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Questions & Answers
Sept 3, 2020
Q: How do you measure the Return on investment (ROI) of a transformation?
A: Return on investment (ROI) is an approximate measure of an investment’s profitability. This financial metric is a ratio that compares the gain or loss from an investment relative to its cost.
Projecting the ROI of a transformation could be a starting point to decide whether or not it is worth implementing one. For example, if you want to change the organizational design of your company to support a new business strategy you can calculate the cost of doing that against the benefits that it will bring. Analyzing what would happen if you don’t do it at all, is a good exercise to do in parallel. If you can deliver on your new strategy with the same design, the same people and the same culture, you may not need to invest.
In our experience, companies that successfully implemented transformations, required a pivot to a new organizational design, capabilities and culture, and to set up new KPIs (Key Performance Indicators) to measure success.
It is usual that the long-term financial benefits of these kinds of transformations by far outweigh the cost of the investment.
Aug 20, 2020
Q: How do you change a culture?
A: Organizational culture can be defined as the “way things happen here”. If you share some time with different people within a company you will soon grasp those values and behaviors that drive their actions. The sum of those actions and their results are the current culture.
If you want to change it, you can either start defining those desired values and behaviors with the assumption that they will bring the needed culture and results. Or, you can start the other way around, picturing the best environment to help the organization thrive and then decide what values and behaviors are needed to produce that change.
Even if you get to define all that, moving from one way of doing things to a new way, takes time, effort and commitment from everybody.
You will need some key ingredients:
The company’s Leadership commitment to the change over time
Employees’ adherence, engagement and loyalty over time
Organization’s agility to sustain those values and behaviors despite the complexity of business context