When business transformation is not business change

Many businesses are accelerating their plans for organisational change as a result of COVID. Understanding the difference between transformation and change will more effectively help them achieve their goals

Think about your organisational structure in a whole new way

Business Transformation

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The one thing that is constant in business is change. For some companies this requires a constant review and development of plans but for others it demands a complete transformation. 

The upheaval experienced by many businesses in 2020 has accelerated many companies’ growth strategies and the transformation plans needed to achieve these new goals. Many businesses have change plans in place but a series of change within a business does not equal business transformation.

LHH has worked with many businesses in developing both transformation projects and change strategies. One observation when speaking to business leaders is that sometimes they talk about their transformation plans but in reality, these are a series of continuous changes rather than a fundamental transformation of a businesses’ operating model.

Change or transformation

Change strategies are based on the current state and past performance of a business with programmes executed in linear steps with a clearly defined end goal. Transformation aims to create a business that is dramatically different to its current state. With future expectations guiding the direction of business transformation and programmes rolled out through experimentation and exploration, a successful transformation programme requires input from all parts of the business with information flowing in multiple directions and not just a top down approach. 

A two-speed transformation approach to a business

A successful organisational transformation requires a split speed approach. On one side it will be BAU with the business continuing to generate revenue through its existing operational structure. But at the same time work must be done simultaneously to reimagine and reinvent its operating model that will change both its customers and internal stakeholders’ experience to achieve its transformation goals.

An effective implementation of this two-speed approach requires a successful evolution of leaders and managers capabilities to not only manage the requirements of the existing operational structure, but to also deliver the development of the new transformation model. The challenge that many individuals face when being instrumental in implementing this two-speed approach is to develop capabilities which are polar opposites to each other. 

The dual capability challenges for leaders: delivering BAU and transformational change at once

  • Business experience Vs. unknown future
    One of the key capabilities of managing the BAU part of the business is that the leader will have their experience and knowledge of previous performance to benchmark against. This will enable the leader to give clear direction and lead from the front. 

    Transformation is in itself exploring the unknown and navigating the ambiguity to achieve their desired goals. Leaders need to forget what they already know and make calculated risks which will require being connected to multiple layers of the business for their input and buy in. 

  • Clear strategy Vs. imagined future
    Business leaders will need to clearly communicate what the future of the business will look like as a result of their transformation strategy. Compared to BAU where strategy and goals will be based on historic performance with clear tactics to achieving them, transformation will require the leader to sell the opportunities to the business and inspire the workforce to believe in the leaders visionary future. 

  • Driven results Vs. accelerated performance
    Where leaders can focus on motivating teams to achieve improved results, transformation can be achieved by leaders unlocking employee potential and enabling them to recognise opportunities. This will only be fully achieved by employees embracing the new culture associated with the business transformation and riding the change ‘wave’ to maximise the opportunities and successes it offers.   
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