Successful Transformation: Balancing Innovation with Certainty
co-author: Martin Roth
Transformation: Implementing Innovation
Transformation projects implement innovation, bringing an organisation from an old state (e.g. manual processes) into a new state (e.g. digitalized). During a transformation, it is vital to be cognizant of certainty levels for each decision and to maintain the optimum rate of analysis and “learning” (in the sense of continuing to pursue understanding). This balance needs to be struck in order to ensure that the transformation progresses and that the decisions which are made lead to an end product that matches the customer requirements and is in line with the strategy.
Pitfalls to Transformation Success
Pitfall One: Assumed Certainty
Experienced project professionals and consultants are recruited precisely because of their expertise and are naturally expected to be able to give advice and solutions. A culture evolves where these professionals are expected to know all the answers – they are not paid “the big bucks” to come in and ask questions. This can occur either because the professionals consider themselves always certain or because the company who hired them expects them to be certain and does not give them space to express doubt.
Consequence: Low quality, wasted time and money
When operating under an assumption of high certainty, where it is not actually present, a crash will happen when the old state is left. The certainty that comes with experience only works in situations where everything is known. If there is relevant input to a decision that has not been properly analysed (unknown knowns or known unknowns) or potential consequences that have not been estimated (unknown unknowns), unforeseen consequences can occur causing the final product to not meet the requirements, delays to occur, or money to be wasted.
Solution: Transformative Mindset
When working with transformation, it is critital not to confuse past experience with certainty about the future. Despite the fact that experience is very valuable to transformation projects, the context and data driving decisions within them is never the same. Achieving success in a transformative state requires a mindset that is comfortable expressing doubt and open to understanding others. When the project members embrace a transformative mindset, a new state of certainty can be reached together.
Pitfall Two: Analysis Paralysis
Since huge changes are expensive and certain paths can feel irreversible, many companies find themselves in situations where they do not move forward with their transformation until they are 100% certain. This feels safe but it can be expensive because often times a project team is already mobilized with a high burn rate waiting for big decisions to be made. This can even happen in organizations with mature innovation strategies because they can lack the mechanisms to know when it is time to make a decision or which decisions to make.
Consequence: Project does not move or is delayed
Analysis paralysis occurs when necessary decisions are not made or decisions which are made are not communicated effectively. When only engaging in analysis, transformation will not occur, since you will not take the actions needed to implement your innovation. Most of the time, it is only the act of moving towards the target itself that can bring you the data required to continue increasing certainty.
Solution: Structured Decision Model
Structured decision processes can sometimes feel contradictory to innovation because they share characteristics with old fashioned, more hierarchical, work practices. However, it is critical to develop a structured decision model to enable your project team to balance analysis with decision making in order to move forward. Juxtaposed with the need to achieve an optimal level of certainty before making key decisions, a project team must continuously find the “minimum viable certainty” to make key decisions and achieve project success.
Conclusion: Transform your Transformation
To achieve success with transformation, it is critical to adopt and foster a transformative mindset and a structured decision model in your project to move towards the target future state your project intends to bring. This will not only get you on the path to successful transformation in delivering what you set out to do with a higher quality, but will also greatly reduce waste in the process of implementing the change, giving you a greater chance of delivering on time and on budget.