In this video case study, ISG's Alexandra Classen and Dr. Tammie Pinkston examine the full continuum of the digital transformation journey with a heavy focus on technology modernization and change management in four parts:
- Determining a future vision
- Finding the right partners
- Leading rapid change
- Realizing value at scale
Part 1: Determining a Future Vision
OK, so a time when I helped a client to determine a future vision, I actually formulated a joint mission and vision for that program together with all of the stakeholders. And when we did it, then we broke it down in further components and key elements. So, we said: “we want to have a forward-looking IT.” What does that really mean to the client?
Their answer was: being product-aligned, creating workplace for their employees, having a globalized operating model. And after we have done those key elements, we went further down and broke it into the dimension of a target operating model so that they have really a comprehensive vision and mission for their way going forward.
Dr. Tammie Pinkston
You know, often when our clients go on these journeys, there's multiple priorities and multiple goals. It's really hard for them to crystallize what it is they're trying to achieve. But what I've found over the years is people answer that based on their area of responsibility and what they know.
We have a really engaging tool that we use for leadership alignment, and it can be used at multiple levels of the organization. And I actually encourage clients to use it at multiple leadership levels to get vertical readings, but then also horizontal – to get geographies represented and get functions or departments represented as well. It really challenges their thinking, and it's not a survey; it's based on their opinion statements. We ask those participants, “how much do you agree with this statement about the program or the change initiative?” And if they're outliers, we have that conversation to understand why, but we really get to the heart of the assumptions they're making that may be incorrect. Or the unintended consequences or the barriers to change.
But ultimately, we go through the exercise, and they collectively create an action plan that we then will track over the life of the program, and we build it into larger organizational change management interventions and activities. At the end of the day, if we can get them to crystallize and to rally around what's truly important to them and have them all talking from the same script, it really bodes well for the success of the of the change program.
Part 2: Finding the Right Partners
What's also important for a transformation journey is selecting the right partner. So, everything matters. I mean, if you go and change your operating model, for example, I have a customer, who had really a decentralized, localized operating model, and they had to change to something global.
They have to get the partners in to really help them to shape that global operating model and get the competency to scale – the ability to scale – to really make that transformation journey a success.
Part 3: Leading Rapid Change
Dr. Tammie Pinkston
Where do you find your clients struggling with transformation at speed?
So exactly when they have to develop a new operating model. When they, for example, change from that localized model into a global model, and they need to find the right approach to do this. I see them taking a very complex road and trying to do everything at once. So, what they need to do is really go in from a business perspective and go in by business domain and decide what needs to be done in these domains and have a clear plan to do it. The goal is that they can really tie the transformation to the speed required for each business requirement.
Dr. Tammie Pinkston
Absolutely. And what our clients have to recognize, and I think some do, which they really struggle with, is transformation is changing everything that their workforce knows: the way they've always done it. So, we know that humans don't like change. They have a low tolerance for ambiguity. We're creatures of habit. All those things are working against us.
We really have to, from an organizational change perspective, we have to understand which stakeholders are impacted the most, how are they going to be impacted, what's changing (everything's changing in their world), and we have to build the story. We have to help them understand what that future operating model looks like, because most people can't see a future that's different from their present. And so, our communications will create and paint that picture for them.
And we've also found it very helpful to use a change network because as an external resource, we're never going to know the business and the way that they do their work. A change network can help us paint that picture much clearer for them and lead individuals on that change journey. And it allows that organization to describe, “Here's what we used to do, and here's what we're going to be doing.” It helps to clarify the roles and responsibilities, because fundamentally individuals need to know what they stop doing, what they start doing, and what they need to continue doing in that future state. Right?
Right. I mean, there is no transformation without a change program. It doesn't lead to success. That's also my experience.
Part 4: Realizing Value at Scale
So, what I’ve seen at my customer: that they thought they were done, especially one pharmaceutical company, they thought after they signed a contract and they just pushed it over to the providers. But then they saw that business just did not really go for it and actually migrate the application to their platforms.
So, they lost a lot of the value of the contract of what is partnership, because they need continues to need to change and have to get these stakeholders on board to come on to this journey. That's my experience when it's kind of – it's not stopping when you actually sign a contract. We need to go after it, and you really continuously need to engage with your stakeholders.
Dr. Tammie Pinkston
Absolutely. When they sign the contract or when the new system goes live, that's really just the beginning. So, it is we've discovered that it's imperative that we continue to monitor, that we talk to the helpdesk or whatever tiers of support that they have and say, “where are we seeing consistent issues? Where do they not understand what's happening? Where are they not using the process or the tools?”
So, we often will recommend that clients keep their change networks in place if they actually leverage those. Because they can be a very helpful group of individuals that continue to provide feedback to say, “Hey, I think we need help here,” or “This team doesn't seem to be getting it.” They really can help us focus when we may need to go back in and increase adoption through, again, change management techniques.
But you know, the other thing that I think is so critical, after programs are launched or new relationships are built, is we have to help coach senior leaders to ask different questions. We had a telecommunication client many, many years ago where we recognized in this ERP implementation: They were coming from a world of they spent 14 days looking for $0.07. Because you couldn't pass the $0.07 on to the right there if you didn't find it and account for it. But in that new world, it's a very different model.
But if you if you don't build those checks in, and, quite frankly, if you don't change the performance management and the metrics of that workforce, they have a tendency to bounce back to their old habits. They remember how they've always done it. So, it's a very hard thing. And a lot of clients don't have the patience or the sustainment to get to the performance management and the metrics. But it is absolutely essential to click into that new operating model because at the end of the day, people do what they're rewarded to do.
Right. I mean, you really have to get the right measures in place. Also for other stuff, like financials, transformation progress, adoption. The measurement system is really key for all of that.