A common scenario is when a large company initiates a pilot transformation. They select a specific department or project as the experimental area to introduce a new culture, new interaction principles, and new engineering practices. The aim? To scale the accumulated experience across the entire company. A good idea? In my opinion, not really…
Whenever I discuss the goals and potential scenarios of IT and business transformation with management, I strive to be as convincing as possible to avoid “local transformation.” Here and now, I won’t elaborate on why I think this approach is flawed and what alternatives exist. Instead, I want to focus on answering the question: “What should you do if the management insists on this scenario?”
Here are my Digital Trasformation tips for Local Transformation projects:
- Choose the Right Area for Local Transformation. Ensure it’s not something insignificant to the company and top management. However, starting with mission-critical systems or projects with a high risk of failure is also dangerous. The tasks in the pilot area should be important enough to maintain top management’s interest but not critical projects where failure would be catastrophic.
Tip: Use the Cynefin Framework to identify areas that are complex but not chaotic, where experiments can be controlled, and insights can be scaled later. - Consider Who You Launch the Pilot Project With. It might sound strange, but I strongly advise against launching pilot transformation projects with the best employees. A test project with a team of highly motivated super-professionals is likely to succeed. However, when scaling the results, you will face average employees with low motivation, average expertise, and low tolerance for change. At that point, you might not be prepared to deal with their objections, fears, or even outright sabotage. Therefore, I recommend starting test projects with typical teams rather than specially assembled teams of superstars.
Fact: According to a McKinsey study, approximately 70% of complex, large-scale change programs don’t reach their stated goals, often due to resistance from middle management and employees. - Pay Attention to PR. Communicating the launch of the pilot transformation project within the company is crucial. The worst option is to do everything quietly, allowing rumors and gossip to spread, causing concern and setting the stage for future resistance. The other extreme is constant loud noise around the project, which doesn’t build trust. The best approach is a balanced one, involving senior company leaders as sponsors of the upcoming changes. Regular but not too frequent communication, announcements of significant events, and transparency about the goals, expectations, and results of the pilot project are essential.
Tip: Utilize internal communication platforms and regular town hall meetings to keep employees informed and engaged. Highlight success stories and quick wins to build momentum and buy-in. - Start with Designing Interfaces. While it’s tempting to quickly conduct a kickoff and launch the first product team to show the inevitability of change and achieve quick wins, pause for a moment. Take time to consider the people who will soon interact with your first team. Many of them aren’t yet involved in the changes and might not even know what’s happening. It’s crucial to identify these people and offer them interfaces for working with the new structures. Most rules and agreements might not last long and will need changes later. However, if you start a dialogue with people outside the transformation perimeter before launching the first team, they’ll be grateful, and your chances of success will increase.
Fact: According to Prosci’s Change Management Best Practices, engaging with stakeholders early and often can increase the likelihood of project success by 50%. - Remember, It’s Temporary. Working on an experimental project for local transformation, remember that most of what you build won’t last long. Many process discoveries, innovations, and insights will need reevaluation when scaling up. The main task of the pilot project is not to create the perfect process but to make as many mistakes as possible in a small area of change and not repeat them when scaling up. Neither the processes nor the structures built in the test project are likely to survive. However, the model of interactions and culture should be preserved when scaling up. Only then will it all not be in vain.
Tip: Document lessons learned and establish a feedback loop to continuously improve transformation efforts. Use tools like retrospectives and after-action reviews to capture insights.
In short, if there’s a chance to avoid starting a company’s transformation with a pilot project in a limited area, it’s better to take it. Come to me for consultation, and I’ll tell you how to manage risks when transforming a large department or the entire organization. But if you still have to start changes in a local, limited area, I wish you luck and share my experience to increase your chances of success.