Our Thoughts on Transformations that Work
Business transformations aren’t uncommon: Our research shows that more than one-third of large companies are currently in a transformation effort. But are they successful? Usually, lasting results are hard to achieve; our research finds only 12% of transformations meet the original ambition. So, how do you build a successful program?
Look to your leaders
One of the strongest predictors of a transformation’s success is having the right people in the critical strategy roles . The three common mistakes companies make? 1) Not focusing on the critical roles; 2) Not looking beyond the “star players,” which can lead to oversubscription and burnout; and 3) Spending too little time thinking about the long-term vision for the future.
There is growing support around the role of the chief transformation officer . This is a newer role, so people stepping into it often don’t have a predecessor to lean on. Based on input from attendees of our Full Potential Transformation Forums and work on more than 700 transformations, we’ve outlined that the CTO must serve as a strategic architect, integrator, operator, coach, and controller, often serving in the roles simultaneously.
A valuable component is having frontline ownership of a transformation effort . Leveraging cross-functional ability and creating line-led teams that run and deliver transformations while also running day-to-day responsibilities keeps the workforce mobilized and engaged. The keys to executing a line-led transformation are 1) intent, which consists of a well-articulated goal, empowerment, and sense of urgency, and 2) accountability: having specific targets, consequences, and transparency.
Middle management can also play a key role in transformation efforts. Transformations need a mix of creativity and innovation, and involving middle managers is a great way to build your next generation of leadership. You should also encourage middle managers to bring forth innovative ideas and be sponsors of your transformation, and reward bold action and results.
Steps for success
Our research on transformations that work found six practices are key to successful programs :
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Treating transformation as a continuous process: Today’s highly dynamic environment no longer allows for a structured program with a beginning and end, but rather a state of constant transformation, adjusting programs accordingly.
Building transformation into the company’s operating rhythm: Don’t think about transformations as a separate entity. Keeping leadership involved around one vision can help keep the program moving.
Managing organizational energy effectively: When you find the key players of a transformation, make sure they’re not disrupting multiple routines at once. Our research has found that if companies try to change more than two routines at once, there are increasing odds the transformation will fail.
Using aspirations to stretch management’s thinking: Don’t just examine external benchmarks. You need new ways of thinking beyond your current practices, and so benchmarks might not be available yet.
Driving change from the middle out: Move away from a top-down approach, since senior executives are usually too far removed from daily operations to understand the real issues. Middle managers have a better understanding of what needs to change, but typically aren’t at risk of getting lost in the weeds.
Accessing external capital from the start: Transformations are expensive, and our research has found nearly all failed transformations were underfunded, as they were financed by cost-cutting measures. By contrast, nearly all the successful transformations we studied used capital markets.
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How Bain enters new markets
We don’t just advise on transformations, we do them ourselves. In this episode of Beyond the Bio , Tamara Lewis explains how Bain goes about entering new markets, based on her firsthand intrapreneurial experience opening our Seattle office in 2018. Opening an office isn’t just about growing our presence: We think about it from both a client rationale and a people rationale. Having a presence in Seattle’s innovative market created a lot of opportunity for Bain to build a stronger business with clients. And, when it came to our employees and the talent market, there was a real desire to be in Seattle. But there’s no perfect formula when it comes to building a culture. Tamara explains the Seattle leadership team focused on our values, behaviors, and rituals, taking the best of Bain and applying it to our clients’ needs for innovation, creating norms in which everyone is included and serves in a mentor role, and placing a focus on local social, community, and environment involvement.
Transformations often struggle because they miss one key ingredient: real ownership from both leadership and the frontlines. It’s not just about having a ‘star’ Chief Transformation Officer or a few key players; it’s about empowering leaders at every level to take charge of the vision. The most impactful change happens when cross-functional teams are aligned, have clear goals, and are held accountable. When everyone—from execs to frontline managers—feels the urgency and owns their part, transformation moves from being a task to a collective mission. Real change sticks when it’s woven into the fabric of how a company operates daily, not just a box to check.
AR/VR/MR Researcher | Technical Consultant | Python | Rapid Prototyper | Right To Education Activist | XoRphilic | Let's connect and explore.
2 个月Great insights on the complexities of business transformations! The role of the Chief Transformation Officer as a strategic architect, integrator, and operator is crucial to maintaining momentum in today’s rapidly changing environment. I fully agree that transformation should be a continuous process rather than a one-time initiative, and the emphasis on cross-functional teams and middle management involvement is key to driving sustainable results. Ensuring frontline ownership and using external capital from the outset are also strategies I’ve seen lead to successful outcomes. Bain’s approach to balancing innovation with operational goals is truly inspiring. It’s this blend of leadership vision and tactical execution that ensures transformations meet or exceed their original ambitions. Kudos to Bain for continuously pioneering effective transformation strategies!
Strategy & Growth Advisor | Proven strategies for customer-centric innovation that drive growth
4 个月To support driving change from the middle out, you should: 1 - Identify blockers to change by leveraging middle managers' unique perspectives. 2- Develop systemic solutions that address root causes of these blockers. 3 - Craft cultural solutions to promote new behaviors and mindsets. 4 - Empower middle managers with tools and frameworks to lead change. 5 - Facilitate cross-functional collaboration to drive integrated transformation. This approach capitalizes on middle managers' insights to create comprehensive, lasting organizational change.
Business Development Executive
5 个月Well said!
Founder & CEO at EZ
5 个月Organizations move slowly, large ones even more so. In my time as a consultant, I saw several cases where pushing transformation was like pulling teeth. As an Founder in a constantly transforming industry for the last 7 years, what I have learnt is that eventually, organizations do transform, persistence is key! Make big bold moves, rather than multiple small moves, and then stick to your stand.