The Human Side of Digital Business Transformation

Chapter 5Foundation Elements of Digital Business Transformation

November 2021 will be remembered as an iconic month. It is not often that we hear global conglomerates announce serious restructuring, and that month three such organizations announced the transformation—General Electric, Toshiba, and Johnson & Johnson. These companies join the long list of conglomerates that have made the radical decision to dismantle their business empires in the name of unlocking potential hidden value in the complex corporate structure.

General Electric (GE) is splitting up into three public companies focused on growth sectors of Aviation, Healthcare, and Energy. As described in a Forbes article (Fischer 2021), the repeated efforts at downsizing, divestitures, leadership changes, and the constant pressures for improved operational excellence over the past few years have fallen short of the intended outcome. This led to the drastic decision to split the multi-dimensional conglomerate into more manageable “mini” corporate structures.

Similarly, Toshiba faced a trying journey into decline. Following over seven years of challenges, Toshiba has been unsuccessful in managing market disruptions, rapid technology developments, financial under-performance, internal conflicts, and governance failures. Abruptly in November 2021, the board proposed to split the 140-year-old company into three standalone companies—one with an infrastructure focus, the second focused on devices, while the third company includes ...