Business Transformations: Overcoming The 8 Reasons They Fail

Business transformations fail in up to 70% of cases. Let's explore the reasons why transformation is so difficult and how you can use enterprise architecture to overcome them and adopt a culture of continuous transformation.

Business transformation is the greatest challenge facing enterprise leaders, and it has been for some time. All the way back in 1995, Harvard Business School professor, John Paul Kotter documented eight reasons why transformations fail.

25 years later, Boston Consulting Group reported that 70% of digital transformations were still failing. Just last year, Forbes documented the reasons for this, which are almost identical to the ones Kotter listed decades before.

In 2023, we're still asking the question: how can leaders embed agility and a culture of change into their organizations, so that their strategy is able to adapt along with market forces?

We believe the answer is enterprise architecture. Bringing your technology, processes, and strategy into alignment, and gaining full clarity on your IT landscape, allows you to embed a culture of continuous transformation and agility, to enable rapid, easy, and repeatable transformation.

This clarity and alignment is enabled by the LeanIX enterprise architecture management platform. To find out more about how LeanIX can support your transformations, read what Gartner has to say about cloud transformation:

DOWNLOAD GARTNER® REPORT: How To Choose The Right Approach For Application Modernization And Cloud Migration

In the meantime, let's look over the eight reasons that Kotter first identified for transformation failure, and how enterprise architecture management tools can help you overcome them.

1 "Not Establishing A Sense of Urgency"

The Problem

The majority of the departments in your company will have no contact with the market, so have no access to relevant feedback. This means that your operations function can see your organization as successful, while your sales team can be frustrated that your business isn't meeting the needs of your customers.

Vice versa, your sales team won't grasp the purpose of an operational change that could impact customers. Achieving alignment for transformation is, therefore, challenging.

Without a universal understanding of the need for change across your organization, most of your teams will see your transformation initiative as an inconvenience. Certainly, they won't understand any need for urgency.

The Solution

Once you have a clear overview of your IT landscape, your processes, and your business strategy, you can pinpoint and evidence the need and urgency for change to your stakeholders. LeanIX doesn't charge per user, so you can share that information with everyone in your organization and get them all on the same page.

2 "Not Creating A Powerful Guiding Coalition"

The Problem

Just as information showing the need for change can become siloed, so too can your transformation efforts. They say it takes a village to raise a child, and it takes a whole organization working together to complete a transformation.

Unless the right stakeholders are in the room, you're certain to miss out on key perspectives and information. Likewise, without buy-in across your organization, it becomes increasingly difficult to complete a transformation.

The Solution

With enterprise architecture information available to everyone across your organization, you have a single source of truth to work from. This makes collaboration on transformation significantly easier.

3 "Lacking A Vision"

The Problem

It's impossible to get your whole organization moving in the same direction, unless you know what your destination is. That means that to accomplish a transformation, you need a clear vision for how your organization will look after.

Too often, however, organizations mistake the acceptance of a need for transformation for a vision. To transform, you need to not just understand the problem, but have at least a potential model for a post-transformation state.

This isn't to say that you'll ever reach your destination, or that the plan for where you want to be won't change as you progress. The key is that you need to have a working, iterating model for where you want to go in order to take steps to get closer to it and improve.

The Solution

The LeanIX platform isn't just a single source of truth for your transformation information, it's also a modeling tool. Using the platform, you can build new versions of your IT landscape and test and edit them until you have a plan for where you need to be.

4 "Under-communicating The Vision"

The Problem

Once you have that vision, you can't keep it to yourself. Your whole organization needs to see your vision in order to inspire them to work towards it.

This is where transparency is key. Yet, gifting clarity on the benefits and advantages to achieving your vision to a variety of stakeholders with different knowledge sets and priorities is difficult.

The Solution

Using the LeanIX platform, you can model the ideal state of your IT landscape, and then share tailored and customized views on that model with everyone in your organization for feedback. This doesn't just offer valuable intelligence, but it also ensures buy-in from everyone involved by offering them a personal glimpse of how your transformation will benefit them specifically.

5 "Not Removing Obstacles To The New Vision"

The Problem

“Great ideas need landing gear as well as wings.”

C D Jackson

A vision is all well and good, but you also need to execute it. When you share that vision with your stakeholders, you're likely to find that they can foresee obstacles you have missed, due to their first-hand experience with their daily roles.

Once you've built your masterpiece vision, it can be tempting to dismiss this feedback as simple negativity. It's only once the transformation has started that you find your transformation stalled by these blockers.

The Solution

With a detailed model of your landscape planned out in the LeanIX platform, employee feedback can be immediately validated. Adapting your target model to avoid obstacles is then quick and easy to achieve.

6 "Not Creating, Short-Term Wins"

The Problem

Once you present the model and timescale for transformation, and confirm the benefits, you can walk away and come back to reap the benefits, can't you? This, however, leaves it too easy for buy-in and excitement to dwindle, and tasks to slip down to-do lists.

To maintain the enthusiasm for transformation that you've built up, you need to showcase that the initiative is generating incremental value, not just at some point in the future. That means that you need to constantly highlight the progress and wins as they happen.

The Solution

The LeanIX platform documents your IT landscape and the progress from your starting state to your vision model. This can then be shared with stakeholders to highlight the steps you've taken and the impacts they've had.

7 "Declaring Victory Too Soon"

The Problem

Converse to waiting until the end of the transformation to report back on its success, organizations may also see an early quick win as a proof of concept, and consider the work done. Yet, transformation isn't a process you can complete.

As the tides of the market ebb and flow, you may need to change course part-way through your transformation. On the other hand, you may complete your planned transformation efforts only to realize the need for more change is approaching from the horizon.

As John Kotter explained:

"In the recent past, I have watched a dozen change efforts operate under the re-engineering theme. In all but two cases, victory was declared and the expensive consultants were paid and thanked when the first major project was completed after two to three years. Within two more years, the useful changes that had been introduced slowly disappeared. In two of the ten cases, it’s hard to find any trace of the re-engineering work today."

J P Kotter, Leading Change: Why Transformation Efforts Fail, Harvard Business Review, 1995

The Solution

To ensure value from change, you need to adopt a culture of continuous transformation, with a dedicated function. The only way this is possible is to maintain your transformation information within a dedicated system so that you aren't starting from scratch each time.

8 "Not Anchoring Changes In Culture"

The Problem

To begin a one-off transformation initiative, you must first get stakeholder buy-in. Likewise, to foster continuous transformation, you need to make a cultural change in your organization to support it.

This means ensuring that everyone in your organization understands the principles and benefits of continuous transformation. Constantly report on the initiatives and the value that your transformation function is producing.

The Solution

The LeanIX platform enables your continuous transformation function to continue to provide insight and value to your organization. To find out more about what LeanIX can do for you, book a demo: