We have learned about global organizations taking up large-scale process improvement and digital transformation initiatives leveraging lean production, six sigma, agile, business process automation, etc. Typically, these initiatives result from some strategic decisions made at the top and initially treated with high priority. However, we have seen that, after some initial success, the tempo seems to be dying down. Holding on to the momentum and continuing with far-reaching improvements (true transformation) is easier said than done.
Transformations that redesign an organizations’ business need tremendous amount of time, attention, and energy of the leadership. This is where sustainability of a large program becomes doubtful. Let’s look at the threat that the large traditional banks are facing today. Everyone is going through some sort or change (transformational or not) at various levels (local or global) threatened by the still-emerging Fintechs which keep disrupting the status quo with novel products and services everyday – digital microloans, peer-to-peer lending, AI-driven advisory services, name anything. These new offerings are destabilizing the traditional banks and are eating into their market share. Banks have realized that there is nothing called “steady state” today and they need to respond, respond very fast. This is where everyone is taking up initiatives at various levels and we hear the term transformation everywhere, in everything.
Now, when there is strategic push from the top to redesign your products and offerings, there is a lot of initiative in putting together a multi-disciplinary team that is tasked with the responsibility of scripting the turnaround story at a fast pace, typically, under the helmsmanship of some role, namely a chief transformation officer (CTO). The team defines a roadmap and embarks onto their transformation journey targeting some low hanging fruits. In traditional banks, per se, with a lot of legacy to carry on with, you would find a lot of such easy targets.
The bank gets on with the task partnering with one or more of the leading consulting firms and the ninjas are under the spotlight – everyone wants to be a part of the “game changing initiative.” At the end of the first year, you see very good results in a lot of cases, perhaps, you have even exceeded the expectations dramatically for some of the KPIs – improvements in digital sales, operational efficiency, customer experience, etc. has really crafted a great success story for the bank.
But, more often than not, you see that the enthusiasm starts dying down after the initial successes. What is happening to that continuous improvement that you have been talking about so often, thus far? If we try to explore the reasons, what could they be?
In my next blog I would try to discuss a few possible reasons which potentially work as barriers to sustained excitement with regards to these initiatives.