Managing Change within the Retained Organisation ft. Bombardier
For organisations seeking to improve their operations, outsourcing has long been an effective plan of action.
With the ability to perform back-office processes with greater efficiency, at a lower cost and with a high level of functional expertise, outsourcing solutions often carry the promise of significantly boosting a businesses competitive edge. However, in reality, the desired benefits do not always come to fruition. The reason for this is that many organisations focus on the processes being moved to the outsourcing centre while neglecting to pay enough attention to the retained organisation’s operation and the significant change management initiative it must undergo.
Octavian Cuntan is a Director of Business Transformation at Bombardier Transportation, Indirect Goods and Services. There, he leads various projects of the organisation’s multi-year transformation that seeks to improve the efficiency, quality and customer experience of its operations. On the Wednesday 20th of October, Octavian will provide insights into the lessons learnt throughout this five year transformation journey at the 12th annual Nordic Business Transformation event in Stockholm, Sweden. Here, we explore the Bombardier story as it transitions into the continuous improvement stage of its business transformation and discuss how the organisation has supported its retained organisation as it has outsourced a selection of their operations.
Bombardier’s five-year journey sought to target the improvement of everything on the businesses product line, Octavian explains. “It was about addressing how we can become more lean and agile in our manufacturing, how we can drive customer quality and, ultimately, how we can drive shareholder value”. Today, Bombardier is four and a half years into their five-year plan, the target of which is believed to have been achieved ahead of time. “We are now moving towards the phase of continuous improvement and simplification,” he explains.
“Mindset is not an easy thing to change. You can hammer down messages from a top down perspective but it doesn’t mean that people will follow.”
However, as with any transformation journey, particularly one of this scale, there are bumps along the road. One of the biggest challenges that Bombardier has had to overcome is employee mindset. “This has been a true concern for us mainly because we are working in an industry that has been going at its own pace for tens of years,” Octavian explains. “Mindset is not an easy thing to change. You can hammer down messages from a top down perspective but it doesn’t mean that people will follow. There are a lot of people that have been doing the same thing for maybe 20 or 30 years so in attempting to change this and bring the organisation to a more agile state you are confronted with a lot of ‘no, it can’t be done’ or ‘we tried to before and it failed’”.
An instance where Bombardier experienced resistance was in the outsourcing of one specific manufacturing area. “There was a lot of insider expertise in that area which lied with individuals but it did not lie with the organisation,” Octavian explains. “If Person A, B, or C were to leave or were to be removed from the organisation, the knowledge would go with them. So the argument was that if we were to outsource that expertise, we would then create proper documentation for that area and we would have a contract with service level agreements and a business model. So if outsourced Company A is doing it today but that relationship ends, Company B can take over and we can simply handover the documentation and continue.”
This is a topic Octavian will discuss in detail at Nordic Business Transformation, however he shares that, to go forward, Bombardier took a step back to think about how they could make their effort more human. “It is about identifying the areas with the most resistance and then understanding how we can bring a targeted explanation to that area to communicate that what we are doing is making their job easier, giving them the opportunity to develop further and make a lateral development or upward move if they want to take new chances and so on and so forth.”
Identifying himself as a big fan of Simon Sinek’s Golden Circle, Octavian puts emphasis on communicating the why, how and what throughout the transformation process. “In a transformation journey, if people don’t understand why you’re doing it in the first place and then don’t understand what you want to do or how you want to do it, it’s going to be a never-ending effort to bring and keep people on the journey.”