Firstsource recently commissioned research into how leaders can make their transformation programs less stressful and more successful. Out of this research emerged a Business Transformation Leadership Framework. Here a former FTSE-100 CEO shares his reactions to it.

The five leadership challenges of business transformation

Managing the paradox of business case optimism

Of all the business cases in the many companies I’ve either been Chief Executive or Chairman, where they’ve gone through all the processes right up to the board, I have to say I can’t remember one that ever delivered what was on the nameplate.

There have been some that have been very good. But there have been more that have been far off, and some that have been a disaster. So how do you spot the few that are going to be successful?
I think it comes down to the following features:

• The credibility of the people putting forward the case. Have they got that mix of analytical mindset and knowledge of the detail that is absolutely essential in pushing through a big case?
• The scale of benefits. Even if they’re 30-40% wrong, are you still going to end up with a huge advantage?
• Consequences of failure. Is there a possibility that if this went wrong by 30-40% that it would crash part of the business, or even more dramatically the total enterprise?
• Future gains. Can it be a platform for future advancements? So, you might lose on this one, but you’ll gain on the second, third and fourth? If you did it nationally, could you then roll it out internationally? 40% under-performance becomes 10% underperformance, and then the time after that becomes 5% over-performance.

Judging organizational readiness and impact

I’d ask how new the top leadership is, that wants to bring in change. Do they come from the business or are they brought in from outside? If they come from outside I’d welcome their ideas but be suspicious about their knowledge of the processes inside the business.

I also look at not just the people presenting but the people who have to deliver. Because often, the people who present projects to top management are not the people who have to deliver.
I can think of one case of a CEO who was a very good salesman and a strongly able manager. He had a very distinguished career. He brought a proposition for a major change program to digitize and simplify a very complex set of processes across the world. This particular initiative eventually failed because the culture of the organization didn’t respond quickly enough. The board had misgivings on this very issue but the CEO’s persuasiveness carried the day.

The whole aspect of culture is very complex in a changing world. Top management probably doesn’t take it seriously enough, and they should. If the change is really important – in terms of either scale of expenditure or impact on the business – management has to set aside precious time to deep dive, so that they really understand what it’s all about.

Ensuring dissenting opinions are heard

In my experience board cultures vary from being extremely open to actually being very closed cultures. If there’s an open culture on the board, then there’ll be a good discussion. If there’s a lack of open culture, there’ll be no discussion. There’s little you can do to influence that other than being aware of what sort of environment an organization has at the very top of the business.

On the implementation side, it’s all about project management. You’ve got to have a structure and governance procedure, and a clear project leader. Then ensure there’s a free thinker in the group, who’ll be a pain in the neck for the operators, but who won’t be frightened to speak their mind.

Creating a genuine partnership with key suppliers

You need relationships where the top supplier and the client leaders are seen as peers and are willing to have an open dialogue.

Having structured meetings are good because they focus on detail, but the big issues are either exploded into these meetings or resolved outside the meetings. The most productive way is to resolve them outside of meetings at a level where people are willing to speak very frankly.

Managing the emotional marathon

Social love and care is one important aspect to consider while being aware that it’s a marathon.
Try to avoid over-promising. It’s always better to under-promise and over-deliver, whereas winning projects usually means that you over-promise and under-deliver. Be aware of whether you have over-promised and the impact this will have on the team and its interaction with top management.

Also, any financial reward has to recognize that it’s a journey. Getting year one right is great, but actually, it’s much more important you get year three and four right, and ultimately the entire project right.

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