Top-performing companies are more likely to have invested in enterprise-wide transformation over multiple years

PwC’s Accelerating Performance research* identified 11 factors that differentiate the top 20% of companies from the remaining 80%. This article focuses on being ‘totally committed’. Find out more about Accelerating Performance.

While nearly every company is undergoing some kind of change program, far fewer companies have a total commitment to top-to-bottom, end-to-end transformation.

Yet research from PwC shows a clear correlation between prioritising and investing in transformation and being in the top 20% of an industry in terms of profit margin and revenue growth. 

Our Accelerating Performance data* shows that the top 20% of Australian companies are totally committed to transformation. They are 1.6 times more likely to have recognised transformation as a top priority three or more years ago, and more than six times more likely to have increased investment in whole-of-business transformation by greater than 30%.

<sup>1. Percentage of respondents from Australia who indicated ‘to a large extent’, or ‘to a very large extent’ to each of recognising the need for a digital operating model, ecosystem participation, and engagement of service partners
2. Average score of respondent for their increase in investment in the last three years across each of digital technology initiatives, ecosystems, and service partners
Source: PwC’s Accelerating Performance research</sup>

In other words, they keep transformation as a priority over multiple years. How do these companies keep up momentum (and investment) over such a long period of time?

Our research, combined with our experience working alongside top performers, shows that this is what total commitment to transformation looks like:

1. Leaders at all levels are committed to the ‘why’

Organisations don’t necessarily require a burning platform for transformation, but leaders need a burning ambition to transform. We see stark differences in the conversations taking place among leaders of top performers: constructive dissent and debate are encouraged and they have a shared vision for ambitious transformation targets. They don’t talk about ‘change fatigue’ but see transformational change as part of ‘business as usual’.

Effective transformation requires cascading a shared vision and behaviours throughout an organisation in a consistent, repeatable format that leaders participate in themselves and then facilitate for their own team.

Delivering sustained transformational outcomes requires leaders and teams to operate with passion and purpose. When the ‘why’ is not definitive and the ‘what’s in it for me’ is not persuasive, the company simply won’t have the tenacity and perseverance required to get it done.

2. Ways of working are changed, not just tech platforms

While transformation does (and should) involve digitisation, more than technology needs to change. Tech experts shouldn’t have sole responsibility for delivery; all parts of the business have a role to play. 

Unlocking value frequently comes from tackling the challenge end-to-end, however ‘the system’ - a company’s existing ways of working - tends to make this hard.

Silo-based targets can result in ‘the blinkers being on’ to opportunities in the wider enterprise, with a limited view and accountability for outcomes. Meanwhile companies can have a tendency to reward individual efforts rather than teams, and especially cross-functional teams.

It is therefore critical that ‘the system’ evolves into one that both expects cross-functional solutions and rewards those that deliver them.

3. Top performing companies bring their A team

When undergoing transformation programs, it’s common for companies to set up project teams that run separately to ‘business as usual’ and leave their best people alone to focus on their day jobs. While it may be tempting to run a project this way, if you’re transforming and designing for the future, you need to have your best people involved.

^{* PwC surveyed 464 respondents in Australia at director level or above with anonymised responses, in November 2022, from the following industries: consumer markets; financial services; technology, media and telecommunications; industrial, manufacturing and automotive.}