The DNA of Transformation Success

By Michael Vullings & Graham Christie
Updated 08 Dec, 2023 11:15am AEST

The failure rate for major change programs remains high

One of the most common challenges facing leaders, executives and managers is how to successfully drive major change in their organisation.

A familiar pattern found across most organisations is that major change programs often get started with high expectations, leaders are often confident that goals will be achieved, yet the chances are that programs will fail to achieve their targets. The vast majority of programs settle for dilution of value or mediocre performance.

Attempts to quantify performance of major change programs (for example a business transformation program, major integration, or business restructure) place the likelihood of success at somewhere between 5% and 30%, according to most studies.

Yet despite low rates of success being common place for major change programs, there is a clear way forward and there are many tactics that executives and managers can employ to dramatically improve their odds, which we will explore in further detail.

Changing the Game’s approach to transformation beats the odds

Based on the bestselling business book and ABBA 2022 Finalist, ‘Changing the Game – The Playbook for Leading Business Transformation’, an integrated approach to transforming an organisation typically follows five phases:

1. Take stock. This is about assessing the company and its operating environment to identify and prioritise areas for focus. Leaders need to ensure operational and financial stability, build credibility through quick wins, and ultimately to lay foundations by mobilising a top team who have all bought into the need for change.

2. Create the mandate. This is where leaders establish a common view of where the company is today, along with the opportunities and challenges faced. This is then used to build an objective ‘base case’ of the company’s performance based on the continuation of the status quo.

3. Map the Journey. At this stage, leaders focus in on creating a compelling ‘vision’ for the future and to develop high-level aspirations for the company. This is used to establish a common direction and shared sense of purpose, from which to explore strategic themes and initiatives, and then ultimately commit the organisation to a plan of action towards a newly imagined future.

4. Mobilise. Leaders need to create a strong foundation for delivery by preparing people to change, including: clearly communicating the company strategy to employees and other stakeholders, removing obstacles and creating incentives, and continuously promoting change. At this stage, a central program team such as a Transformation Office (TO) can become critical to coordinating efforts.

5. Execute and track. In this fifth stage, leaders empower their teams to develop detailed solutions and assign ownership. Then ensure resources to deliver initiatives and establish routines to drive and monitor progress such as including a review cadence, performance monitoring, and root-cause troubleshooting.

A feature of the approach outlined in this article is that steps can operate in parallel rather than sequentially. This not only reflects the modern reality faced by most executives where major change programs are being simultaneously planned and executed, but this also supports a “compressed transformation” cycle, where the duration of major change programs can be reduced.

Boosting initiative performance

Integrating best practices into each stage of the journey can dramatically increase the chances of success. We’ve highlighted specific tactics, which form part of Changing the Game’s industry-leading approach, and are widely used in successful change programs. According to industry research adoption of all these tactics improves the overall odds of overall transformation success to over 80%.

In recent years, the availability of data on the delivery of corporate initiatives has led to a renewed focus on what actions and decisions boost performance. Many of these were empirically understood by experienced practitioners, however, the impact of many of these decisions is increasingly quantifiable and can act as a good guide for executives and managers making decisions about the execution of a major change program.

This renewed focus on delivery performance data led to some interesting conclusions about what works well and how major change programs should be organised and setup to boost performance.

Preparing for or undertaking transformation?

CTG Strategy specialise in supporting functional/divisional leaders, CxOs and their teams to drive transformative results.

Our experts have deep experience in business transformation, large-scale and complex technology programs, business integrations and divestments, and restructuring and turnaround programs.

If you are looking for expert support in planning or implementing a major change program, please get in touch.