How do you effectively transform as an organization if you have offices across multiple markets and each market holds several divisions based on services or product lines? As organizations become bigger, local markets become more decentralized; local markets and divisions do things their own way. But now, centralization can benefit or harmonize certain processes, such as sharing data across markets or procuring and implementing a single software solution across all markets, lowering costs and improving productivity.
These types of transformations prove difficult because there are many different stakeholders with their own way of doing things. Local regulations, culture and market forces made these stakeholders develop their own best practices to get things done.
Transforming a complex organization like this is therefore not a single transformation, but multiple, depending on the number of markets the organization resides in and the number of divisions it has. Transformations like these often fail due to the high complexity as a lot of legacy processes and IT systems will need to be phased out.
The BearingPoint approach helps organizations to make sense of complex organizational structures spanning different markets, divisions and product lines to harmonize processes and IT systems, roll-out best practices from markets and divisions and increase data sharing throughout the organization.
How should big multi-national organizations with complex organizational structures drive change? Common pitfalls in organizational change derive from a lack of vision, clarity & communication, resistance from the workforce, a failure to highlight success and not building a strong top team. In this blog, we explain our reference model approach and how we mitigate these pitfalls.
BearingPoint's approach incorporates reference models, which are best practices derived from our 4,500 consultants' expertise and extensive research. We create a utopia on paper, how things should be in an ideal world. The reason we call it ‘utopia’ is because it holds everything a company could want for that specific business process. We then apply the reference model to the specific company, to enrich the transformation journey with proven best practices.
The BearingPoint Tender & Quote reference model helped an international med-tech company to implement a new tender process and organization for 15 European countries, following the BearingPoint reference guidelines. The reference model gives an overview of what steps are taken when responding to a tender. See Figure 1 for the reference model.
Figure 1: The BearingPoint Tender & Quote reference model
For a global life sciences organization, we developed the functional specifications for the IT architecture behind the new B2B eCommerce platforms. The model concerns the Purchase part in a customer journey from Awareness, Consideration, Selection, Purchase, Loyalty and Advocacy - and it is focused on the eCommerce functionality as a touchpoint. The reference model describes the steps in ordering on a B2B eCommerce platform and what is needed on the back end to make it work.
Using our BearingPoint B2B eCommerce reference model we designed the new process with input from stakeholders from local markets, taking local best practices for international implementation. Because we used this model to structure current existing functionalities to the best state, we have managed to deliver the first version of the future state for 2 countries in only 8 weeks' time.
Figure 2: The BearingPoint B2B eCommerce reference model - 'Purchase' part of the customer journey
There are many obstacles on the road in reaching the utopia as described in the reference models. Often, and especially with large multi-national organizations with complex organizational structures ‘utopia’ means something different for almost every stakeholder. It is important to keep your stakeholders involved throughout the process. Through our experience, we created a step-by-step plan on how we can customize these best practices so that they can work for everybody.
Figure 3. The six BearingPoint steps for successful transformation
1. Establish Utopia
We combine our internal knowledge of our 4,500 consultants with external research and industry best practices to develop an organizational utopia. For example, for designing the SAP architecture for the eCommerce of a life sciences company, we took references from our partnership with SAP, similar projects are done by BearingPoint and by taking best practices from our experience at B2C companies that are further along in eCommerce than the life sciences industry. This approach resulted in an ambitious and comprehensive best practices model.
2. Map the current state
Using the reference model, we map the current state of operations. Representatives from the most critical parts of the business that will change are included from now on. We work with them to map the current state and to identify best practices. In one case, we performed a time and motion study, to know the effort processes took. A study that was performed over 15 countries, gave insight on which activities create value and which activities do not.
3. Create a central future state
We perform benchmark studies on the current state to find out what works for this specific company in this specific industry. We combine these results with our reference model to create, in cooperation with representatives from the local markets/departments, the new central future state, which can be adapted based on local characteristics.
4. Create localized future states
We create localized future states, with deviations when needed for local rules and regulations, the local culture, market forces and product portfolios. The local markets are in the lead as they know their business the best
5. Find the gap
The implementation phase will be difficult, especially if the gap between the current state and the future state is big. In collaboration with those that will use the new process, we find the gaps between the future and the now state. We establish ways of changing to the new state, identify risks like business continuity and put forward mitigating measures.
6. Implement the future state
We assist customers with implementing the future state. Some organizational changes face little resistance, while others will face significant resistance. There is often a misalignment between what the business wants and what IT deems possible. Having identified the gap, we help organizations with the transformation and help business and IT alignment. We offer change management, IT implementation and help our clients by building competencies to make sure that the new process is maintained. Through our approach, we build a team of relevant stakeholders from the beginning to avoid the common pitfalls of big organizational transformations.
Are you facing a big organizational transformation? Please feel free to contact us if you have any questions.