Unblocking Your Business Transformation Pipeline: How to Increase Successful Outcomes
28.03.23
Business transformation is now ubiquitous, but a McKinsey study reports that 70% of all transformation strategies fail. Are you positioned in the 70% and want to do something about it? The well-known strategy mantra that “execution eats strategy for lunch” prevails in practice, but what gets overlooked in practice is that the strategy that underpins the business transformation efforts may be deficient in its design and communication.
The evidence suggests an ongoing struggle between ambition and outcome, which results in the strategy being misunderstood throughout the organisation. A common challenge is adherence to a rational approach and deterministic view of a complex environment. However, this is too rigid an approach in a complex environment. What is required is a proven strategy to guide the organisation through an adaptive view of the organisation and external environment.
The flux and stressors in the internal and external environments continually reshape management's deterministic strategies. Sometimes, a diversity of emergent strategies prevails in the organisation, demonstrating evidence of creative and innovative thinking. But these are disjointed and unconnected and impossible to manage effectively. Unfortunately, current observations of business transformation strategising activities in the academic and practitioner literature remain nascent, and this puzzle needs fixing.
One continual challenge for the leadership team is to possess the skills and strategies to realise their agendas in an environment with the only constant is change with correspondingly low levels of stability and predictability. Therefore, business transformation must incorporate an understanding of its complex environment, create appropriate structures and processes, and possess an interdisciplinary innovation thread throughout the organisation.
An emergent strategy design approach is more appropriate, as it is possible to develop a central adaptive system that can align people and systems with the external environment. If one considers an analogy of the human body, its ability to create antidotes to attack externally driven viruses gives life during times of illness. Likewise, organisations are open systems which need to possess inherent mechanisms that enable their survival in unpredictable environments. Understanding organisations as complex adaptive systems will help learning and development leaders to create a sustaining transformation effort within their domain.
We shall now briefly delve into areas of potential blockages for business transformation and consider the benefits of effective learning and development interventions to enhance the success rates of business transformation within your organisation:
Benefits
1. VUCA – This term is widely banded in the academic and practitioner literature, but developing the capabilities that enhance agility in complex environments remains nascent. Of strategic importance is for organisations to create such capabilities within their learning and development programmes.
2. Mindset – Another consequence of the pandemic for those responsible for learning and development is the quest for new knowledge and a cultural shift. At the employee level, this involves adhering to the new direction and buy-in to the vision. Unfortunately, this does not always lead to inspired employees.
3. Collaboration – Organisations now operate in ecosystems, which have blurred traditional boundaries of sectors and the firm. Collaboration is a positive enabler that affects the firm’s business transformation. However, scarce resources, too rigid processes and cultures can act as blockages to achieving success. Therefore, organisations are compelled to create new forms of collaboration by placing ecosystems as the epicentre.
4. Opportunities – Change should be seen as an opportunity rather than an externally driven threat. Staying relevant in the face of economic, societal and environmental shifts requires searching in new areas. In a recent workshop, a key takeaway for some participants was the need to focus on relationship-building for innovation rather than sole preoccupation with being process driven.
5. Unlocking hidden value – Some existing interlocked structures, relationships and processes may not add value during business transformation and may confuse staff, who may engage in quiet quitting. The adaptive system approach will identify such instances and focus on the big picture.
ENDS
Recommended Read
The Emergent Approach to Strategy. in light of my recent experiences trying to help my current MBA cohort understand how to lead their organisation in VUCA environments, I have found Peter Compo’s book to be a breath of fresh air. The content is academically solid with practical examples., with theories cutting across disciplines, from science, humanities and management. The cumulation is an excellent book that clarifies the chronic strategy dilemma of creativity and innovation.