How to Beat the Odds of Business Transformation

August 20, 2021

Many organisations undergo transformation, with hopes and dreams of a better future, but only 3 in 10 transformations ever make it.

If change initiatives aren’t managed properly, it could have costly consequences on the business and its people: revenue losses may not have been recuperated; investors are left frustrated; and employees and managers alike feel jaded.

To learn how we can beat the odds of transformation, we spoke to IKEA China’s Head of Digital Design, Momo Estrella. In the past few years, Momo has helped IKEA make headway in digital transformation, by leading the China HQ to innovate and meet the shifting needs of their Chinese consumers.

So let’s begin with the question in everyone’s mind: Why do most transformations fail?

When ambiguity sets in

When transformations fail, it’s usually because the CEO failed to align the motivations of teams with a clearly communicated vision. Other times it’s because top management missed out on putting the right infrastructure in place to manage changes in how people worked. 

Consequently, when initiatives seem to have missed its target, ambiguity often creeps in and negatively affects the team’s morale and productivity. If ambiguous situations aren’t managed properly, hopes of a successful transformation fade away.

That said, successfully leading change is also about leading through ambiguity. So what do leaders who can lead through ambiguity look like?

How to lead through ambiguity

On the one hand, good leaders need to have a whole lot of enthusiasm, passion and energy to keep a team motivated even when the going gets tough. On the other hand, they also need to stay level-headed and open to new ideas to navigate through complex and ambiguous situations.

We can take a page or two from Momo’s book when assembling transformation teams. From his own experience, Momo suggests looking for people with these traits:

  1. A sense of stubbornness. Stubbornness can be a good thing, especially when people are excited by change. They are often unafraid of pointing out to others when something is wrong or amiss. This keeps teams on track.
  2. A capacity for high-stakes decision making. Transformation is a high-stakes endeavour and good leaders have to be comfortable making decisions under pressure, especially when clouded by ambiguity.

Lead with a language of progress

When undergoing any kind of transformation, no one feels the impact of change and disruption more strongly than the employees and managers. After all, they’ve built legacy operations and some fear any notion of change.

However, according to Momo, we’re not trying to directly manage the team’s outcomes per se. Instead, what we should do is to manage our team’s motivations and support them in shaping those outcomes.

The key here is to provide our teams with visibility on progress, which in turn motivates them to stay on track. One way of doing this is to set a combination of rhythmic and maturity goals. Rhythmic goals are useful for maintaining pace and keeping people motivated, whereas maturity goals allow for distant business milestones to be within sight.

Momo explains: “As you speak the language of progression, ambiguity becomes a little less threatening. Progression helps you deal with ambiguity, and there’s a shared feeling of advancing closer towards your organisation’s vision.”

Transforming together

When organisations embark on a transformation journey, we can’t benchmark our performance against the past because there is no “past”, as Momo puts it. As leaders, everything about transformation becomes exciting as opportunities are virtually everywhere.

With that in mind, business transformations aren’t projects with a deadline, but continuous processes. Hence it’s paramount that they are proactively managed at the process level and especially at the people level.

“I feel like I could never do what I do without having the people that I have around me, above me, and under me,” Momo shares. “It's a network of brilliant people that really inspired me and helped me achieve what I and the organisation set out to do.”