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Considering the final results the right hand side of the graph, we can see that over time the savings can be huge.

Transformation Debt™, like any debt, is not inherently a bad thing though. Used correctly it is a massively important Strategic Management tool. But like any debt, Transformation Debt™ is only bad when:

¨      It is hidden and you don’t know you are incurring it

¨      You don’t know how you will pay off the debt

¨      You don’t know the interest rate

¨      You don’t know how long you will have to pay the interest

¨      …all of the above.

When times are good, you can invest in reducing Transformation Debt™, which means when times are bad, you can lean on Transformation Debt™ by allowing a controlled increase.

However, if you do not expose and manage Transformation Debt™ your Transformation Debt™ could already be too high to allow you to ride out the bad times. If you max out your credit card, how will you be able to fix your car when the exhaust falls off?

 

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Questions to ponder...

What is your estimate (for your Enterprise) for how much money could be saved, if Transformation Debt™ is exposed and managed?













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