Fancy explaining to your Board, shareholders and the City how you managed to waste over £100m and years of time and effort for nothing? It won’t be you, right? That’s what they thought at:
- Co-Op Insurance: FAILED £175m programme to migrate GI business to a new insurance platform - in litigation with IBM
- LeasePlan: FAILED €100m SAP implementation
- Lidl: £500m – FAILED €500m SAP implementation
These are just three recent examples of failed transformation programmes. However, failures don’t often make the news; more often than not they are quietly brushed under the carpet and, understandably, not talked about openly – and if you’re reading this I’m sure you’ll be aware of some…
Business and digital transformation programmes involve fundamental change, and impact an organisation's operating and business models; people, customer, operational and technology domains, and the interaction between these domains. Add in the management of stakeholders, 3rd parties and vendors, and balance all these elements with changes needed to the corporate mindset and culture... it's complex with many moving parts that are all connected.
So how does it happen, why do transformation programmes fail? Specific examples are well documented (and there’s lots of info available online) but there are common themes:
Get the basics right
- Ensure there’s alignment between strategy, operating models, your transformation roadmap and change capability
- Understand and be clear about the problems you’re trying to solve and the outcomes you want
- Ensure the business case stacks up, and there’s clarity of programme objectives and scope
- Establish a fit-for-purpose programme and governance structure with clearly defined roles and responsibilities
- Identify and engage stakeholders
- Do not jump on bandwagons… just because something is popular does not mean it’s appropriate!
- Understand what you’re getting into, and be aware that there will be hard decisions and compromises to be made
- Do not underestimate the size and impact of change, or impose arbitrary delivery dates – that’s just nuts!
- Don’t let vendors tell you what you should do, or expect them to act in your best interest (‘land & expand’ consultancies are focused on their revenue generation)
- Leadership, management and direction needs to be clear and focused
- Break silos (operational and mindset), don’t be afraid to do things differently
- Have a holistic view of the programme, never lose sight of the big picture,
- Your board has NEDs to provide oversight and challenge, your programme board should have programme NEDs
- Recognise the different stakeholder groups, keep messaging consistent, simple and appropriate for each group
- Bring people with you - business transformation is a journey...
So, if you’re embarking on a major transformation programme you need an independent voice on your side, a critical friend to provide oversight and challenge, and to keep you (and your vendors/suppliers) honest and on the right track!
Gary Burke is the founder of Rabbits from Hats and works as an independent Transformation Consultant, passionate about increasing the understanding of transformational change and its impact on business and operating models. Although having an actuarial background, Gary’s interest in transformational change drew him to that space where he has now worked for over 25 years in a mix of project, programme and head of change roles across multiple sectors.