So Your Company Is Talking About Transformation — But Is It Ready? Here's How To Tell.

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Change. If talk of it has been swirling around the water cooler, people on your team probably have questions. When will the shift happen? Who’s going to be most involved? What does the change mean for specific roles? While each of these questions matter, perhaps no question is more critical than this: Is the company ready?

Plenty of businesses throw this question into a lake, distracted by competitive pressure, the whims of egotistic leaders or the desire to stay comfortable. But it’s by facing the question that the business can devise a regret-free game plan.

Committing to transformation

Although headlines in the news might have left workers uneasy about the idea of company changes, companies have a choice about whether they want to transform or not. In fact, they have three choices: stay the course, evolve or disrupt.

Staying the course typically means growth of 0-3%. Popular retailer TJ Maxx sits in this category. Their brick-and-mortar approach and support of different brands has been effective for them. Companies that evolve see growth between 2 and 5% — consider the NASCAR pitstop today (21 people, 12 seconds) versus the pitstop of the 1960s (4 people, 5 minutes and 38 seconds). Disruption happens when growth is more than 5%. But that takes challenging the status quo, bringing the company’s core capabilities into new, auxiliary or complementary markets, and offering clients new and different things. Netflix, one of the most well-known disruptors, changed the entertainment game with streaming video services.

Disruption or transformation is like a chocolate brownie. It’s easy for people in a company to say they want it — but are they willing to do what it takes to make it from scratch? It’s tougher to actually execute, so companies have to be willing to commit. To get that commitment, they need first to check for a solid market opportunity, develop and communicate a shared vision, and then ask, “Are we ready, willing and able?” If the company has a good attitude of buy-in around the opportunity and workers have the skills necessary to execute, the business can often successfully transform.

The eight pillars of transformation

Assuming a business is ready for transformation, it should look at eight distinct pillars to make the change happen:

1. Leadership. Are enough people willing to accept responsibility to organize people toward the common goal? A company might need as many as 100-150 champions on the team who can show others why the company is doing things differently. Build out the leadership team so there’s a good mix of homegrown and outside talent that can create healthy debate.

2. Culture. What do people want the company to be? What’s the gap between that vision and where the company is right now? Initially, our team’s culture was a high-touch service where workers aimed to do anything for the client. Now, we’re striving to be more innovative. We actively work against fixedness and apply the broken window theory — i.e., the idea that little things can make a big difference.

3. People. Do people have the right attributes and skills necessary for the transformation? Don’t be surprised if there’s some variance. Typically, just 20% of people readily conform, 60% are the neutral majority and 20% need some proof or encouragement before coming on board. Companies can address skills gaps in lots of ways, but we introduced a program called Learn IQ, where any employee in the company can take a micro-credential program at any university.

4. Systems. Does the company have a scalable system model in place? Without one, the business will bring clients in the front door only to have them run out the back. We went from 289 units on the road in 2018 to 30,000 units in 2022 by taking a very systemic approach.

5. IQ. Can people interpret the core, adjacent and macro signals available (e.g., interest rates)? Can they execute logically? When we decided to do the last mile, we intentionally decided not to try to please everyone because we had something to learn and wanted to get better at it. We focused on market entry, expansion and diversification and didn’t bring in other clients until we knew our first clients were satisfied.

6. EQ. Does the company know when to hit the gas versus the brakes? During Covid-19, we took a high EQ approach, stayed cool and focused on what we needed to do. As a result, while the overall industry dropped 17%, our team went up 38%. Any team can look into implementing this during moments of tension or stress.

7. Flexibility. Does the business see challenges and opportunities with a willingness to fail? In mobility, we started in Class 1. Now, we go all the way through Class 8. We were willing to try franchising and then pull out when that didn’t work.

8. Fearlessness. Every team has fears, uncertainties and doubts. Is the team willing to face those and stare them down? Many times, we don’t have data or know something is going to work. But we encourage people to try things out and fail fast because we know bold actions create new opportunities. Betting on young leaders is one way we’re committed to being fearless.

Step up, hit repeat, compete

In many companies, staying the course or undergoing gradual evolution is the right decision. However, a business needs to be constantly assessing circumstances and goals. The team might find that, at a certain point, changing is the right move to make. Once they are ready, willing and able to take the transformation on, success depends on the company stepping up to all eight transformation pillars. If the business can hit repeat on that sequence over time, it can continue to meet customers’ demands for generations and enjoy long-term competitiveness.

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