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During my 11-year consulting career, I have run a number of business transformation projects for clients. The projects have ranged across a number of industries and for companies ranging from $100m up to $3b in revenues. I have enjoyed the work because of the confluence of strategy, operations and organisational behaviour.  That said, it has definitely had its stressful moments. Over the course of numerous client engagements, I have learned quite a bit, but 12 major points stand out that are critical to the success of the transformation:

1. Alignment across the Top

Make sure your board and CEO believe transformation is the top agenda item. Without the people at the top on board, it will be impossible for the business to transform.

2. Declare a target and an initial set of top-down initiatives  

Nothing aligns people better than one, unified program target. The CEO should set the overall program target and aspiration – it should be a stretch, but not impossible. It also shouldn’t be analysis paralysis to figure out the target – if the CEO moves quickly, people will follow quickly. The executive team should then quickly scratch out the initial 15 initiatives. Again, speed is important. Spend hours, not days, getting the first version down and then let the design process refine, add, subtract and decouple overlaps.

3. Use a phased approach and spend enough time planning

Ensure a clear process that all initiatives progress through, that allows you to design, plan, implement and track your initiatives. This process needs to be challenging, but can’t be so onerous that it alienates people. No matter how much of a rush your team is in, you should plan to spend an adequate amount of time scoping and defining initiatives (think 10-12 weeks). This is critical to ensure people buy-in and understand what is going on. Bring in resources that are experts in problem definition and planning to help you with this. Additionally, focus on creating 1-point accountability for each initiative and removing overlapping goals across initiatives. Again, top-team and board alignment (your #1 success factor) will be critical to keep this process moving.

4. Use a PMO

Do not let your PMO become 'just a bunch of processes', as it is often described. It is so much more than that. There is power (and data) in consolidating everything in one location, using a standardised approach across all initiatives.  This centralisation will help you forecast your transformation’s EBIT uplifts, control and allocate program costs, shift bottleneck resources (e.g. training & IT) to the project that matter most and track progress.  Additionally, the PMO will help you manage the calendar and set up the right cadence of process and content (problem-solving) meetings.

5. Go to the right level of planning and tracking

Transformations are not bean-counting exercises. They require the right amount of planning and tracking to understand initiative definitions and delivery progress without becoming overly burdensome.  Tools like MS Project are NOT the right tools for tracking 20-30 initiatives at the PMO level. There can be too much detail in some areas (steps, processes & resourcing) with not enough attention in others (initiative definition, constraints, KPIs, costs and revenue forecasts, for example).

6. Align the program outcomes to an incentive program beyond STI and LTI

Share the upside (or costs savings) with a self-funded incentive program over and on top of short-term and long-term incentives.  This program specific bonus should extend beyond just initiative sponsors to include initiative leaders and specific key program contributors.  The amounts should be significant (think 30-50% of annual salaries) to really change behaviours and to indicate the seriousness of the program.

7. Prioritise ruthlessly

There will always be more to bite off than the organisation (and executive team) can chew. Prioritising will not be 100% scientific or quantitative – there’s a bit of art to it as well.  There will be a number of initiatives that will be tough to quantify a direct bottom line impact from however, these initiatives will be critical to enabling the overall program’s delivery.  The PMO should help the executive team prioritise the initiatives that are going to really move the dial (and enable the dial to be moved).  This may mean tough conversations – putting things on hold that everyone previously thought was important.

8. Use a small dose of performance management

People have allergic reactions to performance management.  Kicking off your program as a performance management initiative is a sure way to create an organ rejection.  That said, a cascaded meeting approach is normally required, whereby the CEO both helps clear road blocks and provides a healthy dose of pushing to keep initiatives on track.  People will appreciate the process if you get this right.

9. Make sure you consider organisational culture step of the way

People always say this and it sounds nice, but there are some clear and practical thing you can do to achieve this.  This may involve rethinking your vision, mission and values, ensuring people are involved in program and initiative design and ensuring consultation steps across all initiatives. You might also consider building training and people development into individual initiatives so the people who will make the change happen are bought in.

10. Communicate, communicate, communicate!

When I help executive teams and CEOs design transformations, I like to build in communication to each individual initiative, as well as create a unique initiative focusing on communicating and moving the dial on employee engagement.  Change management can be a bottleneck – planning it out alongside relevant communications will only help lubricate the entire approach.

11. Bring in an expert that can cut through (and avoid) politics

When designing the overall program and planning initiatives, it is critical to bring in the right expert that has done this a number of times and is above the fray of politics.  This expert (or team) can act as a shared resource to help with designing and planning initiatives, as well as ensuring that all initiatives are laid out on equal footing. For example this expert will objectively gather the facts, rather than bringing past organisational biases to the table.  They will also be well versed with the right level of detail required in initiative design and tracking (see #5).  Finally, this expert can provide the right tools for design and tracking so you don’t have to start from scratch.

12. Provide resources to help push critical initiatives across the line

With most transformations I run, resourcing an initiative is always in competition with business as usual activities.  The CEO and board (and executive team) should be prepared to bolster initiative teams with external resources.  Not only does this help get the critical work across the line, it will also help the organisation grow and learn from the external resources’ experiences.  Finally, for many initiatives, these external resources will be self-funded from the EBIT returns from delivering the initiatives and should be budgeted right in against the future returns.

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