I recently picked up and reviewed, for a second time, a survey of companies operating in Western Europe, carried out by Capgemini and the Economist Intelligence Unit. In it, 86 per cent of respondents agreed that “business transformation has become a central way of working”. However, the percentage who believed business transformation was something their company excels at was only 30 per cent. That research was carried out in 2007 and I was left wondering whether things had improved. I suspect not.
In our familiar world of procurement, many programmes aimed at transforming performance are a disappointment despite the best efforts of those initiating and leading them. Such transformation efforts often have a solid beginning and then fizzle out. Evidently, business leaders’ level of understanding of how to intervene in the complex systems that comprise our modern organisations is inadequate. Initiative after initiative fails to deliver the hoped-for benefits and leaders are left baffled and frustrated as to why.
No matter how well the transformation is presented, an impasse frequently occurs because of a growing resistance among those involved. The programme is not seen as relevant to those that have to implement it. Not long ago, we saw this in one business where the chief procurement officer had decided to launch a supplier relationship management (SRM) programme. Despite a compelling case for it, the leadership failed to systematically check its team’s capacity for adopting the new tasks required. Two years later, the leadership was left having to re-launch the programme in a further attempt to make the desired changes stick.
In this situation, as in many others, people at every level often perceive the pursuit of continuous improvement or performance transformation as a threat. If procurement leaders and internal change agents are to secure their colleagues’ energy, enthusiasm and commitment, they must design their change programmes so they ensure the active involvement of people in creating the transformation strategy and its specific goals.
The rational mindset that sits behind every transformation proposal has evidently led some to overlook the importance of people needing to commit their heart as well as their head. They need the opportunity to work through understandable doubts about any new programme initiated from the top.
If you lead a procurement transformation, why not pause and reflect whether you’ve done enough to secure that head and heart commitment. It might mean the difference between success and failure.
By David Atkinson
This blog appears in the November 2012 edition of Supply Management magazine. See it here.