Situation
A Fortune 500 financial services institution in Japan had invested $500M+ in a transformation program to modernise its technology, drive growth with new products, and enhance customer experience by digitising services.
Midway through the program, the CEO contacted us as he believed that the program was under-delivering. Projects took too long, ran over budget, and did not realise the expected results. Managers were resistant to stopping projects that failed to produce tangible value. They also failed to capitalise on new opportunities by shifting course once projects had navigated and been approved by the company’s onerous governance processes.
Intervention
Through interviews and observation, we identified the key drivers of resistance to change, including people, processes, regulatory and governance requirements, and technology limitations. We implemented a framework to distinguish innovation projects and govern and manage them separately to business-as usual projects.
Working with key stakeholders such as finance, risk, and IT, we established a “sandbox” environment that enabled innovation teams to quickly perform experiments, whilst managing risk and complying with regulations. We also introduced new metrics specifically for tracking the progress of innovation projects, focusing on learning rather than financial ROI metrics.
This dual portfolio approach ensured that innovation funding was protected, aligned with the strategy, and readily accessible, whenever new opportunities were identified./p>
Outcome
The organisation completed its annual project selection and budgeting process more than 50% faster than the previous year. It could also more rapidly make changes to the portfolio through the year and respond to new opportunities as they appeared. There was tighter alignment between the strategy and projects being executed, which could be adjusted as project teams generated learning. The number of innovation projects proposed, approved and executed increased.
