Challenges and Success Determinants of Business Transformation (Part 3) *

This article was written by the SEViX Managing Partner and founder, Mr. Rainer E. Ulrich.?

Four phases of the strategic business transformation lifecycle

Part 3 summarizes the four phases of the transformation lifecycle and identifies the outcome and requirements for each phase.

Present vision

This phase includes both the why and the where to regarding the change. "Why is strategic business transformation needed and how capable is the organization to manage the change?" This phase diagnoses the need for business transformation. It also develops the strategy and vision in dealing with the need for change. This step requires analytical skills as well as creativity and foresight. Another goal of the vision phase is to gain C-level commitment to the developed strategy. The vision for the entire organization is usually the focus of the transition process.

Alternatively, the transformation can take place in one department or business unit. However, it does not mean that business transformation requires visionary leaders, in the sense of charismatic, "guru-like" figures. However, the responsible business transformation manager must have a clear focus and goal. So an important question for managers is, "How capable are we as an organization of doing this, and how can we agree on a plan?"

Expected outcomes

1. recognize the need for business transformation

2. identification of strategy and vision

Prerequisites

1. analytical ability

2. creativity

3. Anticipatory skills

Participation

For the manager, this phase of business transformation means mobilizing the company itself and thus its employees. Engagement and communication are essential here, as is the establishment of discrete projects, if necessary, to bring about change and create momentum. For committed stakeholders, this is both behavioral and attitudinal; they contribute fully to the transformation team. Business transformation requires a clear understanding across the organization of what change is required, why it is required, how it will be achieved and measured, and who is responsible for what. Detailed planning and ongoing alignment with business functions are essential to ensure engagement across the organization. Involving middle management talent in particular is important to effectively execute the change process.

Expected results

1. communicate business transformation

2. define discrete projects

Requirements

1. detailed planning

2. align business functions

Strategic Business Transformation

As a continuous process, business transformation works from the inside out in three phases:

• Replacing the old; consciously juxtaposing the new with the old,
• traversing the no man's land, i.e. the neutral zone, and
• support the dissolution of the old.

One focuses on what is currently evident in the business transformation. This means, among other things, acknowledging fears, resistances, comforts and habits, consciously repacking suitcases.

Transformation may involve reorganizing or establishing new business processes and relationships, including new business units such as a "shared service center," moving and retraining employees, creating and leveraging new capabilities and improving employee competencies, and changing their behaviors, attitudes and shared values. Employees must understand that they, too, are subject to transformation processes and commit to a pace that is acceptable to them. At the same time, managers in the process must ensure that departmental thinking and actions are suspended. The rational and emotional elements must be brought together to win hearts and minds.

Change also typically affects IT capabilities, business operations as well as processes, systems, technologies and software of the organization. Successfully changing IT at a pace that allows the organization to remain competitive is often the deciding factor in business transformation.

Expected outcomes

1. new business units (e.g., service centers)

2. new business processes

3. new relationships

Prerequisites

1. understanding and commitment of employees

2. successful IT change

Optimization

The question of why must be answered by the business transformation manager, as well as the question of where to. Do not lack clarity in this! The primary task as a manager is to direct attention, to pave the way, to direct energies. Again and again. Do not wrap every message in absorbent cotton. And don't discuss every measure to death. That takes too much time. Instead, we need to talk turkey: not in an exaggerated way, but not in a gently lenient way either.

For managers, business transformation means focusing on the essentials.?Change must be embedded and internalized as a new "business as usual." Institutionalization ensures that quick wins are consolidated, processes and successes are measured, and any "laggard" behavior is eliminated. The conditions for effective business transformation must be created and ensured so that change capability is enhanced. Even if this sometimes means parting with employees.

?Expected results

1. measurement of processes and successes

2. Eliminate "laggard" behavior

Prerequisites

1. internalization, institutionalization and optimization of business transformation

2. create stability

In practice, a business transformation often appears chaotic and some employees involved with it struggle with many tasks at once. The reality of implementation is full of obstacles and often dilutes the best laid plans. Therefore, the incremental nature of change must be captured. This is one of the most difficult management functions. The continuous incremental approach and willingness to return to previous cycle phases to resolve issues and reinforce messages is a key element of the transformation process.

CHALLENGES OF THE BUSINESS TRANSFORMATION LIFE CYCLE

1. The incremental nature of business transformation must be included.
2. Dealing with unintended consequences.
3. Effectively and efficiently changing IT.

KEY MESSAGE

Continuous incremental approach and willingness to return to previous cycle phases to resolve issues and reinforce messages are essential to success.

Bottom Line

The business transformation manager's ability to move back and forth between the phases of the cycle, review the implications of change interventions, and resolve intended and unintended consequences is rare, but extremely valuable to the business. Change management has both abstract theory and theory- and experience-based knowledge, the latter being the actual foundation for business transformation. Typically, "experiential knowledge" represents a deep level of behavior and attitude; however, achieving this level does not require a single session or a series of training activities.

[*] Excerpt from the SEViX book "UNTERNEHMENSWERTSTEIGERUNG - Business Transformation als Chance".

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If a time-critical transformation management project cannot be accomplished by existing management expertise, then a general manager/CEO ad interim experienced in strategy would be the solution.

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Please contact us directly if you need concrete help in change management projects or a managing director/CEO ad interim or a business transformation manager and a well-practiced team with implementation competence.

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Get in touch with SEViX!??https://sevix-group.com/en/kontakt/

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