Centralized vs. Decentralized Change: What Works Best?

This executive brief summarizes key insights from a roundtable discussion examining the key differences that come hand in hand with centralized, decentralized, federated, and hybrid change leadership approaches. Senior transformation leaders shared practical experiences and tested strategies for determining optimal organizational structures for transformation success.

Key Discussion Areas:

• Pros and cons of centralized vs. decentralized change models

• Resource allocation and budget realities across different approaches

• Portfolio management strategies for coordinating multiple initiatives

• Future implications of AI and automation on change management structures

  
  

Roundtable led by: Aric Wood, Tigerhall - Chief Strategy Officer

• Anica Addison, Equifax - former SVP, Strategic Growth Initiatives & Business Excellence

• Gina Chung, ZoomInfo - VP, Strategic Programs

• Holly Hon, Entertainment Partners - Senior Vice President, Operations

• James Hoch, Teradata - Senior Director of Strategy and Transformation

• Jodie Bennett, Willis Towers Watson - Global Transformation and Operational Excellence Leader

• Joe Edney, RTI - Senior Transformation Leader

• Kym Kulle, Merkle - Strategic Chief of Staff & VP Business Ops

• Leigh Gordon, HCLSoftware - SVP, Human Resources

• Madhuri Kumar, Championx - Vice President & Global Head of Talent Management

• Marshall McDonald, LPL Financial - Head of AI Strategy and Transformation 

• Nicholas Mudd, Cummins - Global Service Transformation Director

• Pooja Solanki, DaVita Kidney Care - Vice President, Enterprise Change Management & Deployment

• Rachel McKain, Northwestern Mutual  - Senior Director - Enterprise Change Management 

• Stacey Taylor, Visa - VP, Implementation & Change

• Stephanie Coleman, Sodexo - Program and Transformation Office, Senior Director

• Travis Hahler, Salesforce - Sr. Director Global Strategy - Change Management 

• Trina Chatterjee, CBRE - Senior Director - Strategy Execution 

• Vanessa Hammett, Mars - Change Management & Communications Lead

Part I: Model Selection and Implementation

The Decentralized Advantage

Leaders highlighted the power of proximity in driving change success. Organizations found that placing change agents closer to impacted employees created stronger relationships and a better understanding of local business needs.

Key Impacts of Decentralized Change:

• Relationship Leverage: Change agents embedded within business units could tap into existing networks

• Contextual Understanding: Local teams better understood specific operational challenges and cultural nuances which tied into long-term change adoption

• Sharing Accountability: Business leaders felt more invested when they had direct control (and say) over change initiatives

Notable Quote:

"The closer a change is to the people it impacts, the better. They are more likely to understand the why and to trust the people leading the change”

- Anica Addison, Equifax - former SVP, Strategic Growth Initiatives & Business Excellence

The Centralized Imperative

Enterprise-wide transformations demand an enterprise-wide approach. Strategic initiatives like these require more oversight, coordination, and a higher degree of compliance. 

When Cohesion is Critical:

• Technical Transformations: Platform migrations, ERP implementations, and system rollouts

• Compliance Requirements: Regulatory changes requiring uniform implementation

• Brand Consistency: Communications and cultural initiatives requiring a unified messaging

The Hybrid or Federated Model Sweet Spot

The overwhelming consensus favored federated approaches that combine centralized strategy with decentralized execution, allowing organizations to maintain standards while allowing for adaptation at a local level.

Getting to the Best of Both Worlds:

• Common Playbook: Centralized standards and methodologies ensure consistency

• Local Adaptation: Business units customize approaches based on maturity and context

• Scalable Framework: Organizations can deploy at different paces across regions

Part II: Resources and Portfolio Management

The Funding Paradox

Leaders revealed counterintuitive budget dynamics where decentralized funding often proves easier to secure than centralized allocations despite the fact that running decentralized initiatives can prove to be more costly. 

Resource Allocation Realities:

• Function-Level Budgets: Business units are more willing to fund initiatives they control

• Central Budget Constraints: Enterprise budgets face more scrutiny and competition

• Ownership Psychology: Leaders invest more readily in changes they can directly influence

Strategic Portfolio Orchestration

Change is not and should not be a preoccupation limited to the change leadership team. By creating a strategic portfolio of initiatives, senior change leaders can not only align initiatives with strategic CEO & organizational goals but also allocate resources across multiple concurrent changes.

Governance Framework Essentials:

• Goal Alignment: Every initiative tagged to specific strategic objectives

• Priority Stacking: CEO enterprise-wide changes take top resources, followed by business unit priorities

• Monthly Reviews: Regular roadmap assessments to rebalance resources and priorities

“It’s hard to say no to great ideas. But you need to roadmap your initiatives and tier your resources so that you’re allocating the right resources to the right priorities and the right enterprise goals.”

- Gina Chung, ZoomInfo - VP, Strategic Programs

Part III: The Future of Strategic Leadership

AI-Driven Transformation

Leaders predicted significant shifts in change leadership roles as AI and automation handle tactical execution, freeing professionals to focus on strategic advisory functions.

Role Evolution Predictions:

• Advisory Focus: Change professionals become strategic consultants rather than tactical executors

• Agentic Workforce Management: Leaders orchestrate AI agents to handle routine change tasks

• Embedded Competency: Change leadership becomes a core leadership skill rather than a specialized function

Notable Quote:

Tools like Tigerhall will pave the way to make change less centralized and empower leaders across the organization to also lead change. You get oversight and direction from the top with strong, contextually-driven execution from functional leaders. For change leaders, that means taking on more advisory or coaching roles, giving frontline leaders the latitude and flexibility to execute changes that stick.” 

- Stacey Taylor, Visa - VP, Implementation & Change

Enhanced Federated Models

The combination of AI capabilities with federated structures promises to amplify the benefits of hybrid approaches while reducing traditional coordination challenges.

An AI-Enabled Federated Model:

• Automated Coordination: AI agents handle routine coordination tasks

• Personalized Deployment: Technology enables mass customization of change approaches

• Real-Time Orchestration: Intelligent systems manage complex multi-initiative portfolios

Key Takeaways

1. Context Determines Approach: No universal solution exists - optimal models depend on transformation type, organizational structure, culture, and resource availability.

2. Hybrid Models Dominate: The most successful organizations use federated approaches that combine a centralized strategy with decentralized execution and local customization.

3. Resource Politics Drive Decisions: Budget allocation realities often influence model selection more than effectiveness or true cost-saving measures.

4. Portfolio Management is Critical: Success requires sophisticated coordination mechanisms to manage multiple concurrent changes. In doing so, change teams can decrease the likelihood of change fatigue and ensure that change initiatives fit with the organization’s overall strategic direction. 

5. AI Will Reshape Roles: Change professionals will increasingly become strategic advisors and AI orchestrators, transferring execution to more suited owners: functional leaders. 

The Executive Council for Leading Change

The Executive Council for Leading Change (ECLC) is a global organization that brings executives together to redefine the landscape of organizational change and transformation. Our council's aim is to advance strategic leadership expertise in the realm of corporate change by connecting visionary leaders. It's a place where leaders responsible for significant change initiatives can collaborate, plan, and create practical solutions for intricate challenges in leading major shifts in large organizations. 

In a world where change is constant, we recognize its crucial role in driving business success. ECLC’s mission is to create a community where leaders can excel in guiding their organizations through these dynamic times.