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Business Transformations Tend to Fail When Leaders Don’t Take a Human-Centric Approach to Transformation

November 13, 2018

A New Report from The Boston Consulting Group Finds That It’s Not Enough for Business Transformations to Focus on the “Head and Hands” of Transformation; They Also Have to Engage the “Heart”

SAN FRANCISCO, Nov. 13, 2018 (GLOBE NEWSWIRE) -- As digital transformation sweeps the business landscape, large-scale change efforts are not just increasingly necessary but also constant—businesses today are in a state of “always-on” transformation. To succeed in this environment, leaders need to engage three crucial elements, according to a new Boston Consulting Group (BCG) report titled The Head, Heart, and Hands of Transformation. Not only do they need a strong vision and a focused set of actions (the “head”) and agile ways of working (the “hands”), but also they must inspire and empower people at all levels (the “heart”).

“‘Always-on’ transformation calls on leaders to go beyond traditional one-off short-term approaches,” says Jim Hemerling, a coauthor of the report and a senior partner at BCG. “Too often, with the focus on short-term results, leaders neglect their employees, who more than ever are overwhelmed by the demands of constant change. In this challenging environment, it is vital to take a holistic, human-centric approach to transformation, emphasizing things like an organization’s purpose, an empowering culture, and demonstrating care for people whose lives are being disrupted.”

Research from the report underscores the importance of the head, heart, and hands: of the more than 100 transforming companies BCG studied, 96% of those that fully engaged all three elements showed sustained performance improvement, compared with 33% for companies that did not.

One example of the success of the head, heart, and hands approach is Microsoft’s transformation under CEO Satya Nadella.

Nadella hammered home a “mobile-first, cloud-first” vision and focused the organization on growth, addressing the head of transformation. Notably, and this is often overlooked, he articulated a new purpose—“to empower every person and organization on the planet to achieve more”—and fostered a new culture and leadership model, thus tending to the heart. He unleashed new ways of working that have not only enabled execution but also spurred innovation and agility; that is, he equipped the hands.

Unfortunately, among the companies BCG studied, the heart was the most consistently neglected aspect of transformation. Says Hemerling, “People, working as individuals and in teams, are the lifeblood of successful transformation. But in practice, they are frequently treated as a means to an end or, worse, as collateral damage, which can have dire consequences for them and the organization.”

Hemerling offers some specifics on the steps leaders must take to engage the heart of their companies:

-- Activate and embed purpose.Purpose is an organization’s “why”—its reason for being. Purpose fuels transformation by fostering an emotional connection that inspires greater employee commitment and a willingness to go the extra mile. -- Create an empowering culture.Culture comprises a clear articulation of the values and behaviors that define how things get done in an organization. A healthy culture serves as a tacit code of conduct that steers individuals to make choices that advance the organization’s goals and strategy and can also serve as a magnet for talent. For example, as part of its highly successful transformation, Australian airline Qantas put thousands of senior-level, frontline, and supervisory leaders through leadership development programs that helped them become better listeners, effectively coach staff, and empower their people. This, among other initiatives, helped Qantas move away from a “command and control” workplace culture and toward one that invigorated the hearts and minds of the workforce. -- Demonstrate care.Leaders need to express empathy for the employees whose lives are disrupted by a transformation. It is critical that leaders solicit the input of employees and visibly address their concerns. At a pharmaceutical company undergoing a merger, for instance, a routine pulse check from management revealed that employees felt a lack of resources in their day-to-day work, something leaders then promptly addressed.

“It’s no longer enough for leaders to excel at setting direction and executing change quickly,” Hemerling says. “Increasingly, employees are looking for much more than a paycheck or tangible rewards; they seek intrinsic motivations, such as meaning and connection. They want to contribute, develop, and achieve. While it’s not a panacea, the head, heart, and hands approach to transformation enables organizations that truly embrace it to succeed today and thrive tomorrow.”

A copy of the report can be downloaded here.

To arrange an interview with one of the authors, please contact Eric Gregoire at +1 617 850 3783 or gregoire.eric@bcg.com.

About The Boston Consulting GroupThe Boston Consulting Group (BCG) is a global management consulting firm and the world’s leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with offices in more than 90 cities in 50 countries. For more information, please visit bcg.com.

The Boston Consulting GroupEric GregoireGlobal Media Relations Manager

Tel +1 617 850 3783Fax +1 617 850 3701gregoire.eric@bcg.com

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