Business transformation in 2020 is inextricably linked to our modern appetite for information. Consumers crave transparency and in response, businesses are deploying innovations to facilitate access to information. Those that fail to keep up may be consigned to the ash heap of history. According to the Harvard Business Review, corporations in the S&P 500 had an average stay of 61 years in 1958. By 2011, those corporations had a life expectancy of 18 years. Today, studies estimate that 75% of S&P 500 companies will be obsolete by 2027.

Thus, the importance of business transformation can’t be overemphasized. Corporate leaders see a landscape littered with the wreckage of companies that failed to adjust to evolving market realities. These executives understand that ongoing survival and prosperity will, in many cases, require radical change.

But, why business transformation? As mentioned, the impetus may center on delivering better experiences to consumers. Studies show that more than 60% of businesses have prioritized the development of cutting-edge UX tools as part of the business transformation process. In today’s marketplace, an aggressive competitor offering streamlined consumer experiences can cause maximum disruption. Thus, senior corporate leaders understand that maintaining the status quo isn’t an option. Their organizations simply can’t afford to lag in operating at the speed of the customer.

The incredible impact that a fully optimized consumer experience can provide, is, therefore, one reason why business transformation has become a strategic imperative for many companies.

What is Business Transformation?

A useful definition of business transformation: “a major shift in an organization’s capabilities and identity so that it can deliver valuable results, relevant to its purpose, that it couldn’t master before.” In essence, the company undergoes a “mastery of change” to facilitate brand positioning and growth.

As this definition indicates, true business transformation is a major change that will affect every level of an organization. It also requires an all-in effort. Timid, halfway measures won’t be effective. That’s why, as Sean Connolly, president and CEO of Conagra Brands, puts it, business transformation isn’t for “the faint of heart.”

The Challenges of Business Transformation

Implementing fundamental change in a company’s core culture and business practices isn’t a trivial exercise. When executives embark on such initiatives without proper preparation and the tools to manage the process, they aren’t likely to get positive results. According to CEO World, 60-80% of organizational change efforts fail. To confirm the challenge Gartner, in a recent study asserts that only 34% of major change initiatives are successful. But, failure needn’t be the norm.

So, what will it take for your company to successfully transform itself in the marketplace?

Having the right vision, leadership, strategies, and tools are the keys to success. Below, we look at what that means in practice.

The Right Vision for Business Transformation in 2020

Having a clear vision of the endpoint you want to achieve is critical. For example, how do you envision your company’s future? In what ways must your corporate culture and practices change to facilitate future success? Finally, do you need a major transformation, or would a more focused repositioning suffice?

According to Kasia Moreno, editorial director at Forbes Insights, the right vision centers on a clear understanding of what your customers want and how to deliver on that promise. Kasia also maintains that such a vision “includes defining the depth and scope of the changes and the redesign of internal processes and structures.”

The Right Leadership for Business Transformation in 2020

When McKinsey & Company interviewed 12 CEOs that presided over successful transformations, it found that good leadership was indispensable in achieving success. “CEOs did not delegate transformation accountability,” McKinsey reports, but spent “real-time on it every week.” In other words, the executive team must be committed to fundamental change and willing to use their influence to achieve it.

McKinsey recommends that the execution of the transformation plan be entrusted to an executive-level Chief Transformation Officer (CTO) who can commit fully to that endeavor. Of course, the CTO would report directly to the CEO. This is particularly important because the siloed nature of enterprise businesses often makes coordinated efforts a challenge. The CTO, working in tandem with the CEO, would track and direct transformation efforts across the entire organization.

The Right Strategies for Business Transformation in 2020

Inadequate planning ultimately results in failure. As part of your comprehensive planning process, you’ll identify not only the goals you want to reach but also the strategies you’ll use. Here are some basic principles that should underlie the detailed strategic initiatives in your plan.

1. Identify Exactly What Needs to Change Before You Begin

An article in the Harvard Business Review states this principle succinctly:

“Before worrying about how to change, executive teams need to figure out what to change.”

Before beginning a transformation effort, it’s important to conduct a comprehensive assessment of the present state of your company. Armed with that information, you’ll understand what to change in order to achieve your goals.

2. Build on Your Strengths

Although transformation will involve changes to significant portions of your company’s present culture and practices, you may have valuable legacy assets that you should leverage rather than abandon. These include internal expertise, brand identity, and customer relationships.

3. Start Small, Then Scale

It’s best not to implement wholesale structural change all at once. Because your transformation initiative will replace previously trusted processes, the last thing you want is for it to cause unanticipated disruptions. The latter will certainly discredit the entire effort in the eyes of significant stakeholders.

Start small, but plan how you’ll implement the new practices to the level required to achieve your goals. If possible, conduct pilot tests of planned changes before implementing them on a wide scale.

Do You Have the Right Tools to Get the Job Done?

According to Kasia Moreno, “Execution is the hardest part of transformation.” In fact, research shows that 60-90% of businesses that initiate business transformations create strategic plans but fail to execute them properly.

Effective implementation starts with the leadership team communicating the vision for the company’s future in an accessible way. That communication should inspire employees at all levels of the organization. They are, after all, the ones who must carry out the transformation.

That said, although the executive team may communicate the vision persuasively and put in place a coherent, comprehensive plan, the actual implementation will still meet roadblocks. Unless you coordinate the activities of employees in front-line departments, the transformation effort will likely fall short. If visibility into activities, results, costs, benefits, resources used, and milestones achieved remain isolated within each department, the natural result will be an overall lack of cohesion.

What’s needed is centralized leadership (such as the Chief Transformation Officer mentioned above) who can direct all aspects of the transformation process across the entire organization.

In order to effectively carry out their function, such teams need a company-wide, comprehensive view of all transformation activities and their results. And, that’s exactly what Business Transformation software is designed to provide.

Shibumi Can Help Your Company Achieve a Successful Business Transformation in 2020

Business Transformation software, such as Shibumi, provides all the tools necessary to facilitates the planning, tracking, and management of your transformation program. Shibumi enables alignment, visibility, transparency, and accountability at every level of the transformation process. As one client noted in a review, Shibumi “can easily configure methodologies and workflows, then run powerful analytics over the top to give program visibility at every level.”

If you’d like to know more about how a Business Transformation software tool like Shibumi can contribute to your company’s success, visit our website today.