Half of our respondents had been involved in a successful transformation, while the other half had experienced an unsuccessful transformation. So, what can leaders do to tilt the odds of success in their favor? To find out, we interviewed 30 leaders of transformations and surveyed more than 2,000 senior leaders and employees in 23 countries and 16 sectors. Our own research, in which we spoke to more than 900 C-suite managers and more than 1,100 employees who had gone through a corporate transformation, showed similar results: 67% of leaders told us they had experienced at least one underperforming transformation in the last five years.Ĭonsidering that organizations will spend billions on transformation initiatives over the next year, a 70% failure rate equates to a significant erosion of value. In 1995, John Kotter found that 70% of organizational transformations fail, and nearly three decades later, not much has changed. But in today’s complex and uncertain world, as we face challenges ranging from climate change to digitization, geopolitics to DEI, organizations must treat transformation as a core capability to master, as opposed to a one-off event.Īt the same time, leaders must recognize that transformation is fraught with risk. The researchers identified six behaviors that consistently improved the odds of transformation success.ĭisruption used to be an exceptional event that hit an unlucky few companies - think of the likes of Kodak, Polaroid, and Blackberry. Leaders lost faith and looked to distance themselves from the project, which led employees to do the same. When their teams hit the inevitable challenges, negative emotions spiked, and the team entered a downward spiral. By contrast, leaders of the unsuccessful transformations didn’t make the same emotional investment. This meant that when the going inevitably got tough, employees felt appropriately challenged and ultimately energized by the stress. These leaders offered a compelling rationale driving the transformation, and they ensured employees had the emotional support they needed to execute. A team of researchers found that in successful transformations, leaders not only made sure their teams had the processes, resources, and technology they needed - they also built the right emotional conditions. Organizational transformations are extremely difficult on a personal level for everyone involved.
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