Why business transformation programs fail

“The first step toward change is awareness. The second step is acceptance” -Nathaniel Branden”

Sometimes people ask me why business transformation programs fail. Many of them have searched the web, found the famous top 10 list and also a number of measures how to avoid them. What many people don’t realize is that these measures are very tactical. Like if I do this, then that won’t happen. Reality is different these days. Business transformation programs fail because of lack of awareness, trust and structure. Root causes of failures are less related to technology, more to process, and most to people.

The first two factors, awareness and trust, are very difficult to change, because they are directly related to how people within and in close proximity to the program behave. The third reason, structure, is relatively easier to change, because there are tons of proven concepts, methods and tools available that can help you. The challenge there is to implement them correctly and stick to it.

Awareness

One of the courses that I followed at University was Information Management. The professor was a fabulous storyteller. He vigorously spoke about technology and sociology. That may seem like a weird combination at first. But if you think about it, technology only works when people adopt it and apply it as intended.

In one of his classes he spoke about awareness and referred to the Thomas Theorem: “If people define situations as real, they are real in their consequences” (W. I. Thomas and D.S Thomas). The theorem and his explanation made such an impression on me that ever since, it jumps up in my mind once in awhile and let me ponder about situations that transpired.

What if the interpretation of the situation is wrong? In that case, the consequences are most likely wrong too. An interpretation is personal, subjective and in reality somebody’s perception of the situation. You cannot change someone’s perception. At best you can influence it and steer it in another direction, and hope that overtime it changes. 

Internalize this theorem for a second and apply it to business transformation. If you want to in-still change in an organization and ignite a transition to the future state, the hardest part is to make people aware. If you want to be effective with creating awareness, there are 3 factors you want to look at: communication, relevance and acceptance.

Communication is about clarifying the purpose of the program and motivation. People tend to accept change if they understand the purpose and can relate it to themselves using their own insights, visuals and words. When they understand the value and realize that a step forwards actually means achieving a number of benefits, they’ll make that step. When they have reached the point where they can flawlessly articulate and share the purpose with others, you know you have a successful communication strategy.

The other element is about relevance. In other words: ‘what’s in it for me?’ People can only become aware if they hear about it. But they really pick up on it and are willing to invest time and energy in further exploring the subject, if it has meaning. This is an area where communication in business transformation programs can improve. Communications must be more tailored towards different stakeholder groups. How many times have you seen the same set of slides passing by in meetings with stakeholders who have completely different needs and interests? Wonder why certain people do embrace change and others don’t?

Trust

In one of my posts on www.basdebaat.com I wrote that ‘trust, is the primary driver of success’. The single reason why people are willing to do things together and work towards a common goal, is trust. They are willing to build and strengthen relationships, because they believe there are mutual benefits in doing so.

One of my favourite books is from Stephen M.R Covey and is called “The Speed of Trust.” Covey says that trust means confidence, and the opposite of trust, or distrust, is called suspicion. In a high-trust relationship, you can say the wrong thing and people will still get your meaning. In a low-trust relationship, you can be very measured, even precise, and they’ll still misinterpret you.

Business transformation programs with low-trust relationships between key stakeholders have a high risk of failure. When trust is low, programs tend to delay on schedule, under-deliver on scope and overrun on budgets. It is important when business partners are being selected, teams are being assembled and meeting structures are being defined, to gauge the level of trust and make corrections when deemed necessary. This is an accountability of the executive sponsor. It makes sense to periodically conduct a ‘trust assessment’ of the critical relationships and make conscious investments.

High-trust relationships demonstrate effective collaboration and consistent performance. People are going the extra mile, because they are intrinsically motivated. In 1965, Bruce Tuckman, introduced a performing model that can be very helpful with building and developing project teams. I oftentimes introduce the forming-stroming-norming-performing model at the start of a program and revisit it along the way, because team dynamics change all the time. The model helps people explain and understand why certain behaviours happen and how they can best respond to it. That contributes to better, healthier and more trustworthy relationships.

Structure

Business transformation programs that don’t have a robust planning and scheduling function fail by default. My recommendation is to implement a cascaded model, comprised of plans and schedules at 3 distinct abstract levels. Executives have a strong preference to steer the program based on a GANTT (high level visual timeline from start to finish) with major work streams and milestones. At the program level, the PMO works with the same GANTT, complemented by a MPS – Master Project Schedule that has all the contractual deliverables, key tasks and dependencies. The MPS can be supported by a number of trackers that have detailed schedule information by sub deliverable, for example design documents. The MPS has a firm schedule for a 3 months’ horizon. At the project team level, leads work with the MPS and TWS – Team Work Schedules that are deliverable oriented and activity based. They follow a 6 weeks rolling window.

Having a plan and schedule does not mean ‘success guaranteed’. A major risk of failure is timely and appropriate decision-making. Decisiveness competency is influenced by a number of factors. One of them is trust, the other ones are quality of available information, level of ambiguity, risk attitude and ability to deal with pressure. It is the responsibility of the program manager to understand what the critical decisions are, the timing that decision need to be made, and managing the decision-making factors pro-actively. Part of that responsibility is to escalate decisions up the chain if they are not made or made inappropriately. 

Organizations must be resilient and have the capacity to recover quickly from difficulties and toughness. Business transformation programs are roller-coasters with high peaks, lows, accelerations and slow-downs. Project and business teams involved in the execution, will encounter the valleys of despair at times and wonder if they can ever get to the finish line and meet expectations. There are a number of remedies to deal with this. For example, increased executive level involvement at peak times to fast-track decisions or remove hurdles like resource constraints. Daily scrum meetings where progress, issues and risks are being discussed with the key players and as a result the bonding helps the team to get through a difficult stage. Or team building exercises where the focus is on techniques that improve overall performance. 

Successful business transformation programs focus less on tactical measures to keep them on track, but more on the people factor. They have created effective communication strategies that create the required level of awareness for the different stakeholder groups. They are able to relate to the interest of the group and individual. These programs foster a high-trust culture, resulting in strong, collaborative and productive relationships. They thrive because there is a well-defined structure with plans and schedules, and teams that can deal with pressure, high expectations and tight timelines.