When companies envision something as significant as workforce transformation, radical certainly seems to be the appropriate adjective. Employees need new skills to perform new tasks in profoundly different ways. It all adds up to an overwhelming sense that transformation can only be accomplished through radical means.
The problem is that the term radical often misrepresents the essence of workforce transformation, according to a group of senior business leaders LHH convened in Zurich to discuss the realities of workforce transformation.
In short, most workforce transformation scenarios involve steady, constant alterations in the type of people you employ and the kinds of skills they possess—usually to keep pace in a business environment that experiences steady, constant changes in business planning and strategy.
Simone Gibertoni, CEO of Clinique La Prairie, a European medical spa firm, suggested that the need to radically transform a workforce is evidence, in and of itself, of an organization that has fallen behind. “If you’re having to radically transform your organization, you’re already in danger,” he said.
Gibertoni went on to describe the essence of a successful workforce transformation as “small improvements every day that will help you … instill a culture of making today better than yesterday.”
However, Gibertoni also acknowledged that non-radical transformation does not mean sluggish or leisurely. “You still need a 2x-speed organization,” he said. “One that is focused on improving the core of what you do … and second, focusing on what will bring you success in the future. Especially in the luxury business, you need leaders who are able to balance innovation for the future with the heritage of the past.”
Other panelists at the Zurich event were very much in lockstep with Gibertoni’s argument, although some believed that in some instances, radical transformation may be the only option left.
If you’re having to radically transform your organization, you’re already in danger.
Frank Waltmann, Head of Organizational Excellence for LafargeHolcim, the global building product manufacturer, described a scenario from a previous organization where a new CEO was brought in to address severe performance problems that were threatening the very future of the organization. After assessing the gravity of the situation, the CEO opted for rapid, radical transformation, he said.
This approach was likely necessary because of the threat to the company, but it was still difficult for many of the employees. “For the employees of this company, the transformation was like a nuclear bomb going off,” Waltmann said. “There was a real sense of urgency due to the severity of the issues. Employees needed their leaders to be tough and face ambiguity head on—not behaviors that leaders were used to demonstrating. As a result, a lot of those leaders exited the business.”
The panelists did agree that no two transformational journeys are the same, and the key to a successful transformation is the presence of transformational leadership. Sarah Kane, a partner in the PwC global advisory business, said it was particularly important for leaders to include innovation as part of any transformation initiative. Creating a culture that can thrive during change and try new things is essential to helping any organization transform its workforce. “People need to be allowed to fail, but fail fast,” she said.
Four key lessons learned from the front lines of transformation
Overall, the discussion about whether transformation needs to be radical was only one of the many talking points at the Zurich conference. The panelists also shared four key lessons they learned from the front lines of transformation.
- Use only three or four KPIs. In many cases, organizations get carried away with multiple metrics they think will help define their success. But this often leads to more confusion, time wasting and failure. Focus on a small number of key metrics and move forward.
- Don’t neglect the middle. In many transformations, the focus is on ensuring that senior leaders are engaged, because they are primarily responsible for leading the change. The middle managers who serve as the heartbeat of the organization are often ignored. This neglect can be a huge problem, as middle managers may feel the most threatened by transformation. Devote some time and energy to helping this important leadership class engage with transformation.
- Cultivate transformational leaders who can imagine a bold, new future for your organization. Transformational leadership requires leaders to be visionary, connect the organization and inspire active participation in change. Transformational leaders must be comfortable with ambiguity and unafraid to take calculated risks.
- View innovation as essential to survival. In order to grow, organizations must be able to innovate, whether that’s adopting new technologies, developing new solutions or creating new and engaging customer experiences. Leaders must have their fingers on the pulse of industry developments, creating a culture that cultivates and tests new ideas.
All the panelists agreed that we are no longer in a “business as usual” environment and as a result, leaders need to move on from what worked in the past to develop new transformational skills for the future.