Business Transformation: Why technology changes nothing…

Image: Dreamstime 2014As an undergraduate, I had an art lecturer who  was into Bauhaus – the artistic movement, not the band!  Founded by the architect Walter Gropius, the Staatliche Bauhaus was all about creating a ‘total’ work of art, in which all artistic disciplines would eventually be brought together.

It’s got me thinking about the technology end of business transformation. Very often, technology is sold as the ‘total’ work of art that will bring everything in the organisation together. Want people to collaborate? Invest in collaboration software!  Want your employees to be more productive? Give everyone mobile technology so they can work on the train! Want to change the company?  Change the technology!  You get the picture…

In case you think this is some sort of Luddite rant against all things IT, let me be clear. In and of itself…technology is neither good nor bad. It just is. A fact of modern business life. A tool. As the way in which companies interact with their customers shifts, the technological landscape must rapidly flex to accommodate new ways for commerce – helping organisations drive value, grow profits and respond to market demand at lightning speed. Which brings me to one of the fundamental challenges with technology. In and of itself...it changes nothing. And yet…it can change everything.

For Gropius and his cohort, Bauhaus represented a practical opportunity to extend beauty and quality to every home by means of well designed industrially produced objects. For change-savvy organisations, technology represents a practical opportunity to derive business benefit and streamline operations by means of well designed systems and software. So… what makes the difference between truly transfomational technology, and the stuff that just clogs corporate arteries?

The three ‘ologies’…

Psychology. In my experience, the secret is to start with the psychology. Yep.. you heard right. The abstract people bit! Lets face it, large scale business transformation is only achieveable by bringing people, process and technology together. Clever organisations do this by creating a shared ambition for change. They tell a compelling story and create a future that truly involves their employees. They consult widely, and then spend sufficient time buttoning down the scope and setting expectations. Everyone involved in making the change happen is clear about what is expected, and what they can expect.

Methodology. Bill Gates is famous for saying ‘The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.’ Clever organisations look closely at their existing processes to understand where inefficiencies lie. They conduct a detailed gap analysis to establish what is missing from their processes, what can be re-engineered, discarded or left as is. They do this more than once!

Technology. Creating a shared ambition for change, then using technology to facilitate and incentivise new processes or ways of working is a far better approach than using IT to beat people over the head in order to make them shift. Of course, some degree of change resistance happens in most organisations. Poor execution of technological change simple exarcerbates this. I’ve lost count of the number of pitched corporate battles I’ve witnessed when ‘those guys in IT’ get it wrong. Notice, it’s not the technology that is wrong, it’s the people implementing it. Well communicated change, underpinned by well conceived technology can change corporate fortunes. Or it can change nothing.

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.