Transformation and change are very different.
Where change is a finite initiative, transformation is a portfolio of initiatives, which are typically interdependent.
The goal of business transformation is to reinvent the organization and discover a new or revised business model. It comes with unpredictability and a significant amount of risk. Even if the individual initiatives within a transformation program are successful, the overall transformation could still fail. It’s an iterative process of discovery and agility. It’s no wonder so few succeed.
Here I will highlight five of the common pitfalls to avoid during transformation. If you’re a business leader looking to maximize your transformation ROI, be sure to steer clear of these obstacles to your success.
Pitfall #1: Delegating sponsorship and accountability for transformation program delivery to the implementation team.
One of the most common pitfalls I have seen is business sponsors delegating the transformation entirely to their implementation team. These change leaders shirk accountability and neglect to model the way. Large-scale transformation cannot be outsourced.
Without clear change leadership and “rolled-up executive sleeves”, cynicism and mistrust will run abound.
People follow leaders who walk-the-talk, because they know communication comes in both words and deeds.
Authentic business sponsors motivate others by what they do and how they do it. They are recognized by people as credible, trustworthy, and effective—and they know how to influence behaviour. They incorporate key messages into hour-by-hour communications and use every possible communication channel. They involve every department and ensure consistent levels of involvement by key stakeholders. McKinsey calls this “change that’s rolled up, not rolled out”.
They also support their implementation team by pausing for celebration and reflection along the transformation journey. And when things go wrong, they take full accountability and help remove roadblocks. They don’t "throw their team under the bus", and recognize that failure is a part of the transformation process. This results in a high-performing implementation team that trusts each other and its leader.
Pitfall #2: Not selecting fit-for-purpose processes, tools, and technology.
Sometimes what can happen is that when a transformation is initiated, the need for change is obvious to the business sponsors and senior leadership, but may not be obvious to rank-and-file employees.
Leaders are insulated from reality because they don’t know how people are working today, and the change feels like it is being imposed from above. Current state analysis is skipped, and there’s no real understanding of current processes, tools, and technology. Corporate culture is ignored because leaders want to get on with it and skip the preliminaries. These leaders fail to appreciate how deeply culture can be ingrained in people’s beliefs and habits—and, therefore, how very difficult it will be to change behaviour in a way that will last.
Transformation must start with a cultural assessment and current state analysis. Without both these components, you will generate cynicism and resistance.
How can you possibly move to a new business model when you don’t know your current needs, challenges, and opportunities? What if you have a strong corporate culture - how can you ignore it?
Intense opposition and resistance come from a lack of culture alignment during a transformation.
Genuine buy-in, however, comes from involvement - involvement in focus groups and meetings where a discussion is facilitated the current state and culture.
People must be allowed to openly share and diagnose challenges in the current state - invite them to “hack” the current processes. This will assist in building a vivid and compelling case for change that gets everyone on board. People will understand that things will get worse before they get better (because of the learning curve that’s involved) and enthusiasm and momentum will be sustained.
Pitfall #3: No sense of how this initiative fits into the larger scheme of things.
Another common pitfall is that the transformation has little meaning and relevance to people.
The lack of pressure to change and an unclear vision gives way to false starts and change that fizzles out. There’s just not an intense enough sense of urgency to the transformation. The status quo is too comfortable, and leaders underestimate the effort and resources that will be required to drive people out of their comfort zones. We all recognize these initiatives as the “project of the month” or “pet projects”.
Leaders are responsible for communicating how a transformation will contribute to business success. And, it’s their job to help their people seek and find meaning in the transformation.
They need to answer how the transformation links to business strategy, organizational vision and values and how it will impact each key stakeholder group within the organization. It can significantly undermine a leader’s credibility if their people think they’re embarking on a transformation haphazardly. Even though the leader probably has all sorts of great reasons to launch this transformation, if they don’t translate that into an organizational context and communicate it, it’s as though those reasons don’t even exist.
When you feel like you’re over-communicating, that’s a sign that you’ve done enough - in all my years as a management consultant, I have never heard a single person complain he or she was being communicated with too often.
Pitfall #4: Neglecting organizational change capacity.
Every successful leader knows that real transformation takes time.
Over time, changes that are an add-on to operational workloads cause high stress, burnout, and frustration. The organization’s top talent to slip or ultimately leave and most others cannot keep up the pace.
Leaders are working in an “ivory tower” when they set unrealistic timelines and assign insufficient resources. Excessive day-to-day workloads breed resentment and lack of judgement.
Leaders are only seen to pay lip-service to the “people are our greatest asset” value they espouse and undermine their leadership abilities greatly. It’s no surprise that they don’t achieve the expected business results from their transformation.
Before you initiate a transformation, perform a capacity audit and scan all other change efforts being implemented or planned within the organization. Use tools such as change scorecards, change heat maps and a portfolio dashboard to better understand and manage the portfolio of changes in the organization. I like to allude it to “air traffic control”.
Take an objective look at business priorities and decide where work could be integrated or consolidated. Staff and pace properly so they have the best odds of success. Stop or pause some work, adjust timelines and reallocate your top performers to key priorities. Make room for people and teams to embrace change and lower the cost morale and performance.
Pitfall #5: No organizational change competency.
According to John P. Kotter, it can take five to ten years for a transformation to stick, and “seep into the bloodstream of the corporate body”. Leaders who disregard the importance of reinforcement will face workarounds and their people reverting to old ways of working. Their new business model will not sustain.
Just as key functions in organizations such as finance, human resources, and information technology are set up as strategic disciplines, organizational change competency should be embraced as such to consistently get the maximum ROI from transformation.
Build a common change methodology and you will see consistent returns. Educate leadership and rank-and-file employees on how to adapt to change and contribute to successful outcomes. Finally, build the systems and processes to make the steps transparent - provide training and templates, assign change leadership roles and authority levels, integrate changes across the portfolio and organize communities of cross-departmental resources at the right times.
Consider establishing a strategic change office, if you want a competitive advantage over your peers in your industry.
The transformation path is perilous and what I have described above are some of the most common (and preventable) mistakes. Consider the current transformation efforts you are leading, whether they are at risk and what you can do to mitigate them. Take immediate action to thwart these hazards before they impede your success.