Most chief executives, especially new ones, must fundamentally transform their enterprise at some time during their tenure. Boards are increasingly appointing CEOs with that explicit charter, and almost all CEOs recognize the need to take even successful enterprises to new levels of performance.
We recently talked with 11 chief executives who have successfully driven and sustained fundamental change. They run organizations headquartered in North America, Europe, Asia, and Australia and in fields ranging from manufacturing and finance to the Internet, consumer, retail, and nonprofit sectors.
“The first thing to realize is that there is not a magic formula. If there were,” says Archie Norman, the nonexecutive chairman of ITV and the leader of many successful corporate turnarounds, “we probably would not be having this conversation.”
Even though they lack a magic formula, the CEOs we spoke with have relied on many of the same leadership tools. In fact, the similarities across their approaches far outweighed the differences. In particular, almost all the leaders discussed the three core elements of transformation:
We would like to thank the executives for their time and insight. This report—and the videos and related online content at leadership.bcg.com and bcgperspectives.com—would not have been possible without their willingness to share their experiences in driving fundamental change within their organizations.
Furthermore, we thank the following people for their help in coordinating and conducting the interviews: Sandeep Chugani, Anders Fahlander, Alastair Flanagan, Mark Freedman, Shigeki Ichii, June Limberis, Tom Lutz, David Michael, Steve Richardson, Jürgen Schwarz, Michael Silverstein, Janmejaya Sinha, and Saurabh Tripathi.