When organizations get people and alignment right, their transformation efforts are more likely to succeed.
Just 26% of organizational transformation initiatives succeed. There are many reasons why most transformation efforts fail including a lack of vision, strategy, and/or sense of urgency, declaring victory too soon, not anchoring the transformation within the culture, and not giving people the tools, resources, and autonomy necessary to implement the changes needed for transformation.
Notably, what underpins each of these potential reasons for failure are two things – people and alignment. When organizations get people and alignment right, their transformation efforts are more likely to be successful.
Successful transformations require buy-in and engagement from C-suite leaders. However, this alone is not enough. A successful transformation requires the right people. There is more to “the right people” than strategic talent acquisition. As Jim Collins points out, there are three parts to getting the right people – getting the right people on the bus, getting the wrong people off the bus, and getting people in the right seats.
When organizations focus on getting the right people and getting these people in the right place, they are more likely to see their transformation succeed. In organizations where senior leaders replace uncommitted people, 29% of transformations succeed, compared with 6% where leaders keep those people in place. Further, when leaders move people internally and bring in new talent, they are more likely to have their transformation efforts succeed.
As new people are brought into the organization, as people are moved internally, and as people are moved out of the organization, communication on the changes, roles and responsibilities, and expectations is critical.
Here it is important that this communication be cascaded across the organization. In our work, we have seen organizations make strategic talent changes, but not communicate these changes across the organization. What ensues is confusion, redundancy, and frustration. Successful transformation requires people to know their role and responsibilities, and the roles and responsibilities of others within their team and within the organization.
This brings us to the second key focus area for successful transformation – alignment.
There is a positive relationship between alignment of organizational change strategies and performance, and highly aligned organizations have been found to grow revenue 58% faster and to be 72% more profitable than their peers.
Alignment of the leadership team is critical, but for transformation to be successful – and sustained – focus must be placed on aligning the organization. Organizations that have engaged frontline managers have a success rate of 26% and those that have engaged frontline workers have a success rate of 28%. This is compared with a success rate of just 3% for organizations that have failed to engage these employees in transformation efforts.
This need to engage and align the organization, not just the leadership team, is echoed in recent research by McKinsey & Company. The research found that while the average organization involves 2% of its employees as initiative owners in a transformation, 7% is the tipping point for better results.
Why 7%? When 7% of employees own part of the transformation, transformation-initiative owners can no longer be ignored, and employees realize that the transformation is not a distant project but rather a fundamental change in how they work. And there is improved alignment across the organization.
When we work with clients on transformation initiatives, we focus on many areas including the critical underpinnings – people and alignment. Let’s take the example of a global packaging company.
The interim president of a global packaging company’s beauty and personal care division faced mounting market pressures and obstacles, including an absence of operating mechanisms and a lack of trust among the leadership team.
To transform the organization, Brimstone began by taking the division’s leadership team through a Strategy and Leadership Team Alignment. Strategy and Leadership Team Alignment is designed to align the leadership team by clarifying strategy, setting the stage for strategy implementation by engaging and aligning the organization, getting the right people in the right place, and driving the organization to high performance.
Strategy and Leadership Team Alignment helped the leadership team to increase trust, establish operating mechanisms, and unify the group around a single strategic view of the division and its future. As part of the engagement, Brimstone facilitated the leadership team’s process to create a Strategic Business Framework.
The Strategic Business Framework outlines objectives and measures and, more importantly, prioritizes the strategic imperatives and outlines what the team needs to do to succeed. The Strategic Business Framework ensures the entire team owns the strategy and that the organization is engaged in the process.
The leadership team then went through Brimstone’s Business Acceleration Teams. Business Acceleration Teams address the most critical issues facing the organization while changing the way people work and developing new leadership capabilities.
As part of Business Acceleration Teams, the team conducted an extensive calendar management exercise. The exercise focused on scheduling and prioritization. Through the work, it was clear that the team did not have enough days in the week to do everything they were trying to do.
The division was successful in its transformation initiative by getting the right people in the right place, engaging and energizing employees, giving employees ownership of the process, and focusing on alignment.
The division prioritized specific segments of the business. As a result, within one year, sales in these segments grew by 9%. This was driven by the radical improvement in the division’s alignment, trust, and team performance, as well as clarification of roles and the establishment of ground rules and operating mechanisms.
What’s more, the division reduced emphasis on less profitable business segments and then later sold these segments.
The interim president summarized the transformation: “Consultants tend to go into an organization and say, ‘this is the answer.’ This approach doesn’t work. ‘The answer,’ typically sits on the shelf and change does not happen. Brimstone takes a different approach. Brimstone works with leaders and with organizations. The Brimstone process is built on engagement and on multi-level feedback. It truly involves the entire team. The result is lasting transformation.”
There are many reasons why transformation initiatives fail. Those initiative that succeed focus on both people and alignment.