Articles

How do you change?

It’s no surprise to learn that for many years, most retail financial services companies have been pursuing similar business strategies.

The intentions behind statements such as “our strategy encompasses efficiency, growth and value for both customers and shareholders” are all too familiar. So there is not much scope for lasting competitive advantage …. Or is there? Research shows that the most successful companies are distinguished by their ability to deliver their strategy successfully.

This means:

  • Doing the right things, and
  • Doing them well.

We discuss these points below.

Doing The Right Things

Arguably selecting the right changes to implement is more critical than implementing change quickly.

This means:

  • Developing strategies and associated operating models that create value
  • Translating strategies into actionable ‘road maps’, programmes and plans
  • Developing prioritised portfolios of change that deliver the strategy
  • Delivering change through programmes, projects and operational change
  • Realising the benefits
  • Continuously monitoring the strategy, road map and investment portfolio.

In our experience, most organisations do some of these things. But very few do all of them, and even fewer explicitly link the processes into a comprehensive, coherent approach to managing change. Experience tells us that missing any of these elements will seriously undermine the benefit of the change.

Doing The Right Things Well

What typically stops an organisation doing the right things well:

1. Instability, caused by continuous changes in direction. Too frequently, companies continually lift up the bonnet and tinker, initiating ‘kneejerk’ activities in response to the latest potential issue or opportunity. This is particularly true in today’s more risk-conscious environment. Symptoms of this behaviour include:

  • Continuously revising and re-shaping the strategy, investment plans and programmes (we have frequently seen situations where over 40% of the available change resource is spent re-planning)
  • Shaving 10% (say) off all company programmes and projects to make ‘head room’ for new projects (death by a thousand cuts).

2. Lack of agility such that processes and procedures make it difficult for the business to respond quickly to changing circumstances.

It won’t have escaped your notice that stability and agility appear to conflict. The trick is to strike the right balance.

Stability vs. Agility - Striking the Balance

To use an analogy, the tortoise won the race by consistently applying itself to the task in hand, whereas the hare raced off, stopped and started again. With organisational change, we need the speed and agility of the hare with the steadfast purposefulness of the tortoise! Establishing the complete change process described above provides the foundation, but how do you achieve agility in the execution of change processes and prevent them from becoming constraints? Agility is characterised by the way an organisation works. The table above shows some of the key factors that both enable and inhibit agility. In summary, we must embed agility into the very processes, governance and structure of the organisation.

Conclusion

The organisations which implement change most successfully appear to manage it effortlessly – they don’t instigate transformation programmes every 5 years, don’t employ an army of consultants to help them ‘make a stepped change’, or ‘boom and bust’ their way through change. They steadfastly deliver what they have set out to do, year on year. We argue that to achieve change effortlessly, organisations will consciously or unconsciously:

Keep the summit in sight

Develop and maintain a clear strategy, making regular adjustments
in preference to occasional sweeping changes.

Keep focused

Build end-to-end change processes to ensure that resource are marshalled to
steadfastly deliver the strategy.

Keep agile

By embedding the capabilities to respond quickly and flexibly to changing
circumstances.

Keep vigilant

To ensure that all parts of the end-to-end process are done competently and
let others become famous for doing some parts excellently.