making it happen
Having a strategy is one thing – making it happen is another. Your business strategy is only as good as your ability to make it happen successfully. The 'new normal' has created the need for many businesses to revise their strategies and transformation capabilities to enable their future success.
Numerous studies, however, show that the average success rate of business transformation in reaching expected results is only 30%.
The value of simplicity and your people’s involvement in an effective ‘end to end’ business transformation approach, are key to reaching your strategic objectives successfully.
Success starts with strategy.
Creating your strategy to achieve value growth
Strategy is not an end point in itself – it is the path your organisation and its people follow every day towards reaching its objectives.
Strategy guides not only the delivery of value growth in a company but also the behaviour and decisions made at all levels to move a business from its current situation to a desired future situation. A successful strategy will form a conscious part of influencing your organisation's behaviour and the choices made on a day to day basis in making it happen.
"simplicity and common sense should characterise planning and strategic direction" Ingvar Kamprad – founder of IKEA.
The thinking behind a strategy of course may be complex, with numerous inputs, analysis, priorities, and considerations made in its formation. It is the task of leadership to interpret this complexity, and to translate it into a strategic direction and activities that all internal and external stakeholders can understand and commit to.
Simplicity and involvement in a business strategy are therefore key to being successful. It is important that your whole organisation can understand not only the strategy itself that guides their work, but the why? behind it.
There are many ways to create a business strategy, and many ways you can develop and benefit from an ‘inclusive approach’ to developing and deploying your strategy successfully.
Leadership especially in the last twenty years has been evolving. There has been a clear movement away from ‘transactional’ leadership approaches that ‘direct’ an organisation, towards more ’transformative’ leadership approaches that ‘enable’ an organisation.
Transformational and transactional leadership are therefore opposites when it comes to the theories of management and motivation, bringing different contributions to strategic success. Transactional leaders focus on organisation, supervision, and group performance, whereas transformational leaders focus on change within the organisation.
A transactional leader generally does not look ahead in strategically leading an organisation to a position of market leadership, instead these ‘managers’ are often concerned with making sure everything is done smoothly today to contribute to success.
A transformational leader goes beyond managing day-to-day operations and enables strategies for taking their company, function, or team to the next level of performance and success.
Top down strategies can be quick to develop and execute, but risk being highly directive – placing increased demands in securing understanding and commitment. At times of crisis where speed to respond is critical, this approach of course can have short term benefits.
Inclusive strategies are formed when the process itself reaches out to the organisation to be part of creating the strategy, this can bring increased buy in as well as valuable inputs to the strategy itself. Such approaches often generate a more sustainable approach to creating business value.
No matter the leadership methodology or mix of methodologies you use to create and benefit your strategy - can you explain it in a ‘nutshell’? Can you summarise your strategy on one page of paper? If not, then it is wise to consider this before translating it into a transformation approach to realise it.
Strategy and Business Transformation
Translating your strategy into business transformation.
Your strategy should clearly identify your organisation's vision, purpose, objectives, goals, values, and culture necessary for its success. Within a strategic business plan there will be a defined set of strategic directions that form tactical and operational actions.
A new strategy and direction will likely promote and lead to a fundamental change in how your company will operate. This change may also require creativity and innovation. Creativity is the process of coming up with new ideas, innovation is the process of bring these ideas to reality and in doing so create increased business value.
Simply put - unless you want to continue with your current results, it will mean doing something different. The more you want to change these results, the greater likelihood that many dimensions are affected, and be instigated by innovation.
Business transformation occurs where there is a fundamental change across a business in many dimensions, enabling it to move from a current situation to a future desired situation – that results in growth in a business value stream. This can result from a fundamental change in strategy or strategic directions defined.
Business improvement occurs where there are changes in a specific business dimension. Despite the scope of such change being less, there are still common success criteria, and the need for transformation capabilities in an organisation to deliver such change successfully.
'Culture eats strategy for breakfast'
The importance of your leadership and organisation's culture to enable your strategy and transformation cannot be over emphasised. Guy Browning, a renowned thought leader in thinking differently and innovation, summarises this. "Even by having a strategy to innovate, if the culture does not support that - it won’t happen".
So, what does he mean by leading innovation and creating the culture for a new transformative strategy to be successful? Guy provides his own valuable insights as "establishing a people culture where there is no blame, where people have permission to make mistakes, where people are encouraged to share ideas, where a fast failure rate is in place" – all of which helps your people to keep innovating to find the successes.
With such an inclusive culture and level of agility in place, people’s potential can be unleashed to power a strategy to success. Only leadership can create this environment – so it is the first step to check how this is in your organisation, and to understand the demands this will place on your leadership throughout the course of transformation.
Changing culture is one of the least successful areas of change management and can often take time to be reached. In today’s increasingly fast changing world and demands on business, it can be easily be overlooked – hence the importance of starting on this now – even without a new strategy. A fast track way to start this can be by creating your strategy using the inclusive approach discussed earlier.
Also, consider the behaviours that exist in your organisation. Where are people spending their time, money, and attention? How are people rewarded? What rules and expectations are followed, enforced, or ignored? Do your people feel safe and supported? What tolerance exists for discomfort, to learn and try new things? What constructive conditions exist for giving feedback?
The effects of a poorly made intervention from a position of seniority that opposes these cultural aspects should not be underestimated – it can lead to stagnation, destroying progress, confidence and the credibility needed for people to believe in leadership and the strategy they are working towards.
A strategy is often accompanied by a definition or a set of culture and values – consider if this is needed? If so, how can you make it real every day, and not just a ‘statement’ or a ‘glossy poster on the wall’. With such a culture in place or being actively anchored in the organisation, the conditions will likely exist to build the involvement and commitment needed for your transformation.
The value and success of an end-to-end approach
Designing your business transformation
Numerous studies have highlighted that the success rate of business transformation based on expected outcomes is only 30%. It means that those embarking on business transformation have a greater chance of failing to meet their strategic objectives than not - so what transformation approach is proving most likely to lead to your success?
In my years of experience, and in research carried out by McKinsey, a 'total' or 'all in'
approach to business transformation proves most successful in terms of results. Such approaches benefit from designing an end-to-end roadmap to achieve these results.
Business transformation design identifies and maps the current situation to the new expected situation across several business dimensions, it means many changes being made in many areas of your value chain. For each dimension, understanding what is necessary in making the changes, their interdependencies and what needs to be done to reach the new situation is essential. Such design provides not only a holistic understanding of the needs to be acted upon, but also can mitigate unforeseen risks of failure.
"the banana skin is waiting for you around the corner anyway - you just don't know where" Ari Vatanen – former World Rally Champion
One common issue I have encountered in the past, is managing expectations and risks at the outset of transformation, such as over-optimism in the results possible, the work necessary, the possible risks and mitigations needed, or the timeframes where results develop.
The success rates from change, for example, are often measured against an expected outcome. If these outcome expectations are unrealistic or not qualified fully, then it is often the case that they can never be fulfilled, which can create critical issues for an organisation in transformation.
There are many reasons why such over-optimism can occur. One such area is in specific projects where an investment is required. Business cases are often used to justify and prioritise such changes with the promise of attractive return on investment, and timelines for these benefits to be realised. Such business cases need great care - especially where valuable resources are limited, and business conditions are uncertain. It is important to be optimistic, and set challenging ambitions, but the pursuit of 'fool’s gold' is a huge risk in both results and the consumption of a company's limited resources.
By mapping your business transformation, there is the possibility in the design phase to not only identify risks, but also tactical synergies and approaches, that can be made to deliver the transformation and improve value growth more effectively and efficiently, than a solution alone.
Even if you are considering a change in one business dimension e.g. a new IT system, it's essential to review the effect of that change across other business dimensions, e.g. organisation, to identify if there are other unforeseen impacts, or potentials to create improved value. A relatively small change in one area can bring significant and unforeseen impacts and risks to others.
Realising your transformation
Your transformation design will lead to a definition of what is to be achieved and creates the roadmap of activities to deliver your strategy, and to improve business value. Low hanging fruits identified and acted upon early, can quickly provide the resources to fund the longer-term investments needed for your transformation.
There are four core activities that are necessary to enable and realise your successful business transformation, and activities that can be successfully be undertaken within your own organisation.
Future evolvereia blogs will dive deeper into these topics in the coming weeks, however, in keeping with this blog's theme, there are some key ways a company can utilise its own resources to realise transformation.
Programme and project management
Often a business will identify strategic directions that will be delivered through programmes of project activities, this is the backbone and leading process of business transformation – however project management alone will not deliver real change.
There are numerous project methodologies and tools you can use in your transformation, but there are some key considerations to make when utilising the internal capabilities of your organisation.
Forming project teams can provide the dedicated resources to focus on an activity, but there can be a risk of disconnection or isolation from the day to day business – making the project objectives harder to reach. Therefore, it's important to consider fully the governance, structure, and capabilities that such teams are formed with.
Governance is a critical aspect of a project's success – especially where programmes of interdependent projects are in place. Governance provides the checks, balances and strategic decision making that orientates a project activity to successfully meeting its objectives – this can be formed, for example, by steering groups of senior leadership and sponsors of the change.
The structure of a project group should provide the day-to-day form for a project to reach its objectives successfully, the higher the level of resource management and decision making that can be established in such groups, the greater the capability to act on the project needs. Roles and time commitment should also be the clearly identified to all in a group based on project scope and timelines.
Capability within a project group is also key – the scope of the project should be understood to determine what capabilities, skills, and characteristics are needed to be successful, and for what purpose. It can and should mean teams of diversity, as a wide range of capabilities are needed for a project to be truly successful. This can mean leadership capability also – the lifecycle of projects often mean success can best be reached through the rotation of project leadership roles based on the maturity stage of the project. Static project leadership can result in the wrong skill set and capabilities in place at the wrong time. It is also important to consider the capabilities of the 'end user' of a project’s outcome – can they be included in such teams? My experience often has highlighted the huge value this can bring to being successful.
The next evolvereia blog will expand further on how you can create high performing teams to achieve your transformation.
Studies have shown the average success rate of change in business to be 33%, a very similar result to that of business transformation, and surprising given the knowledge that exists on the topic. There is also often confusion between 'business transformation' and 'change management' - they are related but entirely different in their scope.
Search the internet and you will find a myriad of different companies and approaches to change management, many of which are stimulated by self-marketing and the need to create a unique selling point of a 'provider's service', rather than direct experience and competence of practitioners gained in real life business environments.
However, when change is made with excellence, the average success rate of change rises to 133% - creating even greater results than expected – it's therefore a hugely important and valuable aspect of competence within business transformation and one that is often underinvested in. Even a moderate focus and capability in change management can dramatically improve the success rate of change.
The principles of effective change management can be straightforward and are essential for success in business transformation. No matter the method employed, the key is to establish involvement and commitment to change in a way that enables the transformation and activities of an organisation.
It’s therefore very important that the stakeholders in any change activity are recognised, and a situational change management plan and roadmap of activities like communication be in place, to addresses the commitment to change for each individual based on their role and their needs in the change process, to reach a positive level of adoption.
A component of any change management plan should be the transfer of new knowledge necessary for a change to happen. There is a difference however between 'knowledge' and 'competence'.
Competence is often perceived as 'experience of doing something right or well', but this is hard to achieve when the application of new knowledge is also 'new'. It is important to consider also how the knowledge is used and the associated attitudes and motivations are to be for its use to be successful. Old habits and knowledge die hard - existing or institutionalised knowledge and ego can provide an obstacle or blockage for new knowledge to be acted upon.
Learning design and learning styles are often overlooked in how receivers best access and adopt new knowledge situationally to their roles and experience. The capability to access and try new knowledge in a safe, relevant, and supported environment can rapidly accelerate adoption and results.
Utilising end users as trainers can be a way to support training as well as providing credibility, early technical assessments of solution capabilities, and feedback of possible improvement needs.
Leadership should ensure the investment in the adequate resourcing of such training and be visible and active in supporting their teams through the adoption curve.
Sir John Whitmore, the pioneer of coaching, identified that on average people only express 40% of their potential. Therefore, there is a huge opportunity for people to express more of their potential in the roles they perform and the results they produce, when their environment and leadership culture enables them.
No matter a person’s role, we are all leaders - some are leaders of leaders, some are leaders of others, but we are all leaders of ourselves and what we do inside. Performance coaching techniques gain greater commitment and motivation internally in a person to perform at a higher level.
There is a direct correlation between competence level – 'our knowledge, attitude and motivation' with the adoption rates, return on investment and the value growth from business transformation. In a transformational leadership culture, leaders look to create and stimulate this environment with a focus on team development, coaching, motivation, and collaboration with employees at different levels of an organization to accomplish change for the better, and in doing so provide opportunities for personal and professional growth for each employee.
Performance coaching can also help identify and create the foundation for further continual improvement, creating a higher and more sustainable level of performance in the longer run.
Again, the role of being a performance coach is one that can be enabled internally, with a relatively low investment in the internal skill sets and capabilities to approach this consciously.
Paul Glass - Founder of evolvereia
evolvereia gives businesses an end-to-end transformation concept based on proven methodologies and tools, using our experience from some of the world’s leading innovative companies, to help and coach businesses to achieve their transformation goals and increase value growth.
Contact us to arrange a free consultation that will help your business and people to grow.