Do you feel it too? The more numerous the “impacts” become – Corona virus, persistent supply bottlenecks, war in Ukraine, energy prices, climate protection targets, supply of skilled workers, to name just a few – the more determinedly numerous companies are setting comprehensive transformation processes in motion.

This is a good sign, because the pressure is enormous! It is important to know the success factors and to achieve the necessary results. In this article

  • I will therefore once again highlight the central role of corporate culture,
  • discuss the key success factors of a transformation process, and
  • outline the importance of broad-based continuing education, using Coca Cola as an example.

Culture of change

Without an appropriate culture of change, rejection reactions can set in, since companies are living systems in which people move with their emotions.
This culture of change focuses on three dimensions – ability to change, willingness to change and empowerment – that are important for the quality of change management.

  1. Promoting the ability to change; e.g., via continuing education programs and opportunities to learn directly on the job. Continuing education measures are often used to accompany change measures in order to train new competencies, attitudes and behaviors.
  2. Strengthening the willingness to change. Many employees still find it difficult to break away from the status quo. Models such as Kotter’s 8-step model therefore emphasize the sense of urgency at the beginning of a transformation and act as a kind of initial spark for willingness to change.
  3. Empowerment; the transfer of responsibility to employees and the granting of room for maneuver. Scientific studies (e.g., Meyer et al., 2019) have come to the conclusion that the granting of room for maneuver in the digital transformation varies greatly and can have both a relieving and a burdening effect, especially when responsibilities are unjustifiably attributed and there is a threat of overload. In addition to room for maneuver, the way in which employees are involved in decision-making is also a key factor in the course of transformation processes.

A corporate culture that targets these dimensions is significantly more likely to be associated with transformation processes having promising characteristics (see “results” later in the post).

Success factors of transformation processes

Current studies essentially have the following success factors in common:

  1. The need for change is well explained; i.e., managers have proactively used dialog to make the need for change comprehensible to all employees.
  2. The strategy is made transparent; i.e., the strategy of the management is transparent in the change processes, for example in the form of a transformation matrix or similar.
  3. Existing entitlements are taken into account; i.e., appropriate consideration is given to entitlements and benefits acquired in the past in the change processes.
  4. Opportunities for co-design are opened up; i.e., employees have sufficient opportunities to help shape change processes.
  5. Investments are made in further education; i.e., the company invests heavily in further education so that employees can adapt to changing competence requirements.
  6. The error culture is strengthened; i.e., the work culture encourages trying out new things in the change processes. Google has introduced the Psychological Safety concept for this purpose.

Empirical analyses suggest that the probability of a successful transformation project is high.

The Coca Cola Digital Academy

The strongest correlations between the ability to change and the success factors outlined above can be seen with regard to regular participation in training programs. Coca Cola has established a Digital Academy for this purpose. This is designed to impart fundamental knowledge and skills on digital, analytical and agile core topics so that employees can work successfully in a digital world.

Six building blocks are at the forefront of transformation:

  1. Clear roadmap and “story of change” to be shared throughout the organization.
  2. Talents with key competencies – cf. contributions on workforce segments and strategic workforce planning – are identified and focused on from addressing, recruiting and onboarding to retention.
  3. Agility and thus the question: How can new ways of working be introduced promptly and fast, iterative processes be anchored in the organization?
  4. Digitization. With the support of new technologies, such as AI, and digital business models, it is ensured that a transformation has a positive impact on business success.
  5. Only with valid data and its structuring can higher-value analyses be performed.
  6. A structured process with systems and tools supports the adoption and scaling of use cases across the enterprise.

Results

In order to strengthen the willingness to change, it is particularly important – according to the results of the regression analysis – that the direct manager clearly communicates the requirements and goals to the employees and asks what they need in order to achieve the goals. The communication culture of managers is therefore immensely important!

The above-mentioned success factors have been shown to contribute to higher employee commitment – measured by a lower propensity to change jobs and higher job satisfaction.

Both factors – propensity to change and job satisfaction – are associated with costs for the employer, whether in the form of declining job performance, a loss of image or rising recruitment costs.

Employees who have experienced a transformation process in the last two years are significantly more satisfied with their work overall than employees without such transformation experiences. The former are also significantly less likely to consider changing employer.

Although change can certainly be painful for employees, appropriate transformation management transforms potentially negative emotions into productive positive emotions. The higher satisfaction of the employees could then also reflect the fact that the opportunities and benefits for the individual of a well-designed transformation have turned out to be greater than the individual risks and costs associated with the changes.

At Coca Cola, a productivity increase of up to 20 percentage points was achieved in manufacturing. In addition, service quality improved throughout the supply chain.

Conclusion

A corporate culture that aims to promote employees’ ability and willingness to change and to actively mobilize their potential in everyday work is significantly more likely to be associated with transformation processes exhibiting the promising characteristics examined.

Where several of the above-mentioned success factors come into play in change processes, employee commitment is also more pronounced.

High training intensity, also known as learning penetration – measured as the proportion of employees in a company who have taken part in at least one training measure in the last 12 months – is very important when departments or functional areas are reorganized and responsibility and decisions are delegated.