In my opinion, 3 out of 5 transformation projects fail due to a poor governance structure, which leads to suboptimal project implementation, extended deadlines, ambiguity in results, slow decision-making, and inadequate management oversight. Establishing the right governance framework is thus essential. The project manager leading the transformation must also be sufficiently trained within the organization to ensure compliance with the governance structure. Business transformation involves making fundamental changes to the way a company operates.
Changes may involve improving and modifying disruptive technologies, customer experience, business culture, operating models, and other aspects. All of these changes aim to improve the way business is conducted in all business models. I conducted a survey this year, with the advice of Professor Koide from Sanno University, and found that only 19% of the transformations launched in the last 3 to 5 years were fully successful. So what was done differently in these successful 19% transformations that led to success? According to the study, the most common objectives of transformations initiated in the last 5 to 7 years were main business expansion (65%), followed by business efficiency (59%). The most challenging types of transformations involved a significant change in business strategy (33%) and cross-functional transformation (27%).In addition to the factors mentioned above, having engaged employees is a key factor in accelerating the adoption of change.
Successful transformations reported having employees who supported them 63% of the time, while failure cases reported having employees who supported them only 30% of the time. Companies that focused on change management efforts had employees who supported them 19 percentage points more than those that didn't. It was found that there were specific change management activities that contributed to employee participation. A business transformation framework takes a structured, planned approach to change, whether it's changes in digital capabilities, customer experience, management teams, or some other business component. The findings reflect that transformations are increasingly complex and that the key to increasing the success of the transformation and accelerating adoption is to have resources and activities dedicated to managing change. Business transformation, by definition, is a radical change that any organization wants to undergo; it could be in the way it wants to reshape the organization, modify operations, serve customers, or a combination of everything.
Whether you are in the early stages of transformation and growth or if you already have transformation processes and digital transformation initiatives underway, Standley Systems can help you manage business processes related to transformation. Even for non-digital companies, the role of information technology in business transformation transcends companies. Crisis-driven and forecast-driven transformations are slightly more difficult to achieve than crisis-driven transformations. I hope to be able to shed some light on the many challenges an organization faces and what leaders need to do as they prepare for a business transformation. Looking ahead, transformation objectives are moving from basic business expansion and improvements in business efficiency to significant changes in business strategy (78%) and cross-functional transformations (76%), which tend to be larger and more complex. However, in most industries today disruption is widespread and business models are regularly challenged, often by digital startups with agile business models.
But before moving on to a detailed discussion, I wanted to take a moment to briefly explain what business transformation IS and ISN'T. Creating and carrying out changes based on a framework is a basic business process and a key element for transformation. The types of transformation span all spheres and can include data analysis, operating models, business leaders, and other components of change and growth. Business transformation and digital transformation are often intertwined; meaning you can't have one without the other.
Digital technologies play a multifaceted role both in the objectives of digital transformation and in transformation in general.