{"id":39276,"date":"2022-11-01T08:21:06","date_gmt":"2022-11-01T12:21:06","guid":{"rendered":"https:\/\/centricconsulting.com\/?p=39276"},"modified":"2023-10-23T09:15:28","modified_gmt":"2023-10-23T13:15:28","slug":"the-business-transformation-process-the-only-guide-youll-need","status":"publish","type":"post","link":"https:\/\/centricconsulting.com\/blog\/the-business-transformation-process-the-only-guide-youll-need\/","title":{"rendered":"The Business Transformation Process: The Only Guide You’ll Need"},"content":{"rendered":"

We’re kicking off our business transformation blog series, where you’ll learn all you need to know about successfully embracing an agile mindset across all areas of your company.<\/h2>\n
\n

More than ever, companies are facing significant pressures to innovate, stay ahead of competitors and operate at high levels of performance.<\/p>\n

High-performing companies that can effectively transform in today’s market will thrive while lagging businesses will cease to exist.<\/p>\n

What is the Business Transformation Process?<\/h2>\n

Today’s business leaders realize that to navigate the challenges \u2013 and opportunities \u2013 presented by ongoing disruption, they need to reevaluate and transform business processes.<\/p>\n

While the amount of change necessary within an organization varies greatly, most companies find today’s business transformation needs extend far beyond tactical, operational improvements. A successful transformation often requires a fundamental shift in strategy, core operating structures, and in some cases, the company’s underlying business model.<\/strong><\/p>\n

The following graphic illustrates the typical ranges of business transformation and how transformation initiatives are moving up the curve in terms of size and complexity:<\/p>\n

\"Business<\/a>As a result, the very definition of business transformation must evolve to reflect the increasing magnitude of change and the need for continuous evolution rather than one-and-done deals.<\/p>\n

The business transformation process is not a one-time job, nor is it just one process.<\/p>\n

We define business transformation as:  “Driving competitive advantage through the ongoing deployment of strategic changes and performance improvements across an organization, encompassing people, process and technology.” <\/span>\n

When Is Business Transformation Needed?<\/h2>\n

Even prior to the pandemic, the average lifespan of an S&P 500 company decreased from an average age of over 36 years in the 1970s to just under 20 years<\/a>. And now, analysts predict company lifespans will only get shorter as the pace and level of disruption increases exponentially.<\/p>\n

Today, companies must rethink not only how they reach and serve their customers but also how they effectively operate in a business anywhere<\/a> environment.<\/strong><\/p>\n

In addition, we are seeing an unprecedented shift toward mass digitization. Transformational technologies, such as artificial intelligence (AI), machine learning<\/a> (ML), natural language processing (NLP), robotic process automation<\/a> (RPA), cloud computing<\/a> and robust collaboration platforms are enabling companies to transform their business models and operate virtually.<\/p>\n

Collectively, these disruptions are increasing the pace of change and putting pressure on companies’ strategies, people, processes and technology. Perhaps equally as important, these disruptions allow new and existing competitors to change the game, potentially putting companies at a significant competitive disadvantage and at risk of becoming irrelevant.<\/p>\n

But you don’t have to just sit back and play defense. There is a golden opportunity for bold, forward-thinking organizations to take advantage of these new realities and reposition themselves to gain a competitive edge in the market.<\/p>\n

In other words? Now is the time for business transformation.<\/strong><\/p>\n

Signs a Business Needs a Process Transformation<\/h2>\n

To effectively address the threat of disruption, companies must proactively challenge current norms, drive innovation and embrace change in a way that allows them to respond rapidly to changing market dynamics.<\/p>\n

However, despite the desire to transform, companies struggle to do so. Below is only a sampling of some of the key challenges companies face when they critically need a business process transformation:<\/strong><\/p>\n

    \n
  1. \n
      \n
    1. \n
        \n
      1. Lack of leadership alignment to vision and strategy, aggravated by rapidly changing market conditions.<\/li>\n
      2. Ineffective efforts at capturing, aggregating and distilling key insights from mounds of data to understand market realities and make informed decisions.<\/li>\n
      3. Slow to modernize company operations and enable digital execution.<\/li>\n
      4. Hurdles and silos get in the way of innovating and launching new products, services and solutions to the marketplace.<\/li>\n
      5. Uncertainty about how to address mass disruption to organization, people and culture.<\/li>\n
      6. Not fully realizing value through end-to-end strategy alignment and execution.<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

        These challenges are all significant on their own. However, one of the biggest underlying issues many organizations face today \u2014 and which contributes to many of these challenges \u2014 is the lack of business agility across the organization. But what does business agility mean?<\/strong><\/p>\n

        We define business agility as:  “The willingness and ability to organizationally respond to changing business dynamics in a flexible, adaptive and rapid manner.” <\/span> To keep up with the ever-increasing pace of change and ensure your organization stays one step (or many steps) ahead of the competition, it’s critical you have this ability.<\/p>\n

        You don’t simply need agility isolated to certain parts of the business, such as IT. Today, you need it across all parts of the business, ranging from strategic planning to product development to operations to information technology to corporate culture.<\/p>\n

        So how do you go about creating an agile business \u2013 one that can embrace disruption, quickly evolve its business model, rapidly deploy new business capabilities, enable a culture of change and sustain results over time?<\/p>\n

        Business Transformation Process Drivers<\/h3>\n

        Based on the increasing magnitude of change, the business transformation process can be complex and impact many business elements. Each element \u2014 as illustrated in the relationship model below \u2014 is critical on its own.<\/strong> But collectively, you must structure and integrate these to be structured and integrated with one another in order to drive new business capabilities and achieve topnotch performance levels.<\/p>\n

        \"\"<\/p>\n

        You will notice in the relationship model there are many interdependencies between the drivers of business transformation you must consider over the course of the process, with several dynamics emerging immediately.<\/p>\n

        For example, a compelling vision guides the overall transformation, but you need to ground it in understanding customer, industry and business realities. Technology plays a critical role in inspiring your vision and enabling new business capabilities. Processes are fundamental in defining how your business performs and delivers value, driving organization design and resource requirements.<\/strong><\/p>\n

        Addressing these complexities requires a comprehensive approach to business transformation. Based on the ever-increasing pace of change, we can no longer view business transformation as a periodic or a singular event. You need an agile approach to business transformation by building agility throughout the organization, so you can respond in real-time to changing business dynamics and pivot quickly to stay ahead of the competition.<\/p>\n

        What Are the Core Steps in the Business Transformation Process?<\/h2>\n

        If business transformation is the new norm and an ongoing journey \u2014 which it is \u2014 then what essential transformation steps do you need to get right? We have boiled successful transformation down to six key steps, which we’ll cover one by one throughout this blog series.<\/p>\n

        It is important to note that these steps are highly dynamic and do not imply a sequential or waterfall-based approach to the transformation process. As you respond to continual market shifts and disruption, you need to integrate multiple ongoing activities within each of these six essential aspects of agile business transformation.<\/p>\n

        \"Business<\/a><\/p>\n

        Customer and Business Insights:<\/strong> Garnering real-time customer and business insights to enhance decision-making and guide the business.<\/p>\n

        Understanding the impact of changing customer expectations requires harnessing new technology<\/a> to attain a 360-degree view of business performance. Integrated customer data platforms, AI, experience management platforms and predictive analytics tools have created previously unavailable opportunities to aggregate data. This allows you to collect a complete view of your organization and facilitate informed decision-making.<\/p>\n

        Vision and Strategy:<\/strong> Adapting to the ever-changing market and charting a new course forward, one which is both compelling and inspiring to the organization.<\/p>\n

        Embrace disruption and learn to mobilize quickly, altering business strategies in real time to gain a competitive advantage. Rather than developing strategy<\/a> in isolation, successful business transformation processes involve diverse perspectives from stakeholders, especially your employees. The goal isn’t constant enterprise-wide disruption, of course, but to build agility within business processes to both test assumptions and proactively adapt.<\/p>\n

        Operating Model:<\/strong> Establishing a blueprint for configuring internal operations and building high-performing, agile business capabilities.<\/p>\n

        A well-designed operating model is both the method and the result of creating a transformation blueprint. This blueprinting process consists of three integral steps:<\/p>\n