As a Chief Information Officer or Chief Data Officer, have you ever implemented a large-scale transformation program that didn’t achieve its intended effect? Unfortunately, I see this all too often. There are multiple factors involved, I’d like to share some key takeaways on how you can make a transformation program a success.
According to McKinsey, one of the leading U.S. management consultancy firms, 70% of complex large-scale programs don’t reach their stated goals. A success rate of only one in three means a huge loss of opportunities and profit — not only for the businesses themselves but also for the broader economy and society as a whole.
From our experience dealing with transformation processes at CPG, manufacturing, or telco companies, for example, we see a lot of factors that lead to unsuccessful implementation. The interesting thing is that each factor has a diminishing effect on the other factors, resulting in a vicious circle.
A lack of employee engagement, dwindling management support, little to no cross-functional collaboration, and a lack of accountability are all related factors that underpin unsuccessful transformations. If all these factors are at play, you face a perfect storm, making failure a predestined outcome.
Too little, too late
All these caveats aside, there is one other factor that’s fundamental: pro-activeness. If you’re implementing a transformation to recover from financial distress or even to secure the survival of your business, it’s already too late. Then your focus tends to be on immediate and radical cost reduction rather than innovation and value creation. So, pro-activeness is key.
You often hear that real transformation happens at the bottom of the business. Whether this is true or not, the responsibility to initiate transformation lies with the management committee. So, I’d say that real transformation happens at the top, where all the factors that create value are tackled to accomplish change. Including top line, bottom line, capital expenditures, and working capital.
Start big and move fast
Every transformation starts with growth initiatives. I won’t trot out “little seeds” metaphors: there must be a holistic approach. Speed is your friend when it comes to transformation. Achieving early wins is essential, as they allow for more efficient use of your working capital. It also gives your organization the stamina it needs to take on the tougher aspects of real transformation.
This is where data comes into play. It provides an understanding of why you undergo a transformation and offers a clear direction, especially for your team. They must aspire to something greater and adopt a mindset that allows them to believe a cultural shift is possible.
Get in touch! Let’s discover how you can accomplish change and transformation with the right levers.