Managing Change Blog
Empirically it has been proven that companies shift their market position (up or down) more dramatically during times of significant economic turbulence. The same can be said for people.
The next generation of leaders within an organization are often made in the fiery crucible of a business transformation. The lessons learned and relationships formed from the intensity and pace of a full potential transformation—the term we use for an ambitious cross-functional effort to alter the financial, operational and strategic trajectory of a business—can be powerful.
It therefore stands to reason that transformation teams should be stocked with an organization's most promising talent. And yet, the natural demands of the day-to-day business work powerfully against getting this right. The urgent trumps the important, and the so-called franchise players in the business remain on the proverbial bench. Why? They are simply too overloaded already, too embedded in their current teams, too critical to the ongoing operations of the business … so say their supervisors, and they are most likely right. But chances are, these are precisely the kind of people needed in the inner circle driving a transformation.
At Bain over the past few years, we have run more than 20 Transformation Forums around the world, attended by senior executives who have gone through, are going through, or anticipate needing a business transformation of their own.
In a majority of cases, newly formed teams work on the most important aspects of the full potential plan, those that are likely to create the most value. To coordinate the added complexity of running a transformation and further support change, some kind of a transformation support office (TSO) is often formed, accompanied by the temporary appointment of a chief transformation officer, reporting to the CEO and executive team. The staffing of such an office, as well as the appointment of these all-important initiative leaders, and sometimes the change agents who accompany them, is an absolutely make-or-break set of decisions.
The path of least resistance unfortunately is to staff these key positions with people who are available, those whom members of the leadership team are willing to "give up." While perhaps satisfying in the near term because of minimal disruption to the organization, the long-term consequences are severe. Not only does the transformation program begin to lose its credibility and impact, but it also is a missed opportunity to elevate the next generation of leaders. At the end of the day, putting the wrong people in the wrong roles destroys value.
Change management has been around for decades, but more than 70% of change efforts fail. Bain’s Results Delivery® insights help companies to predict, measure and manage risk, starting on day one.
From our forums, we find that the majority of individuals who play key roles in these transformations see an acceleration in their careers as a result. The cross-functional exposure, the direct access to the CEO, the executive team, and often the board, and the additional access to training all enrich and expand the skills of these individuals.
One CEO who was frustrated with his transformation team put it to me this way: "Why am I spending so much time and money training and coaching what at the end of the day is really my 'B-talent?' That's got to be the dumbest thing I've ever heard of!" He came to the realization—unfortunately late—that the people who had been selected to lead the initiatives as well as their version of the TSO were far from the franchise players of the business. Within a few months, they had lost the credibility of the organization, and progress began to sputter. Luckily, he intervened and with his senior team reconstituted the program, drawing in top talent respected within the organization. And just like pouring oil into an old and rusting engine, the transformation began to run with new life and increased speed.
Zig Ziglar once said, "You don't build a business. You build people and then people build the business." Business transformations are the ultimate training ground. They present a golden opportunity to find the real high-potential people in the business, give them the platform to grow into the next generation of leadership, and accelerate value capture. It's an opportunity not to waste.
David Michels is a partner and director in Bain's Zurich office, and the EMEA leader for the Results Delivery practice.