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The Transformation Management Model: A Total Evaluation Route to Business Change Success

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This paper discusses a business model we call the Transformation Management Process that enables organizations to respond more quickly and more creatively to changing market conditions, business and customer needs. The Transformation Management Investment Model is a Human Resources driven process that the authors have effectively executed in major multinational corporations.
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“The Transformation Management Model: A Total Evaluation Route to Business
Change Success”
AUTH ORS Richard R. Bahner
Linda K. Stroh
ARTICLE INFO
Richard R. Bahner and Linda K. Stroh (2004). The Transformation Management
Model: A Total Evaluation Route to Business Change Success. Problems and
Perspectives in Management, 2(4)
JOURNAL "Problems and Perspectives in Management"
FOUNDER LLC “Consulting Publishing Company “Business Perspectives”
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0
NUMBER OF FIGURES
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© The author(s) 2019. This publication is an open access article.
businessperspectives.org
Problems and Perspectives in Management, 4/2004
180
The Transformation Management Model: A Total Evaluation
Route to Business Change Success
Richard R. Bahner1, Linda K. Stroh2
Abstract
This paper discusses a business model we call the Transformation Management Process
that enables organizations to respond more quickly and more creatively to changing market condi-
tions, business and customer needs. The Transformation Management Investment Model is a Hu-
man Resources driven process that the authors have effectively executed in major multinational
corporations.
Introduction
It is the rare corporation that recognizes the need to integrate human resources policies,
people, assets and procedures with changing business strategies. Rarer still is the organization that
acts on this need. Yet, in today's competitive global market, an integrated strategy is increasingly
necessary. This paper discusses a business model we call the Transformation Management Process
that enables organizations to respond more quickly and more creatively to changing market condi-
tions, business and customer needs. The Transformation Management Investment Model is a Hu-
man Resources driven process that the authors have effectively executed in major multinational
corporations (e.g., PepsiCo, AT&T, Citibank, & Deutsche Bank).
Need for Change
Given the speed with which change occurs in the global business environment, standard
planning techniques and asset allocation methods have become woefully outdated. Indeed, achiev-
ing new levels of business sophistication is a never-ending process, requiring companies to rapidly
reallocate assets to meet changing conditions. To effectively accomplish this reallocation the com-
pany needs a system that provides continuous evaluation and improvement, ensuring effective use
of both business (hard) and organizational (soft) assets. In particular, what is required is a balance
and alignment between customer, organizational and business investment. In today's market, or-
ganizations not taking such an approach run the serious risk of failing to meet the expectations of
shareholders. Table 1 depicts the new reality of doing business in today’s global economy and lists
those factors that must be considered for alignment between business and organizational needs to
occur.
Table 1
Global Market Trends: The New Reality
x Globalization is increasin
g
x S
p
eed of chan
g
e is acceleratin
g
x Cost of transactions is
g
ettin
g
lowe
r
x Coordination of activities is bette
r
x Connectin
g
with “new” is increasin
x Networked com
p
etitin
g
is increasin
g
x Disintermediation is a real issue
x Customers demand a
gg
re
g
ation
x
A
ttention is becomin
g
a bi
g
issue
1 President, R. Bahner International, USA.
2Ph.D., HRIR/Loyola University, USA.
Problems and Perspectives in Management, 4/2004 181
Among the distinguishing characteristics of companies achieving sustainable shareholder
value is that the management in these organizations constantly evaluates the key operational driv-
ers of the business and, in response to changes in the business environment, strategically reallo-
cates the company’s capital among those drivers, whether they are in marketing and sales or in
some area of production. This process must occur every time the business changes marketing
strategies, experiences a merger, acquisition or spin off, or moves to a new level of sophistication
and globalization maturity. The result is a company experiencing an ongoing process of active,
bottom line-oriented self-assessment and growth. Figure 1 shows the key operational drivers of
this process and denotes the importance of effectively allocating capital among them.
When a company’s organizational and business assets are in alignment, adjustments occur
naturally. For this alignment to occur, however, the business must measure its organizational and
business assets differently than it did at previous levels of maturity. It also must be able to reallo-
cate assets rapidly to meet changing conditions.
STRATEGY
SALES /
MARKETING
PRODUCTS /
SERVICES
ORGANIZATION
DESIGN
RESOURCE
MANAGEMENT
SHAREHOLDER
VALUE
ORGANIZATIONAL MATURITY
MARKET ENTRY DEVELOPING CONSUM ER FOCUSED MULTINATIONAL MATURE *
O
P
E
R
A
T
I
O
N
M
A
T
U
R
I
T
Y
ENTERING NEW
MARKETS
MEASURE BUSINESS CONCEPT
INNOVATION AND
MARKET VELOCITY...
* Culture shift points
Fig. 1. Business transformation strategic drivers
Aims and Process of Becoming a New Global Economy Company
The aim of the transformation management process is to help an organization align its
human resource and business assets with its business strategy and customer needs, with the ulti-
mate goal of enabling the organization to respond more quickly and effectively to changes in the
global business environment. This is achieved through evaluations of customer, business and or-
ganizational needs; by investing in organizational needs to achieve desired business results; and by
ensuring that each unit/division of the organization contributes to the company's profit. The key to
the success of this process is garnering management’s attention in the areas with the potential for
the highest short-term return--that is, over a 6-to-18-month period.
One of the advantages of the Transformation Management Model process is that it helps
companies attain unique positions in the marketplace, thereby achieving a strategic advantage.
Another advantage is that it enables companies to achieve market differentiation, thereby fueling
business and customer growth. As shown in Table 2, simply following the market leader is likely
to result in diminishing returns. Rather, the company must develop its own special capabilities and
leverage its unique strengths.
Problems and Perspectives in Management, 4/2004
182
Table 2
Following the market leader leads to diminishing returns
x 1992 – 58% of the companies outperformed the standard & poors market average
x 1999 – only 31% of the companies outperformed the standard & poors market average
One of the greatest barriers to success for companies operating in the new global econ-
omy is that managers, accustomed to working in the "old economy," see change as linear and
something to be pursued gradually, rather than as something radical and requiring rapid execution.
It is thus incumbent on today's management to ensure that it has an adequate pool of leaders who
think creatively and who are not only able to identify new goals, customers, markets, etc. but who
can come up with execution methods on how to reach them.
For a business to develop a unique position in the marketplace and achieve strategic suc-
cess, management must encourage innovative thinking and recognize the value in taking risks not
only at the highest levels of the organization but throughout the company. Only then the business
will be able to effectively reach new customers and thereby improve profit margins and fuel busi-
ness expansion. Therefore a “Culture of Success“, which encourages reasonable risk needs to be
created and supported by organizations.
To reach the goal of utilizing their various resources and assets most effectively, compa-
nies need to be sure that decisions and ideas are generated at the lowest possible level of the or-
ganization. This facilitates the company's ability to respond swiftly to rapid changes in market
conditions and equally quickly reassign assets to take advantage of market opportunities. An anal-
ogy to a professional sports team is apt here. Organizations following the transformation manage-
ment model act like an ice hockey team, everyone knows the strategic goal and can adjust both
tactics and reassign team members rapidly to meet changing conditions. The workers in such a
company must be tough and talented, able to act quickly, able to change priorities and direction
quickly and often; and able to work as part of creative and innovative teams. Most importantly,
everyone in the organization must be clear on how to “score” and be prepared to “pass off” the
economic puck quickly to create opportunities for the organization to win.
The key barrier to success in most companies attempting to reach this goal is the lack of
leaders who understand and can operate comfortably under the conditions of the radically differ-
ent, faster pace of the new economy (Stroh, Black, Mendenhall & Gregersen, in press). What are
needed are leaders who can focus on the -what’s (new goals/ideas/customers/markets, etc.) as well
as the how’s (processes, investments, execution skills) at the same time. The transformation proc-
ess forces management to focus on both the 'what’ and the 'how’ simultaneously and therefore
calls for a more sophisticated business leader. Focusing on A, B, and C level players through the
development component of the process is a key element to assure that there is an adequate pool of
top management leaders to meet the needs of the business. Based on our experience working in
multinational companies, we developed the Strategic Talent Analysis Review System (STARS) as
a key part of the transformation process that enables organizations to address the leadership chal-
lenge. This model shows it is important that you leverage the Organization Leadership to push and
support the Transformation Process. This support is critical to create the “Culture for Success” that
allows you to turn the Transformations into Profits. Putting the right people assets who understand
what needs to be done in the right place at the right time will allow the change to be executed
quickly throughout the organization.
HR's Role in the "Transformed" Organization
Among the many crucial roles human resources play in the transformation process is in
helping organizations foster environments in which innovative thinking takes place (Harvey,
Speier, Novecevic, 2001). Encouraging and supporting the creation of such an environment
throughout the organization is no longer a luxury but a necessity.
Problems and Perspectives in Management, 4/2004 183
Among the ways HR can encourage innovative thinking is by conducting brainstorming
exercises with top management teams and their staffs to identify what the company needs to do to
grow and meet future demands (Hamel & Prahalad, 1994). By conducting such exercises every 24
to 36 months, the company can help to ensure that it will expand its customer base and meet the
long-term needs of those customers. Table 3 suggests several strategic questions appropriate for
such brainstorming exercises.
Table 3
Strategic business transformation questions brainstorming exercise?
Today 3 - 5 years
Which customers is
y
our business se
r
vin
g
? ??
What channels do
y
ou use to service them? ??
Whom do
y
ou / will
y
ou com
p
ete with? ??
What is / will be
y
our com
p
etitive advanta
g
e? ??
Where do / will
y
our mar
g
ins come from? ??
What skills / ca
p
abilities make
y
ou uni
q
ue? ??
In what end
p
roduct market do
y
ou
p
artici
p
ate? ??
Gary Hamel and C K Prahalad “Competing for the Future” HBS Press 1994.
Having the Top Management Team come to consensus on these questions will build a
powerful commitment to the strategy. In addition, organizations need to develop a strong leader-
ship base, to succeed in the new global economy and be able to create new markets. This requires
that companies look at the fundamentals of how they are structured. For this to occur, organiza-
tions need to encourage radically new definitions of potential customers. HR support in helping to
create this new environment is a key element of the transformation management model process.
(Table 3 illustrates the need for such a new definition of potential customers.)
Execution of the Transformation Management Model
The Transformation Management Model Process, graphically depicted in Figure 2 is de-
signed to help manage change in a measured way by:
xAuditing the Business, Human Resources Processes and End Customers Needs
xPerforming Investment Analysis on all areas of the process
xAligning Human Resources People, Processes, Policies and Assets to support the
Business Strategy
xExecuting the Change and Leveraging the Organization
xMeasuring Investment Performance of both Business and HR ROI and Rebalancing
Investment to support the next period of change.
BUSINESS
STRATEGY
ORGANIZATION
STRATEGY
TECHNOLOGY
STRATEGY
TMM
CUSTOMER
AUDIT
BUSINESS
AUDIT
HR BUILDING
BLOCKS
BALANCING
EFFECTIVE
INVESTMENT
LEVELS
HR
AUDIT
Fig. 2. Transformation management model. “Turning transformations into profits”
Problems and Perspectives in Management, 4/2004
184
Understanding what you do not know and consciously challenging assumptions are a key
to breaking out of the box and helping design new business models (Robinson & Stern, 1997;
Caudron, 1998). This frequently is the outcome of the Transformation Management Model giving
the company a strategic advantage to deal with the challenges of the new economy.
Human Resources needs to play a pivotal leadership role in establishing, supporting, and
imbedding the transformation management process at all levels of the organization. In fact, all the
support levers of change are in the influence and control of the human resources organization.
How effectively HR helps manage the rate of change and innovation is critical to the organiza-
tion’s ability to stay competitive (Shah, 2000). The human resources challenge is to determine how
to facilitate a new alignment to ensure creative, ongoing transformation. For most companies, this
will require attracting, nurturing, and retaining diverse human capital.
Diversity Issue
Table 4 provides an important message about the business need for diversity of thought to
be successful in the new global economy. Organizations will succeed only if they can attract, mo-
tivate, and retain diverse talent (Jehn, Northcraft, Neale, 1999). This requires creating a business
culture that can attract, motivate, and retain a global workforce. Organizations need to do this to be
able to achieve consistent innovation, transformation and growth.
Table 4
Do we need to think differently?
If you were to take the world and shrink it down to the size of a village of 100, but keep
all current ratios the same as now, the human resources and marketplaces would look like this…..
x There would be 58 asians, 12 africans, 10 europeans, 8 latins, 5 north americans and 7 from all other
areas
x 17 would speak mandarin, 9 english, 8 hindi, 6 spanish, 6 russian, 4 arabic and 50 over 200 other
languages
x 33 would be christians, 18 muslims, 6 buddists, 5 athiests, 3 jews and 35 would identify with other belief
systems
x Of the 67 adults in the village 50% would be illiterate
x Only 33% would have access to clean drinking water
x 20 would make 75% of the total income and another 20 only 2% of the total - only 7 would own their own
car
x 60 would live in substandard housing
x Only “one would have a college education
HR Building Blocks Investment
To be an effective business partner and ensure that a productive business culture is estab-
lished and maintained, HR must first be sure its own house is in order. In other words, it must be sure
its processes, policies, assets and actions are in line with the company's overall business strategy.
This will require continually monitoring these processes and policies as well as generating new ways
to work. Thus, essential to the role of the new human resources professional is an in-depth under-
standing of the business, the ability to influence internal investment and a platform on which to rec-
ommend new policies and procedures that will help the organization achieve its goals first needs to
demonstrate that they are effectively managing and executing the basic support processes of compen-
sation, staffing, training, etc. (Harvey et al., 2001). The Business-Investment Support Platform (Table
5) was developed with the aim of ensuring that basic HR functions are managed consistently and
efficiently, enabling energy and assets to be directed toward more future-focused strategic initiatives
to achieve business goals and gain market advantage.
Problems and Perspectives in Management, 4/2004 185
Table 5
Human resources transformation business investment support platform
Platform Purpose How HR plans to professionally support the strategic intent, business
strategies and organization needs by linking Human Resources support
directly to the business strategy to create the necessary environment for
success.
Investment Approach Business based resource allocation process to support most critical
business needs based upon the maturity of the business and end
customer needs .
Methodology and Measurement Line management driven process integrating human resources planning
with the business planning process and external customer needs.
Implementation for Results Human Resources process standards to be implemented by local
management and supported by geographic business organizations.
Governed by appropriate local market conditions, business strategies
and affordability.
Tantamount to effective execution, HR must be sure that its policies and procedures are clearly
explained, understood, and, where possible, managed directly (i.e., online) by management or the employ-
ees affected. The key to the successful execution of this process is establishing specific objectives, a stan-
dard execution method (HR Product) and measures of success for each of the main HR Processes. The end
goal of the support platform is to create a “Culture of Success” environment that will positively support the
implementation of the business strategy. This is accomplished by eliminating barriers to success such as
policies, processes etc. that will work against the strategy implementation by driving the wrong behaviors
or rewarding the wrong actions. The platform also provides a way to prioritize HR Investment. This is
important to assuring success because of the limited capital available during transformations. Given this
fact we have found that the best approach is to invest in improving the base processes first i.e. Employee
Relations, Communications and Information and then invest in higher-level processes in later accounting
cycles. This flow is depicted in Figure 3 that shows how the model works to support the business and pri-
oritize your use of capital. This approach is aimed at gaining management's confidence that the company's
HR-related initiatives are contributing to meeting the company's overall business success.
Creating a business dashboard with the Business, Customer and Organization measures
on it is a good way to have management understand how to integrate all the components that affect
shareholder value and evaluate the success of all initiatives simultaneously.
In addition we recommend that all measures and reviews be conducted on an 18-month
rolling-quarter basis so that corporate budgeting or annual reward programs and reinvestment de-
cisions that are not affected by political issues do not encumber them.
HR ROI
To ensure that Human Resources Professionals and Line Management understand all the in-
vestment issues we have designed a Business Audit we call the Business Standards Validation Process
(BSVP). This facilitates Human Resources understanding of all the business drivers depicted at the top of
Figure 3 and appropriate measures of the business. This is coupled with the Human Resources Planning
Process (HRP) to form the major support intervention of the model depicted in Figure 4. This review proc-
ess gives line management an understanding of how Human Resources Processes are measured and can
affect the bottom line of the business. It also includes an evaluation of the health of the organization
STARS (Strategic Talent Analysis Review System) and helps management evaluate what specific invest-
ments that need to be made in the next accounting cycle to improve the business. Once these investments
are decided upon, Human Resources commits to an anticipated return to the business and then measures
the success of the initiative during the next accounting cycle. Examples of the sort of initiatives and meas-
ures that have been used in successful model transformations to determine the return to the business are
listed in Table 6. Through the use of these processes HR professionals come to better understand business
issues affecting their organization and managers come to better understand how investments in such HR
processes and initiatives such as training and recruitment can influence business outcomes.
Problems and Perspectives in Management, 4/2004
186
STRATEGY SALES/
MARKETING
SHAREHOLDER
VALUE
RESOURCE
MANAGEMEN
ORGANIZATION
STRUCTURE
PRODUCTS/
SERVICES
BUSINESS PROCESSES
Market Entry* Developing* Consumer Focue* Multinational* Mature**CULTURE-
SHIFT
POINT
P
R
E
S
E
N
T
S
T
A
T
E
CORPORATE
CULTURE
WORKFORCE
MOBILITY
ORGANIZATION
DEVELOPMENT
EDUCATION
& TRAINING
RECRUIT ING
& STAFFING
COMPENSATION
& BENEFITS
POLICY &
PLANNING
WORKFORCE
MOBILITY
CORPORATE
CULTURE
ORGANIZATION
DEVELOPMENT
EDUCATION
& TRAINING
RECRUIT ING
& STAFFING
COMPENSATION
& BENEFITS
POLICY &
PLANNING
QUALITY HR
TRANSITION
PLAN
D
E
S
I
R
E
D
S
T
A
T
E
KEY CORE
PROCESSES
EMPLOYEE
RELATIONS
ORGANIZATION
COMMUNICATIONS
INFORMAT ION
MANAGEMENT
HR ADMINISTRATION
Fig. 3. Human resources business support platform
Table 6
Human resources support platform
Process Objective HR product Success
measure
Key change issue
1 2 3 4 5
Recruiting &
staffing
- Supporting
organization change
process
- Position filling
process
- Speed of filling
open jobs
- Global staffing
standard
Education /
training
- Developing core
skills / competencies
to support business
- Management
training initiatives
- External customer
satisfaction survey
- Training linkage to
business plans
Organization
development
- Developing future
leadership
- Performance
management
- Succession stars
plan
- Market share
increase
- Global
management
support system
Workforce mobility - Efficient utilization of
global talent
- IA program
development
- Regional plan
- Assimilation
program
- Speed to market - Effective planning
- Employee
assimilation
Problems and Perspectives in Management, 4/2004 187
Table 6 (continuous)
1 2 3 4 5
Corporate culture
support
- Effective
management of
change process
- EE attitude survey
- BSC / EVA
scorecard initiative
- Stock price
- Productivity
increase
- Consistent global
rollout required
Workforce
information
- Effective human
asset management
- Human resources
mis system
- Administrative cost
per 100 employees
- Information
ownership
Employee
relations
- Effective managing
the workforce
- Negotiations
authority process
- Employee turnover
- Work actions
- Defining minimum
standards
Employee
communication
- Effective managing
workforce perceptions
- Employee
communication
process
- Employee attitude
survey results
- Global cultural
issues
HR strategy - Linking HR &
business strategies
- Business
standards
validation process
- Revenue
- Share of wallet
- Key / top
management
commitment
HR policy - Support behaviors
required to execute
business strategy
- HR policies
measures and
standards
- Business strategy
execution / culture
change
- Support standards
in place globally
HR planning - Effectively utilizing
organization resources
- HR strategic
investment support
plan
- Talent inventory
review
- Process
governance -time /
resource
commitment
Compensation /
benefits
- Effective controlling
business costs
- Total
remuneration
approach
- Ratio of employee
cost to revenue
- Global evaluation
standards
Fig. 4. Transformation support interventions
In order to assure effective use of capital during the transformation process and buy in for
the change, both Line and HR Management must participate in the investment interventions deci-
Problems and Perspectives in Management, 4/2004
188
sions as part of the overall process. Annually they assess the (next) areas that should be invested in
and what levels of return are required from each. The measurement discipline and periodic re-
evaluation are critical to the success of effective implementing the business strategy and the re-
quirements of any new business operations model.
Assuring Change at the End Customer Level
The third area to be considered in obtaining optimum economic pull through from the
transformation is the Customer and integrating the market needs into the total process. One of the
areas in which HR can be particularly effective is having a point of view in the area of managing
corporate governance. The closer to the marketplace decisions can be made, the more effective the
corporation will be in reacting to changes under market conditions. Yet frequently control is dele-
gated to the wrong level of the corporation. Human resources can serve a valuable role by making
top management comfortable with allowing decisions to be made as close to the end customer as
possible. Figure 5 shows the dynamics of the governance process and the competing forces that
need to be balanced to assure that a business flourishes. As organizations move through the global-
ization continuum through organic growth or through mergers and acquisitions there will be shifts
in the governance control within the organization. This is natural and cyclical. The most successful
businesses pay attention to these changes and assure that the rebalancing of control toward local
management occurs as quickly as possible. A consistent management development program that
line management has a great deal of confidence in is a critical element to succeeding in this rebal-
ancing. If Corporate Management has a high degree of confidence in the field management’s abil-
ity to deal with business issues effectively then they will release assets and decisions to be made
by local management where capital can be used most efficiently. Without this shift, organizations
may soon find they are overtaken by competitors who can respond more quickly to market changes
and gain market share, business and profitability at the expense of slow adapters.
Hierarchical
Control
(Bureaucratic)
GlobalConsistency
LocalFlexibility
SelfGoverning
Compliance
Local
Autonomy
(Internal M arket s)
Synergy
Accountability
Horizontal
Collaboration
(Co mmunit y)
HR’S NEW
CHANGE ROLE
ACHIEVING
BALANCE
LEADERSHIP
BUSINESS
STRATEGY
ORGANIZATION
STRATEGY
Fig. 5. Organization Governance - Supporting the Change
To ensure that any initiatives it proposes have a high degree of acceptance and ultimately
success, HR must explain how these initiatives will add to the company’s ability to act faster and
more effectively in response to customer demands in the marketplace. In other words, to be per-
Problems and Perspectives in Management, 4/2004 189
ceived as a value-added player in the organization, HR needs to agree to be held accountable, for
all areas of the business and, helping the company remain profitable.
The Importance of Stars
As we have discussed the fastest way to make transformations successful is to assure that
the right people, who already understand and support the need to change, are put into the key lead-
ership positions at the right time. This greatly facilitates imbedding the new business culture and
allows for rapid implementation of new strategies at the end customer level in multiple markets.
The process that we have used to accomplish getting the right management in place is the STARS
system depicted below:
Competition for innovative, creative employees has always been tough, but today secur-
ing such employees is critical to the continued success of the business.
To gauge its progress in undertaking its responsibilities in the transformation process,
management needs to conduct periodic reviews of the organization’s skills, its ability to manage
change, and its leadership-renewal capabilities. These reviews should be done in conjunction with
the business reviews by line management to discuss investment issues. The form these reviews
take is less important that ensuring that discussions occur on an ongoing basis and that line man-
agement is clear on both the business and organizational goals necessary for the company's contin-
ued success.
STRATEGIC TALENT ANALYSIS REVIEW SYSTEM
QUANTITY
QUALITY
BUSINESS
PLAN
CURRENT
ORGANIZATION
ANALYSI S
ORGANIZATION
FUTURENEEDS
LONG
TERM
BUSINESS
PLAN
HEADCOUNT/
$$ REVIEW
ORGANIZATION HR
PLAN, TRAINING, OD
STAFFING, CAPACITY
GAP
ANALYSIS
HEADCOUNT/
$$ REVIEW
SHORT
TERM
Identity Existing:
Competencies
Skills
Education
Language
Mix ......etc..
Evaluate:
Capability
Potential
Costs
Identity Required:
Competencies
Skills
Education
Language
Mix .....etc..
Evaluate:
Capability
Potential
Costs
KEY ISSUE IS
LEADERSHIP
Fig. 6. Developing new “new” talent
This intervention is included in the management planning cycle to assure that manage-
ment plans for required changes and that performance is tied to achieving the business strategic
results. This discipline is an effective means to at get line management to recognize and commit to
certain levels of investment in the organization during the budget cycle so that organization in-
vestment progress can be made and monitored. This process also facilitates the measurement of the
organizations capacity to effectively manage change. It assures that the reward and other HR proc-
esses are aligned with the business strategy and the organization maintains the capacity to manage
Problems and Perspectives in Management, 4/2004
190
transformations. This process is the key area that top management must focus its time and efforts
on to assure the continuing success of the business.
The New Role for the IT Organization
As part of the transformation process, companies may want to consider ways IT could be
used more effectively. In that achieving efficiencies and competing in the global marketplace will
increasingly require enhanced technological capabilities, IT is likely to continue to be essential to
running global companies. Given that it is usually easier to teach technical people about a business
than it is to teach businesspeople about technology, it makes sense that IT professionals could take
on an expanded role in the organization of the future.
Table 8
The new “new” it department- facilitating transformation
x It is the most diverse and flexible group in the entire organizaion
x It has to be fast moving and transforming continuously to keep pace
x It is a feeder department for the new “new” ideas, processes and business models
x You can teach it people the business you can not teach many business people it
x Partner it with sales / marketing to invent / construct the new “new” business models
The technology group is typically the most diverse in the company. Assuring that some of
these people move into management positions is important for any company that hopes to operate
profitably in our increasingly technological world. Finally, because of the diversity of the skills
and abilities represented in most IT departments, IT professionals are an important source of ideas
on ways to enter new markets and create new business models and opportunities.
The diversity that is typical for IT groups presents another challenge for human resource
professionals--namely, understanding, accepting, and motivating these employees so that they may
exert the necessary positive impact on the company. Traditional employees will have to be moti-
vated too, of course, but, because of the cultural diversity found in IT employees, they may need to
be treated especially sensitively. The STARS process is a good way to assure that the proper man-
agement mix is maintained throughout the organization to assure the proper levels of creativity and
innovation for the business.
A New Type of Human Resources Professional is Required
Effective managing the transformation process requires a totally different view of the role
of human resources. The real value-added role is in facilitating continuous learning and change
within the organization to deal with the new diverse global marketplace and new realities.
If human resources professionals are to take on the much-needed role of chief change of-
ficers, they will need to become true business partners. They will need to be capable of influencing
top management to embrace initiatives that will allow their organizations to quickly mature and
evolve.
The new HR role is that of consultant, facilitator and chief change officer. To meet the
requirements of this role the HR Leader and HR Organization in general must focus their energies
and resources on value added activities for the business, eliminate / outsource non value added
activities while still maintaining understanding and control over information and re-skill the HR
Organization to deal with the complexity of the execution of the Change Management Leadership
Role for the business.
Problems and Perspectives in Management, 4/2004 191
Getting Management to Pay Attention to the Right Areas
Our experience shows that it is very important to have management easily and quickly
come to consensus on decisions as to where to invest. To do this effectively we suggest utilizing a
simple and effective software tool to facilitate the decision process, The Performance Profiler ©by
Quantisoft. This flexible and easy work with tool creates spidergraphs out of Excel data so people
can quickly see the areas that need to be addressed. Since most Line Executives are visual it pro-
vides a very practical way to present information and measurements on multiple issues and can be
adapted to do top level reviews of both Hard Side and Soft Side issues, investment performance
etc. as well as Performance Management issues that need to be addressed by individuals utilizing
existing information and databases. This factor is especially important because, while being ex-
tremely effective in influencing the best-cost decisions, the tool does not add much cost to the
Transformation Management Decision Process Model.
Putting it All Together: Effective Execution
To institute the transformation management process effectively requires that both man-
agement and HR professionals take a totally new view of the role of human resources. These new
HR professionals need to be willing to take risks; understand the company's markets, products,
systems, processes and organizational capabilities; understand the end customer needs and market
realities, to be leaders in executing change initiatives; promote diversity as a key enhancement
strategy; and to embrace a business approach to HR that facilitates the creation of a positive, fu-
ture-focused business environment. In short, the new HR professional will function as a true Busi-
ness Partner and Chief Change Officer in defining, encouraging and measuring the effectiveness of
investments and returns for the organization, facilitating discussions and providing new ideas
about how best to utilize corporate assets to execute the business strategy and help influence the
direction and the running of the company.
The responsibility to help manage the highest cost portion of the company’s asset base is
a great opportunity. To take advantage of the opportunity Human Resources Professionals need to
have a process that is very relevant to the future success of the business and capable of facilitating
the execution of the processes. Becoming skilled at dealing with the issues of Transformation and
Change is a powerful skill and a critical, essential concern for the future success of the business.
References
1. Hamel, G., Prahald, C.K. 1994. Competing for the Future. Harvard Business Press.
2. Harvey, M., Speier, C. Novecevic, M. 2001. A theory-based framework for strategic
global human resource staffing policies and practices. International Journal of Human
Resource Management, 12, 7, September, 898-915.
3. Jehn, K.A., Forthcraft, G.B., Neale, M.A. 1999. Why differences make a difference: A
field study of diversity, conflict, and performance in workgroups. Administrative Science
Quarterly, 44, 741-763.
4. Robinson, A.G., Stern S. 1997. Corporate Creativity: How innovation and improvement
actually happen. San Francisco: Berrett-Koehler.
5. Stroh, L.K., Black, S., Mendenhall, M., Gregersen, H. (in press). Globalizing People
Through International Assignments, Lawrence Erlbaum.
6. Shah, P.P. (2000). Network destruction: The structural implications of downsizing. Acad-
emy of Management Journal, 43, 101-112.
... Change is the only constant and organisations in its entirety experience these changes in some way. Bahner and Stroh (2004) discusses a business model which they call the Transformation Management Process that would enable organisations to respond quickly and creatively to the changes created by market conditions, business-and customer needs. Bahner and Stroh (2004) furthermore identified the following global market trends; ...
... Bahner and Stroh (2004) discusses a business model which they call the Transformation Management Process that would enable organisations to respond quickly and creatively to the changes created by market conditions, business-and customer needs. Bahner and Stroh (2004) furthermore identified the following global market trends; ...
... The practices in this component include the review or alignment of organisational strategy in order to ensure that the talent management process will support the strategy (Veldsman, undated). Selecting talent (Wing, 2005), developing talent (Bahner et al., 2004;Huselid et al., 1997), setting objectives and performance standards (Baldoni, 2006;O"Conner & DeMartino, 2006), ensuring that employees have sufficient resources to perform their jobs (Wing, 2005), facilitating a more participative environment with appropriate levels of delegation (Daft, 2004;Loch et al. 2007), continuous performance feedback with subsequent rewards (Beechler, Woodward, 2009;Salaman & Asch, 2002) are all practices that line managers need to do to manage the talent in their organisational units. The strategic review and job design and structure practices could be practices that have more Human Resources involvement; however, Human Resources will be responsible for providing the Human Resources framework that will enable managers to perform these practices. ...
Thesis
Full-text available
In an interview with Harvard Business review Gary Hamel (Allio, 2009) noted: “Management is the single largest constraint on business performance.” Current management models and practices need to be reviewed because managers do not seem to be able to add significant value to their organisations anymore. In 2007 the Hay group conducted a study and showed that middle managers in the United Kingdom cost the economy approximately £220 billion per annum (Paton, 2007). According to a Towers Perrin Global Workforce study (2007) it showed overall employee engagement in organisations across the world was 21% whilst disengaged employees was 38%. The Towers study further showed that managers are playing an enormous role in the statistics above. This study focuses on the concept of creating a management value chain for management, to ensure consistent application of enabling management practices in order to contribute to the improvement of employee engagement and ultimately organisational performance.
... Досягнення нових рівнів складності бізнесу -нескінченний процес, який вимагає від компаній швидко перерозподіляти активи для подолання наслідків змін у середовищі, а від персоналу -сучасних знань та навичок, уміння адаптуватися до зовнішнього середовища, комунікативних здібностей. Для ефективного позиціонування компанії на глобальній арені важливу роль відіграють людський чинник та система його менеджменту, які забезпечують постійну оцінку та вдосконалення, забезпечуючи ефективне використання як бізнес-властивостей, так і організаційних навичок [1]. ...
... The practices in this component include the review or alignment of organisational strategy in order to ensure that the talent management process will support the strategy (Veldsman, undated). Selecting talent (Wing, 2005), developing talent (Bahner & Stroh, 2004;Huselid et al., 1997), setting objectives and performance standards (Baldoni, 2006;O"Conner & DeMartino, 2006), ensuring that employees have sufficient resources to perform their jobs (Wing, 2005), facilitating a more participative environment with appropriate levels of delegation (Daft, 2004;Loch et al. 2007), and continuous performance feedback with subsequent rewards (Beechler, Woodward, 2009;Salaman & Asch, 2002) are all practices that line managers need to perform to manage the talent in their organisational units. Strategic review, job design, and structure practices could be responsibilities that require more involvement from Human Resources; however, Human Resources will be responsible for providing the framework that will enable managers to perform these practices. ...
Article
Full-text available
Orientation: A currently emerging viewpoint is that today's management practices no longer add value to organisations. The focus of this article is to conduct a systematic review of the scholarly literature on management practices that could be related to employee engagement. Research purpose: This study searched for evidence in support of the notion of a management value chain, and enabling management practices within each value chain component that could relate to employee engagement. Motivation for the study: An alternative management value chain model could contribute towards a better understanding of which management practices may potentially impact employee engagement. Research design, approach, and method: This is a non-empirical (theoretical) study, based on a systematic, in-depth literature review to identify the key management components and enabling practices within this proposed management value chain. Scholarly research databases were sourced for relevant peer reviewed research conducted since 1990, not excluding important contributions prior to 1990. The literature was systematically searched, selected, studied, and contextualized within this study. Main findings: Support was found for the notion of a management value chain, for enabling management practices within each proposed management value chain component, and it was also established these management practices indeed have an impact on employee engagement. Practical/managerial/implications: The possibility that management work can be presented as a generic management value chain allows managers to approach engaging management practices more systematically. Contribution/value-add: This study highlights the importance of some management practices that have never been seen as part of management work.
... The practices in this component include the review or alignment of organisational strategy in order to ensure that the talent management process will support the strategy (Veldsman, undated). Selecting talent (Wing, 2005), developing talent (Bahner & Stroh, 2004;Huselid et al., 1997), setting objectives and performance standards (Baldoni, 2006;O"Conner & DeMartino, 2006), ensuring that employees have sufficient resources to perform their jobs (Wing, 2005), facilitating a more participative environment with appropriate levels of delegation (Daft, 2004;Loch et al. 2007), and continuous performance feedback with subsequent rewards (Beechler, Woodward, 2009;Salaman & Asch, 2002) are all practices that line managers need to perform to manage the talent in their organisational units. Strategic review, job design, and structure practices could be responsibilities that require more involvement from Human Resources; however, Human Resources will be responsible for providing the framework that will enable managers to perform these practices. ...
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Full-text available
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Competing for the Future
  • G Hamel
  • C K Prahald
Hamel, G., Prahald, C.K. 1994. Competing for the Future. Harvard Business Press.