Quo Vadis, Business Transformation
Guest post by
Gaurav Kumar, Principal Consultant, Infosys
A key step that needs occur prior to the start of any business transformation is the definition of objectives for the same. Many a transformation enterprise has bitten the dust with conflicting objectives being pushed by key stakeholders. As a fundamental premise, we can agree that any business transformation activity must have a set of objectives that it seeks to achieve. These objectives are quantified in myriad ways to arrive at a value that is expected to be achieved through the transformation. This activity however does not provide the clarity on the individual stakeholder objectives that the transformation seeks to achieve. Neither does it provide the collective sequential set of priorities which can be used as guidance by the transformation team. For example, the transformation may be effecting improvement of a particular metric however the levers to impact may widely differ amongst the stakeholders.
At this stage, we make a fundamental assumption: key stakeholders for the transformation are represented in the Steering Committee. As a first step, it is essential to collate a prioritized listing of objectives from the Steering Committee members. These objectives should then be grouped and presented to the designated Steering Committee for harmonization. The harmonization exercise seeks to achieve the following:
- Enunciate exact set of objectives to be achieved
- Provide weightage to each enunciated objective
These set of objectives and their weightages serve as input decision framework for the entire transformation exercise. The decision framework also needs to take into account the ease of implementation. This can be categorized as the extent of change management as well as the technological ease of implementation of the change. This especially applies to requirements and their prioritization.
Such an activity also enables identification of key metrics that are expected to be affected by the transformation. The tracking of the same helps validate the efficacy of the transformation. The impact to metrics should be further broken into levers which are specific actions that impact the calculation of the metric. The quantum of change in these levers should be agreed upon and the monetary benefit assigned to the same. These help transcend the gap from the qualitative nature to objectives to the quantification of business benefit. The realization of this business benefit which could come in terms of revenue increase or cost reduction. Avoidance of risk in this case is treated as a cost reduction measure as there are risk mitigation measures or insurance premium that needs paid as safeguard.
An effective transformation always keeps its eyes on this decision framework and uses it to track proposed solutions for impact to the levers in the pre Go Live state. In the Post Go Live state, the metrics and the levers are tracked against as per the agreed periodicity to determine the degree of success.
To use a hackneyed quote from Through the Looking Glass:
"Would you tell me, please, which way I ought to go from here?"
"That depends a good deal on where you want to get to," said the Cat.
