Business transformation is about changing an organisation on multiple fronts so that it can adapt to shifts in the market and remain competitive and relevant to customers. There is never a perfect time to trigger transformation — the best time is always now.
Ten years ago, transformation was typically something that companies initiated when revenues dropped, market share eroded and share prices tumbled. In today’s complex and fast-moving world, business transformation has become a constant and continuous process.
Research in 2016 found that recently listed firms were dying more quickly than ever. For comparison, firms listed in the 1970s had a 92% chance of survival, whereas firms listed in the 2000s had a 62% chance. Today, the average lifespan of companies has shrunk to 10 years.
Some former powerhouse companies have fallen in relevance because they failed to innovate consistently or quickly. They are sobering reminders of what happens when companies do not transform to adapt to new markets.
It takes courage to initiate business transformation, especially when a company’s performance seems solid, and the business model is delivering steady profits. Executives are aware that companies should constantly reinvent themselves to survive long term. However, two-thirds are not confident that they can successfully transform the business in five to 10 years.
The key factors that drive business transformation
Business transformations are often multi-year projects that demand high magnitudes of effort and resources. They may involve simultaneous changes to strategy, processes, structures, technology, and culture.
Some companies may not be ready for this complex undertaking as they lack the necessary strategy, plan, framework, resources, momentum, and sustainable change approach. These are some of the more common reasons behind unsuccessful business transformation initiatives:
- Aligned strategy
More often than not, companies might not have a clear mission and vision, nor the goals and initiatives to deliver them. Sometimes, a CEO does have a vision, which is the driving force for the transformation programme. However, the vision may not be aligned or understood across the organisation.
- Executable plan
Some organisations have a strategy. However, they may lack the skills or experience to translate strategy into reality. Creating the transformation roadmap through trial and error may end up wasting precious time and resources. Bringing in an experienced transformation partner can accelerate this process and increase the chances of success.
- Sustainable change
The danger of positioning transformation as a temporary intervention is that after completion, old ways might creep back when it’s time for business as usual. As a result, the work done during the transformation programme is undone, and the new way of working is shelved.
Implementing business transformation successfully
Execution is the most difficult part of business transformation. But executing it successfully require out-of-the-box thinking. Most of all, they require a “top-down, bottom-up approach” because while managers or leaders at the top can set the direction top-down, transformation must be from bottom-up.
Therefore, it is crucial to factor in the input and experiences of the people at the lower ranks of the company because they will be the ones that will be executing the programme. With a top-down, bottom-up approach, executives can:
- Ensure clear communication and understanding about the transformation and what it means for every employee.
- Create buy-in and reduce resistance to change.
- Identify potential risks and issues and minimise them.
- Develop an executable plan.
How Renoir helps organisations execute sustainable change successfully
Business transformation should never end. There should always be constant activity to change and improve. The best performing companies make it a permanent, regular practice to review their alignment to the mission and progress towards the vision. Companies that continuously find ways to raise the bar to become better are the ones that remain competitive and relevant in the marketplace.
Sustainable change happens when mindsets are ingrained with a culture of change so deeply embedded that it becomes second nature. That is the level of maturity we aim to bring our clients to.
Renoir’s methodology is centred around this philosophy. Our business transformation framework, which is divided into two stages, is designed to tackle the major problems that hinder success:
- The strategy and transformation planning stage ensures that the journey moves in the right direction and is set up for success. Alignment is achieved and an executable plan with effective governance is put in place.
- The transformation execution stage ensures that the programme is executed successfully by using a tailored change management approach.
- Help for our clients to build and define their transformation strategy and roadmap.
- Support to ensure that the business transformation is implemented successfully. We partner collaboratively with our clients by working with people at all levels of the organisation to ensure that the business plan is realised.
- Knowledge and expertise in executing business transformation successfully in companies from various industries around the world.
- A deep understanding of the process and methods that leads to success.
- Bespoke solutions that are tailored to a business’s needs and goals.
If you’re ready for the next step, connect with us for more information.