The “old economy” was characterized by distinct periods of rapid innovation followed by predictable periods of stability. This meant that businesses had months, or even years, to respond to emerging trends.

Unfortunately, economists say that this pattern does not apply to the 21st-century economy.

Now, businesses have to respond to change immediately or, better yet, be the one leading the change. So, modern businesses are in a perpetual state of urgency, trying to keep up with rapidly changing customer demands, labor market trends and technological advances. However, “a higher rate of urgency does not imply ever-present panic, anxiety or fear,” said John P. Kotter, author of one of my favorite books, Leading Change. “It means a state in which complacency is virtually absent, in which people are always looking for both problems and opportunities, and in which the norm is ‘do it now.’” The implication of this for business leaders is that they must be able to inspire their teams to not just cope with change but to instigate it. The team that passionately resists complacency will win. It stands to reason that assumptions about leadership and management born in the old economy probably don’t apply now either. Leaders must learn how to transform the corporate culture from one based on maintaining the status quo to one that loathes complacency and craves change. Yet culture is not created by declaration, but by the collective thoughts, feelings and actions of every team member. So, what do 21st-century leaders need to do differently to enable a change-craving culture?

Leaders must learn how to transform the corporate culture from one based on maintaining the status quo to one that loathes complacency and craves change.

#1 – Paint a Picture That Inspires Action:

Leaders must be really good at making the case for change in a way that inspires action and optimism, not fear and retreat. They must create a compelling vision that explains why change is necessary in a way that causes a permanent sense of urgency. Leaders should boldly and passionately describe the consequences of inaction and the thrill of success. “Because I said so,” barely works with children, so why do leaders think adults will accept similar explanations? As Jeffrey Hiatt and Timothy J. Creasey said in Change Management, The People Side of Change, “Understanding the why makes you better at doing the how.” Think about it. How often do you blindly do what you are told? And even when you do, you probably still have doubts. It’s those doubts that hold people back from fully embracing change.

#2 – It Takes Courageous Leadership:

Managers are paid to create action plans, organize resources, set short-term goals and drive operational performance. Skilled managers solve problems and make short-term changes in response to a crisis. An unintended consequence of crisis-driven change management is that it creates the perception that once the crisis is over we can relax and that things will, “go back to normal.” That’s why leadership, not management is needed to change an organization’s culture. For enterprise-wide cultural change to take hold, the call to change can’t be a reaction to a singular event. It has to be about creating an environment that is permanently capable of responding to new threats and opportunities. The key to building that capability is to continuously challenge the current state and question long-held assumptions. Never being satisfied with the status quo must become the new status quo. Leaders must enable and reward this new way of thinking at every level of the organization by altering internal management structures, like strategic planning, organizational hierarchies and performance management systems. It takes courageous leadership to challenge those “sacred cows” and seemingly effective ways of doing business.

#3 - Resistance to Change is Normal:

Changing a culture is really accomplished by individuals changing how they think, feel and act. Adapted from the Kubler Ross grief model developed in the 1960’s, leaders can expect their staff to go through several phases often referred to as the “change curve:” Denial, Resistance, Exploration, and finally, Acceptance. Trust me, your team can no more deny these phases than they can deny the laws of gravity. Leaders must boldly and routinely talk about this natural, human reaction to change. They must shine a bright light on the emotional process that everyone from CEO to CSR goes through. Your leadership challenge is not to eliminate resistance to change, but to acknowledge it and take steps to accelerate it. I have found the ADKAR model to be the most effective way to accelerate the change curve as described in Jeffrey M. Hiatt’s ADKAR: A Model for Change in Business, Government and our Community. ADKAR stands for: Awareness, Desire, Knowledge, Ability and Reinforcement. This model represents proven techniques to proactively address resistance to change. Sharing this model with your entire team creates a common language, thus encouraging open dialogue. You must role model this by saying, out-loud, that you know everyone will go through a process to deal with change and that you will do everything possible to help the team through it. However, be aware that some people will not thrive in this environment and will opt out. It’s okay to say that too. Sometimes leaders have to help people be outrageously successful . . . someplace else.

#4 – Create a Top-Down Vision with Bottom-Up Execution:

Empower and engage all employees to participate in the transformation because they know more than you do about the internal dysfunctions and the opportunities for improvement. I know it’s hard for executives to believe that they don’t know everything about the inner-workings of their company, however, the complexities of modern business prevent any one employee from having the exclusive ability to diagnose internal obstacles. It’s better to let senior leadership set the stage for what and why things need to change but leave the how to the people. That’s the conclusion of Michael Beer, Russell Eisenstat and Bert Spector in their four-year study of organizational change at six large corporations, “Why Change Programs Don't Produce Change.” The grass-roots or “bottom-up” approach to change is most effective. Or as they say, “It’s better to let each department ‘reinvent the wheel’-that is, to find its own way.” One time, my team developed a new job reference guide with user-friendly cheat sheets and tools. On purpose, we gave it to only a handful of people. In no time, envious team members started asking when they would get their copy. Had we launched an aggressive campaign mandating usage of this tool, I know there would have been instant resistance. Sometimes it’s better to light a small fire and let others fan the flames. If the goal is to change just enough to get over a particular challenge and then get back to “normal,” then a one-and-done, event-driven approach will do the trick. However, if you are going for a complacency killing culture shift, you need to start with a bit of top-down guidance to set the stage, but enable the heavy lifting to be done by the people in trenches. Save the slick speeches, motivational posters and business jargon. Instead, talk candidly about the change curve and take steps to accelerate it. Twenty-first-century leaders must encourage collaboration, intellectual curiosity and courageous attacks on organizational sacred-cows by removing barriers and rewarding those who dare to challenge the status quo.

This article was originally published on LinkedIn.