Levi's Changes Everything

I think back to my days in the army. We'd go out for a five-mile run. The platoon would start off together, but then a group of guys would start to straggle. So the sergeant would take the whole platoon, run us back around the stragglers, and recreate the group. After a while another group would straggle, and we'd circle back again. The platoon moved forward in a series of concentric circles that helped everyone get to the final destination.

It's the same thing with organizations. Your change agents, the people who really see the future, pull the organization along. But if they get too far out, if they don't circle back, they lose people.

What's the corporate equivalent of "circling back"? How do you bring people along?

You use all the "I" words: information, involvement, intervention. We had open houses. People could visit the Third Floor, see what we were doing, try out some of the technology prototypes. We'd do conference calls with groups all over the country. We held "Town Meetings" involving thousands of people, both in person and over videoconferencing.

We tried to make it fun. I remember one of our first Town Meetings. We wanted to explain the principles of the redesign, the difference between functional and process-driven organizations. I was giving a talk when a guy in the audience interrupts: "Tom, I don't get it." I said, "Okay, Michael, let me explain it this way." He interrupts again: "I think I get it, but you're not doing a very good job making it come to life." Then Michael walks to the front of the room and you can hear the whispers -- "Oh my God, what's he doing?"

Michael, by the way, has a reputation as someone who's not afraid to speak up. So he begins: "Tom, get out of the way, let me explain it." Then the music starts, and out come four people dressed as silos doing a song-and-dance routine. It was hilarious. The great part is, Michael got a call later that day from a friend of his in the company: "Have you been fired?" He didn't realize it was all a set-up.

Is there a positive role for resistance? Can't it help prevent groupthink?

Absolutely. You have to let people challenge your ideas. We did lots of things to create room for dissent. We hung whiteboards in all the halls -- here at headquarters, out in the field -- and encouraged people to tell us what was wrong with our plans, no need for names. Whenever we held big meetings we'd put up bulletin boards and ask people to post comments, including negative stuff, that they didn't want to make in public.

There comes a point, though, where you have to be very clear about where you're going. The boat is leaving the dock. There are plenty of seats for everyone, but you have to choose whether you're going to get on board. Everyone has a voice. Not everyone has a vote.

The Human Side of Change

The hardest part of change is the human part. We've all heard the lament: "We know where we want to take the company, but we don't have the people to get us there." How do you find the right people?

It's what we're living through now. There's not a lot of turnover at Levi's. I've been here for 30 years. When I joined we were a $100 million business; we're now a $7 billion business. Many other people have similar histories. That's one of our strengths. We have a unique culture. We're not about to disavow the past.

At the same time, we are engaged in a far-reaching transformation. We're changing business processes, systems, the content of thousands of jobs. We're creating jobs that never existed before. We have to find people with the right business and leadership skills to fill those jobs. We think we've designed a process that gives us the best of both worlds. It respects the Levi's culture, but creates a totally new organization.

How does it work?

We've created whole new categories of jobs with new responsibilities, qualifications, titles. If you look at our customer fulfillment organization, for example, you'll see jobs like process leader, performance consultant, source relations manager, system relationship coordinator. They've never existed before. And they require new behaviors. People have to understand the big picture. They need the capacity for leadership, the ability to work in a team, the vision to think systemically.

We allow everyone at the company to apply for these jobs, and we encourage people to apply for more than one. It's a totally level playing field. We publish the job descriptions on e-mail. We hold panel interviews with people who pass an initial screening. It's a time-consuming process, but it's fair. We posted the first new jobs in March 1995, and we've filled about 700 so far. We've still got a long way to go.