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The ten Impact Essentials: A conversation with Elizabeth McNally

A playbook of essential steps shows clients how to achieve sustainable improvement.
Through research and our experience leading thousands of transformations, McKinsey has identified ten activities critical to the successful execution of transformation plans. In this video, McKinsey partner Elizabeth McNally explains the impact essentials.

Interview transcript

Over the last few years, our clients have increasingly asked us to expand our role beyond planning a transformation. They also want us to partner with them to execute that plan.

As we’ve done more of this work, we’ve built a playbook of steps that are proven to achieve sustainable improvement. This playbook contains ten impact essentials that are critical to driving the successful execution of any transformation plan.

1. Commit to full potential. An organization must be determined to achieve its full potential, measured by both performance and health, which includes its corporate culture. To visualize its potential, an organization needs a detailed baseline analysis, as well as the aspiration to achieve ambitious goals.

2. Create conviction. An organization must engage all employees with a compelling change story that explains the ongoing change. The story must be crafted to excite employees by persuading them that this change will be meaningful for them. To convey this change story, organizations need a sophisticated communication strategy using different channels to reinforce the drumbeat of this message.

3. Deploy talent. In a successful transformation, an organization positions the right talent in critical roles. Leaders must identify the talent they’ll need to lead this transformation and decide where to deploy them. For some employees, this could require changing career-progression plans.

4. Lead by example. Senior leaders must align around, and serve as role models for, the transformational change, often altering their business practices and behaviors. The organization must be aware of the challenge this poses and be willing to help these leaders evolve.

5. Activate influencers. Change must also come from the bottom up, using an army of formal and informal change agents and influencers. These individuals will use their networks to build excitement, participation, and activity from the ground level up.

6. Invest in capabilities. Most transformation plans require significant capability building, including the development and refinement of new executional skills, functional abilities, and leadership traits. By identifying the most effective learning techniques, organization can teach people the skills they need to improve their performance.

7. Reward individuals. A successful transformation needs a system of incentives—both financial and nonfinancial—to motivate the behaviors that will achieve an organization’s goals.

8. Hardwire change. Transformations often require new ways of doing things. Create a plan to design or use the tools, technology, processes, and operating models needed to support change.

9. Design and scale initiatives. Design a portfolio of initiatives and make sure that each is robust. Sequence the execution of these initiatives to maximize impact while at the same time taking care that this plan is manageable. Don’t forget to figure out how to scale these initiatives to be sustainable. Sometimes, organizations are so focused on pilot projects that they lose sight of the bigger goal.

10. Launch a transformation infrastructure. Every transformation effort needs a topflight governance and performance-management system to oversee implementation. By creating a transformation office, an organization maximizes the likelihood that every aspect of its plan happens on time and on target.

These impact essentials are grounded in research and our experience leading thousands of transformations. We’ve found that all ten are needed for a transformation to achieve sustainable impact. They’re called essentials for a reason.

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