With the news that the UK has the lowest export growth in the G7 other than Japan, it is clear that UK business is suffering.
This situation is confirmed by PwC’s CEO survey which found that 22% of UK CEOs believed that their current business model will not survive to 2030. PwC identify a wide range of forces impacting organisations from climate to digital disruption and from changing regulations and customer requirements. In contrast to the 22% of worried CEOs, PwC found that 83% of the top performing companies they analysed had changed their business model in the last 3 years. A significant number of these invested in and carried out enterprise-wide transformation.
In the case of a complex and broad transformation affecting all parts of the enterprise, the PwC report makes a good case for a dedicated individual in the C team (e.g. Chief Transformation Officer), either selected internally, for example, a de facto transformation champion, or recruited externally. The justification is that transformation is too important to be left at a lower level in the organisation.
“That person should be elevated to the top table, ensuring transformation remains a fixture on the boardroom agenda”
The PwC report outlines the qualities needed in the Chief Transformation Officer role including curiosity, creativity, collaboration and crisis management.
The role of the Chief Transformation Officer
The role requires a special ability to keep everyone on side. Apart from the slight awkwardness of potentially having two CTOs in the C-team, the Chief Transformation Officer has to convince colleagues to cooperate in the transformation strategy. I have worked in organisations where it was positively encouraged for different leaders to compete with each other, leading to a robber baron mentality. If the ChiefTransformation Officer spends all their time dealing with internal rivalries, they will find it difficult to stay abreast of the pace of change in the wider world. In an article in the MIT Sloan Management Review, Howard Yu and Alyson Meister point out that while transformation strategies need to take these changes and trends into account.
“Companies cannot afford to lose sight of their core customers and the present economic environment”.
As a positive example of a successful transformation, they cite Nike with its evolution from a foundation in technology to the Nikeland metaverse, a wholly integrated part of their digital strategy. On the negative side, they describe how Ron Johnson tried to remake JC Penny in the image of Target or the Apple Store, forgetting the loyal core customers, and how this transformation resulted in bankruptcy two CEOs later.
The Sloan Review article describes two other challenges for transformation leaders-the need to engage in tough and possibly heated debate when decisions are painful for some stakeholders, using the example of evolving Disney+ to include content aimed at adults rather than just kids, and the need to avoid overlooking current employees when the strategy requires hiring of “star talents”.
How Tensense can support Chief Transformation Officers
In conclusion, the job of Chief Transformation Officer is not a straightforward one and they need all the help they can get. As well as having like minded colleagues and experts to assist, the Chief Transformation Officer can look for tools that help them understand how changes are being received in the enterprise. One approach to finding out how changes are perceived is to ask the workforce for their opinions in a noninvasive way. Using Organisational Sensemaking™, Tensense provides an anonymous, quick and ongoing way of assessing the mood of the people about how the organisation is doing. You can find out more in this short video here.