Business Transformation: Ready, Steady…Stall!

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Recent headlines documenting the ongoing saga at Tesco bring to mind Lao Tzu, who wrote: ‘If you do not change direction, you will end up where you are heading’. No doubt many column inches will be devoted to the analysis of what went wrong and why. Did management ignore the warning signs within? Or did they simply fail to adapt and react to changing circumstances in their external environment?

Whatever the outcome, one thing is certain. If it is to appease shareholders and customers, Tesco’s incumbent CEO, Dave Lewis will need to transform it’s business, to do so radically – and in a short space of time. In this case, the £250m hole in Tesco’s finances, a property portfolio of large and unprofitable stores, and a devalued ClubCard and brand, are all powerful incentives for change. But, what happens when the organisation isn’t ready?

In my experience, things only change, when you do. Such change may be conceived in the boardroom, but it is delivered with and through the people inside the wider organisation. And this is where the challenges begin. I often say that business transformation is about psychology, not methodology. So it’s just as important to understand the ‘who you are dealing with’ as well as the ‘what needs to be different’. Just ask the team who are transforming the Co-Op!

Instead of charging headlong down the transformation tunnel, it might be wise to ask:

Is the vision clear?
Is the appetite for change genuine?
Are management’s messages consistent with their actions?
How ready is the organisation to make the change?
Do the resources and business conditions support change?

The greater the complexity of change, the more vital it is to understand where you are starting from. Otherwise, ready steady go ends up as ready steady stall.

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