new contentscdn.optusdigital.com/opfiles/business/pdfs/optus_future... · 2016. 9. 23. · andy...

CONTENTS

1View online report – yesopt.us/fob15

http://yesopt.us/fob15

For long term survival, organisations need to become change-ready.

View online report – yesopt.us/fob15


ROAD TO GROWTH: HOW TO GAIN A COMPETITIVE ADVANTAGE BY BEING CHANGE-READY

Change and being able to adapt to change is now part of doing business but how do some organisations embrace change and are responsive and successful while many more fail. To ensure long-term survival and prosperity in this ever-changing environment, organisations need to become change-ready.

DISCOVERING THE PRACTICAL REALITIES OF CHANGE

Road to Growth reveals what change readiness actually means for business, and how organisations can prepare and enable themselves for successful change implementation.

To discover the best ways to apply change readiness as a new business fundamental, we wanted to understand two things:

1) Does being change-ready have a relationship with performance and growth?

2) Do change-ready businesses behave differently from other organisations?

The answer, according to our research findings, is a resounding ‘yes’ in both cases.

INTRODUCTION

In fact, our research showed any business – of any size, in any sector and with any business model – can become change-ready.



Change readiness is a state of being equipped and prepared to deal with change.



Section 1

THE AUSTRALIAN BUSINESS CHANGE READINESS SCORECARD

WHAT IS CHANGE READINESS?

Change readiness equips and prepares businesses to deal with change. It encompasses the entire organisation so they are always ready to deal with and adapt to changes, navigating their way, no matter what is thrown at them. It is not the same as change management.

Change management is a well-established theory and practice, built from academic frameworks and typically relates to the processes, tools and techniques to manage the people-side of change in reaching a desired business outcome.

EXPLORING THE CONCEPT OF CHANGE READINESS WITH AUSTRALIAN BUSINESSES

In developing the Optus Future of Business Report 2015, we conducted an extensive survey of 502 senior business decision-makers across Australia. They included chief executive officers, chief financial officers, general managers, chief marketing officers, chief operations officers, chief human resources officers, chief information officers and several other management functions, representing 12 industries:

• banking, finance and insurance

• retail and wholesale

• transport and logistics

• manufacturing

• information media, technology and IT

• property, business and professional services

• electricity, gas, water and waste utilities

• education and training

• health

• mining and resources

• local government

• state and federal government

We also conducted in-depth interviews with 29 senior executives and nine change experts to gain deeper, qualitative insights.



AUSTRALIAN BUSINESS CHANGE READINESS SCORE

To gain a clearer picture of businesses’ ability to adapt, we developed an Australian Business Change Readiness Score. This score is based on a number of factors, including how well business decision-makers understand the need for change, the benefits change can deliver, and how capable they believe they are of implementing real changes.

Overall, our research revealed that:

23% of Australian businesses are highly prepared for change (with a score of 80 or above, out of 100)

55% display some change readiness

(a score between 61 and 79.99)

22% show low readiness for change (a score of 60 or below)

THE SCORECARD

The average score across all businesses was 69.9 out of 100. We’ll delve into more details including the methodology behind the score in Section 4.

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HOW CHANGE-READY IS YOUR BUSINESS?Check out the change-readiness assessment tool and see how change-ready you are at optus.com.au/futureofbusiness


http://optus.com.au/futureofbusiness


If you’re not ready for change, then growth is guaranteed not to happen.



Section 2

WHY CHANGE READINESS MATTERS

One in four Australian businesses recorded a high change readiness score. But why does this matter?

Change-ready businesses grow faster; perform ahead of their industry or category; and are more experienced and successful in dealing with change.

We’ll discover how being always ready for change is good for business.

“IF YOU’RE NOT READY FOR CHANGE, THEN GROWTH IS GUARANTEED NOT TO HAPPEN. YOUR BUSINESS HAS A LIFE EXPECTANCY OF ABOUT FIVE YEARS.” Roger La Salle, futurist and business commentator

CHANGE-READY BUSINESSES ARE PERFORMANCE LEADERS

The relationship between change readiness and business performance is linear – the higher the change readiness score, the more likely the business will perform well.

Over half (58%) of change-ready businesses say they are performing stronger than their competitors. This figure drops to 32% for less change-ready businesses.

THE CHANGE GAPS: WHICH BUSINESSES HAVE OUTPERFORMED COMPETITORS

High change-ready businesses are more likely to achieve above-average performance.



“WHEN CHANGE IS HAPPENING AROUND YOU AND YOU ARE CHANGING WITH IT, IT SENDS A STRONG MESSAGE THAT YOU’LL HAVE A HEALTHY BUSINESS TOMORROW.” Executive, banking and finance, enterprise

CHANGE READINESS EQUALS HIGH GROWTH

Change-ready businesses grow faster than other businesses. Based on their self-assessments, they are more than twice as likely as less change-ready businesses to have overachieved on their growth targets over the past two or three years.

THE CHANGE GAPS: WHICH BUSINESSES HAVE ACHIEVED THEIR GROWTH TARGETS?

High change-ready businesses are more likely to have over achieved against set targets.

10 View online report – yesopt.us/fob15


CHANGE PROGRAMS OFTEN FAIL BECAUSE THERE’S NO CLEAR SENSE OF PROGRESS. PEOPLE GET BOGGED DOWN. GOALS AND TARGETS SHIFT AUTOCRATICALLY. THEY’VE GOT CONTAMINATION FROM EXISTING INCENTIVES THAT REWARD PARTICULAR BEHAVIOURS THAT ARE NOT CONDUCIVE TO CHANGE.

Dr Jason Fox, motivational strategy and design expert



“WE ALWAYS OVERESTIMATE THE TIME FRAME AND UNDERESTIMATE THE IMPACT OF CHANGE. WE ALWAYS THINK TRANSFORMATIONAL CHANGE IS GOING TO HAPPEN FASTER THAN IT DOES, AND WE ALWAYS UNDERRATE HOW TRANSFORMATIVE IT’S GOING TO BE.” Mark Pesce, inventor and futurist

SUCCESS RATES WITH CHANGE INITIATIVES: CHANGE-READY VERSUS THE REST

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WHY CHANGE-READY BUSINESSES ARE BETTER AT TRANSFORMING

Experience isn’t everything when it comes to successful change. Our research reveals businesses that have experience with change don’t necessarily have more success with their transformation initiatives.

What does make a significant difference is the change readiness of an organisation. Businesses that scored high on the change readiness scale succeeded with 75% of their transformation initiatives, while less change-ready businesses succeeded only 59% of the time.



CHANGE IS A POSITIVE, NOT A NEGATIVE

Change-ready businesses take a positive view of change, focussing on external drivers. Their top two triggers for undergoing transformation were:

• meeting customers’ needs, and

• improving service delivery

Less change-ready businesses were more defensive and inward-looking. Their top two triggers were:

• reducing costs, and

• generating growth and increasing profits.

THE CHANGE TRIGGERS: HIGH VERSUS LOW



Disruption is happening everywhere.



Section 3

WHY BUSINESSES NEED TO CHANGE

Disruption is happening everywhere. Businesses of every size and in every industry should be prepared to deal with technological disruptions, shifting consumer expectations and sudden external changes.

Being change-ready is not dependent on the size or age of a business. It’s about looking outwards, embracing external change and letting disruption lead you to growth and gaining a competitive advantage.

“IF YOU ARE THE NUMBER ONE OR NUMBER TWO IN THE MARKET AND YOUR WORLD IS CHANGING AROUND YOU, YOU NEED TO BE CHANGING AT LEAST AS FAST, IF NOT FASTER. IF YOU’RE NOT, THEN YOU’RE IN TROUBLE!” Executive, retail and wholesale

THE RATE OF CHANGE IS INCREASING

Most businesses have been through some form of change and are expecting more change to come.

86% of businesses surveyed underwent moderate to large changes in the past two to three years. The same percentage (86%) believe they’ll have the same degree, or more, of change in the next two to three years.

Based on surveyed respondents, the top five industries expecting the most change are:

1. Banking and finance 68%

2. Information media, technology and IT services 60%

3. Local government 54%

4. Manufacturing 54%

5. Retail and wholesale 47%



WHAT’S CAUSING CHANGE?

External factors are driving the need for change within most organisations, with the top 5 drivers of change being externally focussed.

Change-ready businesses see more pressures overall and they are more focussed on external pressures.

45% of change-ready businesses nominated customers as the main pressure for change, compared to 28% of less change-ready businesses.

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TOP DRIVERS FOR CHANGE (ALL RESPONDENTS)



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COSTS ARE ALWAYS TOP OF MIND. ESPECIALLY WHEN YOU’RE TALKING ABOUT CHANGING SOMETHING, IT ALWAYS ENDS UP COSTING MONEY, SO YOU HAVE TO BE ABLE TO SHOW WHY IT’S WORTH IT.

Executive, manufacturing



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THE TRIGGERS AND BARRIERS TO CHANGE

There are many catalysts for, and barriers to, change. Interestingly, the business leaders interviewed identified cost as the number-one trigger of change (the need to reduce spending) and a barrier to change (the cost of implementation).

THE MAIN PRESSURES FOR BUSINESSES TO CHANGE



WHAT’S TRIGGERING AND PREVENTING CHANGE IN BUSINESSES?

For less change-ready businesses the drivers for change are very internally driven and defensive around reducing costs. The top three triggers of change in these organisations are:

1. Reducing costs (55%),2. Generating growth or profit (49%), and 3. Improving efficiency (48%).

Meanwhile high change-ready businesses look at costs as a barrier to getting things done rather than as a driver of change. Within this set of decision-makers, almost three in five (58%) strongly agreed the cost of implementation was a barrier to their business implementing change.



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INDUSTRY CHANGE READINESS: HOW THEY PERFORM

WHICH INDUSTRIES ARE MOST READY FOR CHANGE?

Being change-ready is not dependent on the industry you are in, with no stand-out industries identified as leading the way in change readiness.

The score distribution shows change readiness to be more fragmented across some industries with some businesses lagging behind their industry averages.

The retail and wholesale sector was the most ready for change of the industries surveyed, and local government the least – although there was less than 6% difference between the average scores of those two sectors.

We found similar conclusions based on age and size of the organisations as well.

HOW WELL DO YOU RATE COMPARED TO YOUR INDUSTRY?Check out the Change-Readiness Assessment Tool and see how change-ready you are at optus.com.au/futureofbusiness




ARE BUSINESSES OVERCONFIDENT?

Business leaders are overconfident about being change-ready. When we compare the Change Readiness score against respondents self-rated change readiness, we see a worrying disparity. Decision makers’ perceptions of their organisations’ capacity for change, and the attributes and attitudes required to change are actually different.

“THE CENTRAL PROBLEM IN WESTERN BUSINESS TODAY IS CASUAL OPTIMISM: ‘IT WILL ALL BE ALRIGHT. IT’S GOING TO BE GREAT.’ OR IT’S THIS CASUAL PESSIMISM: ‘MY GOD, IT’S GOING TO GO TERRIBLY THIS YEAR. I’M WORRIED ABOUT THE ECONOMY.’ MOST BUSINESSES LACK DETERMINISM: ‘THIS IS THE PROBLEM, THIS IS HOW WE WILL GROW.”Andy Lark, CMO, Xero

THE CHANGE GAPS: CONFIDENCE VERSUS ACTUAL SCORES



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ANY BUSINESS CAN BE READY FOR CHANGE

To better understand the attributes of high change-ready businesses, we compared them against their less change-ready counterparts. The results suggest that change readiness is not restricted to any particular type of business; there are large and small change-ready businesses, in various industries across both the public and private sectors, and operating under a range of different business models.

Where the high change-ready businesses differ is in their heightened awareness of the causes of change – particularly external pressures – and what they must do to adapt. They understand the importance of engaging change enablers – such as technology – to make the most of the situation when changes do happen.

What sets a high change-ready business apart from the rest?

Change leaders share common traits: they value flexibility, agility, the ability to listen, collaboration and openness. Survey respondents told us that change-ready businesses should have:

• a senior leadership team engaged with the idea that the business must be ready to deal with change

• a strong and active planning process that is strong enough to be followed, but flexible enough that it can be adapted when needed

• clear and strong communication across the whole business, especially when communicating how changes may benefit individual staff members and the organisation as a whole

• strong connections between different levels within the organisation; for example, senior leaders should be visible and

connected at all levels of the organisation, and front-line staff feel connected to approachable management and leadership teams

• employees who feel confident they can take risks and will be supported by the business

• an open dialogue about the potential for failure and the inevitability of some failure during any process

• management systems and processes that support employees and drive change through the business

• an internal culture where employees accept that change is inevitable and are excited about the opportunities it can bring.

Underlying these traits, change-ready businesses have a sense that they are preparing for and anticipating change – “like crouching at the starting line, ready for a race”, as one respondent said.

WHAT DO CHANGE-READY BUSINESSES LOOK LIKE?



CHANGE-READY ORGANISATIONS HAVE BETTER RITUALS FOR COMMUNICATING WITH EACH OTHER. THE BEST TEAMS THAT I’VE WORKED WITH MEET EVERY DAY – JUST SHORT, STAND-UP MEETINGS. THEY HAVE GOOD INTERNAL NETWORKS THAT ALLOW PEOPLE TO COMMUNICATE WITH EACH OTHER IRRESPECTIVE OF THEIR HIERARCHY, TITLES OR DIVISIONS.

Dr Jason Fox, motivational strategy and design expert



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“I BELIEVE EVERYBODY NEEDS TO BE A FUTURIST. YOU CAN’T OUTSOURCE THAT. EVERYBODY HAS TO THINK ABOUT THE FUTURE, THINK ABOUT WHAT MIGHT HAPPEN, AND THINK ABOUT WHAT IT IS THAT THEY CAN DO TO BE ABLE TO CREATE SOMETHING BETTER FOR THEMSELVES AND THEIR ORGANISATIONS”. Ross Dawson, futurist

Q. How do you view change in the context of business, the importance of change and what it means to businesses at the moment generally?

A. If you look at mid-range, large organisations; the two dominant boundary lines that get drawn – think of them as guardrails on the road for change – at the one end is culture and the other end is structure. And for different organisations, those guardrails turn that road sometimes into a single-lane road. For many government organisations, it’s a single-lane road, narrowing quickly to a bicycle lane. In other organisations, that boundary, those guardrails, widen out. Organisations struggle with change because they’re unable to determine how wide those guardrails should be on the road. So the guardrails always narrow naturally. If not addressed, the rule – I call it Lark’s rule – the guardrails narrow naturally. They’ll always form a bike lane. And, you know, organisations are complex political power bases as a whole. And it’s rare you’d ever find a leader in an organisation who said, “Guess what? No rules.” And most leaders you talk to, they’re managing those guardrails right the way down into,

“I want to deliver this yield to my shareholders.” And it’s such a conservative mindset, particularly in Australia. Versus the new market entrant who comes in and goes, “You know, we’re just going to eat the market alive.”

INDUSTRY EXPERT SPOTLIGHT ANDY LARK, CHIEF MARKETING OFFICER, XERO



Understanding what it takes to become change-ready.



INTRODUCING THE CHANGE ENABLERS

Calculating the Australian Business Change Readiness Score allowed us to better understand what it takes to become change-ready. The scores were based on the results of an extensive survey, during which we asked decision-makers to focus on four key areas of their business:

1. Processes and systems – the way the business works, including systems and procedures

2. Products and services – the product or service they offer to their customers

3. People and culture – the employees and internal culture of a business

4. External factors – how a business deals with external pressures.

We asked them questions relating to five attributes for each business area, including:

a) need for change – whether the organisation has identified and clearly communicated a need for change in this area.

b) capability – if the organisation has the capabilities to successfully implement change in this area

c) benefit for the organisation – if change in this area will benefit the organisation as a whole

d) the benefit for individuals – whether the organisation’s employees understand how change in this area will benefit them and their careers

e) leadership support – if senior managers strongly support change in this area.

Based on the respondents’ answers, we were able to identify the specific attributes that businesses can use to improve their overall change readiness. We also created two different measures:

1. Performance score: The average readiness score for each enabler

2. Importance score: The result of regression analysis showing the relative strength of each enabler in contributing to the overall score.

Section 4

HOW TO BECOME CHANGE-READY

So, given that underprepared businesses on average fail in 41% of their change initiatives, how can they get better at change?



BUILDING ROBUST, FLEXIBLE PROCESSES AND SYSTEMS

Processes and systems is the most important area of the business for determining change readiness, contributing half (49%) of overall change readiness. Being change-ready in this area will have the greatest impact on overall change readiness.

“IF I AM CHANGE-READY WITH REGARDS TO MY SYSTEMS AND PROCESSES, THEN MY BUSINESS IS READY FOR CHANGE.”Executive, business

“PROCESSES PRETTY MUCH DRIVE THE BOTTOM LINE. SO IF YOU CAN IMPROVE THESE, THEN FIRSTLY, IT WILL ENHANCE YOUR PRODUCTS AND SERVICES, AND SECONDLY, YOU WILL MEET INDIVIDUALS’ NEEDS INSIDE AND OUTSIDE THE ORGANISATION.”Executive, retail and wholesale

PERFORMANCE AND IMPORTANCE OF CHANGE ENABLERS ACROSS KEY BUSINESS AREAS



YOU CAN PUT ANY SORT OF CHANGE YOU WANT ON TOP OF A STRONG UNDERLYING STRUCTURE – GOOD END-TO-END PROCESSES AND BUSINESS MODELS.

Ian Tsicalas, Director, STW Group



DELIVERING PRODUCTS AND SERVICES THAT CUSTOMERS WANT

Products and services is the second most important area (26%) in driving overall change readiness. This area of business presents a large opportunity for improvement as businesses are currently underperforming in this area (66%).

“ALL OUR CUSTOMERS ARE ONLINE AND NEWS TRAVELS FAST. THEY KNOW MORE ABOUT OUR STORES THAN WE DO. WE ARE WORKING REALLY HARD TO MAKE SURE WE ARE KEEPING UP WITH THEM.” Executive, retail

With market disruption prevalent in many industries, it’s surprising that this area’s importance score was only 16%.

High change-ready businesses were 56% more likely than low change-ready businesses to recognise the need to be able to change due to external influences.

Our analysis suggests that a business’s capability in adapting to its external environment is a critical enabler of change.

“CHANGE IS NOT TECHNOLOGY-LED. PERHAPS A COMPETITOR HAS USED TECHNOLOGY TO CHANGE BUSINESS PROCESSES, BUT IN FACT IT’S THE COMPETITIVE ENVIRONMENT THAT’S FORCING THE CHANGE, NOT THE TECHNOLOGY.” Mark Pesce, inventor and futurist

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“CHANGE IS ABOUT SEARCHING FOR WAYS TO ENCOURAGE CUSTOMERS TO TALK TO YOU, LISTENING TO THEM, PAIRING THAT UP WITH THEIR BEHAVIOURS, AND GETTING THE INSIGHTS TO MAKE CHANGES, SO THAT YOU CAN CONTINUE TO SERVE YOUR CUSTOMERS IN WAYS THAT ARE MORE AND MORE VALUABLE.” Jodie Fox, co-founder, Shoes of Prey

ADAPTING TO THE EXTERNAL ENVIRONMENT



EMPOWERING PEOPLE AND FOSTERING A CULTURE OF CHANGE

People and culture has long been documented as one of the most crucial elements in change. To ensure success in change and change readiness, our research suggests businesses need to address the four areas of the business collectively and people and culture should not be handled in isolation.

By having agile systems and processes in place, high change-ready businesses can empower their people to be responsive and ready for change.

We also found that change-ready businesses were 85% more capable at creating a culture of change and enabling their people to change than their less change-ready counterparts.

“PEOPLE FIND IT HARD TO CHANGE. IT’S A COMMON HUMAN FRAILTY, BECAUSE CHANGE IS UNKNOWN. SO YOU HAVE TO ENABLE PEOPLE TO TAKE A SMALL STEP FIRST, REINFORCE THE BENEFITS AND TAKE AWAY THE FEAR OF CHANGE.” Gordon Cairns, Chairman, Origin Energy

What is the main factor differentiating low and high change-ready businesses? To gain this understanding we assessed performance scores across the five factors and compared high change-ready against less change-ready businesses.

We found strong leadership support to be a defining characteristic of highly change-ready businesses.

Organisations that had consistently good leadership support for change initiatives in all four key business areas – processes and systems, products and services, people and culture, and external environment – received the highest overall Business Change Readiness Scores.

LEADERSHIP SUPPORT AND CHANGE

“I DON’T THINK WE ALWAYS KNOW HOW TO DEAL WITH CHANGES. IT CAN BE HARD TO RECOGNISE WHEN YOU ACTUALLY NEED TO CHANGE AND WHEN YOU CAN KEEP DOING WHAT YOU’RE DOING.” Executive, retail

“THE MOST SIGNIFICANT BARRIER TO CHANGE IS THE CEO. I’VE SEEN IT IN A NUMBER OF CORPORATIONS WHERE THE CEO SAYS: ‘I DON’T NEED TO CHANGE. YOU’RE THE GUYS WHO NEED TO CHANGE.’ AND IN FACT, THE ONE PERSON WHO DOES NEED TO CHANGE IS THE CEO. SO UNLESS CEOS EMBRACE IT AND THEY GO THROUGH THE PROCESS, IT BECOMES TOKENISM.”Gordon Cairns, Chairman, Origin Energy



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Top areas of focus to improve change readiness:

1. Rapidly develop the capability to change processes and systems.

2. Foster a culture of change and empower people to change.

3. Ensure senior leaders strongly support changes to product and services.

4. Promote and gain widespread recognition of the need for the business to adapt to external factors.

HIGH CHANGE-READY VERSUS LOW CHANGE-READY: THE GAPS IN ENABLERS



Change leaders see technology as a critical enabler of change.



Section 5

THE ROLE OF TECHNOLOGY IN CHANGE

Given the environment of rapid technological development, ever-changing consumer expectations and new disruptive entrants to the market, what role does technology play in change – enabler or inhibiter?

“WITHOUT TECHNOLOGY, YOU DIE.” Executive, retail

High change-ready businesses recognise the positive impact of technology and how technology is an enabler to be change-ready.

THE CHANGE DIFFERENCES: THE VIEW OF TECHNOLOGY’S IMPACT

IMPACT OF TECHNOLOGY ON CHANGE

Almost all businesses with high change readiness see the positive impact of technology on their business with 45% stating it has a ‘strongly positive’ impact. One in four businesses with low change readiness feel that technology is a hindrance.

Low change readiness High change readiness



I BELIEVE THAT TECHNOLOGY TODAY IS AT A POINT WHERE WE NO LONGER NEED TO LOOK AT WHAT’S AVAILABLE TO MAKE A DECISION. WE NEED TO IMAGINE WHAT THE MOST PERFECT SOLUTION WOULD BE AND THEN USE TECHNOLOGY TO FIGURE OUT A WAY TO GET THERE.

Jodie Fox, co-founder, Shoes of Prey



THE CHANGE DIFFERENCES: BUSINESS CONFIDENCE IN KEEPING UP WITH TECHNOLOGY (ON A SCALE OF 0–10)

CAN YOU KEEP UP WITH TECHNOLOGY?

As little as one in five (21%) of the total businesses we surveyed are very confident they are keeping up with changes in technology. There is a large group that still see room for improvement with three in five (58%) showing a moderate level of confidence they are adjusting to the technology changes around them.

44% of low change-ready businesses have low confidence in their ability to keep up with changes in technology around them.

High change-ready organisations aren’t constantly upgrading to new systems. Rather, they are choosing robust, flexible systems that enable change – and investing in maintaining their ongoing capability for change.

“YOU’RE ALWAYS ASKING ‘HOW QUICKLY CAN I CHANGE THIS ONCE I PUT IT IN?’ SO YOU’RE NOT CHOOSING THE BEST TECHNOLOGY, YOU’RE CHOOSING THE TECHNOLOGY THAT WILL ENABLE YOU TO CHANGE IN THE FUTURE. WE WILL NOT CHOOSE THE BEST TECHNOLOGY VENDOR IF WE ARE NOT ABLE TO MOVE WITH IT AND ADAPT IT THE WAY WE WANT.”Executive, banking and finance (enterprise)

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“WE ARE HAPPY WITH OUR CURRENT PLATFORM AND WE ARE ALWAYS MAKING CHANGES TO IMPROVE IT. BUT IT TAKES TIME TO TRAIN PEOPLE UP AND GET THEM COMFORTABLE WITH THE NEW WAY OF WORKING.”Executive, retail and wholesale



HOW RESTRICTIVE TECHNOLOGY AFFECTS CHANGE LEADERS

THE WRONG TECHNOLOGY CAN RESTRICT CHANGE

While technology can be a powerful enabler of change, it can also be a massive roadblock. The chief offenders are legacy systems, and it can be challenging to change these systems without causing major disruptions to the business.

“WE WORK WITH LEGACY SYSTEMS, AND WE CAN’T JUST CHANGE THEM WHENEVER WE WANT. IT TAKES YEARS TO PUT A SYSTEM IN PLACE, SO WE NEED TO BE ABLE TO MODIFY AND ADJUST WHAT WE HAVE.” Executive, finance

Forty-one per cent of high change-ready businesses consider restrictive technology to be a barrier to change. By comparison, just 7% of the least change-ready businesses view restrictive technology as a barrier to change.

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“WE HAVE THOUSANDS OF STORES, A NUMBER OF DIFFERENT ORGANISATIONS IN THE GROUP AND OFFICES EVERYWHERE. GETTING ALL OF THE BUSINESSES ON ONE PLATFORM WAS A HUGE TASK, BUT NOW WE CAN ALL COMMUNICATE ON THE ONE PLATFORM.”Executive, retail and wholesale

This gap between the most change-ready and the least reflects the largest difference between the two groups on any barrier to change. The more change-ready businesses get, the more frustrated they experience with legacy systems.



WHAT CHANGE LEADERS WANT FROM TECHNOLOGY

Key benefits of technology identified by decision-makers we surveyed:

• Reduce costs 78%

• Better distribute knowledge and information throughout the business 77%

• Improve collaboration 73%

• Engage and interact with customers in more targeted ways 72%

There is a clear difference in the benefits from technology once we compare high vs low change-ready businesses. High change-ready businesses focus on knowledge sharing (84%) and collaboration (83%), meeting customer needs (83%) and improving their systems (82%). Only then do they focus on cost reduction as a benefit from technology.

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THE CHANGE DIFFERENCES: BENEFITS OF TECHNOLOGY



HOW SYSTEMS ENABLE CHANGE ACROSS THE BUSINESS

Processes and Systems is the area of the business where technology is seen to be playing the greatest role in helping to implement change, followed by Products and Services.

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“TECHNOLOGY IS ABSOLUTELY INTEGRAL TO THE WAY RETAILERS MEET CUSTOMER NEEDS. IT’S ALL ABOUT UNDERSTANDING AND HARNESSING THE DATA. WHOEVER DOES THAT THE BEST WILL WIN WITH THEIR CUSTOMERS.”Executive, retail

“WITHOUT TECHNOLOGY, YOU’VE GOT GEOGRAPHICAL BARRIERS, HIERARCHICAL BARRIERS AND TIME BARRIERS – TECHNOLOGY CAN ELIMINATE ALL OF THESE BARRIERS AND MAKE COLLABORATION A WHOLE HEAP EASIER.” Dr Jason Fox, strategy and design expert



Q. What is the role of change in business, and is it becoming more or less important?

A: The role of change in business is definitely becoming more important. Change is now a constant in business. If you’re looking to compete and grow, and you’re not up for a constant change agenda, then you will ultimately fail.

Q: What is driving the need for change?

A: Customers and customer expectations are driving change. Digital disruption is actually changing the way customers behave, changing what they expect and lifting requirements around how we compete and engage with them. Cloud is also fuelling innovation and disruption in many industries. By leveraging cloud technologies, organisations are focussing on building new and disruptive solutions. And those are then being put into the market through distribution channels like app stores or through the internet. We are seeing the beginning of a fairly significant change agenda going forward because not only does cloud give you access in reduced costs, it’s also providing platforms, it increases the productivity of technologists to deliver these disruptive solutions. The digital disruption as well has brought the global market to the consumer and so not only are they accessing regional solutions and capabilities, they are also able to access global in a very easy and straightforward way. And so your competitors of today are probably not your competitors of tomorrow and customers themselves now have a broader choice around products, solutions, services.

Q: What is the role of technology in a change-ready business, and what will the role be in the future? Will it be different?

A: I think technology is more pervasive now than it ever has been. Thinking about how you may compete in new channels, create new products, deliver greater efficiency...engage with your customers better, create platforms that make it easier to do business with and be a business of choice for consumers. All of those capabilities are underpinned or enabled by technology. Technology now is a critical part of all change. Technology is now playing a greater part in enabling better interactions with customers as well, and even through our face-to-face interactions, technology has a role to play around better engagement with customers. I think technology is critical now and will become more critical going into the future.

Q: What makes a change-ready business different to a business that isn’t?

A: The leadership of an organisation, government structures and how easy or hard it is to get things done and get things approved and the autonomy that is provided through the layers of the organisation are real indicators about how easy it is to effect change. How ready a company is for change needs to start also from the top down as well. And so the leaders that are externally focused, that are driving innovation programs, that are focusing a lot on their people and their culture are, for me, indicators outside in that that company is preparing itself to be a change-ready organisation.

INDUSTRY EXPERT SPOTLIGHT CRAIG RYMAN, CIO AMP



How ready is your organisation for change?



Road to Growth uncovers some tell-tale signs of highly change-ready businesses. They:

• excel with their capabilities to adapt their processes and systems

• understand the importance adaptive processes and systems have on people and culture

• have the support of senior leadership for change across all areas of the business

• are more likely to understand external pressures on their business and give a high priority to meeting customer needs and improving product or service delivery

• believe technology has a strongly positive impact on the business and is an enabler for change.

Change is inevitable. As we found in our research, change is pervasive across industries and unlikely to slow down any time soon. Being change-ready gives businesses a significant competitive advantage, creating more opportunities for them to maximise efficiencies and grow.

Change readiness is achievable for any business. To find out how change-ready you really are, take our Change Readiness Assessment Tool at optus.com.au/futureofbusiness

Here you’ll discover your Australian Business Change Readiness Score and determine next steps so you can move closer to becoming a high change-ready organisation – and start your journey to the road to growth.

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NEXT STEPS




The research was conducted by Added Value on behalf of Optus. The Optus Australian Business Change Readiness Score is based on the change readiness models, constructs and measures developed by Professor Achilles Armenakis from Auburn University and Daniel Holt from the US Air Force Institute of Technology.

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