Covid-19 has reshaped the transformation agenda, are you ready to adapt?
Let’s roll back to the start of 2020: who would have bet their house on a global pandemic being the biggest single disruptor in living memory? It is a disruption that has left even the most experienced managers feeling daunted and perplexed.
The new reality means that to survive, a great number of organisations will need to drive change at a pace and with a level of precision that test their limits. Like never before we will need to understand the requirement to change, the impact of change and how we deliver change at a pace that was believed not possible.
The transformation agenda will be reshaped. Looking at this through my experience as both a Chief Transformation Officer and Chief Information Officer, below are 5 key areas of focus I would be proposing that a CEO considers while reshaping the transformation agenda:
1. Embrace and balance the risk and opportunities of remote working – As we move to greater use of remote desktop and other enabling technologies, the threat of malicious penetration and ransomware increases. To unlock the benefits of a continuation of the remote working model it is critical to consider Cyber Security and Data Loss Protection not just as a key enabler, but as a fundamental obligation. For many this will mean significant investment in new technologies.
2. Review how working capital improvements can be made – Perform a diagnostic review to identify quick wins though investment prioritisation, deferment of initiatives that are not going to address immediate issues, and development of a plan that generates cash improvements.
3. Review the budgeting process and improve operating costs transparency – Zero-base everything! The move to a zero-based budgeting process creates transparency around the entire cost base and improves decision-making. This is not a popular approach but is much better than reductions based on an arbitrability derived percentage. One transformation from my past operated what we called a “Spend Control Tower”. The intent was to prevent what the market, CEO and CFO considered unnecessary spend. Not only was it universally hated, it failed to deliver any recurring benefit as most of the costs returned once the initiative ended.
4. Review and optimise global business processes, strip waste and focus on AI lead improvements – Seize the opportunity to optimise business process. Accelerate the move to a full set of digitally enabled end-to-end processes. This enables cost optimisation, operating model performance and the safe transition to working from home.
5. Create a Transformation Office (TO) – The transformation actions need to be driven at pace by a leader who has the delegated authority of the CEO. It’s a proven fact that transformation can’t be delivered by the business alone. The TO’s domain should include: developing a transformation vision & culture, governance & cadence; ensuring stakeholder alignment; and creating, delivering and realising initiatives.
Our new norm is the inevitability of disruption. Until recently we would have listed the drivers of disruption as being emerging markets, evolving regulatory and compliance needs, the pace of digitalization, process automation and a more informed and empowered consumer base.
For many, the impact of Covid-19 will create an unprecedented level of turmoil and fear around the unknowns and associated risks. But equally for some, it will bring new opportunities to re-balance the operating model, to acquire and assume new business as others divest and to get control over the underlying cost base.
Our new enemy as we emerge from Covid-19 is not the resurgence of the virus but the risk of procrastination, postponement and complacency that prevent leaders from shedding legacy, reducing costs and seizing opportunity.
Business leaders have been saying for years that we are in an era of disruption. Now that a massive disruption has arrived, it is time for us to show we truly grasp the challenge and can surmount it.
Executive Interim – Chief Transformation Officer & Chief Information Officer