Today’s technology-enabled business landscape, rapid innovations, new business models, intense competition, global operating environment, constraining legacy systems, increasing regulations, and ever-changing customer expectations are making the business environment highly complex. Organizational transformation is the complex endeavor of innovating and redesigning the organization, which significantly impacts all or most aspects of the business.
The Business Problem
Many recurring research studies by Economist Intelligence Unit, Project Management Institute, McKinsey, et al. over the last few years have continued to show that less than a quarter of business and technology transformation efforts really succeed. Organizations typically gauge business and technology transformation “success” by assessing the attainment of strategic objectives, improved organizational performance, and sustenance of significant business change. The rapid penetration of digital technologies, cloud computing, social media, and mobile computing is challenging business models and core competencies that were a strategic differentiator. The once superior operating environments are becoming legacy burdens for organizations as they try to capitalize on new technologies. Product and service offerings are becoming obsolete faster and getting commoditized. The significant business change initiated by business and technology transformation initiatives heavily impacts a large number of internal stakeholders at different organizational levels, as well as external stakeholders.
Organizations are constantly conceiving business and technology transformation initiatives to drive innovation and build distinct, superior operational infrastructures. High-performing organizations are having greater success in driving such transformational programs by recognizing, investing, focusing, and implementing leadership excellence. Business and technology transformation leadership excellence facilitates planning and execution of strategies that deliver and sustain stretch business outcomes. Transformation leadership integrates and aligns the following six dimensions to drive business and technology transformation success:
- Strategy: Align transformation to organization strategy and objectives to be achieved.
- People: Manage human capital and encourage the workforce to embrace changes.
- Process: Redesign current business processes and implement the new processes.
- Technology: Develop and integrate the ever-changing technology landscape.
- Structure: Assess and restructure the organizational model for improved performance.
- Measurement: Gauge success by evaluating actual value delivered by transformation.
Organizational Transformation Leadership
Leadership on both fronts, the technical and human, is essential for the entire duration of the organizational transformation. The strategic business change that organizational transformation is driving requires cross-divisional, cross-functional, and cross-level leadership to realize the transformation purpose, change vision, and sustain business outcomes. The business need for proactive leadership across all the impacted organizational areas and from the beginning to the end of organizational transformation is critical. Leadership in actively and effectively engaging with key stakeholders ensures the expected business outcomes are getting realized at each phase or stage gate of the organizational transformation. The lack of leadership significantly jeopardizes the purpose and strategic objectives for which the transformation was started.
Transformation Leadership Is the Deal Breaker
The breadth, depth, extent, level, and nature of leadership on a business and technology transformation intended to re-architect large parts of the business play a significant role in landing the desired future transformed state. Transformations are typically cross-divisional, cross-functional, and intended to make significant changes to the business. Given the organizational matrices, work complexities, and corporate politics, the business and technology transformation team relies heavily on leadership traits to secure support, overcome barriers, resolve escalated issues, and manage risks across organizational divisions, functions, and levels. Leadership throughout the transformation process in envisioning, sponsoring, planning, analyzing, motivating, communicating, securing buy-in, reinforcing the long-term commitment, and sharing the benefits of transformation with all stakeholders is paramount.
Multi-Level Leadership Model for Transformation
An organization transformation leadership model has to be architected and implemented up front to effectively confront cross-divisional, cross-functional, and cross-level barriers and challenges. Without a holistic leadership approach, transformation will inevitably be a failure by it not accomplishing the business objectives and improving organizational performance. The holistic leadership model addresses the leadership needs on all fronts—all organization levels, impacted organizational functions, divisions, and geographies. The organization structure model details the governance practices for the transformation to redesign the organization and transition it from its current to future state. The multi-level leadership model complements the organization structure model by spelling out the leadership behaviors, responsibilities, and actions at each tier of the organization structure. In addition, the model enumerates the styles and levels of involvement of leadership needed from the beginning to the end of the transformation odyssey.
Business and technology transformation leadership is a “must-have” for transformation success. Organizational transformation leadership is the secret sauce for strategic objective alignment, integration of the six dimensions mentioned earlier, stakeholder engagement, organizational change readiness, and business value realization.
Subramanian’s critically acclaimed book expands upon the above ideas: Transforming Business with Program Management
Satish Subramanian will be presenting a free webinar with ITMPI on July 13! Sign up here: How to Be a Business Transformation Leader