This issue of BoardroomDirect® takes a look at how boards address transformational changes, such as M&A’s, new product and technology rollouts; how boards and companies should abide by the new proposed CEO pay ratio disclosure rules; the latest data on political spending disclosure; and why cash flow statements have become the most read by boards.
Issue in focus: Transformational change: How the board can help
Many companies today are considering implementing transformational changes to their businesses, that may include mergers and acquisitions (M&A), new go-to-market strategies, or significant technology rollouts. According to PwC’s 16th Annual Global CEO Survey, 61% of CEOs say they anticipate change in 2013 at their companies in M&A, joint ventures, or strategic alliances, and 75% said the same about an increase in technology investments.
To be successful in today’s complex and competitive world means companies must think ahead and be willing to transform themselves to respond to economic, political, regulatory, technological, and other pressures. Transformation comes with risk. Mismanagement of these risks can lead to negative outcomes, including failing to achieve strategic objectives, significant disruption to operations, and possible damage to a company's reputation.
The likelihood of a failed transformational program is high: 70% of all attempted organizational changes fail, according to Dr. John Kotter, who wrote The 8-Step Process for Leading Change.
This month's headlines