Transformations That Work

Lessons from companies that are defying the odds

by

Michael Mankins

and

Patrick Litre

by

Michael Mankins

and

Patrick Litre

From the Magazine (May–June 2024) · Long read

Rick Salafia

Summary.

More than a third of large organizations have some type of transformation program underway at any given time, and many launch one major change initiative after another. Though they kick off with a lot of fanfare, most of these efforts fail to deliver. Only 12% produce lasting results, and that figure hasn’t budged in the past two decades, despite everything we’ve learned over the years about how to lead change.

Clearly, businesses need a new model for transformation. In this article the authors present one based on research with dozens of leading companies that have defied the odds, such as Ford, Dell, Amgen, T-Mobile, Adobe, and Virgin Australia. The successful programs, the authors found, employed six critical practices: treating transformation as a continuous process; building it into the company’s operating rhythm; explicitly managing organizational energy; using aspirations, not benchmarks, to set goals; driving change from the middle of the organization out; and tapping significant external capital to fund the effort from the start.

Idea in Brief

The Problem

Although companies frequently engage in transformation initiatives, few are actually transformative. Research indicates that only 12% of major change programs produce lasting results.

Why It Happens

Leaders are increasingly content with incremental improvements. As a result, they experience fewer outright failures but equally fewer real transformations.

The Solution

To deliver, change programs must treat transformation as a continuous process, build it into the company’s operating rhythm, explicitly manage organizational energy, state aspirations rather than set targets, drive change from the middle out, and be funded by serious capital investments.

Nearly every major corporation has embarked on some sort of transformation in recent years. By our estimates, at any given time more than a third of large organizations have a transformation program underway. When asked, roughly 50% of CEOs we’ve interviewed report that their company has undertaken two or more major change efforts within the past five years, with nearly 20% reporting three or more.

A version of this article appeared in the May–June 2024 issue of Harvard Business Review.

Michael Mankins is a leader in Bain’s Organization and Strategy practices and is a partner based in Austin, Texas. He is a coauthor of Time, Talent, Energy: Overcome Organizational Drag and Unleash Your Team’s Productive Power (Harvard Business Review Press, 2017).
PL

Patrick Litre leads Bain’s Global Transformation and Change practice and is a partner based in Atlanta.

Transformations That Work

Idea in Brief

The Problem

Why It Happens

The Solution

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