3 essential success factors of business transformations (and a rookie mistake to avoid)

Transformations can make or break a business. Anyone who’s been responsible for rolling out a major IT overhaul or implementing a cost reduction program will have battle scars to prove it — but with good planning and sound strategy it doesn’t have to be a painful exercise.

As you’d expect there are lots of elements that need to come together to get a transformation right, but in our experience, these three factors are the most critical.

#1 Ensure management and board have skin in the game

Without the backing of the executive team and board, most transformations fail. Why? Because without support from the top, issues around change, process and structure that affect your whole organisation (and there’ll be lots of them) will not be prioritised – and this invariably means they won’t happen.

Build your transformation objectives into your organisation’s long-term vision (including five- and 10-year plans), and establish a centralised PMO to manage processes and communication. These two steps enabled my team to reduce Newcrest’s global IT spend by 40%. — Carl Duckinson, Executive Director TACT

#2 Identify champions and encourage business participation

Identifying project sponsors and champions early on can save you sizeable headaches down the track. With so much ground to cover during a transformation (including planning, communication, workforce engagement, beta testing, execution, training and ongoing assessment), finding change-agents and encouraging them to channel their enthusiasm to their colleagues is the smart way to go. Project champions can be real circuit-breakers during transformations by helping those who feel threatened, anxious or unwilling, adapt to a changed working environment.

#3 Build a diverse and capable project team

Your workforce is diverse so make sure the team selected to oversee your business transformation reflects this. If you want to maintain the inclusive, high-performance culture your organisation is known for (of course you do), it’s important to ensure all your people feel represented and supported throughout the transformation process. There needs to be a collaborative relationship between project teams and your workforce for all the reasons stated in #2.

Just as important is ensuring your project team follows a structured, best-practice methodology that is aligned with the goals of your transformation and doesn’t veer away from core objectives. Avoid silos within the project team for this reason.

Number one rookie mistake

A recent Forbes study cited two main causes of business transformation failures: poor execution (ie inadequate planning) and resource/budgetary constraints.

That may be true, but In our experience the biggest mistake you can make is to not bring your people with you. Even during highly emotive, morale-sapping transformations that involve the shedding of staff, its possible to keep your workforce on side and aligned with the program’s objectives – if the process is sensitively and collaboratively managed. The key is communication.

Consider this

Are visual aides such as posters and email updates regularly distributed? Are sufficient online and in-person training resources made available? Are changes – and the reasons for them – communicated to staff before they are introduced? And are your people given the opportunity to voice their concerns, questions and suggestions to management without fear or favour?

The answer to all the above questions is self-evident. Transformations are difficult enough without making them even harder by alienating your workforce.

So, go forth and transform.

This article was written by Scoot Communications for Melbourne-based tech business and Scoot client, TACT, in November 2015.

It was also published in Inside SAP magazine in November 2015. Read it here.