Jason Adcock: Most organizations struggle with the definition and execution of their transformation initiatives. In this podcast, we are bringing some new insight and commentary to some of the most critical in your industry.
Together. Noel and I have spent our careers deploying technology to deliver better business performance across a variety of industries and sectors. Today, we're bringing some of this knowledge and experience for your benefit..
Noel: One of the areas we're going to be looking at really today is digital transformation, and we know a lot of organizations are accelerating their efforts around digital transformation and the importance it has on making sure they stay relevant. And surprisingly, a BCG survey showed only 30 percent of transformations succeed in actually achieving their objectives.
And I know Shane's particular expertise is actually helping many transformations turn around. So, Shane, thank you so much for joining the session today. love to hear a little bit more about you
Shane: Yeah, thanks Noel. My experience [00:01:00] probably spans a couple of different kind of periods in my career. So I've worked as a CIO sponsoring digital transformations and I've worked as a consultant trying to deliver those transformations to, you know, another organization. So it's been great to see it from both perspective and that's what has informed, my work with Alumni as we've gone in and looked at these different programs of work.
Noel: So Shane, I just want to dive in a little bit just in particular around the importance of transformations. We know organizations that don't effectively deliver against those, lose their relevance, Blockbuster Blackberry, just to name a few of, and I just wanted to come back to that statistic I highlighted earlier on, you know, only 30% succeeding. That's a relatively small number.
What do you think is leading to such a small, small return?
Shane: Yeah, I mean it's a pretty shocking statistic and I'm sure it's one that weighs heavily on executive teams and boards as they're contemplating these kinds of programs. The three points, that really come to mind for me.[00:02:00]
The first is around how the program gets established right up front.
The second would be around its strategic alignment to the business, and the third would be around the lack of end-to-end requirements and solution architecture to guide the work going forward.
So I feel like first and foremost, that the seeds of failure often start right at the very start of these programs - timeframes, cost, benefits can all be agreed by, an executive team and the board well in advance of, appropriate delivery analysis being undertaken.
They become immovable constraints, and they define whether the program is successful or not, rather than actually, businesses focusing on the transformative nature of the journey that they're on in the first place, so I think that's one of the biggies.
Noel: I'm very conscious.
You've, you've obviously been parachuted., A few times into, those transformation programs that aren't quite delivering those goals that are expected. And I'm sure like myself and Jason as well, you know, we've been in those sort of environments [00:03:00] where, there's a lot of investment being put into these transformations because they are so critical to the organization.
Shane: Yeah. The scale of a transformation means that organizations have to be clear around things like their customer strategy, their channel strategy, their digital strategy, product strategy, migration strategy, goes on and on.
But all of those things need to be aligned with each other. Too often, when we commence work on a comeback, or a transformation turnaround, there's just no clarity around the current state of the strategic mandate for the program.
Too much has changed. There's been stakeholder changes or strategy changes. Those things haven't been reflected back into the original program thinking.
So that undermines the program 'cause it means, future pivots and direction are highly likely as the team uncovers actually what the business, is really expecting from them.
Jason: Yeah, and following on from that, when these programs then later get into trouble if they haven't brought the right people in at the start, and they're in a scenario where say the, you as the chief information [00:04:00] officer will have had staff come to you and say, hey, this transformation is running badly, we're not getting the results, we're not getting what we need, the board maybe is very frustrated.
And the organization is looking at, maybe abandoning that journey, maybe pivoting, maybe doing something else when the right strategy would be to stay course. I'm just wondering, when you start intervening in a program like that,
where do you cut through the rumor, the innuendo? Where do you begin to get to the truth? How do you influence the board? How do you make a decision as to whether or not the program should continue?
Shane: I'd always recommend starting with a bit of a structured diagnostic exercise that looks across all the dimensions and gets a fact base, that can help take the emotion out of the debate on how best to milk that comeback effort.
We haven't really talked about the people aspects yet, that's also critical because when digital transformation programs are suffering setbacks, there's often elevated turnover, extreme working conditions, people are feeling exhausted.
Your best people are often the ones that have suffered the most.
Before the program gets to that point [00:05:00] of intervention because they're the ones that are trying to compensate for the problems, holding the program back. And I think the final piece is really making sure that you overindex on your communications. So that's both within the transformation team itself and right across the organization.
You know, you need to be able to talk about the areas that you've identified, where you wanna make improvements and set out a really compelling vision. That demonstrates you've learned some lessons and convince people that you've, got the board and the executive team reengaged and recommitted to the direction the program’s gonna take - those things, settle it down, and get the program back on track.
Noel: Absolutely. That is critical for any success. But I'd also welcome your thoughts around, the layers that go down a little bit. One would probably classify them as the middle management, amd perhaps a little further. When you're talking large scale transformations, it is holistic, it is organizational wide to that degree.
Um, so I, I find that sometimes people get slightly . Slightly lost in thinking, oh, soon, as soon as senior [00:06:00] management are on board, we're all good. But actually a lot of the work is being done in those layers below. And obviously you touched on some of the key points there in terms of, if there's higher attrition because they're the ones that are burning out.
Shane: Yeah, and I, I think that's when you have that strategic clarity, everyone down through the layers of the organization can be sure that when they turn up for work in the morning, the choices they're making, the decisions they're taking, the guidance that they're giving is actually moving you forward towards the end goal.
When there's a lack of clarity about that, it causes confusion, it causes rework, uh, you've got these large programs, it doesn't take much to, to throw people. You just see people pulling in different directions. They're all trying to do what they think is the right thing. The reality is they, can't tell for sure, and that's why they, revert back to whatever they think makes the most sense.
That's why I think, a high quality diagnostic that puts facts on the table.
And helps overcome a bit of the storytelling and a bit of the emotion. You've gotta look at, obviously what the promises were that were made up front, and you've [00:07:00] gotta, you've gotta inject a bit of reality. And that's where I think experience comes to the fore in these kinds of turnaround efforts.
Because you've got to, be brave, be honest, and actually explain to the board and the executive team, -
“Hey, this is where we’ve got to, this is what it's gonna take to, to push through and finish. And you're not the first in the world to run into problems in one of these transformation programs, but the prize is still worth it.”
And so for me, the diagnostic is, a crucial piece of that puzzle because you know when things are going off the rails there will be a lot of different points of view. There will lot of different stories.
You need to get the facts on the table as to what it's gonna take to finish the, the journey. Then make your decision about what, what works best for your business and communicate.
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Jason: Yeah, it is interesting. Everybody says they have a unique problem, but, I must have worked in probably over 30 telcos over my career in various consulting roles and permanent roles. And after a while, that the problem is very common.
So the first one would [00:08:00] be a lack of experience and transformation. So the organization we were talking about a little earlier, not having the skills, not having the backlog of experience to, to execute on those transformation properly, and that comes in a really large number of data points, things like a major transformation requires the curation and funneling of a very large set of requirements and an organization operating in BAU is used to maybe managing smaller projects or a trickle through of requirements. So you start at the start and you've broken the funnel of work for the organization.
That's usually where the trouble starts.
Shane: Absolutely.
Jason: And then when you look at the requirements that most of these organizations are trying to deliver, you pretty quickly figure out they're not sufficient for delivery. So they lack internal integrity. So the requirements don't have the right level of dependencies, independencies, the right level of mapping to common goals.
They don't get broken down into the same size chunks of works for execution. They don't take into account dependencies that, are longer in fixed dates. And, at the start of the program I'm talking here.
So they end up being dependent on something that can't be done for six months, but the assumption is it can be started right now.
Shane: [00:09:00] Yeah, I get it. It can be very concerning when, you've invested heavily to transform your business and it's not going well. But to your point, there are solutions to these problems. And I do think that it's worth making that investment to understand what those solutions are.
Noel: And what are, what are some of those, metrics and reportings, to Jason's point, you when you're coming in to look at trying to establish those facts that are brought in to then see, are we now heading in the right direction?
Shane: So the critical thing is that the promises you make as a result of going in and looking at these fundamentals and putting them back in place.
Those promises have to be things that you can deliver on, there's a period,
I guess, there’s a period of some fragility where you've made the changes, whatever is required, whatever's called for as a result of that diagnostic.
And so the nature of the intervention could be different. But if you've had a monolithic program and now you're moving to more iterative deliveries, really over index on that first [00:10:00] delivery and make sure you knock it out of the park.
Building up the confidence of the team, the leadership of the organization, the board is absolutely critical at that point. So you're gonna be looking for key outcomes that you are landing each month or each quarter and showing that you're achieving those, you're gonna be wanting to see change requests dropping away because now you've aligned the program to the strategy, the driver for constant changes…it's not there.
So you're gonna expect to see a much lower volume of change requests that demonstrates that you're on the right path.
If you're in an agile environment you're gonna expect to see, the whole flow of your squads working better. So you're gonna see. Improved grooming, better velocity increased achievement of your sprint goals, less work going onto the backlog.
And I think you just have to keep on re-forecasting, your total cost to complete, time to complete, benefits realization profile. Just to keep on saying to everyone, -
Hey, we're on track and what we said we were gonna do, we still believe we'll do, [00:11:00] so keep people focused on the end goal. And don't focus, entirely on the near term, but keep an eye on where it is you're trying to ultimately get to and communicate that.
Jason: I wonder, when they look at the long-term goals, quite often they don't have enough quick wins in the benefits profile, though that'd be the one area that, that I'd probably suggest most programs focus is getting those quick wins as far as benefits realization,
but I think people do lose patience when you haven't got a almost continuous flow of benefit small to large.
Shane: Yeah, I think that the days of planning a five year transformation program and then waiting for five years to get the benefits, are well gone.
To me, making sure that the people in the organization that are gonna have to live with the transformation really understand it.
Bringing customers into that process. If your business is the sort of business where you can do that then bring customers into that conversation and make sure that it works well for them, so I think a great understanding which flows from the requirements around the, the sort of customer experience, the sort of staff experience, that total experience really, that you're trying to deliver through the [00:12:00] transformation.
It is absolutely vital and I think change management plays a huge part in that.
And although a lot of people pay lip service to it, relatively few companies genuinely invest and sustain that investment to make sure that actually everyone is prepared to pick it up and run with it once these transformations start to land.
Noel: Shane, I couldn't agree with you more. I mean, the amount of organizations that I've gone into that lip service is beyond belief. It's exceptionally important, but it's never really looked at in the same way.
But for me, the other one I've always found is. Just of a realization at different seniority level as well, just what their true technology landscape is, there's very much a bit of a misconception in terms of where they are technologically versus where they want to be going and the sort of services and things they want to be delivering.
We all talk about, oh, we want to deliver this sort of seamless customer journey experience, but you know, sometimes the technology platforms just don't enable that and that sort of separation creates [00:13:00] a lot of challenges as well, because people sometimes are always reluctant to go up the chain going -
Well, actually, it all sounds simple, but technically we just can't enable that sort of thing without changing this.
And that can create some disparity as well and understanding.
Shane: Yeah, look, and I think, you can't be an executive in a business these days and not be able to grasp the reality of, the opportunities and the constraints that the technology that you're using imposes on your business. That's not just the CIO's job. That should be all executives job to have a grasp of that.
There can be a relationship developed with the execution team that basically suggests that it's an execution problem, when actually it's often a alignment back to strategy, disconnect.
And they need to set a different direction or they, they need to change.
Perhaps there's been a big competitive move in the market or a regulator has intervened and the rules have changed, or who knows, maybe a global pandemic comes [00:14:00] along, something crazy like that.
And I think often changes come along in these programs, but the executives and the team don't go right back to the basics and reestablish the strategic mandate and take the time to make sure that, their plan to complete is still actually the right one. It is still relevant. It does actually deliver on the new company strategy, because they're in delivery mode and they don't think they can afford to take the time to go back and actually reconfirm that.
But the reality is they can't afford not to take the time.
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Jason: The good news is that nearly every company has a lot of opportunity to leverage digital technology much, much more heavily. So the benefits of transformation is still there, and I don't know of any company that's... really, exhausted that pot yet. And the other thing I would say that's also great is, as ways of working mature, as the sort of methods that people, like Alumni, our team uses, to architect these programs, the risk also starts decreasing.[00:15:00]
So the lessons learned in the industry over the last four or five years, the new techniques and tools that companies have that can shore up these types of transformations will. invariably make them more successful going forward. I think that's a great thing.
I think the other thing I'll call out as a need in the industry that would be a positive thing to see is I think companies actually need more ambition than they currently have.
So, we've seen a lot of companies come in and disrupt markets, but a lot of the big players just have a fantastic opportunity to move forward and pick up where some of those players are coming in and do it with scale, where an early-stage company can't. So, you know, the right response, the right planning, the right program architectures, the right business strategy, and the right commitment to follow through.
They just can't go wrong because it's just such a big pot available, big pot of benefit.
Shane: Yeah, I think there is a real confidence rebuilding cycle.
I think first and foremost, my, my final message would be that it is, possible to succeed with the digital transformation. And it's possible to avoid the need for an intervention and a comeback or a turnaround effort. If you get the basics that we've talked about right up front, you can be [00:16:00] successful.
It won't be without, its challenges along the way, but you can absolutely succeed with these. We need to see these things, succeeding more first up.
But if you do need an intervention, that is also possible. You can tap experience to help turn things around and still get to the finish line in a calm, sort of disciplined manner.
Noel: I think you yourself highlighted, at the start of a transformation, knowing you've got the right experience around the table, that the right, sort of, joint effort is involved. And similarly, we talk about recovery. Again,
The key takeaway really is just make sure you've got the right balance of experience and, you've got those strategic goals set out, and then you've got the experience to help deliver against those strategic goals.
I think is really the, the core message that's coming out,
So Shane, thank you so much for joining us on the podcast today. It was so wonderful to hear some of your experience and, thank you to our listeners again. Hopefully this was something you've all found useful and give you some food for thought in some of your potential transformations and potentially where you are in your particular percentage of [00:17:00] success of transformation.
But thanks everyone. And we'll speak to you in the next podcast.