Think about the career of a great athlete. They perform at the highest level. Unlike one-time wonders, they improve over time. They are single-minded, and they sustain that improvement. What makes this possible' Training, especially interval training, where intense sprints are alternated with strategic rest to achieve peak performance. A few companies are now drawing on the principles of interval training as they seek to reverse the long-term trend of failed transformations. Research dating back to the 1990s keeps finding that only about 30 percent of transformations succeed, defined as both improving operating performance and sustaining improvement over time.1John P. Kotter, Leading Change, Harvard Business Review Press, 1996; 'What successful transformations share,' McKinsey, March 1, 2010; 'How to gain and sustain a competitive edge through transformation,' McKinsey, October 16, 2023. In 2023, our Rewired research found that 90 percent of organizations were undertaking some form of digital transformation, efforts that generated less than one-third of the planned impact....
Digital transformation often stalls when employees resist new technology. To overcome this common challenge, French spirits company Pernod Ricard drew upon four strategies: proving value through A/B testing, reducing risk by adjusting performance evaluations, investing in training and support, and leveraging internal champions. These efforts drove adoption rates as high as 85%, boosting sales up to 4.5% and marketing efficiency by 15%. In order to drive meaningful transformation, companies need to realize that technology on it's own can't drive value'humans need to be convinced to buy in....
In early October, DualEntry, an AI enterprise resource planning (ERP) startup, announced a $90 million Series A round led by Lightspeed and Khosla Ventures, valuing the one-year-old business at $415 million. The company seeks to replace legacy software like Oracle NetSuite with its offering that can automate routine tasks and provide predictive insights. The massive funding round from top-tier VCs signaled that the startup is likely experiencing phenomenal revenue growth. However, one VC who declined to invest told TechCrunch that DualEntry's annual recurring revenue (ARR) was just around $400,000 when he reviewed the deal in August. DualEntry's co-founder, Santiago Nestares, denies that number. When asked about revenue when the deal closed, Nestares said it was 'considerably higher than that.' This approach involves deploying massive funding into one startup in a competitive category, aiming to overwhelm rivals by granting the chosen company a bank-account advantage so significant that it creates the appearance of market dominance....
Despite two years of broad experimentation, most companies aren't seeing the large-scale GenAI transformations they initially envisioned. The challenge isn't the technology's potential ' it's understanding how to generate real value at three different levels of investment while effectively managing the risks that GenAI innovations can bring. Join MIT researchers Melissa Webster and George Westerman as they reveal insights from their study of 21 large companies that are successfully generating measurable value from generative AI. Rather than pursuing wholesale business redesigns, these leaders are working their way up the 'risk slope' ' starting with low-risk applications and building capabilities for larger transformations. Melissa Webster is a lecturer in managerial communication at the MIT Sloan School of Management. Her research focuses on how organizations communicate and implement new technologies, with particular expertise in digital transformation and AI adoption strategies. George Westerman is a senior lecturer at the MIT Sloan School of Management and coauthor of the award-winning book Leading Digital: Turning Technology Into Business Transformation. He is a leading expert on digital and AI transformation, advising numerous Fortune 500 companies on their digital strategies. Abbie Lundberg is editor in chief at MIT Sloan Management Review. She moderated the session....
