People Powered
Why putting humans front and center in digital transformation is an essential component to success.
TAKEAWAYS:
● Organizational transformations are vital, yet they often fail because they are approached as a rational business journey and not as an emotional journey undertaken by employees.
● Research shows that manufacturers that focus on and invest in their people are 2.6 times more likely to succeed in their transformation efforts.
● There now is a framework of seven key interconnected and mutually reinforcing elements manufacturers can use to achieve and sustain a succesful transformation journey.
Manufacturers today face many challenges, from changing customer demands to rapidly evolving technology to persistent internal and external competitive disruptions. These are compounded by the exogenous risks of climate change, global health crises, geopolitical tensions, and political market interference.
Because of these ongoing challenges and risks, manufacturers need to transform successfully — and continuously. Their ability to thrive now depends on the agility with which they can quickly change to meet shifting customer, employee, investor, societal, environmental, technological, and regulatory factors.
Yet many manufacturers continue to struggle with such transformation. Why? Ernst & Young LLP (EY US) and the Saïd Business School University of Oxford teamed up on research1 to find out. We studied the complex factors behind the high failure rate of transformations and explored how leaders can drive transformations that result in lasting change.
We found that organizational transformations fail because they approach transformation as a rational business journey and lack sufficient attention to the human conditions that drive success. Conversely, those that succeed also focus on, and invest in, their people — and their people’s emotional journey — from the beginning. In fact, the research found that organizations that take this approach are 2.6 times more likely to have successful transformations than those that don’t.
Paul Vail is a Partner in EY Canada’s Business Consulting Practice, Digital Supply Chain and Operations, as well as the Advanced Manufacturing and Mobility Consulting Leader for Canada.
1. As reported in “The Future of Transformation Is Human,” EY and University of Oxford Said Business School, 2022. The research involved a survey of 935 senior leaders and direct reports, as well as 1,127 workforce members from 23 countries and 16 industry sectors. Most respondents had led, or experienced, multiple transformations—both successful and underperforming.
