Changing the Zebra's Stripes.

• Author: Marcino, George R.

Every few years, a rallying cry goes out to business leaders to consider changing the way they do business to ensure survival, even prosperity, in a changing world. This continually recycling energy is "corporate transformation" -- a phenomenon that's reincarnated under a different name each time. Remember business process reengineering? How about rightsizing? Just-in-time sound familiar? Agility? Total quality management? The objective of these initiatives is to improve performance by motivating an organization to reinvent itself, usually by eliminating wasted effort, adding needed effort and/or adopting a new philosophy or business model.

Organizations usually undertake a transformation program because of external threats -- competitive pressure, market shifts or a new regulatory landscape, for instance -- that force it either to raise performance or suffer the consequences. The effort is always time-consuming and often disruptive.

In spite of this, though, transformation usually takes one of two forms. One is to remove work from existing processes to reduce costs or time. The other is to totally change the way business is done, to develop new processes to raise performance. (And one could argue that a radically overhauled process, where all unnecessary work has been removed, becomes a new process.)

Harley Davidson Motorcycles, faced with enormous competition from the Japanese in the '80s, made a massive transition to just-in-time manufacturing to build its current high-performance operation. JIT has as its express objective the reduction of waste. On the other hand, the ATM machine and now online banking are re-inventions of the bank transaction process. No amount of cost reduction in the traditional teller-staff processes would compare with the performance improvements this new technology has wrought. Here, banks fundamentally changed their transaction model. There are many other cases where a transformational program produced similar dramatic and sustainable results but, unfortunately, more that were a disappointment. The latter is a result of faulty implementation. Yet, despite the risks, eventually all management should consider undergoing transformation.

If management makes a commitment to such a program and is prepared to convince everyone in the organization of a credible need for this change, it should carry out the process in a systematic, professional way to ensure a successful outcome.

How High the Moon?

Transformation efforts...