Transformation Compass - how to tell if you're nailing it

70% of all Digital Transformation efforts are wasted. We all are very confident about what needs to happen, as there is no lack of thought leadership. (Just revisit your LinkedIn feed.)

And still, while we are in the midst of all it, have all the facts stacked up, business cases, think tanks, centers of excellence - we don't seem to gain traction. Not the way we would like to. Not nearly as fast or radical as we set out when that transformation idea was born. How come, with so much money and brain power thrown at?

Let me give you my (hopefully) thought provoking take. I'll tell you then a couple of techniques and means and measures you can apply immediately.

First things first, if you deal with "Digital Transformation" and wonder whether "IT Change Management" is different from "Organizational" Change Management.

There is no "real" or "IT" Change Management, Change Management is always Change Management which starts and ends with people. Doesn't matter if you change a logistics backbone system or restructure a business unit. One thing that transformation efforts usually have in common as I observed so far, and it's quite ironical if you think about it, is that the fundamental aspects of managing change are dealt with only on a side note. Big opportunities to precondition for success are being waived again and again.

But why? Again, we're taking things light heartedly when it comes to sustaining change. Lewin's findings still apply, Maslow and his theorems are always around, etc. - there is a reason why Change Management is a field dominated by sociologists and psychologists and not tech experts. I'll spare you the full theory at this point but do encourage you to look into it and at least pick up some free courses.

OK - now on to the core of the issue, why transformation efforts do not take off as I see it. The core reason is that you have to get two different dimensions perfectly aligned. Once you see what I am drawing out now it will become fairly obvious.

First dimension - the organizational trinity.

Stray off center and you get all sorts of issues that will hamper all your transformation efforts effectively. People (skills, motivation) and Technology (maturity, debt) seem to be the best you could hope for and still you see poor traction, making you wonder if People & Technology are really that great? Well, rather look at your Processes. Chances are you are building duck tape around what needs some major revamp. It goes all the way from the top down to the nitty-gritty processes that require you to re-confirm, re-approve, re-do this re-do that. That add some random (historic?) constraint to a process, blowing it up to be way more complex than need be. Will it require guts to rock the ship and touch the way "it always used to be"? Oh yes of course, but that's Change Management 1:1.

And if your focus is on Processes & Technology - happens very often in fact, in particular if numbers are your main concern for just any decision - then you are leaving People out the equation. Bad move, you will not hit those numbers and people will be gone sooner or later. Or worse, stay and watch the ship burn eating popcorn.

Second dimension - the individual trinity.

Obviously, an organization consists of individuals and they have to be properly prepped to walk the talk. In fact, the whole talk should be theirs as much it is yours and one of your main activities as Change Manager will be to make a concern everybody's concern.

Let me explain the green pyramid:

Empowered = Given not only mandate but authority as well and ability to act autonomously (within reasonable boundaries). The opposite would be gatekeeping everywhere, multi-step approval processes with no commitment to act swiftly, often in conjunction with intransparent decisions. Empowered means of course as well that enough resources are provided, even though that's already included in "ability to act". Just pointing it out because often there is no additional fund for Change or way below what it should be.

Intrinsically Motivated = based on beliefs, values and purpose individuals would do the right things right and be convinced of it.

Incentivized = Objectives, goals are not in misalignment with the task at hands.

The double-dip bullseye is where you really want to land. That's your compass. You walk off direction on one level, you'll hardly be able to recover.

These are in my humble view the layers of basic, fundamental concerns that you need to get right for lasting change with impact.

This type of alignment is probably only possible with a wide-spread culture that allows the change to unfold. Things like unconditional support and backup, a common purpose, dealing gracefully with mistakes come to mind. There's more to culture, but let's leave it with that.

So, what could be a change journey that respects all of the above?

It depends... I know, nobody wants to hear that, and yet, no change journey will be alike from one organization to the others with one set of individuals and another. If there were an easy formula you bet we'd have found it already. (You remember the number of thought leaders writing about Digital Transformation, as mentioned earlier?)

Here's an example journey, completely made up, I could envision for a software product roll-out.

Couple of highlights:

• Negotiating Change: Super important and often underestimated. Part of Negotiating Change is to implicitly transfer Ownership to the Stakeholders by getting them and actively involving them in "solution finding" mode by asking the right questions and just genuinely caring about where they come from and what they need to do in order to be successful.
• Passing on ownership to stakeholders is a leading theme for Change Management - Infra and Operations for example should be actively participating.
• What KPIs to track and measure right from start? Depends on the Change but in general terms that could be NPS ratings from the stakeholders, costs saved, engagement/adoption rates. The latter are very important for the Change and could be tied with gamification actions. Think of friendly tournaments or similar.

And in general, be aware that communication is tricky. Things get often lost in translation. I have to remind myself often enough to re-check everybody is still on the same page. Nobody is perfect and everybody should preserve a healthy portion of self-critique at all times. Asking for feedback, often and from different parties, is course the best way to go.

The hardest task for any Change Manager is to keep the engagement level up - even with those stakeholders that are not immediately impacted. Disengagement comes in many forms and is your biggest enemy. Once a change is up to "that guy/girl" or "that department" and people refer to a change program as "a project" you pretty much know for sure things are really bad. Latest at that time you need to activate all the Change Agents and course-correct.

Now, here is some further material to study - get in touch if any questions!

Sources and further resources

[1] 70% of all investments into Digital Transformation are waste, according to Harvard Business Review. That's 900 BN $ in hard numbers.

[2] Great talk about the human side of Change: https://www.pega.com/insights/resources/customer-engagement-summit-london-2019-pega-keynote-heart-matter-human-side

[3] The way we talk about Change Management is not really hitting it: https://hbr.org/2013/04/change-management-needs-to-cha

[4] How Digital Champions invest: https://www.bcg.com/de-de/publications/2019/how-digital-champions-invest.aspx

[5] How Digital Champions invest: https://www.bcg.com/de-de/publications/2019/how-digital-champions-invest.aspx

[6] Why Business Capabilities restore order to the chaos