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| 2 minutes read

How to unlock enterprise value through accelerated organizational transformation

The 2022 AlixPartners Disruption Index continues to affirm that the C-Suite is confronted by disruptive forces more than ever, spanning all industries and individual business functions.

Against this backdrop, unlocking greater enterprise value and setting a course for future sustainable growth can be achieved by tackling three organically intertwined themes, each affecting the outcomes of another:

  1. Greater agility, resilience and accountability
    To maximize stakeholder returns and deliver on the critical financial, organizational and operational metrics, a clear vision and guiding principle for a company’s future end-state is vital. Digitalization, regional expansion, product development and innovation, and other priority objectives can only be successfully implemented along that journey once a clear direction has been determined.

    Course-corrections are inevitable due to disruptive unknowns still to come – the current conflict in Ukraine demonstrates how quickly our world view can alter. Therefore, greater simplicity, business agility, and resilience become the antidotes to an inescapable element of uncertainty, ultimately focusing product and service delivery towards profitable growth, incentivizing the right behaviors and a mindful allocation of resources.

  2. Effectiveness and efficiency
    Organizations scaled over many years – developing greater complexity and inefficiency as a result – may see this as an impossible challenge to overcome at the speed that today’s market dynamics demand.

    However, the ability to react and respond fast within transparent guardrails of defined roles and responsibilities cannot be underestimated. In the area of SG&A, reducing complexity and standardizing or automating central activities will build leaner structures, optimized processes and ultimately significant cost reductions, shifting the clear responsibilities that are created as close as possible to the business.

    The unlocking of enterprise value can be viewed through the dual lenses of doing the right things and doing things right. Business focus on one or the other may vary by a company’s current state – for example, distressed over-indexing in efficiency or growth-minded focusing on effectiveness – yet measuring these core objectives will provide powerful barometers of progress that need to be balanced to achieve the desired outcomes.

  3. Harnessing human capital
    Disruption continues to influence the optimal skillsets required for business success, and it is clear that the war for this highly coveted talent pool is more competitive than ever before.

    To survive and thrive, organizations must be mindful of future requirements borne out of the pandemic, investing in effective, collaborative hybrid environments and making highly flexible working options available to staff. If they don’t, those that are become a much more attractive proposition to top talent.

    Leaders need to visualize the team and the capabilities that they need for tomorrow, not the ones that they have today. They must harness the existing stars of the future that lie closest to home, while strategic hires should be identified and defined within the context of those future-state growth ambitions.

    The demand for consistent, authentic and transparent communication from the top down also is essential, alongside the sharpest attention to execution and implementation and, of course, increasing levels of digital IQ throughout the boardroom and below.

Disruption may bring many challenges, but it also presents opportunities, and accelerating organizational change has never been more critical. Otherwise, complacency or institutional paralysis could lead to the destruction of enterprise value and, ultimately, to external forces affecting change outside of businesses’ control.

...greater simplicity, business agility, and resilience become the antidotes to an inescapable element of uncertainty

Tags

organizational transformation, disruption

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