Transformation Teams - Setup for Success

Transformation teams come in all shapes and sizes. Ultimately, the team's goal is to evaluate and develop an actionable high level plan that will allow the organization to move from its current state to the desired target state.  In today's complex world, that usually means diagnosing details around multiple dimensions of an organization. Without listing in any specific order of importance, those dimensions include:

1. An organizational aspect - what does the org structure look like, what people and skills need to exist to ensure success?
2. A business process view - what processes exist today but require modifications? What new processes need to be developed? Process views are a key component to integration, high level processes see across typical boundaries of organizational structures, while detailed processes can touch on key information that needs to be shared across business units.
3. Technology - technology is a common component in most business services and thus is a key component to ensure successful transformational efforts. Technology aspects need to be mapped and aligned.  Gaps in functionality must be documented and connected to gaps or inefficiencies in processes and how information flows through an organization.
4. Shared data - relevant data that may be missing or duplicated in the current state need to have the following to occur;  alignment to processes, security aspects related to people need to be identified and map how technology will most efficiently use the data.
5. Determine how all of the above work together in the most efficient and effective manner.

Organizing this overall process is usually the job of a business architect. Business architects act as the guide on this journey. They help identify the objectives of the transformation, and how best to measure those objectives in the future state.  The business architect is responsible for helping the team visualize and design that target state. The desired target state could be "blue sky" thinking towards a long term strategy or a smaller, more tactical change.  Business architects are skilled in seeing the bigger picture and are not weighed down by the way operations are currently executed. [A full description for a Business Architect's role within transformation efforts will be addressed in future posts].

Once the target state is designed and approved, the process of identifying gaps and overlaps between current state and target state begins. This process requires intensive research to uncover all aspects of the organizational dimensions mentioned above. Once the details are identified the process continues, the building blocks are stacked and re-stacked until the most stable map emerges. This is an iterative process; the final product is rarely developed on the first pass. As more layers are uncovered, it usually provides insight into changes to previous blocks, eventually developing the full picture.

In larger transformation teams, each of these disciplines are represented by a specific individual skilled for that respective dimension. The business architect often acts as the coordinator to pull together the relevant information from each dimension, but ultimately the team needs to work together to diagnose and resolve.  Some related roles to a transformation team include but are not limited to:

1. Business Architect
2. Process Engineer  [In future posts, we will address the overlapping responsibilities of a business architect and a process engineer].
3. Information and/or Technical architects - Obviously the structure and role of technology-related architecture disciplines can have different meanings; what you need are architects who understand how information is used, organized and structured.  On the technology side, you need technical people with broad knowledge of the technical landscape within an organization and aren't afraid to seek out additional contributing parties that reach out for assistance with the challenges they don't fully understand.
4. Change management - if your transformation effort can afford this resource, it will go a long way to ensure success. Transformation equals change and the number one reason for failure is resistance of that change. [We will also address in future posts the many reasons why transformation efforts fail].

In smaller teams (even teams of one) the business architect can be responsible for many or all dimensions. This business architect will usually have a specific background from IT and process which allows for success. In any size teams, the need for subject matter experts is guaranteed (sometimes the business architect can also play the SME). 

Obviously this information won't guarantee you a successful transformation but it does highlight some important aspects and necessary components to help guide you on your journey.

Changes for the Organization that lead to Transformation, Pt. 2

A change that has taken place within companies is the presence of business transformation teams. Whether the team is a short-term team in a small to medium sized company, utilizing business architecture methods - or a larger company with a long-term transformation team or office, with tailored transformation and architecture methodologies, - this addition to an enterprise can lead to organizational transformation.

When an organization has a business transformation team, it can provide a number of benefits to the enterprise.  Business transformation teams can act as a proactive, reactive or even a supportive role.  Business transformation teams can partner with the business to facilitate transformation, helping to identify needs within the organization, acting as a catalyst and providing a support structure to enable business transformation efforts.

As a business transformation team plays a proactive role within the business, the Business Transformation team can identify needs throughout a company.

This information often results or benefits other transformation initiatives.

Business transformation teams often discover these needs by mapping current state processes, searching for integration points or while performing a gap analysis. These steps are used to develop transformation strategies and drive out business capabilities which inform the transformation.

When business transformation teams interact in a reactive role, they can serve the needs of their customers, as a facilitator.  If a business area knows it wants or needs a transformation, the particular line of business can reach out to the business transformation area with the expectations being provided a structure and framework of a success. 

The business transformation team can guide the business area in turning their idea, their future state into a reality. In addition, a business transformation team can assist a business area by appealing to executive leadership.  Transformational efforts that are easily recognized by leadership have a better chance of being supported, funded and socialized throughout the business areas. This support can add to the overall success that a business transformation team has when playing a reactive role.

A business transformation team can also be a catalyst or an advocate. In a support function they can take previously restricted or suppressed ideas and turn them into a transformation. This advocacy can revolutionize a business area, or even an entire company.  A well-respected business transformation team can help facilitate the transformations that are unrecognized, difficult to occur, and difficult to get buy-in from leadership.  

Business Transformation teams can also be leveraged for the case for change, identifying the benefits for the business, and provide coaching to those executing the transformation.

Dedicated transformation teams, which usually consist of Business Architects, Change Managers, subject matter experts, and other more detailed disciplines like process engineers, IT architecture or Experience Architects, have a unique power to drive change, as well as ensure its ongoing success and sustainability.

Changes for the Organization that lead to Transformation, Pt. 1

Changes within an organization have a variety of effects, often depending on the magnitude of the change.  Some changes are small and can go unnoticed, while others are more cumbersome, take longer to implement and/or take longer to see the benefit. 

It is from the more robust organizational changes that companies find themselves in truly transformational efforts.  Some of the most common large-scale organizational changes that lead to transformation are new leadership, standing up a Business, Enterprise Architecture or Advisory practice, modifying a company's operating model, or moving silos into a more enterprise focused role.

Often when there are changes in leadership, leaders are in a position to implement their ideals. This can initiate a transformation.  This change can lead to transforming either a specific business unit or can spread across larger areas of the organization.  Changes in leadership can result in a transformation simply as a means to evolve from a previous leader’s direction. 

When arriving in a new position, new leaders identify where they can impact direction for an organization. Transformational leaders will attack the opportunity and steer towards new methods and innovative designs. These changes can easily drive large-scale business transformation.

On the other hand, if an organization has a leader that is resistant to change, it can often halt new or prevent existing changes from becoming successful. Having such a leader replaced with a more transformational leader, will allow transformations to occur and with perhaps fewer challenges.  [Note: Politics and differences in ideals among leadership is one of the biggest roadblocks for why transformations don't' occur or are not as successful with implementation and/or timing for the completion of a Transformation.  This topic will be addressed in the near future.] 

Despite the reason for changes in leadership, each leader has their individual ideas and vision for how the company should run; some of these visions align with the current state, and other visions can lead to transformation.  Change Management is an important aspect to ensuring proper execution of a transformation initiative. Change Management specifically addresses the problems around culture and leaders and their willingness to face the change with open arms or closed a closed fist.

Regulations and Compliance Drives Transformation

One primary reason companies take on transformational efforts is due to regulatory and compliance demands.

Business transformation has become commonplace because of regulations which developed from the financial crisis of 2007-2010. Since 2008, numerous pieces of legislation have forced corporations of all industries to transform major parts of their business, if not their entire business.  Regulatory and compliance acts are now driving companies towards transformation because of even stricter rules.

One of the most impactful pieces of legislation is the Dodd-Frank/Wall Street Reform Act. The Act, enforced in 2010, has brought transformation necessity to many industries, including Banking, Financial Services, Energy Trading and Insurance among others.  The Act has forced companies within these industries to implement a number of changes ranging from re-engineering investment and banking rules, restrictions around trading of commodities and derivatives, and monitoring aspects of the insurance industry, including gaps in regulation of insurers that could contribute to further financial crisis.

These rules can drive a number of changes across an organization, including but not limited to:

• Modifying, developing, and/or purchasing new technology

• Improving processes that have to be absorbed and integrated within operating models

• Facilitating changes in the company culture which must support and align with the transformation

• Modification of intellectual property, including employee knowledge bases.

These changes are usually necessary for companies to maintain compliance with the legal and regulatory parameters of their respective industries.  Non-compliance often becomes expensive based on paying for fines or other legal battles.

Business Transformation

One of the many consistent factors companies face in their existence is the need to change.  Companies seem to be always in the midst of constant change, and at times, the act of changing can to be a company's main focus.  For periods of time, companies enjoy periods of success without disruptions and being confronted by factors that will force or be a catalyst for a company to transform.  Yet, with or without warning, companies will find themselves in unfamiliar circumstances with uncertain outcomes and the desire for Transformation. 

As the company transforms, no matter how painful and laborious the process, the Transformation itself is most always for the betterment of the customers in order to return the company to a more sustainable state of financial success, customer growth, and a more competitive position in the marketplace.  With that, transformation is becoming a more desired imperative of a company’s focus and vision for their future.  

The need or even requirement for transforming can be drastically different for each company.  Companies that are in different industries, work within different products, and provide different services can all find themselves with a different purpose for Transformation.  Occasionally, companies are put in a position where they have ample time to adjust and be much more comfortable with the complexity of Business Transformation, while other companies are put in a positions where transformation is needed within a limited time frame and the companies’ focus has to immediately shift to not only adapt to any behavioral changes, but to strategize, plan, and execute the Transformation. 

In future posts, I'd like to talk through the many reasons why companies go through Transformations.