What Does Organizational Transformation Really Look Like?
When businesses refuse to actively engage in organizational transformation, they fail to evolve to the next stage of their business journey. Following a global pandemic, the invasion of Ukraine, and a precarious bear market, businesses are finally opening themselves up to the benefits of organizational transformation — realizing that change may be the solution to current pandemic-produced stagnation.
Types of Organizational Transformation
Organizational transformation is the process of transforming and changing existing business processes and strategies to address business challenges or gain a competitive advantage in the desired market.
Before implementing organizational transformation, it’s important to define what type of change your organization will implement. Although there are specific strategies you can design and tactics you can implement, organizational transformation is based on 2 broad categories. It’s important to define and attribute what category your change will fall under so members of your organization can understand the full breadth of your new implementation strategy.
Structural Transformation
If you’re planning on shaking up management, team organization, or responsibilities for different departments, that’s defined as a structural change. Structural transformation can include mergers and acquisitions, the addition of employees, changes in response to the market, and changes in company policy.
Additionally, structural change can apply to lateral changes developed to create more efficient departments. Teams can be split up, new departments created, and personnel could be shifted. Promotions and other employee adjustments are also aspects of structural transformation.
Strategic Transformation
Strategic transformation is meant to create a holistic plan that’s actionable and takes a high-level approach to evolve a business model to where business leaders and decision-makers think the business should go. Since the pandemic, strategic transformation has been at the forefront of the minds of executives who wish to simplify their business processes and create a better way of managing departments and improving the bottom line.
From introducing new technologies to adapting employee training to include training for new skills, strategic transformation is the gradual guiding light by which a company grows. Post-pandemic, many organization leaders have realized that their legacy systems, centralized methods of communication, and lack of automated processes are actually detrimental to long-term success.
One type of strategic transformation, digital transformation has become of vital importance to organizations around the world. In 2022, 70% of organizations have a digital transformation strategy or are currently working on one. Digital transformation is a large part of strategic transformation since new processes, like automation and smart insights, are implemented using new technologies. Even in the federal government, where legacy systems are the norm, agencies are effectively modernizing their inefficient and incompatible processes to make room for the automation, decentralization, and organizational transformation brought about by digital transformation.
Four Stages of Organizational Transformation
1. Intention
Weigh benefits and drawbacks
Discuss alternatives
Crystalize an action plan
Any organization that evolves needs to do so with intention. The first question you have to ask yourself as an organization decision-maker is “Why?” Why does your business need to make this change? Does it improve employee performance or productivity; is it a method of future-ready innovation or are you increasing your bottom line?
Fully establish your intentions and see if they align with future business goals. The intention is important in organizational transformation because it creates a condition of clarity and demonstrates the actionable change that should reflect not only the desires of an executive board but also of stakeholders in the organization — including management and employees.
Without intent, management gets caught in a muddle of change recommendations and can’t distinguish between what the organization is aiming to achieve in the future and what seems like a good idea to a few executives. Make sure your organization's end goal is clear and aligns with your company’s core values.
Key decision-makers: Department heads and senior management
2. Organizational Buy-in
Key actions for the organizational buy-in stage:
Meet with employees
Discuss concerns
Ensure employees aren’t overburdened
For your organizational transformation to be successful, you need the buy-in of not only the C-suite executives, but also the employees, management, leaders, and stakeholders. From customers to your distributors, it’s vital that your initiative is supported by a majority of organization members.
In fact, without organizational buy-in, your new undertaking could spell failure for your business. About 70% of all change initiatives fail, from downsizing to new technology, restructuring, or even changing corporate culture, change initiatives fail without buy-in from change makers in your organization.
Key decision-makers: Employees, stakeholders, and middle management
3. Implementation
Plan ahead for roadblocks
Implement new technologies
Report on improvements and issues
The best way to implement a transformation is to change what is planned — nothing more and nothing less. Don’t rely on old patterns or discussions. Rather, your strategies should be based on action and rely on a team set in place specifically meant to carry out the transformation.
When implementing, test your new technologies or procedures to ensure they match the expectations set out in your intentions. Don’t wait for change to happen. Instead follow your action plan, and ensure implementation and intention are one and the same.
Roadblocks
Organizational transformation is sure to come with its own challenges, but there are some roadblocks of which you should be keenly aware and communicate when you’re trying to get employee buy-in.
First, make sure those that are impacted by the organizational transformation are fully aware of the obstacles which may lie ahead during implementation. Make certain that your employees aren’t being overworked and underappreciated during a phase that is sure to bring added stress to the departments affected. Establish a way for your employees to reach out during the process and give organization leaders insight on potential issues.
Second, confirm you have the right leaders in place to ensure organizational transformation can be implemented effectively. If middle managers and lower-level employees aren’t well-equipped for organizational transformation, it’s sure to fail. If no one in your organization has the capacity or experience to spearhead organizational transformation, or you’d like to make sure it’s correctly implemented from the outset, consider an expert, like Populus Technology, for the change that can improve your day-to-day operations, automate your processes, and help you improve your bottom line.
Roadblocks aren’t a possibility for organizational transformation, they’re guaranteed. You’re transforming the structure of your business, and mapping out where your roadblocks may be or getting outside guidance could help you become part of the 30% of companies that actually succeed in their organizational transformation strategy.
Key decision-makers: Impacted department employees, department heads, middle managers, and senior management
4. Validation
Create policies for validation
Regularly report on processes or new technologies
Implement feedback into business solutions
When your change is implemented, validate your transformation on a consistent basis. Make sure your employees are utilizing the new technologies or procedures and get the necessary feedback to make adjustments.
Old habits die hard, so for a while, you may have to verify that your investment is paying off. The worst action organizational decision-makers can take after implementing a change is to assume that a change will be readily adopted and never challenged. Don’t make a costly mistake and become lazy. Make sure your all employees and managers are aptly trained on the new process and/or technology and hold them accountable for the transformation.
Key decision-makers: Department heads, middle managers, and senior management
Finding an Organizational Transformation Partner
If you’re making a major strategic change to your organization, whether in technology or in processes, it’s important to understand if your changes will be compatible with your existing methodology and can be managed by existing employees. Partnering with an organizational transformation partner can alleviate the stress for you and your employees — allowing you to focus on the future and your development partner to take charge of the implementation needs of your organization.
In truth, organizational transformation is not always pretty. It can be tedious, monotonous, and at times stressful. However, if your employees are bought in, your leadership is aptly prepared, and you have a partner to help you on the journey, your organization can be prepared to succeed for years to come.
Populus Technology can help you automate your processes, manage your vendors, and develop custom solutions to future-proof your business. Through organizational transformation, Populus can help you eliminate unstructured business protocols and get your company on the same page for consistent, repeatable business results.
