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Secrets of Organisational Transformation Success.
By Kevin Dwyer
Monday, 29th September 2008
 
Organisational transformation is not putting in a new IT system, nor is it changing processes or organisational culture - Transforming an organisation suggests that we wish to change its very self.

Those are examples of tools we may use to make the transformation more likely to happen, but are not transformation in itself.

Organisations are made up of people who interact with each other and with people outside of the organisation to achieve a goal. The efficiency and effectiveness of those interactions usually determine the success of the organisation. When those interactions are inefficient or ineffective and there is competition which is more effective, organisations are seen to fail by comparison. When there is no competition, organisations are seen to fail by their users if there are known or perceived benchmarks against which they can be measured.

In both the competitive environment, for example, commercial businesses and many not-for-profit organisations, and the non-competitive environment, for example most public organisations, the secrets to effective transformation are the same.

Blisteringly Clear Goal

A clear goal of the transformation is mandatory.

It is insufficient to have a change in a set of values as the goal. Values are too open to interpretation by individuals and very difficult for an individual to demonstrate to every person's satisfaction at all times. Most organisations also agree on values such as honesty, integrity, collaboration, innovation and diversity which typically dominate organisational value statements. If values become your goal, how are you going to be different from any other organisation? Demonstrated values have to change in a transformation, but they cannot be the goal of the transformation. The goal will be too nebulous.

A goal to implement something such as an IT system is clear but lacks any dimension of the impact on the organisation and its stakeholders.

A numeric goal based around some financial or customer numbers is at least clear. A numeric goal, provided we are clear on definitions and data sources, also can be cascaded down to departmental goals with attendant KPIs.

However, a numeric goal does not fire the passion of individuals. A written goal such as, "We will be number one", with a suitable definition of what "number one" is, is more likely to fire the passion of individuals. A written goal such as, "Eliminating poverty by 2012" is much more likely to capture the imagination of people than a numeric goal such as, "By 2012 no more than 5% of the population will have access to less than 30% of the national average wage."

The goal of transformation must be about an outcome that is unequivocal, can be related to by employees and other stakeholders alike and contains both a numeric and a written, almost slogan, component.

The goal must be the candle to which the moths of the organisation are attracted. The flame of the candle must not be allowed to blow out, so the goal must be repeated at every opportunity to refocus people mired in the day-to-day of the transformation or business as usual on the goal.

Articulate what must change

It is insufficient in transformation for the leader to set the goal and allow others to work out what needs to change to achieve the goal. The leader must be able to articulate clearly the five to ten things which must change and what they must change to for the goal to be reached.

This may include a change in realised values, but perhaps not the spoken values. Most organisations do not have a problem with their stated values but with their demonstrated values. A change in realised values would indicate a change in recruitment and performance management.

Included in what needs to change may be, for example, one or more of:



  • Product range
  • Development cycles
  • Cost structures
  • Risk appetite
  • Distribution and supply chain structures
  • Competence of the people
  • Preferred market segments
  • Rituals and routines
  • Organisational power structures
  • Myths and stories about the organisation
  • Pricing
  • Funding
  • Systems infrastructure and complexity
The leader must know at a high level what needs to change to be able to direct resources to the correct priorities. It is the leader's role to know, not that of a committee to find out.

Plan

The old adage, "To fail to plan is to plan to fail," is true. Successful transformations always have a strong element of planning. Even if it is not the formal GANTT charts of a large organisation, someone in the organisation will know what actions can be taken in parallel and what can be taken sequentially and what combination of resource and time is required to affect the changes in the time desired.

Not only that, they will know what the risks are and what the key milestones are. They will think about and plan contingencies for high consequence or high probability risks which can derail the achievement of the goal. They will eliminate those risks that are both high probability and high consequence.

The person who is accountable for planning does not have to be a leader. They have to be good at detail, good at seeing connecting activities, good at estimating and good at extracting from subject matter experts the attendant risks of tasks.

Planning has one other important role in transformation. It is the means by which we measure how well we are progressing with the transformation. It allows us to look back and see what we have achieved. It helps our momentum by showing us that whilst we have had our head down on tasks, we have completed a significant part of the transformation.

Communicate

"Tell them early, tell them often", is as good advice there is on when to communicate. We must communicate upwards, downwards and outwards often and as early as we can about the goal, the plan, the activities being undertaken and our progress.

More than that, we must solicit feedback. Whilst transformation is not for the fainthearted committee leader, we must ensure that we take into account what people say. We must respond by adjusting what we do because the feedback identifies an unforeseen risk or explain how we have already taken into account the feedback in our plans, risk assessments and contingency plans. People must feel that their voice is being heard, even if our response is that we disagree.

We must engage our people to ensure that our people:

  • Understand
  • Believe and accept
  • Care
  • Plan
  • Implement
Implement

We must have the courage of our convictions and implement. As leaders, we have final accountability. Once set on the course of transformation we must implement and be judged on the outcomes of the implementation. It is a sorry result when the outcomes we envisioned do not accrue because we failed the test of leading the implementation.

Consultative and project committees are useful governance constructs. However, we must not sidetrack implementation to a governance model full of unresponsive and unaccountable committees. Committees should be kept to a minimum and have clear measures of their performance which reflect on not the "committee", but on the individuals who serve on it.

They must also have clear criteria against which to make decisions. For example, "Milestones are immovable".

Transition employees

It must be made clear to employees what will end in a transformation. For example, what processes, behaviours, systems, measures and structures will no longer be used or tolerated and when.

It must be made clear when the new processes, behaviours, systems, measures and structures will begin.

Employees will make the transition from what is ending to what is beginning at different speeds. It is insufficient to say to people that they have to "Get on the transformation bus or get left behind." People must be assisted from the old to the new order.

Assistance may include but not be limited to:

  • Frequent and clear two-way communication
  • Counselling
  • FAQ sheets, how-to cards and cheat sheets about the new systems and processes
  • Training and retraining
  • Celebrating the end of the old order
  • Welcoming the beginning of the new order
That is not to say that some people will not get stuck in transition and will exhaust the limit of the resources we are willing to devote to transitioning our employees. Those people will need to be found another role inside or outside of our organisation.

©2008 Change Factory

We welcome your comments: you can contact Kevin by email at kevin.dwyer@changefactory.com.au
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