I recently read a McKinsey article summarizing two studies they conducted and entitled, “How To Beat The Transformation Odds”.
The summary spoke to the basics of transformation that we all know and apply to any project of any type.
Set Goals. Not setting goals before planning a change or a project is like going on a trip without knowing where you will go. Although that can be fun (I’ve known people that like to go on “coin toss” events, where you come to a corner and toss a coin as to whether you go left or right, not knowing where the event will end.
Assess Organizational Capability. Most rational people would not start a vacation without understanding the condition of the vehicle they were going to take. For a transformation to take place successfully, the organization needs to exhibit internal organizational intelligence (external organizational intelligence is another term for business intelligence), that is, be willing to learn what is not necessarily desired to know. Only in this way can you identify the gaps that need to be bridged for the organization to truly transform.
Design the Transformation. When the family going on vacation understands what needs to be done for the vehicle they will travel in to be in top operating condition, they put together a plan to see all the maintenance and possible repairs are done before they leave. There is a process of prioritization and trade off. If they want to go to Disney, but the transmission is bad, they may have to give up on some of the other activities planned during the vacation to cover the cost of repairing the transmission. Disney still realistic but only after prioritization (Disney is top) and trade offs (the wax museum, mystery spot and others are foregone.) Organizations beginning a transformation journey are no different and must plan, prioritize and make tradeoffs. What resources will be used? What can we afford to do at this point? Often, a quick win will be lest costly and build momentum, whereas, a more costly and timely action will require thought and consideration as to…
Transformation Execution. This is where the plan is put into place. All hands on deck, or to be consistent with the analogy provided, “Disney or bust!”
Sustain the Transformation. Here is where most organizations struggle. Ken Snyder, Executive Director of the Shingo Institute, home of the Shingo Prize for Operational Excellence, once told me, “After 30 years evaluating numerous companies’ performance, it is apparent there is a near equal split between those that sustain results and those that do not, no matter how robust their systems and processes. The difference is the accumulation of behaviors of the people within the organization, or “culture”.
According to McKinsey, there are three things an organization can do to increase the probability the transformation will “stick”, and decrease the probability the transformation isn’t.
- Focus on People, Not the Project. Transformations are about the people in the organization as much as about the initiatives. Long-term sustainability of a transformation requires companies to engage enthusiastic employees, equip them with skills, and hold them accountable for—as well as celebrate—their contributions to the effort. Companies should take steps toward developing people throughout the organization. To build broad ownership, leaders should encourage employees to experiment with new ideas: starting small, taking risks, and adapting quickly in their work. Doing so can create far-reaching and positive support for change, which is essential to a transformation’s success.
- Communicate Continually. When embarking on transformation, leadership should not underestimate the power of communication and role modeling. The results suggest that continually telling an engaging, tailored story about the changes that are under way—and being transparent about the transformation’s implications—has substantially more impact on an effort’s outcome than more programmatic elements, such as performance management or capability building. But the communication doesn’t end once the change story has been told. Leaders must continually highlight progress and success to make sure the transformation is top of mind across the organization—and to reduce the gap between what employees believe is happening and what they see.
- Take More Action. Transformation is hard work. The changes made during the transformation process must be sustained for the organization to keep improving. There is no silver bullet—and while some factors have more impact than others on a transformation’s outcome, the real magic happens when these actions are pursued together. The more actions an organization takes to support each of the five stages of transformation, the more successful it is at improving performance and sustaining long-term health of the organization.
In short, transformation isn’t where a disciplined, thoughtful approach to all the above do not take place.
I just finished (binge) watching a NETFLIX original series called Fastest Car. The premise was that for 7 episodes, three sleeper cars (something in your neighbor’s garage that makes lots of loud noise on the weekends, is often very shiny, but not always, and only comes out on the 4th of July) would race against a super car (such as Ferrari, McLaren, Lamborghini or Aston Martin). The winner of each episode would go on to the final episode and race the other 6 episode winners, all at once. What was intriguing to me were the sleeper cars. With a couple of exceptions, the really impressive sleeper cars (regardless whether they won or not) followed this same process, as was shown on the human-interest tableau for each participant. It seems it is a universal process. If sleeper car owners can do it, and Disney bound families also, I’m pretty confident organizations can as well!