Dive Brief:
- A majority of U.S.-based C-suite executives in a survey by software firm Celonis admitted to setting transformation plans in motion without first reviewing internal processes. According to the firm's report, 42% of high-level managers said they didn't know where to start when developing transformation strategies — those aimed at increasing productivity, lowering costs and improving customer service. Celonis surveyed 450 C-suite executives and more than 450 business analysts.
- While 41% of senior leaders thought their business transformation was a time waster, over one-third of businesses spent more than $500,000 on those strategies in the past 12 months, with many receiving little return on investment. Sixty-three percent of leaders surveyed by Celonis admitted frontline workers are involved in transformation activities only because middle management or consultants directed them to do so.
- Celonis said its research showed business leaders were investing in transformation activity because they thought they should, rather than because they identified problems to resolve. Most C-suite executives (79%) admitted to not reviewing their internal business processes to determine necessary priorities before first setting goals and key performance indicators for a transformation initiative. And 35% of analysts said they were not basing their work on internal processes when implementing transformation strategies.
Dive Insight:
When it comes to the transformation, some organizations lack a clear focus or don't know where to start; one-third of organizations have no digital transformation plan at all, according to a recent study by Telstra. Major change requires strategic planning, analysis, buy-in and involvement from everyone in an organization.
HR leaders charged with getting workers acclimated to the idea of change know the value of transformation to their organizations. However, a 2018 study by The Hackett Group found that while 90% of HR managers knew that transformation was good for their workplace, less than half said they had the resources to carry it out. Employers that recognize transformation initiatives can have positive outcomes, like those outlined in Celonis' research, will need to be willing to make the upfront investment for long-term gain.
"Transformation strategies will inevitably be part of every organization's operations, because no business can avoid adapting to the latest industry and technological trends," Alexander Rinke Celonis' co-founder and co-CEO, said in a statement. "However, they should be founded in concrete insights derived from processes that are actually happening within a company. Our research shows that too many businesses are rushing into costly initiatives that they do not necessarily even need to embark on."
