Building a Better Transformation
These nine data-based practices
can elevate any business transformation.
Executives with experience working on business transformations know that certain elements of design
can make a big difference in any project’s success.
No one would argue against these best practices.
But without data to back up their value, it’s easy
to justify taking actions that run counter to them.
To quantify the benefits of taking the right steps—and
the costs of not doing so—we studied the database of Bain’s ARC transformation management tool, a sample
of 20 transformation programs and more than 8,700 of what we are calling "initiatives." The result: nine data-based practices that amplify the impact of transformation efforts and truly boost their success.
02
Sponsors should oversee three owners.
Initiative owners report to sponsors. When those sponsors oversee 3 to 4 initiative owners with between 8 and 14 initiatives, those initiatives perform 50% better. Once sponsors have implemented sufficient oversight and coaching
of initiative owners, sponsors typically have the bandwidth to effectively oversee up to 14 initiatives.
175
225
100
1 to 2
3 to 4
5 or more
Performance by number of initiative owners per sponsor (indexed to 100)
03
Make finance part
of an initiative’s core team.
When finance is part of an initiative’s core team, performance improves by 40%. By helping to develop and validate assumptions and targets as reasonable and achievable, finance team members increase
the odds of success. They also ensure that initiative benefits can be traced to overall financial results.
100
137
No finance
partner
Finance partner
is present
Performance by presence of a finance partner (indexed to 100)
01
An owner should be
responsible for three initiatives.
Initiative owners typically hit optimal results when they are responsible for three initiatives. Ultimately, though, it’s complexity, not size, that is the primary determinant of how many initiatives an owner can effectively handle.
04
Work plans should have
10 milestones.
Initiatives with no work plan or with a work plan with more than 20 activities or milestones underperform by 50%. Initiatives with highly detailed work plans significantly dilute value by focusing on planning over action.
78
142
192
129
100
1
2
3
4
5
Performance by number of initiatives per owner (indexed to 100)
107
148
139
100
0 to 5
6 to 10
11 to 20
More than 20
Performance by number of activities/milestones
in implementation plan (indexed to 100)
05
Plan and mobilize
in fewer than 45 days.
Initiatives can get stuck in planning when there
is too much focus on engineering the process
and not enough bias to action. Moving quickly
from planning to implementation creates
momentum and motivates initiative leaders.
100
06
Report status weekly.
More frequent status updates improve visibility and heighten accountability, improving initiative performance by 30%.
135
45 days
or more
Fewer than
45 days
Performance by number of days in planning (indexed to 100)
100
131
Monthly
Weekly
Performance by frequency of status updates (indexed to 100)
Bimonthly
118
07
Empower teams to adopt a “red is good” mindset—honestly identifying, transparently communicating,
and keenly focusing on their
greatest challenges.
Intervention improves performance, so it's important
for teams to identify initiatives that are not meeting expectations and make the effort to get them back
on track.
Bottom 25% of
on track initiatives
Performance (indexed to 100)
100
135
Initiatives that get
back on track
100
136
Performance (indexed to 100)
Before
intervention
After intervention
08
Clear roadblocks
in fewer than 7 days.
Roadblocks can bring an initiative to a standstill.
In programs that consistently resolved them in fewer than 7 days, initiatives are executed twice
as fast. This provides a needed boost and demonstrates to initiative owners that if they
ask for help, they will get it.
100
61
90
15 or more
8 to 14
0 to 7
Time to successful execution in days
(indexed to 100)
09
Identify and focus on
your star initiative owners.
Stars achieve 40% more value, so it pays to identify star performers early and assign them to the most critical and high-value initiatives. They are some of the organization’s top talent and an important source of future leadership.
100
139
Average
owner
Star owners
(top 25%)
Performance by type of initiative owner
(indexed to 100)
Source: ARC Insights Database
By Simon Henderson, Patrick Litré, Rasmus Wegener, and Mark Capeless
Program
Initiatives (definition): the smallest
unit of change in a program.
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Source: ARC Insights Database
Days to clear roadblocks
Source: ARC Insights Database
Time to successful execution in days
(indexed to 100)