of articles in which we spend a day embedded in an executive education program and report directly from the classroom on the experience. For this inaugural piece, we sent reporter Neelima Mahajan-Bansal to Stanford to sample Leading Change and Organizational Renewal, a course that is the product of an unusual collaboration between Stanford’s Graduate School of Business and the Harvard Business School.

It is day three of the five-day program called Leading Change and Organizational Renewal (LCOR) at the Stanford Graduate School of Business. The 59 participants troop in armed with cups of coffee for a power-packed session with Robert Burgelman, one of the most popular management professors at Stanford. Burgelman has won acclaim for his work on ‘strategic dissonance,’ a term he jointly coined with former Intel CEO Andy Grove in their book Strategy is Destiny: How Strategy-Making Shapes a Company’s Future.

In this $14,000 program, Burgelman differentiates between two ways to innovate – the so-called “blue process” and the “green process,” an idea explored in his book. While the blue process is about “induced innovation” and is execution-oriented, the green process is innovation by way of discovery. Burgelman is busily drawing out the two processes with blue and green Sharpies on a white board at the front of the class. “The green process has a lot of uncertainty and that’s why so many executives don’t like it,” he says..

What Burgelman is talking about forms the core of the LCOR program. It is the paradox that organizations and leaders of organizations face: of getting better and competing in mature markets, but also making sure that they are exploring new spaces, new technologies and new markets. “The fundamental alignments that it takes to compete in a big mature market is different from what it takes to compete in new or emerging technology market,” says Charles A. O’Reilly III, the faculty director of the LCOR. “The program is structured around helping people understand that tension.”

These are two very different worlds that a leader often has to deal with, and they need completely different sets of frameworks and tools to understand how to craft strategy and execute it. Such change efforts inevitably run into resistance – which is sometimes due to very rational reasons. Today’s morning session with Burgelman highlights that tension and arms participants with frameworks of dealing with it.

The session instantly touches a chord. “That whole premise of how to step back and try to support the green without disturbing the blue is critical because in my organization I also have people who are supporting green processes and my management does not want to fund them,” says Jacklyn Sturm, an Intel Corp. vice president for technology and manufacturing who is taking the class. “I am trying to figure out how I can support those things.”

There is one common attribute Sturm shares with the other participants who come from industries ranging from aerospace to financial services: Within their organizations, they are all wrestling with the real issues of innovation and change. In fact, that’s the price of admission into this program. Being a high-potential exec is not enough—every student needs to have a real innovation or change problem to get in.