Defining Transformation – Change, Evolve or Transform?

This article will be more first person than is typical for what is posted here—primarily because it requires discussion around some personal experiences.

Transformation efforts have existed for years, but in the last 5 years it has become the buzzword most commonly referred to in any change initiative. While I’ve been recruited to “transform” multiple areas over my career, the reality is that very few of those efforts have qualified as true transformations.

The Cambridge dictionary helps in defining transformation: “to change completely the character or appearance of something in order to improve it.”

Leaving aside the number of poorly executed transformations that fall short of improvement, this definition still lacks clarity. Is change transformation? How about an evolving process of improvement—is that transformation?

In the area of physical fitness, someone can completely change their diet and exercise routine from zero to high intensity immediately, but witness a slowly evolving transformation in their physique. And even then, their body will still be human—not transformed to a different species, which would be more in line with the Cambridge statement defining transformation.

In an effort to better clarify the degrees that could be used in defining transformation as used in most business efforts today, I will give 4 short examples where I was recruited to lead a transformation effort.

A Necessary Change

A banking division was struggling and determined it needed to primarily transform its operations and technology. I met with the executive to create a list of shortcomings he wanted to address and began meeting with sales, trading, compliance, and operations personnel to gather input.

Soon a picture emerged. In this case the executive, a brilliant top performer, had instilled a fear of failure among all the departments, which quashed the initiative and personal accountability that had largely existed previously.

The transformation needed here was actually changing back to what had worked in the past—with a few tweaks for improvement. Creating a safe environment to fail small, with positive feedback loops before the failures became bigger, turned the entire division around.

Yes, the technology needed a continuous upgrade process in place that provided competitive advantages with effective cost controls and a better focus on automation. Operations policies and procedures needed a major overhaul to address changes in technology improvements and product transitions, as well as changes to sales strategies. Improving customer satisfaction by automating low touch processes to allow more relevant customer engagement was also implemented. However, none of these could move forward in an atmosphere of fear and uncertainty.

Transforming Culture

In another scenario, I was part of a corporate wide effort by the president to transform a top down heavy enforcement management structure to coaching and mentoring with continuous feedback for a more collaborative and engaged executive management.

Under the Cambridge definition, the aim of this effort was to completely change the character and appearance of the company’s culture—a true transformation. Millions of dollars were spent bringing in consultants renowned in this arena, and measuring progress, only to have the initiative dead within 5 years.

In this case, there were too many executives with confidence in enforcement and skepticism in coaching. While they knew all the right answers during the training (often even being involved in the presentations) they were not committed to transforming themselves in order to transform the culture.

Evolving to Meet Demand

Having initially setup online access for a brokerage’s customers, I was asked 7 years later to transform the brokerage to an all-digital business model, with no in-branch advisors.

A thorough market analysis had also been performed, and it determined that fixed income customers would provide bigger deposits to the bank’s balance sheet. As a result, the all-digital move was to include developing the first online retail fixed income trading platform. All that was needed was a roadmap to get from in-branch to digital without losing customers—while significantly changing the website’s presentation and capabilities.

The resulting roadmap provided more of an evolutionary progression than a singular major transformation. An analysis of what it would take to convert an institutional fixed income platform to retail determined an 18-month delivery timeline. In the meantime, many advisor-directed activities could be moved online. This resulted in three phases of website development and delivery.

Additionally, there was going to need to be time spent educating customers on the value, simplicity, and efficiency of moving online with available advisor support from a call center. As a result, we actually increased the number of in-branch advisors for two years in order to train customers on how to maximize the benefits of online and call center advisor access.

Those advisors who proved exceptional in moving customers online were then offered an opportunity to work in the newly formed digital advisor call center when the transition was complete.

A Cloud Transformation

Cloud transformation can include evolution or complete transformation (as in Capital One), but it is unlikely to fall under the category of change—at least as described in this article.

In this case, I was asked to address an application that was innovative in its inception but had been built on old technology and with complex highly coupled coding. As a result, any changes to provide new functionality, or to address stress or breakage in the system, required monumental code changes and an entire rebuild upon completion. Any enhancement to computational power meant buying more hardware. In short, innovation was at a standstill on the system.

Having already transitioned to Agile methodologies for application development, we began a partial transformation. Realizing the AWS Cloud had matured to the point of allowing better decoupling of applications, with strong messaging capabilities between microservices, we determined we would rebuild this system on the cloud.

In this case, our transformation was moving on-premise infrastructure to a cloud environment while using the cloud-enhanced services to increase the effectiveness of our existing Agile development processes.

Defining Transformation

I’ve read many articles discussing the differences between transformation, change, and evolution. Probably the only point I have vehemently disagreed with, is the suggestion that change and evolution doesn’t come from executive management whereas transformation does.

As referenced in my first and second examples, it ALWAYS requires executive management being actively engaged and supportive. Yes, change and evolution can start at the ground level and rise up, and transformation needs to start at the top and move downward, but it will always require transformative, evolving executives open to change and innovation provided by those reporting to them.

What most transformation experts agree on is the criticality of properly defining the transformation you are seeking. Otherwise, you are more likely to over-architect the vision of what your company really needs. The proper choice may be as simple as more efficiently returning to your roots, or as complex as a massive cultural change.

One thing is for sure. You can’t successfully achieve what you don’t properly define.

The Continuous Improvement Solution

My perspective and experience is that if you create a culture, with the complementary policies, procedures and methodologies for successful continuous improvement you will more easily understand how you are defining transformation in each project and iteration.

Continuous improvement requires that executives teach and train their people to take initiative and be accountable. This includes how to fail small, how to look for ways to improve customer engagement and satisfaction, how to properly identify business opportunities and risk, and how to evaluate which of the many technological breakthroughs are best for your company to succeed.