⚠️ Health Warning: This article is the uncut version of my Substack series The Transformation Dip. The series offered a shortened, easy-to-digest format. What follows is for the brave who want to dive into the full detail, complete with all the nuance, research references, and examples. Proceed with intellectual stamina.
It Gets Worse Before It Gets Better
I was reflecting on this as I am preparing to move and packaging my books for deep storage (see my previous article AI is Part of the Future, But This 90s Wisdom is More Vital Than Ever). What had started as a controlled experiment with a few books being sorted by theme, had rapidly exploded into a full-blown mess. There was a method to this madness, yet the situation seemed a lot worse than when I had started. All I could focus on was the mess all over, totally ignoring the pile of neatly stacked boxes with each content clearly inventoried.
As I decided to call it a day, I took this photo. I reminded myself of everything that had been accomplished, the order that was quietly accumulating in the corner, and that the ambient chaos was mostly linked to loose ends.
This reminded me of some work I did for an aerospace component manufacturer. They needed to work on their flow of parts and had a mix of high number of part references, very different processes for each part, high volume and value variations, and just to spice things up, some common processes (which were bottlenecks slowing down the flow) and some outsourcing to an unreliable supplier over which there was little control.
With the production team, we sorted the parts into families and had different strategies for each one. The company had already asked a number of consultants to offer solutions and had not followed any, so had asked me to only do the diagnosis. They liked my approach, but I had to warn them that things would get worse before they got better.
We would improve the flow in the long term and save quite a lot of money through reducing lead time (some parts were currently sitting on shelves for months). However, in the short term, some performance indicators would suffer.
This company was tightly managed by indicators from afar by the mother company and they said they could not go ahead with my proposal, adding me to the list of self-fulfilling prophecies of consultants that could not help them.
Over my twenty years of experience with change in manufacturing and organisational environments, I have never witnessed a transformation that went from bad to better directly. There has always been a dip to worse before the improvement. This comes as people lose their bearings, grapple with new processes or world-views, and more often than not, go through an individual and collective inner storm.
Why the Dip Happens
There is ample evidence of this online and the possible explanations are as follows.
Learning Curve and Dual Load
At the heart of any change lies the challenge of learning. Employees must master new tools, processes, or structures while still performing their existing duties. This dual load (managing the “old way” while adapting to the “new”) creates cognitive overload and temporarily reduces both productivity and quality. Until the new routines become automatic, performance almost inevitably suffers.
Disruption of Routines and Workflows
Change destabilises the informal systems that make organisations run smoothly. Established communication patterns, coordination mechanisms, and handovers are disrupted. Dependencies that once worked seamlessly begin to break down, and teams need time to rebuild new ways of working.
Resistance, Friction, and Organisational Inertia
Transformation is not only operational, it is deeply human. People resist change for reasons ranging from fear of incompetence to loss of control or identity. This resistance can manifest as hesitation, passive disengagement, or outright opposition. Even subtle friction in daily operations accumulates, slowing progress and creating a sense that things are deteriorating.
Extinction Burst of Old Behaviours
In psychology, efforts to change entrenched habits often provoke an “extinction burst,” where the old behaviour intensifies before it fades. Organisations experience the same phenomenon: as new systems are introduced, employees may double down on familiar routines, defending the old ways more vigorously just before they finally let go.
Cognitive Load, Decision Fatigue, and Reduced Autopilot
Routine work depends heavily on mental autopilot. Transformation disrupts this comfort zone, forcing people to make deliberate decisions about once-automatic actions. The added cognitive demand slows performance, increases errors, and drains energy.
Resource Reallocation and Temporary Neglect
Transformations consume organisational bandwidth. Management attention, training budgets, and staff time are redirected toward the change initiative, leaving core business operations under-resourced. This reallocation can create temporary performance gaps, as “business as usual” takes a back seat to “building what is next.”
Unanticipated Complexity and Scope Creep
Even well-planned transformations reveal hidden complexities once implementation begins. Dependencies emerge, unforeseen side effects appear, and plans must be revised. Adjustments require additional time and effort, often leading to the perception that the organisation is floundering rather than progressing.
Loss of Morale, Trust, and Psychological Safety
As uncertainty mounts, communication missteps or inconsistent leadership messages can corrode trust. Employees who feel devalued or uninformed become disengaged. The resulting decline in morale and psychological safety compounds operational challenges, further depressing performance and confidence.
Measurement, Reporting, and Misleading Metrics
Finally, the very tools used to assess progress can distort perceptions. Traditional metrics may fail to capture long-term value creation, instead emphasising short-term costs, delays, or inefficiencies. To stakeholders, it can look as if the transformation is failing, even when foundational improvements are being built beneath the surface.
The Transformation Dip as a Necessary Passage
These mechanisms intertwine to form the characteristic “transformation dip.” Organisations entering change must break existing habits, unlearn familiar systems, and reassemble their operational fabric. The temporary decline that follows is not failure but a stage of creative destruction, a necessary disruption on the way to renewal.
If we take this dip as a given, can we avoid it? I do not believe so. In my personal example, I knew that it would get worse and yet still felt overwhelmed by the mess. However, it did not last long, because I was aware of the tendency and able to course correct quickly by looking at what had been achieved and how little was left.
In organisations, the situation is often more complex due to the nature of the operations (few organisations are just sorting books), and the number of people involved. Successful transformations, then, are not about avoiding this dip but about anticipating it, managing it, shortening it (where possible), or lessening its impact.
Successful transformations, then, are not about avoiding this dip but about anticipating, managing, shortening it (which may not be an option when inner transformation is involved, see my article on Times), or lessening its impact.
Dip Caveats and Considerations
- The dip is not inevitable in all circumstances (some critics argue that the “performance dip myth” is overemphasised). But many organisations do experience degradation if they do not manage change well.
- The depth and duration of the dip depend heavily on scale, complexity, organisational maturity, culture, and prior experience with change.
- Execution quality matters more than the plan. Rigour in implementing strategies is crucial.
- The strategies are synergistic: using multiple in concert is often more effective than relying on one.
Proven Strategies to Mitigate the Transformation Dip
There are many textbook strategies to mitigate the transformation dip. I have summarised them below to support further thinking.
Organisations that navigate transformation successfully tend to approach change as an adaptive, learning-driven process rather than a one-off event.
Pilot and Phase Changes
One of the most effective ways to minimise disruption is to pilot or phase changes. Introducing new systems or practices in small, controlled settings allows lessons to be learned early, problems to be addressed before scaling, and unnecessary upheaval in core operations to be avoided.
Build Readiness Before Implementation
Building readiness before implementation through stakeholder alignment, training, and clear communication helps to prepare employees for new routines and reduces the initial shock of change.
Leadership Alignment and Consistency
A transformation’s tone is largely set by leadership. When senior leaders are aligned, visible, and consistent in their message and behaviour, they reduce uncertainty and build trust.
Articulating a clear and compelling rationale for change, complete with expected benefits and a transparent roadmap, further helps employees understand the purpose and direction of the transformation.
Engage Staff at All Levels
Engaging staff at multiple levels, especially middle managers and front-line workers, in design and decision-making turns change from something imposed to something co-created. This lowers resistance and fosters ownership.
Communicate Transparently and Celebrate Small Wins
Sustaining morale during disruption depends on frequent, transparent communication and the celebration of short-term wins. Sharing progress and early successes reinforces belief in the process and prevents discouragement.
This does not mean painting a falsely optimistic picture, but rather showing both the progress made and the challenges ahead.
Train, Coach, and Support Employees
In parallel, training, coaching, and peer support shorten the learning curve by equipping people with the knowledge and confidence to operate effectively in new systems.
Protect Core Operations
Practical considerations are equally important. Organisations that protect their core operations (ensuring adequate resources remain focused on “business as usual”) avoid the deeper performance dips that occur when day-to-day functions are neglected.
Strong Governance and Continuous Feedback
Strong governance and continuous feedback mechanisms enable quick course corrections when challenges arise. Embedding the change into systems, culture, and incentives ensures that the new ways of working are sustained over time.
Combining Strategies for Impact
Used together, these strategies create a proactive, resilient approach to transformation. They anticipate the sources of disruption, manage resistance and uncertainty, and shorten the inevitable performance dip that accompanies meaningful organisational change.
So why don’t we do it?
Why Organisations Fail to Implement Well-Known Change Strategies
There is a certain irony that many of the “obvious” strategies for good change are not implemented in practice. Research offers several reasons why, despite knowing what works, change initiatives frequently fall short of following best practices.
1. Strategic and Leadership Disconnection
- Lack of alignment at the top. Leaders may endorse transformation rhetorically, but often fail to sustain alignment or resolve internal conflicts among themselves. Watkins (IMD) lists “lack of senior team alignment” as a top reason for failure in change initiatives. [IMD Business School]
- Abdication of ownership. Even when leaders commit initially, many shift their focus back to day-to-day pressures and abdicate active oversight of the change process. IMD cites “abdicating the responsibility to drive the process” as a common failure mode. [IMD Business School]
- Focus on activity over outcomes. Some leaders become preoccupied with change artefacts (plans, workshops, dashboards) rather than relentlessly pushing for results. McKinsey warns that poor execution often results from focusing on doing change instead of achieving outcomes. [McKinsey & Company]
Because senior leadership does not consistently embody or prioritise the change, many downstream tactics (communication, training, reinforcement) lose weight or are executed half-heartedly.
2. Organisational Inertia, Legacy Structures, and Cultural Barriers
- Entrenched processes and structural inertia. Organisations often have deeply embedded processes, power structures, and incentives that resist change. Research on change management failures repeatedly cites legacy structures as barriers, especially when new practices conflict with existing incentives or authority lines. [ResearchGate] [SAGE Journals]
- Cultural resistance and change aversion. Even when formal strategies exist, they bump into tacit norms, unspoken assumptions, and informal networks that make up culture. Fear of ambiguity, loss of control, or threat to identity can all block adoption. [MDPI]
- Decoupling policy from practice. Sometimes organisations adopt formal change frameworks in strategy or process documentation but fail to translate them into daily actions. This “decoupling” – a gap between declared policies and what actually happens – is well documented in organisational theory. [Wikipedia]
Even with the right rhetoric and frameworks, the deeper “engine room” of the organisation resists, maintaining the status quo. Systems theory reminds us that the main function of a system is to preserve homeostasis.
3. Capability, Resources, and Execution Gaps
- Insufficient implementation capacity. Many organisations lack the internal capability (skills, systems, change practitioners) to execute best practices. Reviews of failure factors often cite lack of organisational readiness. [ResearchGate]
- Underinvestment in training and reinforcement. Training, coaching, and reinforcement are frequently underfunded or treated as afterthoughts. Prosci argues that lacking reinforcement is a top reason change “doesn’t stick.” [Prosci]
- Resource constraints and competing priorities. Even well-intentioned organisations may divert attention, budget, and energy away from transformation due to day-to-day business pressures. Change is too often treated as an auxiliary “project” rather than core to operations.
4. Cognitive and Psychological Barriers
- Overconfidence bias. Because strategies are well known, leaders may assume “we already know this” or that their organisation is immune to pitfalls. This underestimation leads to weak execution.
- Complexity underestimation and change fatigue. Change initiatives often misjudge dependencies or overload employees with too many simultaneous changes. Multiple transformations colliding can result in fatigue, confusion, and burnout, reducing the likelihood of success.
- Status quo bias. Individuals often display a preference for the familiar, resisting new systems even when change is rational. In information systems literature, status quo bias is a well-documented barrier to adoption. [arXiv]
- Emotional and political dynamics. Change threatens power, identity, turf, or status. Stakeholders may quietly block, delay, or sabotage initiatives, even if they publicly endorse them. These dynamics are often overlooked in top-down designs.
5. Misalignment, Silo Incentives, and Accountability Failures
- Conflicting goals and silos. Different business units or departments may operate with competing KPIs. Gartner notes that 50% of failed transformations stem from misalignment between business units. [Primeast]
- Lack of accountability and measurement alignment. Weak or missing accountability structures (e.g. unclear ownership, poor performance management) prevent follow-through. Research into change failure frequently cites ineffective communication, lack of leadership accountability, and misalignment between strategic vision and execution. [Scholars Crossing]
- Treating change as a “project.” When change initiatives are placed in separate project silos with distinct governance and metrics, rather than integrated into operational responsibilities, legitimacy is diminished. Line managers disengage, and the change becomes isolated from the real business.
A Reflective Contrast: Why Even Consulting Firms May Fall Short
Consulting firms often publish change frameworks, run diagnostics, and propose “best practices.” Yet, in real engagements, they too struggle with implementation. The reasons echo many of the same challenges faced by their clients.
Scope, Incentives, and Delivery Models
Consultants are frequently engaged to design strategy, diagnose problems, or provide tools, but the responsibility for execution remains with the client. Consulting contracts rarely include deep accountability for embedding change, so the “last mile” of implementation often fails.
Client Constraints Dominate
The client organisation’s internal constraints – budgets, politics, leadership bandwidth, and legacy systems, often override even the best external designs. Any “ideal” set of strategies must be adapted to real-world limitations, and compromise is almost always required.
Complexity and Emergent Dynamics
Large organisations are complex adaptive systems. Consultants may underestimate how much local context, informal networks, and politics will diverge from the neat frameworks they design. What looks obvious in abstraction often stumbles when it meets the lived reality of execution.
Time Pressures, Resource Limitations, and Change Fatigue
Consulting engagements, like any other organisational effort, are subject to deadlines, resource constraints, and pressure to deliver visible progress quickly. This can push essential but less visible practices (such as coaching, reinforcement, and continuous feedback) to the margins or lead to their omission altogether.
A Fresh Approach: Change as Co-Creation, Dynamic Adaptation, and Mutual Accountability
How do we break out of these systemic chains? Is there a fresh approach beyond reciting the same recipes?
The gap between what is known and what is done is where the real opportunity lies. To improve the odds of success in transformations, and to build a genuinely resilient client–consultant partnership, we need to rethink how change is delivered, not just what is delivered.
Rather than seeing transformation as a transaction in which “the consultant designs and the client implements,” the new mindset centres on co-creation, shared ownership, emergent learning, and tight feedback loops. The consultant and client become partners in a joint journey, not commander and executor.
Here are some principles and evidence-based practices that embody this approach.
1. Value Co-Creation, Not Value Delivery
In consulting literature, value is often seen as something the consultant provides – frameworks, tools, or advice. Yet empirical studies show that consulting value is co-created through interaction, mutual sense-making, and negotiation.
Misalignment or “value co-destruction” can occur when expectations, power, or interactions go awry. [ResearchGate]
One study of consultant–client relationships found that dyadic trust (trust between consultant and client) leads to greater consultant commitment, which in turn supports successful implementation. [ResearchGate]
In practice, this means clients should not be passive receivers but active collaborators. They bring tacit knowledge, help shape proposals, and adapt solutions. Workshops, joint mapping of problems, co-designing pilots, and prioritising features together build ownership from the start. Resistance is reduced later because the solution already feels like “ours.”
2. Adaptive Experimentation – Change as Hypothesis Testing
Borrowing from the idea of experimental organisational development (ExOD), transformations can be structured as a sequence of experiments: hypothesise, test, learn, and scale. [Wikipedia]
Instead of declaring full-scale rollout plans in advance, small changes can be tested in limited contexts, measured for results, adjusted, and then scaled. This reduces the risk of systemic failure and helps catch hidden complexities early.
Discovery sprints or pilot cycles are effective here: implement a minimal change in one team or region, measure real outcomes, reflect as a team, refine, and then scale outward.
3. Relational Safeguards and Trust Architecture
Because change is human and political, relationships matter. Empirical studies show that trust-building, employee motivation, and commitment are significant predictors of success. [ResearchGate]
Clients often give only partial trust at first, requiring deeper alignment before they will fully embrace transformation. This is natural, especially if past experiences make leaders wary of handing over control.
Power dynamics also shape outcomes. Research shows that consultants’ use of expertise and influence can either raise or suppress client self-efficacy. [PMC]
Clients may experience “approach–avoidance” dynamics: simultaneously desiring change while fearing it. This can lead to “value co-destruction” if not carefully managed. [ResearchGate]
To counter this, it is important to invest deliberately in “relationship infrastructure”: check-ins, feedback loops, frank conversations about concerns, conflict resolution mechanisms, alignment rituals, and safe spaces for dissent.
4. Shared Accountability and Joint Metrics
One barrier to change is that accountability is often one-sided. Consultants are held responsible for design, clients for execution – but no one is jointly accountable for outcomes. This can lead to blame-shifting and half-hearted adoption.
By embedding joint accountability mechanisms – such as shared dashboards, shared run-the-business performance targets, or co-owned success metrics – both sides have skin in the game.
The concept of shared leadership, in which roles and influence are distributed across levels, reinforces this. [Wikipedia] For example, agreeing on a small set of “moonshot plus guardrail” metrics (e.g. cost, cycle time, adoption, customer satisfaction) keeps both client and consultant focused on outcomes that matter.
5. Hybrid Capability Transfer and Embedded Coaching
Change often fails to stick because, once consultants leave, the client lacks the internal muscle to sustain it. While I always try to perform knowledge transfer and capability building, these are often overlooked due to time and budget constraints.
A more sustainable approach embeds capability transfer from day one. Consultants act not only as experts but also as coaches and enablers. Over time, the client team should progressively take over leadership of the change.
This aligns with the “social learning” consulting model, where consultants facilitate and coach rather than merely prescribe. [ResearchGate]
A fade-out plan can be designed so that client teams increasingly assume tasks, lead training, host retrospectives, and ultimately operate independently.
6. Narrative and Sense-Making as Core Levers
Change is not only structural but also symbolic. People interpret change through stories. A compelling narrative can act as a guiding compass.
Most of the storytelling happens through what I call symbolic leadership (see my book, How Might We), where leaders ensure that all communication, behaviours, and symbols are aligned with the transformation message. Leading by example is crucial.
Some change practice emphasises sense-making: helping people reinterpret their world, see meaning in disruption, and co-construct a shared future. In high-uncertainty contexts (VUCA), a “narrative compass” provides direction while leaving room for adaptation. [Emerald]
Jointly crafting the narrative (current state → aspirational future → how we go together) and updating it with real stories of early adopters, failures, and pivots makes it grounded and credible.
7. Contextual Customisation and Local Translation
One-size-fits-all change recipes often fail. Local business units, geographies, or functions have different constraints, cultures, and practices. The “decoupling of policy from practice” often occurs because corporate templates do not translate at the front line.
The fresh approach allows local teams to interpret and adapt change in their own context, within agreed guardrails. This is sometimes called local translation or contextual adaptation.
For example, a telemedicine implementation study showed that change practices must be adapted locally rather than imported wholesale. [PMC]
The best practice is to involve local teams early, encourage them to tweak templates, pilot changes in their environment, and feed back adjustments to the central team.
In Summary
While the strategies to manage change are well known, the real challenge lies in bridging the gap between theory and practice. That gap exists because transformation involves leadership consistency, organisational culture, execution capability, incentives, political dynamics, and the stubborn inertia of human behaviour.
To overcome this, organisations (and consultants) must treat transformation not as a checklist but as a continuous, adaptive journey. This requires humility, sustained leadership, robust capability building, and the recognition that the hardest part of change is not designing the strategy, but living it in the messy realities of the organisation.
Want to Explore Change and Transformation further?
This article has explored the dynamics of the transformation dip, the reasons why so many change initiatives falter, and a fresh approach to building resilience through co-creation, trust, and adaptive learning.
But this is only part of the story. Change is not only about systems and processes – it is also about people, symbols, and meaning. The way leaders frame narratives, handle ambiguity, and embody the transformation through their behaviours often makes the difference between success and failure.
I explore these themes in depth in my book How Might We, where I look at the human side of organisational transformation:
- How leaders can use symbolic leadership to align words, actions, and meaning.
- How to co-create transformation with employees rather than impose it.
- How stories and sense-making help people find direction in uncertainty.
- How to embed change so it endures after the consultants have gone.
The book blends research, lived experience, and practical exercises designed to help leaders and teams not only design change but live it.
📖 You can get your copy here: How Might We – Buy the book
References
- Watkins, M. (IMD) — Why Change Programs Don’t Succeed: Lack of Senior Team Alignment IMD Business School
- IMD Business School — Top Reasons for Failure in Change Initiatives IMD Business School
- McKinsey & Company — Why Change Programs Don’t Deliver McKinsey & Company
- Research on Change Management Failures — ResearchGate
- SAGE Journals — Organisational Inertia and Resistance to Change SAGE Journals
- MDPI — Cultural Resistance and Change Aversion MDPI
- Wikipedia — Organisational Decoupling (Policy vs Practice) Wikipedia
- Prosci — Why Change Fails to Stick Without Reinforcement Prosci
- arXiv — Status Quo Bias in Information Systems Adoption arXiv
- Gartner — Research on Transformation Misalignment Gartner
- Primeast — 50% of Transformations Fail Due to Business Unit Misalignment Primeast
- Scholars Crossing — Research on Leadership Accountability and Change Failure Scholars Crossing
- Research on Consultant–Client Relationships — ResearchGate
- Experimental Organisational Development (ExOD) — Wikipedia
- Trust, Motivation, and Change Outcomes — ResearchGate
- Consultant–Client Power Dynamics — PMC
- Narrative and Sensemaking in Change — Emerald
- Social Learning Consulting Model — ResearchGate
- Local Translation and Contextual Adaptation in Change — PMC