With penetrating look, hence changing formation (7)
I believe the answer is:
echelon
'formation' is the definition.
(I've seen this before)
'with penetrating look hence changing' is the wordplay.
'with penetrating' indicates putting letters inside (I've seen this in other clues).
'look' becomes 'lo'.
'changing' indicates anagramming the letters.
'hence' anagrammed gives 'echen'.
'lo' placed inside 'echen' is 'ECHELON'.
(Other definitions for echelon that I've seen before include "Degree" , "series of steps" , "Military row formation" , "Ladder formation" , "Echo Len (anag.)" .)