Strategic Risk Management Key Enabler for Business Transformation Success

Transcription

1 Strategic Risk Management Key Enabler for Business Transformation Success Satish P. Subramanian, PgMP, PMP, ProSci Principal Consulting Manager, M Squared Consulting / SolomonEdwards October 3, 2016 Speaker Introduction Satish P. Subramanian, a Principal Consulting Manager at M Squared Consulting / SolomonEdwards, is a seasoned strategy, operations, and organization change leader with expertise in business transformation and strategic execution. He has led transformation initiatives for high tech, health care, and financial services companies. He has authored the bestselling CRC Press book Transforming Business with Program Management. He is a Speaker and Executive Trainer. Satish has spent over 25 years as a leadership consultant in management and technology. He has held executive-level positions at Ernst & Young, Infosys, Point B, Cambridge Technology Partners, and Godrej. He is PgMP, PMP, and Prosci certified. Page 2 1

2 Agenda Managing Business Transformation Risks o What is Business Transformation? o Competitive Advantage and Business Transformation o Business Transformation Management Capability o Strategic Risks Derailing Business Transformation o Strategic and Tactical Risk Management Driving Successful Business Transformation o Framework for Business Transformation o Foundation for Success and Risk Management o Managing Risks Across Transformation Life Cycle o Transformation Roadmap Risk Management o Executive Summary Questions & Answers Page 3 What is Business Transformation? Business Transformation is Strategy Execution A complex program that innovates business model, product, service, process, or systems and sustains the desired business outcomes A large-scale organizational change endeavor to achieve substantial and sustainable improvement in business performance A strategic, cross-functional initiative that reinvents the business at an enterprise, business unit, or functional level Page 4 2

3 Business Transformation Challenge Per 2014 McKinsey Global survey of 1946 executives involved in business transformation initiatives, just 26% said their transformation was successful Per 2014 PMI study High Cost of Low Performance, organizations lose a staggering $109 million for every $1 billion spent on strategic change initiatives In the 2013 EIU research, 587 C-Suite executives stated organizations can improve competitiveness by successfully executing strategic initiatives Page 5 Why Business Transformation? Rapid Innovation Digitization SMAC, IOT Business Value Globalization Customer Experience Page 6 3

4 Competitive Advantage & Business Transformation Competitive Advantage Innovation + Operational Superiority + Strategic Differentiation Successful organizations have developed a strong capability in business transformation which helps them in maintaining competitive edge. Source: American Management Association Playbook, May , Article by Satish P. Subramanian Page 7 Business Transformation Management Capability Transformation Purpose, Vision, and Strategy Portfolio Management Program Management Organization Change Management Business Analysis Management Project Management Lack of robust capabilities in above areas poses major risk in delivering outcomes expected from Business Transformation Page 8 4

5 Strategic Risks Derailing Business Transformation Poor articulation of purpose and vision Not doing the RIGHT things Lack of leadership Executive sponsorship is inadequate Not doing things RIGHT Focus on incremental change, tactical outcomes Gaps in capability and talent Page 9 Strategic external and internal risks impede the realization of Business Transformation objectives External Risks - Examples Internal Risks - Examples Competition Regulation Technology Financial markets Political stability Globalization Vendor Customer Reputational Restructuring Direction Funding Bankruptcy Corruption Management decisions Priority shift Key resources Legal Page 10 5

6 Strategic and Tactical Risk Management Effectively managing Business Transformation risks requires a holistic risk management approach Identify, analyze, and mitigate PORTFOLIO Risks Develop portfolio risk management plan; Manage portfolio risks Identify, analyze, and mitigate PROGRAM Risks Program risk management planning; Program risk identification Program risk analysis; Program risk response planning Program risk monitoring and control Identify, analyze, and mitigate PROJECT Risks Plan risk management; Identify risks Perform qualitative and quantitative risk analysis Plan risk responses; Control risks Source: PMI Standards for Portfolio, Program, and Project Management Page 11 Agenda Managing Business Transformation Risks o What is Business Transformation? o Competitive Advantage and Business Transformation o Business Transformation Management Capability o Strategic Risks Derailing Business Transformation o Strategic and Tactical Risk Management Driving Successful Business Transformation o Framework for Business Transformation o Foundation for Success and Risk Management o Managing Risks Across Transformation Life Cycle o Transformation Roadmap Risk Management o Executive Summary Questions & Answers Page 12 6

7 Business Transformation Program Management Execution of business transformation strategy to realize the vision and transformation objectives Vehicle for discovering, planning, executing, monitoring, and delivering successful transformation Drives the journey to the future transformed state and facilitates the needed mind-set changes Alignment and integration of multiple management disciplines to achieve business outcomes Page 13 Framework for Business Transformation Lack of alignment and integration of six key dimensions significantly increases risk of failure of Business Transformation MEASUREMENT (Business Value Management) STRUCTURE (Organization Model Alignment) STRATEGY (Strategy Formulation) COMPETITIVE ADVANTAGE TECHNOLOGY (Technology Life Cycle Management) PEOPLE (Organization Change Management) PROCESS (Business Process Improvement) Page 14 7

8 Articulate Program Vision Assess Current State Develop Future State Create Business Case Design Program 9/26/2016 Front-end discovery lays foundation for Business Transformation success and manages risks Program Management Dimensions Strategy People Process Technology Structure Measurement Program Discovery Steps Page 15 Risks have to be managed end-to-end across the Business Transformation management life cycle Set the Stage Make It Stick Sustain Outcome Delivery Transition to Operations and Close Program Make It Happen Formulate a Program Strategy Monitor the Program Delivery Develop a Program Roadmap Execute the Program Define Program Charter Create the Program Plan Decide What to Do Page 16 8

9 Strategic Initiative Management Strategic Initiative Management 9/26/2016 Weaving risk management processes in Business Transformation roadmap results in program success Problem Vision Sponsorship Governance Outcomes Approach Engagement Leadership Monitor Transition Describe the problem accurately Articulate the program vision and objectives Secure cross-functional executive sponsorship Develop and implement a governance model Define success, outcomes, and key value indicators Invest in planning and creating an integrated approach Drive strong partnership and stakeholder engagement Provide leadership across all levels Monitor aggressively and have contingencies Create and implement an operations transition plan Page 17 Managing complexity and risks as Business Transformation roadmap is executed is critical Problem Describe the problem accurately Vision Articulate the program vision and objectives Sponsorship Secure cross-functional executive sponsorship Page 18 9

10 Strategic Initiative Management Strategic Initiative Management 9/26/2016 Managing complexity and risks as Business Transformation roadmap is executed is critical Governance Develop and implement a governance model Outcomes Define success, outcomes, and key value indicators Approach Invest in planning and creating an integrated approach Page 19 Managing complexity and risks as Business Transformation roadmap is executed is critical Engagement Drive strong partnership and stakeholder engagement Leadership Provide leadership across all levels Monitor Monitor aggressively and have contingencies Transition Create and implement an operations transition plan Page 20 10

11 Executive Summary Align and integrate six dimensions to mitigate risks Strategy, People, Process, Technology, Structure, Measurement Focus on strategic risks from onset of transformation Vision; Current State; Future State; Business Case; Design Identify and mitigate risks across transformation life cycle Set the Stage; Decide What to Do; Make it Happen; Make it Stick Implement end-to-end risk management practices Portfolio Program - Project Business Change Management Manage risks as transformation roadmap executes Ten components Page 21 Agenda Managing Business Transformation Risks o What is Business Transformation? o Competitive Advantage and Business Transformation o Business Transformation Management Capability o Strategic Risks Derailing Business Transformation o Strategic and Tactical Risk Management Driving Successful Business Transformation o Framework for Business Transformation o Foundation for Success and Risk Management o Managing Risks Across Transformation Life Cycle o Transformation Roadmap Risk Management o Executive Summary Questions & Answers Page 22 11

12 Questions & Answers Page 23 Thank You and Contact Information Thank you for your participation and engagement. Satish P. Subramanian Phone: Link to book on Amazon: Transforming Business Publisher: Auerbach Publications Publication Date: March 18, 2015 ISBN: Page 24 12