In the past companies would embark on a business transformation journey as a once in a lifetime event. But now companies must transform their businesses on a regular basis to survive.
Companies are facing challenges that threaten the core of their businesses. There is huge opportunities for organic growth, but to optimize these opportunities on a sustainable basis, companies must reshape their strategies, design new operating models that make the most of all the technology advances and capitalize on Artificial intelligence (AI).
There also needs to be a stronger focus on creating a competitive employee experience taking into consideration the Generational intelligence and diversity within the company. This will then also improve the customer experience that will drive the organic growth.
What are the most important key factors that will ensure a successful transformation in the company?
1. Identify the “WHY” that has initiated the transformation journey.
A lot of companies start the journey purely to safe money, thus a process driven from the inside. However this approach creates a future that will not necessary support their main objective for future growth and sustainability.
The company should start the transformation journey from a customer and employee driven perspective. This means the company need to review and understand the customer’s and employee’s current and future evolving needs and expectations.
Once the “Why has been identified and clearly defined it will provide the leadership team with a clear vision and objectives to communicate and promote with internal and external stakeholders to get buy-in and support for the transformation journey and initiatives.
2. Identify and allocate resources to a dedicated Transformation team
The biggest mistake that a lot of companies make during big transformation journeys is to identify employees in the business that is valued for their contributions and then add this as an additional responsibility to their already full portfolios.
It is important to differentiate between the team that would maintain the operational day to day running of the business and the transformation team that will change the business. The transformation journey will only succeed if the allocated team members have the capacity to properly commit themselves to the time and mental efforts a transformation journey will require.
The team members should be selected based on the following:
- Knowledge and experience of the company, industry & current and evolving customer landscape.
- Company processes, dependencies and ways of working across various business units.
- Experience in managing and implementing changes at other companies for same or similar size transformation projects.
- Ability to engage, interact and influence colleagues and other stakeholders.
- Ability to work through problems to find solutions.
- Ability to execute.
3. Alignment and support of Senior Management
The management teams of all the various business units in the company must be aligned on the reason for the change and understand how it will improve the company as well as the Customer and Employee experiences.
The support for the transformation journey is driven by the management teams, irrespective of whether their business unit will be affected by the transformation or not. This support will be provided in the form of constant communication, training, resource allocation, corporate culture change and any additional initiatives as identified by the transformation team.
4. Balanced and Sustainable execution
It is important to draw up a clear transformation blueprint for the business in order to balance the transition from the traditional operating models and the introduction of the new digital enhanced models, mindsets and culture.
Companies need to be cognizance of the change resilience within the business and how their customers and employees will respond to the various changes. Radical changes can cause conflicts between the existing processes, systems and structures.
The communication and upskilling processes need to be clearly defined in the blueprint to ensure that everyone understands the “New Way” in order to get clear buy-in and support before execution and implementation.
5. Budget and Cost management
Any transformation process that will truly deliver on the business objective to create growth and sustainability should be seen as a long term investment, and not a short term operational expense.
A lot of companies make the mistake to cluster this budget as OPEX in the normal day to day running of the business. The importance of the transformation will be highlighted when a dedicated budget is allocated for the programme. A detailed breakdown on projected expenditure and timelines should be managed by a dedicated resource from finance to manage actual expenditure and align it back to the Return on Investment as proposed in the original business case. The mandates in terms of decision making and allocation of funding should be managed and reported with the same importance and focus.
6. User involvement from start
Any mayor transformation journey have an impact on the employees and customers of the organization. It is important to get support and buy-in from the employees and customers from the beginning to ensure their commitment and involvement with the change.
This is done through a very comprehensive communication plan that ensures everyone in the business and the customers understands the “Why” and how it will impact and improve their experiences and day-to-day engagement with the company. It also needs to create a new standard for Service excellence.
A lot of companies wait until execution and then try and talk to employees and customers. The danger with this approach is that it allows for people to start speculating about the transformation. The grapevine messages can cause a lot of damage if it contains negative views and speculation. This will then develop a resistance to the change based on people’s individual views and fears. It is more effective to engage with all stakeholders pro-actively and create a positive message about the transformation.
7. Pro-active Risk management
It is also important to involve the business units that can identify risk and challenges that might delay execution. Early inclusion of the Risk management, internal audit, cyber security, testing, financial reporting and legal business units will ensure easier movement through organizational and legislative hurdles as the team move towards execution and implementation.
8. Agile Approach
In the past companies would embark on transformation journeys with a set plan, timelines, deadlines etc. However due to the rate of change in our current environment it is important to keep an open mind, as there might be new changes, disruptions and developments in the market or the industry that the team need to incorporate into the journey to get maximum benefit from the transformation. This requires the team to constantly review their plan and blueprints to ensure they deliver on the most effective and impactful transformation aligned to the “Why”.
It is understood that no one can define exactly how the transformation will enfold in the beginning. Many traditional programs struggle with “analysis paralysis” because of the pressure to get the requirements right before moving on. With agile, the transformation journey and implementation is developed interactively and course corrections are made along the way. It also allows for faster implementation of quick wins that will highlight and support the need for change.
9. Regular Monitoring and Measuring
As part of the business case for change the metrics for success is defined based on the “Why”. These metrics must be tracked and communicated across the company to all the stakeholders on a regular basis. This will ensure everyone stays focused and it will validate and support the reason for the transformation as well as the approach followed.
10. Recognition and Reward
The Recognition and Reward practices in the company need to be aligned to the “New way” to reward and acknowledge the individuals and teams that embraces the change.
In order for the employees to buy-in and support the changes on sustainable basis the new principles should be clearly communicated and explained to all employees. This will give them a clear understanding of what will be expected from them and how their commitment and support will align to the company objectives to grow and improve customer experiences and Service excellence.
This also means that negative consequences must be applied when performance is below the new standard and behaviours aligned to the new culture are not demonstrated. Consequences should be swift and consistent and a zero tolerance should be displayed for undesirable behavior from anyone irrespective of their level within the company.
11. Continuous innovation and improvement
Once the initial transformation programme has concluded it is important to note that this will not be the end of the journey for the company. Any company that want to survive in the future will have to create a process that allows and encourages continuous innovation and improvement.
For Companies that embark on any large-scale or societal-level transformation journeys, the key factors above offer insight into different ways of leading that will increase the likelihood for success. We need to alter our mindsets as leaders, and change our underlying agreements to reduce the conflict and dissonance that can distract everyone involved from accomplishing the overall objectives and goals.