Tesco - from vision to blueprint

This leading UK retailer had embarked on a fundamental revamp of their business model (from selling through to supply). They created a major change programme and set about identifying key projects affecting supply chain, internet applications, store opening hours, staff remuneration, product development and distribution. Following their standard practice, they set them up under the governance of individual steering committees.

Opportunity

Six months into the change programme there was little discernable progress and a lot of dissent among stakeholders. Projects were competing rather than collaborating in bringing about the necessary changes. 

Resourcing was difficult and the impact on stores and their performance was often negative, and the project activity was failing to deliver business benefit. Senior management were extremely frustrated at rising costs, delays and the absence of any investment payback.

Approach

Through contacts within the retail organisation, CITI were asked to help with the change programme. We assessed the programme using our programme evaluation methods, and it soon became apparent that, although the business benefits were well articulated and financially robust, there was no clear linkage between the benefits to be realised and the projects being undertaken.

We used our proprietary BIP mapping (benefits > impacts > products) toolkit to establish clear connections between projects and their deliverables, and the benefits sought. This identified that many of the projects were not aligned to the business benefits and some of the benefits did not have any means by which they could be achieved – this led to a major restructuring of the projects, and a fundamental adjustment to the governance of the projects.

Outcome

The BIP mapping tool showed the client how to restructure the change programme based on achieving the business impacts required, ranging from improved customer service, to more valued staff, through to improved distribution processes. The new set of projects each had a clear link between what it delivered in terms of outputs, the impacts or changes to people and processes they would cause, and the benefits.

By taking this approach, we were able to reduce the number of interdependencies between projects and therefore reduce the possibility of delay through projects ‘competing’. By restructuring the projects in line with the business impacts the most challenging task, realignment of business sponsors was undertaken. Their traditional approach to project sponsorship had been based on functional alignment – a problematical approach when large-scale cross-functional change is the outcome sought. The approach used showed the nature and degree of cross-functional dependencies and allowed a more appropriate governance structure to emerge.

The programme was re-organised into three delivery tranches, each with its own set of projects, which would leave the organisation is a new, stable state. The first two tranches have now completed and the original benefits from the business case have come through, despite the delayed start.

In conjunction with CITI, the client developed a new approach to managing complex change based on the toolkit we provided them as part of the process of creating a coherent programme of change. Along with the associated skills transfer from CITI to the client, this has allowed them to successfully embark on other change initiatives with confidence.