Around the world leaders have rapidly changed business models, cut costs and plotted new paths to enable them to make the path to transformation. To thrive in this ‘new normal’ will require companies to make even more fundamental changes.
This is the basis of the argument from McKinsey’s Robinson who explains that true transformation requires the organisation to be rebuilt from the cellular level. Because if business models and mindsets don’t shift the costs will creep back in.
Melissa Arnoldi (CEO, VRio – an AT&T Company) provides a list for success
- Have a compelling story
- Sense of urgency
- Make sure you have a sustainable culture – diverse thoughts and inputs
- Generate short term wins
“More than 70% of Transformations Fail”McKinsey research
- Set the highest aspiration you can and truely inspire people to get there – incremental targets lead to incremental results
- A process that turns ideas into actionable plans and measures targets with rigour
- Over invest in people – transformation is something people do, not something that is done to them.
The path to transformation is to go big. Successful transformations are actually massive. The magnitude of the undertaking demonstrates the ambition and the expected step change in performance and results.
McKinsey research shows that more than 40 percent of a successful transformation’s value comes from growth initiatives—not cost cutting, layoffs or other slash-and-burn strategies.
Speed is very important in transformation. The company needs to demonstrate quick wins, faster ways to generate and apply new ideas and more effective use of capital and resources.
Arnoldi (CEO Vrio AT&T) explains you need to explain the bridge is burning and that “you have to paint a picture of where the business needs to head and why.”
Share Your Vision
True transformation comes from employees aspiring to achieve something greater. Establishing a cultural mindset believing in the organisations future potential.
Transparency, honest and open communication. Explaining the good and the bad is critical as you seek to share the vision.
“You can’t pull off an effective transformation if people have hidden agendas and go off and do their own thing,” George Oliver (Chairman Johnson Controls) says. “There needs to be one vision and a clarity of fundamentals or it’s going to be a mess.”
Stretch the Aspirations
“Setting an aspirational tone at the top, allows a CEO to inspire people to go beyond what they thought possible. Bold performance aspirations often lead to greater outcomes” (Robinson McKinsey 2020).
- The path to transformation deals with all of the big problems, it is massive and aspirational.
- Leaders need to demonstrate results, a clear set of actionable plans are important.
- Communicate with integrity – there are going to be hard conversations, leaders must speak the truth, show respect and collaborate on solutions.
DIGEST of an article from McKinsey The Path to True Transformation By Harry Robinson Published: 28th October 2020 https://www.mckinsey.com/business-functions/transformation/our-insights/the-path-to-true-transformation?