Today’s engineering organizations face near-constant pressure to improve product quality, bring products to market more quickly, cut costs, and drive new up revenues. To remain competitive in an increasingly global marketplace, these organizations must find ways to improve their business outcomes. Many are turning to engineering transformation (EX)—a subset of digital transformation (DX) initiatives intended to improve product design and engineering—to achieve those goals. However, questions remain about how best to approach EX.
Assumptions About Executive Involvement
As with DX initiatives, technological change is the key enabler of EX initiatives. But, in addition to investing in technological change, companies may also invest in changes to their design and engineering processes and to roles and responsibilities within the organization. Such a significant amount of change naturally carries with it the potential for disruption. That disruption can take the form of heavier engineer workloads, compromises on product quality, increased operational costs, cultural pushback, and more.
For decades, executive involvement in these kinds of change initiatives has been seen as an antidote to operational disruption. If VPs and C-level executives sponsor or support the initiatives, the thinking goes, they can keep teams aligned and step in to address disruption as it occurs—increasing the likelihood of success. Findings from Lifecycle Insights’ 2023 Engineering Transformation Study cast serious doubt on these assumptions, however.
Does Executive Support Improve EX Outcomes?
To better understand the impact of executive involvement on engineering improvement efforts, we asked study respondents to note how frequently their executives are directly involved in engineering improvement initiatives. We also asked them to identify whether a lack of executive involvement had significantly hindered the pursuit of those initiatives. The findings revealed that the “Value Realizers”—companies that achieved a high rate of success with minimal disruption—had less executive involvement in their engineering improvement efforts than the other companies.
Executives formally sponsored improvement efforts for only 18% of Value Realizers. In contrast, 32% of all other respondents said their improvement efforts were formally sponsored by an executive. In addition, 18% of Value realizers said their initiatives were assigned to dedicated leaders, compared to 32% of all other respondents.
Despite a far lower frequency of executive involvement, Value Realizers achieved their engineering improvement goals at roughly the same rates as the other study participants but experienced, on average, less than half the level of disruption.
Additional findings indicate that Value Realizers did not miss executives’ involvement in their improvement initiatives. Just 11% percent of those respondents cited a lack of executive support as a barrier to the success of their initiatives, compared to 22% of all other respondents. Likewise, only 14% of Value Realizers identified the lack of a designated initiative leader as a challenge, while nearly a third of other respondents (31%) said the same.
These findings run counter to long-held assumptions about the relationship between executive support and the success of companies’ improvement initiatives. Executive involvement neither reduces disruption nor increases the degree to which companies achieve their engineering improvement goals. This suggests that companies should prioritize other concerns as they plan and execute EX initiatives. But the data also raises an important question: If executive involvement doesn’t improve the odds of those initiatives’ success, what does?
Synergistic Alignment Makes All the Difference
According to the study’s findings, organizational alignment and synergistic changes mitigate disruption from EX initiatives far more effectively than executive support. Companies achieve synergistic alignment when they invest in changes that amplify the advantages new technologies provide and align around clear goals.
As noted previously, technological change is the key enabler of EX. Well over a third of Value Realizers invested in new software (39%) and a similar number invested in new compute hardware (37%). Other respondents did so at much lower rates (26% and 27%, respectively). Value Realizers also reported making formally documented changes to processes, practices, and methodologies at higher rates than all other respondents (42% vs. 31%). Additionally, Value Realizers reported making changes to roles, responsibilities, and structures within their organizations at higher rates (40% vs. 31%).
As these comparisons demonstrate, companies that invested in process and organizational change as well as technological change realized more value from their EX initiatives than their less successful counterparts. Consider this: Adopting new technologies unlocks new engineering and design capabilities. Adjusting processes to maximize the impact of those technologies makes team members more efficient. Redefining roles and responsibilities ensures that employees understand how their performance (and that of the company) will be measured in light of these other changes.
When companies can achieve synergistic alignment, a lack of executive support doesn’t matter because the front-line team members experience the benefits of their improvement initiatives and witness the lack of disruption first-hand. The success of the initiative becomes self-evident in the form of higher productivity, increased revenues, and better product quality.
EX initiatives provide today’s engineering organizations with a method to overcome their fiercest competitive challenges. However, to provide meaningful value, those initiatives must be executed in a way that minimizes disruption. The long-held assumption that executive support is essential to achieving that goal is rooted in the belief that executives are uniquely capable of quelling the high level of disruption that improvement initiatives often introduce. But the study results explored here paint a different picture.
First, the study findings illustrate that EX initiatives need not be highly disruptive. When organizations invest in and align around synergistic changes to technology, processes, and people, they can reduce disruption significantly without affecting the achievement of their improvement goals. That’s true even when executives are involved at lower rates. Second, when company initiatives are not in synergistic alignment, executive support does little, if anything, to reduce disruption. As a result, companies pursuing EX initiatives should prioritize synergistic changes and organizational alignment over the involvement of VPs and their C-level colleagues.