Embracing Transformation: Options for Structuring Transformational Leadership

This IDC Perspective explains the reasons why transformation functions have become formalized, along with different ways organizations set up the function.Organizations must keep transforming to remain competitive, satisfy users and employees, and expand opportunities. There are many ways to transform: digital transformation (integrating digital technologies into areas of a business and changing business models, processes, and strategies to accommodate the transformation), AI-focused transformation (including a shift toward AI agents and greater levels of automation), and many other types of core, operational, and strategic transformations to improve and modernize business processes, workflows, and even models. Core transformations are fundamental shifts in the way an organization operates, while operational transformations change an existing operating model to align better with strategy.The key is that businesses must keep transforming in ways that make strategic sense for their organizations and industry. That's why so many businesses now have some sort of transformation lead. In many cases, it's a chief transformation officer, or a vice president or director of transformation who typically reports to a C-suite executive. Sometimes, however, it's transformation by committee via a COE, a cross-functional group with high levels of knowledge and competency that works across business units to come up with ideas, disseminate knowledge, and share best practices. And in other cases, especially when businesses want to see what's possible and how much it will cost, the choice, at least initially, is to outsource the transformation function.No matter which route is taken, the key is to do it right. That means developing a transformational road map that includes thorough benchmarking and baselining, collaborating with internal stakeholders, building a transformational culture and managing change, and measuring progress and results."Companies today need to react more quickly to the ever-changing needs of their markets and customers if they want to remain competitive and relevant," said Karen D. Schwartz, adjunct research adviser for IDC's IT Executive Programs (IEP). "The only way to do that is by continually thinking in terms of transformation. The actual transformation activity may change, but the role of transformation leader is probably here to stay."