Nobody’s company is immune to the eventuality (or necessity) of change.
Long-term business growth calls for not only scrutiny of existing processes, but an understanding of how those processes stack up against the status quo. What may have been a successful business model ten years ago may now be a course for disaster amid rapid digital transformation, supply chain issues, and other challenges that continue to vex business leaders across the world.
But that doesn’t mean that organizational transformation should only occur as the result of fancy operating models signaling that something’s got to give.
In a globalized business environment, for instance, a cultural transformation is often required to remain competitive. Or if you’re grappling with leadership issues, executing a successful management transformation can be a healthy step forward as you look to right former wrongs or get ahead of the curve.
Whatever the catalyst, eventually your company will need to face (and hopefully embrace) some sort of transformation.
Satoshi Hirose is the dean of GLOBIS University. But in the past, he worked as a risk management consultant. In his Unlimited Insights course, Leading During Transformation, he examines the various causes for transformation initiatives and business process transformation methodology. Understanding both is key to keeping your organization afloat in turbulent times and getting ahead of serious issues before they emerge.
Below is a transcribed excerpt of his course.
All companies have different reasons to change.Satoshi Hirose
Exploring the Different Types of Business Transformation
Satoshi Hirose: Corporate transformation is a very interesting world. It varies because all the companies have different reasons to change.
Specifically, there are some very well-running companies which need to change because the environment changes. At the same time, there are different types of transformation. Some are in a very difficult situation, and they need to transform to survive.
In my opinion, transformation varies. There’s no single one type of transformation. Every company has a different transformation story.
How to Make the Most of the Transformation Process
Hirose: I was mainly involved in the transformation of underperforming companies. This is not easy work.
You have to first stop the bleed of the company, meaning there’s always loss or cash outflow continuously happening in that kind of underperforming company. So you have to stop that.
The next step is to put the company in the right direction, which will create growth and profit. These are two different types of projects you have to run, but you have to do them simultaneously, cascading.
So that is not easy work, but it’s very interesting work at the same time.
When you are conducting cost reduction initiatives, you also have to move forward for positive initiatives.Satoshi Hirose
How to Keep Your Team Motivated amid Business Process Transformation
Hirose: Talking about how to “stop the bleed”—it’s not easy.
You have to renew the contract with the customer. You have to reduce the cost you pay to the suppliers. And sometimes, ultimately, you have to reduce the cost basis, which could potentially include cutting people. That is very impactful and hard to run.
At the same time, the difficult thing is that, when you are conducting these cost reduction initiatives, you also have to move forward for positive initiatives.
Usually, when you are cutting costs and labor, everybody looks down. You have to make the people who remain in the organization look forward and understand what they have to do. And they need to focus on what they have to do.
As a leader, doing both things is not easy. But that is what you have to do when you are involved in corporate transformation.