What The Web Is Telling You:
Before detailing a list of what really causes business transformations to fail, I thought it might be useful to look at some other lists of the top reasons for failure that are being put forward by a bunch of so-called experts on business transformation.
In no particular order here are the top five lists that I gleaned from searching the web.
- Lack of Executive Sponsorship
- Poor Planning
- Lengthy Timelines
- Intimidating Process
- Lack of Agility
- Poor Change Management
- Goals That Focus on the “Now”
- The Wrong Team
- The top team isn’t aligned around the change story
- The organization fails to set performance aspirations based on its full potential.
- The “and” versus the “or”. Such as, “Well, we could cut the cost, but it’s going to sacrifice growth, or customer experience, or safety.” It’s not a trade-off.
- Decisions about will and skill.
- The company fails to align incentives
- The organization fails to track these initiatives
- The company focuses on activities as opposed to outcomes.
- The organization plunges into an activity without adequate preparation.
- Companies don’t always build a deep bench with the right talent and capabilities.
- Last, and most important, the organization doesn’t focus on growth enough.
- Underestimating the changes to the operating model.
- Lacking a clearly defined business outcome.
- Neglecting the ‘people aspect’ of change.
- Failing to include innovation in the corporate culture
- Lack of preparation
- Business leaders may have experience or understanding of a certain aspect of the transformation journey, but it is unlikely that they have in-depth knowledge of all the bases
- Not keeping your eye on the ball
- A weak culture that isn’t aligned with the mission
- Lack of participation and buy-in
- Under-communicating a powerful vision
- Over-communicating a poor vision
- Not enough training or resources
- Change battle fatigue (people getting weary of constant change initiatives)
It’s interesting therefore to note that only two of those lists mention the lack of adequate preparation and even then it isn’t clear that they include problem analysis in that. Only one puts this at the top of the list(!) Further, only one list includes a mention of innovation in the corporate culture.
I don’t believe “Poor Planning” is referring to finding the right problem, in these lists it is usually more about planning the execution.
So if this is the top advice being given it is hardly surprising that overlooking the root causes of the problems that they are trying to fix happens all the time.
Why Don’t The Gurus Pay Attention To Analysis?
The answer appears to lie in the stories they are trying to tell. They want you to believe they have all the right answers. Fine. Now ask yourself who do you believe?
Those lists were from five different consultancies or business advisory gurus – which one do YOU think has the focus in the right place?
It isn’t rocket science to understand that a Business Transformation method is only going to deliver the right outcomes if it is applied to the right problem. Moreover how much innovation or creativity is being sought in these “standard” models?
There is an entire industry of advice that is built on selling proprietary methods or standard approaches. Some of the content is perfectly reasonable and justifiable. However the shaking sand under the foundations is an unforgiveable oversight by the planning department.
Therefore the question you should address before all others is WHY?
So here are my Top 10 Reasons. They are in order and I hope you can understand why they make much more sense. If they raise questions – then feel free to contact for more information.
The 10 Things To Get Right To Avoid Failure In A Major Business Transformation
1. Get the sponsor right
He or she has to be senior enough to drive things through and they have to be committed to the process that follows.
2. Don’t start on a solution until the underlying problem is fully understood and articulated.
Analyse. Dig for root causes. Break the problem into many component parts before even beginning to address a potential solution or series of solutions. If you are starting from a recently prepared Business Strategy – dig there as to why it is saying what it does. Strategy is a direction – it doesn’t necessarily provide a solution to an underlying problem.
3. Spend time on systematically analysing the people and styles that are involved.
This may well produce or alter the constraints when looking at your potential solutions. Understanding the people in your business is fundamental to knowing how to handle them and get the best from their skills and attributes. In a transformation this becomes critical. It will also help you get the right team working together.
4. Don’t jump to a solution to the problem(s) – even though there might be a pretty obvious candidate.
Instead go through a creative design process because it might just throw up a truly better way forward. (In my experience the better the team gets at doing creativity, the better the solutions, even when compared to industry best-in-class.) This will also make sure that your core team have a really good understanding of why they are about to plan and execute the Right Solution to the Right Problem.
5. Validate the proposed solutions
Take into account the resources and other constraints before deciding which one is actually the best way forward.
6. Plan meticulously backwards from the desired end-state. Plan for certainty.
Backcast planning is essential. Don’t let a project team plan forwards from today. Make sure the Phases or Stages are properly authorised and plans are of sufficient quality at each one.
7. Communicate what is happening and why
Ideally get some of the junior people to work on this and help to get the communications believable and believed. Too often communications from senior management aren’t regarded as being entirely honest or believable. So you want to get this one right and the best people to do that are representatives of your audience.
8. Define measurable outcomes and way-points
Make sure this is done robustly – ideally using Monte Carlo methods to estimate values, timings and more. Make your resulting schedules believable and transparent. Also make sure that responsibility and accountability are allocated and understood by everyone. Get Finance involved in how these are going to be tracked.
9.= Put strong governance in place, particularly around dependencies
You can have the best plans in the world but if you don’t control the dependencies they are guaranteed to go all over the place.
9.= Deal properly with Risk and Contingency
Most organisations will do a risk assessment at the outset of a programme but they often don’t actively work on mitigation (which takes resources and costs money). Nor do they keep it under constant review. Risk is closely associated with Contingency and you need to manage the latter properly as well. It is a resource that is nominated for certain stages or phases and, if not required, should no longer be part of the overall budget. Otherwise it becomes the Programme Manager’s slush fund and is likely to get spent on unnecessary things. This whole area needs a great deal of oversight from Finance.
What about the other things?
Well by now it should be obvious that they fit inside parts of the above. But they are methods and components, not the core things to get right to avoid failure. You should think of this list as a guiding philosophy. Benchmark the other lists and activities against it and see where they fit. After all there is no one-size-fits-all when it comes to designing and running a business transformation. It is down to you, the leader, to take control and guide the ship out of port, across a difficult sea and safely into harbour at the other end, without losing a load of people or precious cargo overboard in the process.
More information on how to approach business transformation in your organisation can be obtained through a free consultation with one of our team. One thing you can be sure of is that we won’t be touting a method that isn’t aligned with avoiding failure from the very beginning. Instead we specialise in helping business leaders get to grips with this themselves. Contact us to get the conversation started.
The author Rob Wherrett can be contacted at https://robwherrett.com/contact/
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