McKinsey & Company reports that implementing a set of 24 best practices for “communicating, leading by example, engaging employees, and continuously improving” increases the odds of organizational transformation success from 26% to 79%. McKinsey defines transformations as “large-scale efforts to achieve substantial, sustainable changes in performance, enabled by long-term shifts in the mind-sets, behaviors, and capabilities of employees”. McKinsey defines five stages or “frames” of transformational change
- Setting goals for both performance and organizational health
- Assessing organizational capabilities
- Designing the transformational initiatives
- Executing those initiatives
- Sustaining the changes that were made
From its latest global survey on this topic, McKinsey found that just 26% of respondents state that the transformations they are most familiar with have been “very or completely successful at both improving performance and equipping the organization to sustain improvements over time”. But among organizations that execute all five frames, the success rate is 72%. For organizations that execute on all 24 best practices across all five frames, the success rate jumps to 79% for completed initiatives.
This report implies a strong role for business architecture. Business architecture practitioners facilitate and clarify goal setting; assess organizational capabilities; design transformational initiatives based on descriptions of baseline and target organizational structure, motivation and function; oversee initiative execution; and help sustain change by evaluating the effect of new circumstances on existing architectures. They provide the blueprints from which transformation initiative leaders communicate, lead by example, engage employees, and continuously improve. They are therefore an indispensable part of successful business transformation.
