‘Transformation Is Driven By Digital And Demonetisation Will Drive Digital’
Manny Maceda, Global Head of Transformation, Bain and Company, talks to BW Businessworld about the concept of transformation, effect of demonetisation on Indian companies
Manny Maceda, Global Head of Transformation, Bain and Company, talks to BW Businessworld’s Brij Pahwa about the concept of transformation, effect of demonetisation on Indian companies. Also, he gives a way to companies to cope with Donald Trump’s policies.
You head Bain’s Transformation programme, how important is transformation for a company and how pertinent is your role in ensuring the same?
There comes a point in a company’s life cycle when the leadership often has to make a dramatic change in what they do because of competitive, customer or regulatory changes. And sometimes it is obvious. When you are an Apple computer, an irrelevant PC company and then Steve Jobs joins you to transform you into a leading consumer technology company that is what we call transformation.
When that happens you have to often change strategy, operating model, customers, organisation structure and sometimes even your investors. So we have a practice of putting all of that together and helping that company through that change. We call that transformation.
What is your modus operandi?
Typically, a company’s chief executive recognises the need for transformation but goes outside for help to define and translate the same in an actual vision. So, we typically come in and help the client establish the need to transform.
To ensure the same, we employ different means. Sometimes the strategy needs to be changed, sometimes it is the customer approach and sometimes we even have to change the ownership and investor base because a transformed company might want different kinds of investors. And there is a plan to put that all together which could take a few months initially. But for a company that actually has to transform, it is a journey of two to three years.
What has been your most important and unique case study till date given the fact that you have such a vast experience in the field of transformation?
Without disclosing the name of the companies, my most exciting situations have been literally when everything has all gone wrong. Because sometimes if you catch a transformation need early enough, there is still time. But if you get to the point when it has all saturated, it becomes a challenge. For my favourite client, we had to do that. We had to change who the target customer was. Going from consumer oriented to SME oriented.
We had to change the basis of competition, from supply chain sensitivity to a customer loyalty leader.
We had to change the type of people in the organisation, from those who were good at operations to those who were good with the customers. We had to change the ownership of the company, took it from a public to a private company. And they actually came out at the other side being a leader. This was one of my favourite case studies and the reason was that the initial company was totally transformed into a whole new entity.
People are often rigid. And when such people set up companies they make them rigid as well. How difficult it is for you to transform that rigidity into liquidity and take the company away from its status quo?
It can be very challenging. It is harder for a successful company, especially. The change is required at the top level. From chief executive to the board behind it. Without that, we can actually not do it. The most common trigger for transformation is leadership change, partly because of the skills that you need for the transformed business might be different from what you have but partly because it is very natural that the current leadership is very committed to the way that made the company successful and that makes it hard.
How important has the recent event of demonetisation been in transforming the status quo of Indian companies?
Demonetisation has affected a subset of companies in the financial services sector, banking sector, money transfer payment sector among others. It has ensured a meaningful change to their business model. Demonetisation has compelled these companies to go digital, something which will anyway ensure their transformation. So of course it is helping companies in a big way to transform. It has given a push to companies with a vision of going digital.
On another strand of thought, after Donald Trump’s win, there is a concern about the immigration implications, especially from the Indian business community. As a consultancy leader, how do you view this and what changes do you see?
Of course there is a concern about immigration in the Indian business companies. I sort of have a longitudinal view. Our companies operate under ongoing changes of leadership. In US, we have gone back and forth over various transitional changes, presidential changes. So things will move on. Clearly the president is not behaving in the way which we have seen before. Though I will ask the companies to not overreact but to have a longitudinal plan in place which will help them better throughout this transition phase.