Why Your Tech-First Transformation Is a Waste of Money

[00:00:15]
James: Good afternoon. What are we talking about today?
Jimmy: Afternoon, James. Today we have a special guest who’s going to talk to us about how you can transform without using technology. Everyone is leaping towards technology as the solution for everything.
James: No, you need to be AI-powered.
Jimmy: Sorry, AI-powered technology is the answer to everything. Well, our special guest, Paul Howley, has a different view. He’s going to share why he thinks that approach is wrong and how managers can do it differently. So welcome, Paul.
Paul: Thank you very much.

[00:00:55]
Jimmy: Now, Paul, we know you very well, but for the benefit of the audience, do you want to give us a quick 32-second intro as to who you are and why they should listen to you?
Paul: Yeah, great. So I’ve worked in a number of different industries—airlines, utilities, financial services. It was in financial services where we all met. Across different roles: operations, technology, change, at all levels of the organization. And it’s through those 36 years of experience that I realized there’s a problem here, and there might be another way. So that’s what we’ll talk about today.
Jimmy: But Paul, just to put the cherry on top, what were you trained as originally?
Paul: Originally, I was a radio astronomer. I’m an astronomer by trade, but there were no jobs in that, so I ended up working with you lot.

[00:01:40]
Jimmy: To start off, most transformations begin with a tech decision—new platform, new system, AI tool. From what you’ve seen, why do organizations reach for that as a solution?
Paul: Well, I think you can get seduced by the technology. If you go to conferences, they’re all sponsored by tech vendors who say, “This is the best thing since sliced bread.” The reason they sponsor those events is they make a lot of money from people who think, “I can use this technology to be transformational.” But if you focus on business outcomes, that’s transformational. So it’s the business outcomes, not the technology, that we should all be thinking about.

[00:02:44]
James: I agree, but I think there are two things going on here. First, there’s this huge fear of missing out. Everyone else is doing AI, so if I don’t, I’ll be left behind. Second, we employ senior people who need to justify their jobs. So they say, “Technology’s the solution,” because their careers depend on it. When you add those two things together, it’s no wonder organizations go tech-first.
Jimmy: I’d add a third: people are lazy. In our last episode, we talked about improving systems, which is complex. It’s easier to say, “Let’s buy a new system or AI,” than to get to the root of the problem.

[00:03:28]
Paul: You also need to look at the outcomes of those choices. McKinsey research shows that only 30% of transformations—AI, digital, or system implementations—successfully achieve their business case outcomes. So there’s a problem. And why is that?
James: Further, Paul, I’d argue that only 70% of IT directors are prepared to admit it didn’t work as well as it should have. I reckon the failure rate is much higher.
Jimmy: Fortunately, the three of us were always responsible for delivering transformations in the 30%.
James: But why do you think 70% don’t deliver what they promise?
Paul: Because people forget the business outcomes. You start with a business case, usually financially motivated, but you lose sight of why you’re doing it—customers. My observation is that the 30% that succeed never lose sight of the customer or the outcomes. Every decision is about those outcomes.

[00:06:05]
James: Another point is the debate between efficiency and effectiveness. A lot of people use technology just to chase cost savings—doing the same thing more efficiently, rather than doing the right thing. Focusing on the customer is a totally different ballgame.
Paul: Exactly. We put together a transformational change, and in the honeymoon period, we say, “We want to make a difference for customers and the organization.” But the first thing people think is, “How can I achieve this with technology?” That’s the wrong approach. The hierarchy should be: Can I make the change myself? Can I get specialist help to re-engineer the process? Do I need a small tech change? And only as a last resort, do I need a major tech change? Most senior leaders start at the last step.

[00:07:52]
James: There’s a conceit here, Paul. A major tech change is seen as a big strategic move, whereas looking at policies and procedures is seen as non-strategic—clipboard monkey work. So people’s egos push them toward big tech moves, blinding them to reality.
Jimmy: It’s often easier to buy tech than to unpick the process. It’s complicated, so people layer tech on top of complexity, which just makes things worse.

[00:08:53]
James: So you’ve got lazy management, fear of missing out, ego, and sales pressure from vendors—all driving this tech-first approach.
Jimmy: Paul, a lot of our audience are middle managers. They don’t have tech budgets, so they can’t just go buy a new tool or AI. What’s your advice for them?
Paul: There’s an opportunity for middle managers to be heroic. You can achieve transformation in customer outcomes and experience without the cost or long timelines of major tech investments. Focus on what you can do with people, policy, and process.

[00:10:16]
James: Let me play devil’s advocate. You’re saying we should look at customer outcomes, but my boss only cares about cost. Why should I focus on customers?
Paul: Because if you remove waste from processes, costs go down. You’re improving the experience and the financial sustainability of the organization. Frame it as, “I’m working on customer outcomes, and one benefit is it will be more effective.” That’s a good way to start the conversation with senior management.

[00:11:34]
Jimmy: Everyone’s ears pricked up when you said “heroes.” How would you suggest people approach becoming heroes?
Paul: I’ve got a case study. It’s from financial services, mortgage lending. Most of us have taken out mortgages, and we know the process can be fraught. Brokers are key—they arrange the lending, and if they’re unhappy, they won’t recommend you. In this case, brokers were so unhappy that one wrote to the CEO saying, “I’d rather set myself on fire than give you any more business.” Our net promoter score was -11, which is catastrophically bad.

[00:12:52]
Jimmy: So you had unhappy brokers. What were they saying about you?
Paul: Not very nice things. The CEO got a letter saying, “I’d rather set myself on fire than give you any more business.” We were at -11 on net promoter score—terrible when you’re trying to get brokers to use you.

[00:13:23]
Jimmy: What did you do about it?
Paul: The first thought was, “We need a technology solution.” But that would take 18+ months and a lot of money. I’d just joined as an operational leader and met with the team. They said, “We think we can fix this. We don’t need technology.” So I went to the senior leaders and said, “I think we can get to top quartile service without tech.” Some people told me I was crazy, but the team was right.

[00:14:27]
Jimmy: What did the team say?
Paul: They were at the coalface, dealing with customers. They said, “There’s a better way, but we’re so busy we don’t have time to make the changes.” So I went to the board and said, “Trust us. We can fix this faster and cheaper than a tech solution.”

[00:14:59]
James: So the frontline people wanted to fix it, but usually, the attitude is, “They’re not working hard enough.”
Paul: I’ve heard that before. But I was in a privileged position to say, “There’s a different way. We don’t need tech. We can fix it faster and cheaper.”

[00:15:38]
Jimmy: What did you actually change?
Paul: We looked at people, policy, and process. First, process: there were 28 different ways of processing a mortgage application, and handoffs between teams meant brokers experienced terrible service. Next, policy: there was a lot of “ghost policy”—unwritten steps added because someone was penalized once. Finally, people: brokers couldn’t speak to the decision-makers, the underwriters. So we re-engineered the process to one version, removed handoffs, and trained everyone to be both customer service reps and underwriters.

[00:17:53]
Jimmy: Which of those three had the biggest impact?
Paul: The people. The way we structured the team lost sight of what the customer needed. Fixing that fixed the process and policy.

[00:19:09]
James: Presumably, the original decision was made to save costs—keep underwriters busy and away from customers.
Paul: Exactly. But chasing cost savings actually made things worse.

[00:20:35]
Jimmy: Access to decision-makers is always key. Customers want to talk to the people who make the decisions, not a go-between.
Paul: So we fixed it without tech. We re-engineered the process, removed ghost policy, and trained everyone to be both customer service reps and underwriters. The result? Net promoter score went from -11 to +80, a 91-point improvement.

[00:21:58]
Jimmy: How did you overcome the organizational barriers?
Paul: The team said, “We think we can do this better.” We had to do a lot of hearts-and-minds work—reminding people that our job isn’t to process mortgages, but to help customers buy their dream homes. When you inspire people like that, you get buy-in.

[00:22:48]
James: So a lot of the change was about educating people on what was really going on.
Jimmy: What did the net promoter score end up at, and what are the key takeaways for managers trying to improve performance?
Paul: NPS went from -11 to +80. The key takeaway is that you can make transformational changes without tech by focusing on people, policy, and process. And if you think you can do it better, you probably can. It takes bravery, but the rewards are worth it.

[00:26:42]
Jimmy: It sounds simple, but it takes resilience to stick your hand up and say, “I can improve this.”
Paul: It does. But the reward is great—not just for customers, but for you personally. Engagement goes up when people understand why they’re doing things, not just what they’re doing.

[00:28:41]
James: The two most important things: work out who your customer is and what they want, and take pride in what you do. If you focus on solving the customer’s problem, good things will happen.
Jimmy: And listen to the people on the frontline—they know what gets in their way.

[00:29:51]
Paul: You need to think holistically—policy, process, and people. Tinker with one, and you might break something else.
James: So, Paul, in summary, what are the key things people need to do if they’re in an organization that’s not working well?
Paul: Document the desired outcomes—what are you trying to achieve? Then look at the hierarchy of options: Can I do it myself? Get help to re-engineer the process? Use a small tech change? Only as a last resort, ask for a major tech change. Never lose sight of the outcomes, and organize your team to benefit the customer, not the organization.

[00:32:09]
James: Any manager can do it, but it takes bravery.
Jimmy: That was fascinating, Paul. Thanks for sharing your insights.
James: Cheers.