Organizational Transformation Requires Leadership at all Levels

Guest post from Satish
P. Subramanian

The Business Challenge
 
The low success rate in
organizational transformation and the organizational inability to positively move
the dial on the success rate over the years is a strategic problem.  Organizational transformation is the complex
endeavor of redesigning the organization which significantly impacts all or most
aspects of the business.  Per the 2014 McKinsey
research study of 1323 companies involved in organization redesign, less than a
quarter of those transformation efforts succeeded.  The success of strategic transformation is gauged
by the attainment of strategic objectives, improved organizational performance,
and sustenance of the business change. 

Key
Characteristics of Successful Organizational Transformation

The
silver lining in that organizations have overcome this business challenge.  Organizations with higher success rate in large-scale
transformation initiatives have steadily built and improved their ability to do
so.  They have planned, designed, executed, and sustained organizational
transformation in a holistic, structured way. 
These high-performing organizations have integrated and aligned the six
dimensions of strategy, people, process, technology, structure, and measurement
to realize the transformation success and reap the planned business value.  These organizations have developed strong
transformation capability.  Another key
characteristic for a successful organizational transformation is an active, end-to-end,
and comprehensive leadership. 

Leadership is the Deal Breaker

The extent, level, and
nature of leadership on an organizational transformation that redesigns the
entire business or significant parts of the business is a key determinant of the
transformation success.  Transformations
are typically cross-divisional, cross-functional, and intended to make
significant changes to the business.  Given
organizational matrices, work complexities, and corporate politics, the
transformation team relies heavily on leadership traits to secure support,
overcome barriers, resolve escalated issues and manage risks across organizational
divisions, functions, and levels.  Leadership
in analyzing and communicating the impact, securing stakeholder but-in, reinforcing
the long-term commitment, and sharing the benefits of transformation with all
stakeholders is paramount.  Leadership on
both fronts, the technical and human, is essential for the entire duration of
the organizational transformation. 

Organizational Transformation Leadership

The lack of a leadership
structure and comprehensive leadership significantly jeopardizes the purpose
and strategic objectives for embarking on the transformation. Organizational
transformation leadership is a critical success factor for strategic objective
alignment, integration of the six dimensions mentioned earlier, stakeholder
engagement, organizational change readiness, and business value realization.  Leadership
in actively and effectively engaging with key stakeholders and sustaining their
buy-in ensures the expected business outcomes are realized at each phase or
stage gate of the organizational transformation. 

The business need for
proactive leadership across all the impacted organizational areas and from the
beginning to end of organizational transformation is critical.  Without a multi-level and holistic leadership
approach, transformation will inevitably be a failure by it not accomplishing
the business objectives and improving organizational performance. An
organization transformation leadership model has to be architected and
implemented upfront to effectively confront cross-divisional, cross-functional,
and cross-level barriers and challenges.

Multi-level
Leadership Model for Transformation

The organization structure
model details the reporting structure and governance practices for the
transformation to redesign the organization and transition it from its current
to future state.  The leadership model
complements the organization structure model and enumerates the leadership
structure.  The multi-level leadership model
for organization transformation spells out leadership at each tier of the transformation
program organization structure.  In
addition, it factors the varying styles and levels of involvement of leadership
is needed from the beginning to end of the transformation odyssey.  The holistic leadership model addresses the leadership
needs on all fronts – multiple organization levels, organizational functions, divisions,
and geographies.    

The below illustration
delineates the multi-level leadership model that has enabled many executives to
successfully get to the finish line of an organizational transformation
marathon. Leadership on organizational transformation cannot reside just at the
highest levels.  The business context,
leadership scope, leadership level of influence, and style at each organization
level are different.  The leadership
responsibility and accountability at each level is clearly articulated.  The design, socialization, and deployment of a
multi-level leadership model ensures the leadership needs for a successful
organizational transformation are met.

 
Conclusion

Effective organization
transformation leadership is a “must have” for transformation success.  The transformational change that organizational
transformation is driving requires cross-divisional, cross-functional, and
cross-level leadership to realize the transformation purpose, change vision, and
sustain business outcomes.  The
significant business change initiated by transformation heavily impacts a large
number of stakeholders at different levels and the entire organization.  Organization transformation leadership and
the right leadership model is the secret sauce for organizational
transformation success. 

 
Satish P. Subramanian is author of
the new book, TransformingBusiness with Program Management
 Integrating Strategy, People,
Process, Technology, Structure and Measurement
. He is also a Principal at SolomonEdwards. He has spent over 25 years as a leadership
consultant
in management and technology, and worked with many Fortune 500
companies in the health care, financial services, technology, and manufacturing
industry sectors.
He has also held executive-level
positions at Ernst & Young, Infosys, Point B, and Cambridge Technology
Partners. Subramanian holds a degree in Industrial Engineering and MBA from the
University of Mumbai and an MBA from California Lutheran University. He is
Program Management and Project Management certified by the Project Management
Institute and Change Management certified by Prosci.