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Transformation
By
Muhammad Dhafi Iskandar
Transformation is a complete change in the appearance or character of something or someone,
especially so that that thing or person is improved.1
In an organizational context, Transformation is a process of profound and radical change that orients
an organization in a new direction and takes it to an entirely different level of effectiveness. Unlike
'turnaround’ (which implies incremental progress on the same plane) transformation implies a basic
change of character and little or no resemblance with the past configuration or structure.2
It is a continuous process and will never be completed. Marketplace changes, and so do the needs of
our clients and customers. The nowadays technologies accelerates all of those changes.
Based on the Forbes Insight, KPMG survey more than 900 respondents in the report of “Business
Transformation and the Corporate Agenda3, Ninety-three percent (93%) of U.S. multinationals is in
some stage of business transformation.
The majority of respondents (51%) define transformation as a continuous process of aligning a
business model to support strategy. The second-largest group (31%) defines transformation as
narrower efforts limited to specific functions, processes or areas, continuous or finite. As for the
fewer respondents (18%) define transformation as an all-out turnaround effort that results in an
overhaul of a business model.
Business Transformation is a process whereby a business needs to put away a set of practices and
adopts new ones. This often involves the way employees work, the way the company is structured,
and the way information technologies are introduced, adopted, and used in the business workflow.
Dr. Ray O. Johnson, senior vice president and chief technology officer at Lockheed Martin said that
“Rather than a tipping point or a trigger, we think of business transformation as a continuous
process that we have integrated into all the components of our company and how we operate.”
1“Transformation”. Definition. Cambridge Dictionaries. Web. 5 January 2016.
2 “Transformation”. Definition. Business Dictionary. Web. 5 January 2016.
3 KPMG. “Business Transformation and the Corporate Agenda”. Forbes Insights. Forbes. March 2014. Web.
For most people, business transformation have several benefits that they aim to achieve, such as:
Ensure adequate workforce skills to successfully manage change
Increase efficiencies and cut costs
Create a sustainable business
Improve responsiveness for a better customer experience
Grow revenue and expand market share
“There’s an entrepreneur right now, scared to death, making excuses, saying “
It’s not the right tme just yet.” There’s no such thing as a good time. – Kevin
Plank. CEO, Under Amour.
What holding back the transformations from success is a lack of commitment needed to usher in a
change of culture. Culture is created and solidified over time through expressed actions and
reactions and not through cooked up, generic sounding mission statements disconnected from real
behaviors. Most of these transformations intend to affect change through assessments,
recommendation checklists and ticking boxes; they fail to address the legacy budgetary procedures,
management and hiring constructs, and performance evaluation processes.4
“Don’t worry about failure: you only have to be right once.” – Drew Houston.
Dropbox, CEO and Co-founder.
When decided to change just one part of an organization, one will end up optimizing locally while
creating adverse effects in other parts of the organization, even if they didn’t intend to. There is no
such thing as changing just one part of the business. Usually interconnectedness within the
organization means everything changes as a result of transformation.
When decided to do a transformation, company needs to conduct a strategic business assessment
(SBA) to determine the company’s need and a realistic estimate of the financial benefits to be
expected from the transformation. As an objective, in-depth analysis of current condition in the
company. By using existing performance measures, goals for improvement can be established and
estimated of the benefits to be achieved.5
4Sachs, Aaron and Anupam Kundu. “Unfinished Business Organizational Transformation, Chapter 1 Changes
Drivers and Measures of Success”. Thoughtworks. 12 November 2015. Web. 5 Hobbs, Dennis P. Applied Lean Business Transformation. UAS: J Ross Publisihing, 2011. Print.
“It is always easier to talk about change than to make it.” — Alvin Toffler.
Journalist and Writer.
There are several questions that need to be asking after doing a transformation:
Are we improving? (better than what we were before)
Are we delivering per expectation? (kept our commitments to our customers and employees)
Are we considered as valuable? (customers and employees want more of us than ever before)
Are we contributing back to the society? (what is our overall contribution back to the society)6
“It takes humility to realize that we don’t know everything. Not to rest on our
laurels and know that we must keep learning and observing. If we don’t, we
can be sure some startup will be there to take our place.” – Cher Wang. CEO,
HTC.
The goal of the transformation is to allow the organization to collectively define and measure new
behavioral constructs that allow the organization to “inspect and adapt”: find the balance between
the following opposites enabling it to respond with urgency.
No matter how business transformation has been initiated (market forces or internally), we find that
it succeeds when it follows the following six stages:
1. Recognition from the business leader to transform.
2. Building consensus across stakeholders on the need for change.
3. Identifying the end state of the company’s transformation
4. Planning in detail the new workflows in support of the change.
5. Piloting the transformation in a controlled setting.
6. Rolling-out the transformation company-wide.
Change Management is the operational component of Business Transformation. It is through
change management best practices that communications plans are formed, human resource issues
resolved, workflows tested, buy-in accomplished, and successful change made into working reality.
6 O’Brien, Gary. “How to Measure Value”. Thoughtworks: 25 August 2014. Web.
In a sense, Business Transformation is initiated and managed at the executive suite, while Change
Management lives in the day-to-day organizational trenches. Although change management would
not be necessary but for the need of Business Transformation, the two are different in scope and
execution. Specifically, the Change Management team is responsible for:
1. Articulating the goals of change in a clear and approachable way.
2. Identifying the metrics whereby success will be measured against.
3. Show the steps necessary to achieve the change.
4. Monitor the change process and create a transparent feedback responding mechanism.7
“The way I think about culture is that modern human have radically changed
the way that they work and the way that they live. Companies need to change
the way they manage and lead to match the way that modern humans actually
work and live.” – Brian Halligan. CEO, Hubspot.
“The distance between number one and number two is always a constant. If you
want to improve the organization, you have to improve yourself and the
organization gets pulled up with you. That is a big lesson.” – Indra Nooyi.
Chairperson & CEO, PepsiCo.
7 TMG-Emedia. “Business Transformation and Change Management”. Web. 5 January 2016.
For further assistance & consultation, kindly contact:
Muhammad Ikhlas Modjo
P: +62 815 8200 890
Doddy Oktavianus Iskandar
P: +62 813 1835 9197
Dian Oktaviani
P: +62 816 184 7683
Disclaimer: this content is for general information purposes only, and should not be used as a
substitute for consultation with professional advisors
www.mimconsulting.co.id
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