10 Tips for Flunking a transformation

Transformation fundamentally changes how an organization operates to achieve significant performance improvements. But success is not easy. A Bain & Co. survey revealed only 12% of transformation programs in large companies deliver lasting results. In fact, failure might be the safer bet.

So here is a short guide for CEO aiming to turn strategic transformation into an entertaining but ineffective spectacle.

1.       FOSTER AMBIGUITY AND DISREGARD THE FACTS.

Trust your gut and embrace chaos. Just look at WeWork. The co-working giant expanded aggressively without a sustainable business model, spending recklessly on lavish offices and eccentric projects. The IPO failed spectacularly in 2019, revealing massive losses and questionable governance.

2.       TREAT TRANSFORMATION AS A ONE-OFF EVENT.  

Set a clear start and end date, then pack it up and forget about it once the program is over. move on. BlackBerry tried this approach, dabbling in touchscreens but never fully committed to compete with Apple and Android. By treating change as a phase rather than a necessity, it rapidly faded into irrelevance

3.       COMPARTMENTALISE THE TRANSFORMATION AND LOCK IT UP TIGHT.

Keep change isolated from daily operations. Kodak’s digital camera division developed groundbreaking technology but was kept separate from its core film business. Kodak missed the opportunity to adapt and ultimately lost the market to competitors

4.       EXHAUST YOUR BEST TALENT.

Flood your team with endless, simultaneous changes until they’re too exhausted to think straight. Boeing’s 737 MAX crisis is a textbook example: relentless pressure led to safety oversights, tarnished reputations, and billions in losses.

5.       SET GOALS SO LOW THAT THEY ARE POSITIVELY EMBARRASSING.

 Aim to be “just as good” as the competition. Yahoo aimed low in digital advertising and search, failing to innovate or lead. It became a case study of how aiming too low can lead to irrelevance.

6.       GO FOR OPAQUE MANAGEMENT.

Pair excessive control with a culture of opacity. Theranos excelled at this, keeping employees in the dark about processes. The result was a scandal that destroyed its reputation. When micromanagement meets secrecy, disaster is inevitable.

7.       FINANCE TRANSFORMATION BY REDUCING COSTS.

 Sears opted to cut costs instead of investing in stores, technology, or customer experience. Unsurprisingly, this led to empty shelves, plunging sales, and an eventual bankruptcy.

8.       IGNORE THE OUTSIDE WORLD.

Forget about market trends, customer feedback, or competitive insights. Nokia stuck to internal processes and ignored the shift to smartphones and touchscreen technology. By the time it realized the threat of Apple and Android, it was too late.

9.       RELEGATE TECHNOLOGY TO THE BACKGROUND.

Toys “R” Us delayed investing in e-commerce, assuming its traditional retail dominance would endure. By the time it tried to catch up, online competitors like Amazon had already stolen the market.

10.  REWARD MEDIOCRITY.

 Celebrate those who play it safe and punish innovation. NatWest, One of the UK's leading banks, has attempted several digital transformations since the 2008 financial crisis. Despite significant investments, its efforts have been hampered by a rigid internal culture with internal promotions that have often favored "cautious" and "litigious" profiles, to the detriment of innovators.

By diligently following these steps, you can guarantee a transformation that's more entertaining than effective. You might even win an award for "Most Spectacular Failure"!

If you want to know more about strategic transformation, you will find much more material and ideas in the latest edition of Glimpse magazine, where this article is originally published. Glimpse magazine explores the contemporary challenges faced by organisations through testimonials from professionals, SKEMA alumni, and analyses by researchers.

For more information go to https://www.skema.edu/en/organisational-transformation 

Strategically yours!

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