Organizations often redesign themselves to unlock latent value. They typically pay a great deal of attention to the form of the new design, but in our experience, much less to actually making the plan happen—even though only a successfully implemented redesign generates value. A recent McKinsey survey examines the reasons executives cite for successful and unsuccessful implementations, and in doing so, offers one set of explanations for why organizational transformations so rarely succeed.¹ This survey asked why organizations redesigned, what challenges they faced, what tactics they used for implementation, and how the redesign and its delivery affected employee morale and shareholder value.

Though a majority of respondents at publicly traded companies say their redesigns increased shareholder value, only a very small group of respondents—8 percent of those who have been through a redesign—say their efforts added value, were completed on time, and fully met their business objectives. Executives at these organizations are much likelier than others to say that implementing their redesigns took six months or less and that their organizations accelerated the pace of implementation as much as possible—countering the often-cited wisdom that good change is evolutionary. They also say their redesign strategies focused on changing mindsets and on how the new organizational model would work, not just how it would look, and they report implementation procedures including a clear communications plan and efforts to ensure that support systems reflect the changes. Notably, these respondents are also much likelier than others to say the redesign improved morale, even in the short term, which indicates that these tactics helped their organizations overcome employee distraction and demoralization, two of the most frequently cited challenges to successful change.