By David Miller
Change is becoming more frequent, radical and complex. Failure rates of change projects are high because organisations fail to implement the change fully. To overcome these challenges, the knowledge, skills and processes must be developed by people inside the organisation.
The leadership challenge
Demand for deep, sustainable change in organisations is being driven hard by forces coming from all directions. Radical disruptions to competition, regulation, technology and customer expectations are creating an almost constant need for change. Shareholders are demanding more, from fewer resources. Empowered and innovative employees are mandated to find new ways to enhance profitability, business performance and competitive advantage—faster than ever before. This new type of change is more difficult and complex. Business-critical global, regional and local change agendas are frequently overlapping, and often conflicting. Employees are becoming better educated and more questioning; they are much less receptive to autocratic, compliance driven leadership styles. While transformational change is difficult, disruptive and expensive, organisations are often faced with no real choice when the alternatives—standing still or putting faith in a superficial ‘quick fix’—are even riskier options.
Having a clever strategy is not enough—and successful organisations should proactively develop the internal capacity to implement change faster and more effectively than their competitors. Each change initiative must deliver the intended benefits and contribute to developing overall change capacity. If corporate adaptability is to become embedded into the organisational culture, a prerequisite is that organisations successfully implement individual initiatives. Yet research consistently reveals high failure rates for transformational change initiatives:
• according to many independent studies seven out of ten change efforts that are critical to organisational success fail to • • • • achieve their intended results.
• independent IT research firm Gartner Group reports that for major corporate systems investments:
♦ 28% are abandoned before completion
♦ 46% are behind schedule or over budget
♦ 80% are not used in the way they were intended to be or not used at all six months after installation.
Many so-called failures are actually change projects that have been partially “installed”, rather than fully “implemented”. The organisational, strategy, process and technology components of a change initiative may have been put in place effectively, but are not being applied or used in the intended way with the required level of understanding, commitment and personal ownership. People readily slip back into their old ways of working when change leadership efforts are prematurely withdrawn.(Fig 1)
Executives regularly report familiar problems:
• changes either take too long to deliver their intended benefits, only realise benefits in limited areas or are never completed.
• people, often already overwhelmed with their workload, become more cynical about the likelihood of any new changes being successful, particularly if there is a legacy of poorly implemented change.
• it is increasingly difficult to build sustained employee commitment to new changes.
organisations become unable to deliver their core strategies owing to high levels of resistance.
• limited genuine individual and organisational learning takes place, leading to over-reliance on external expert support and loss of control over business critical changes.
• leaders’ credibility is undermined as they ‘over-promise and under deliver’ through a lack of realism, discipline and competency, around the challenges of implementing major change.
In practice then, true implementation goes beyond mere installation—it requires that a critical mass of people are committed, are willing to change and will sustain their new behaviour to align with the needs of the change. Effective change management is the critical bridge between partial installation and full implementation and is essential to the delivery of sustained benefit.
Six critical success factors
To deliver the desired business objectives of change, employees must be ready, willing and able to change their behaviour. Understanding the key drivers allows change leaders to quantify and track the progress of change actions and take either reinforcing or corrective action.
There are six critical success factors (CSF’s) that must be in place for successful change implementation (see Fig 2). These factors have been translated into a robust process which covers the key areas of implementation that change leaders need to excel at, in order to develop the critical mass of commitment required to succeed.
While the logical starting point is establishing a shared change purpose, the model does not have to be applied strictly sequentially; activities overlap and are revisited as appropriate to the dynamics of the change as they unfold.
Understanding these factors helps change leaders to ensure both that the organisational requirements for change are in place and that the local needs during change are managed effectively. Managing the balance is an on-going, dynamic process: too much focus on organisational factors often leads to compliance, too much focus on local factors frequently leads to inconsistent application. It is critical to support a high level of involvement of those affected by the change at the organisational and local levels of the company.
Shared change purpose
Articulating, communicating and maintaining a shared purpose helps create urgency, energy and unity. It is the critical first step at the launch of an initiative, but also directs people’s focus and maintains their resolve and motivation as they work towards achieving and sustaining the change benefits.
The shared purpose, comprising a clear imperative (the reason people cannot stay at the status quo), a vision for change and the proposed solution, needs to demonstrate that the team leading the change effort share ‘one voice’. For managers who will be called upon to reinforce the change in their parts of the organisation, a shared purpose demonstrates that there is clarity of direction and that it is owned by the leadership of the organisation.
This clear statement of intent and purpose is necessary for building commitment and reducing the confusion that often generates demand for unnecessary change. It helps people to deal with some of the personal disruption they need to overcome before embracing the change as:
• people gain a sense of control, because they have a realistic picture of what to expect when the change is successful.
• people feel a sense of confidence that there is a commitment to provide the necessary support from the highest levels in the organisation.
• people develop a sense of comfort that their involvement will enable them to directly influence what will happen to them.
Effective change leadership
People are more likely to understand and energetically support an initiative when they observe leadership behaviour that is both credible and supportive. Typically, assessing and developing the effectiveness of change leaders should be tackled once the shared purpose and intent of the change have been sufficiently defined.
Effective, early leadership from sponsors and change agents is critical in signalling clear intent, building momentum, raising credibility and overcoming initial resistance before early results are visibly achieved.
When change leadership is strong, people can move more quickly from understanding the initiative to supporting it. When change leadership and influence are weak, people may not believe the change is worth supporting or investing energy in. They become more likely to focus efforts on maintaining the status quo rather than moving forward. This is particularly true if there is a legacy of poorly implemented change, which has undermined credibility in the change leadership of the organisation.
The personal impact and cost of change increases when personal implementation issues become clarified. Early commitment may be undermined and resistance may re-emerge as employees progress through the change. Leaders must continue to role model behaviour and take early corrective action to address pockets of resistance and weak commitment. They can declare victory too early and refocus their energies on other priorities. However, this may simply allow employees, at all levels, to slip back into old patterns of behaviour.
Powerful engagement processes
Powerful engagement processes to overcome resistance and build commitment must be implemented, improved and sustained until the benefits of the change have been realised and new behaviours are firmly embedded in the culture.
Planned formal approaches need to be developed which bring people and the change together in a purposeful way to help them deal with their doubts, build their will to succeed and encourage them to adopt new behaviours. Powerful engagement processes provide ways for people to connect with the change effectively.
There are five key organisational processes that help people break away from the past and provide support for the new ways of working.
Change leaders must:
• involve people meaningfully in the change, giving them a sense of control, and manage their available capacity.
• provide supportive education and training opportunities to develop knowledge and build competence to behave in the new ways.
• reward people for engaging with the change and behaving in these new ways.
ensure that two-way communication takes place, which clarifies and makes the changes that are happening practical.
• make sure that the organisational alignment mechanisms support the change and sustain the initiative. If necessary, for example, change the way people are selected and promoted to support the new skill and behaviour requirements.
Committed local sponsors
Strong change leadership from middle and front line managers who role model the new behaviours themselves and who ensure other individuals apply the change in their area ensures that change is implemented effectively throughout the organisation.
Changes often fail when a gap emerges between a sponsor’s announcements and subsequent local actions. Research has repeatedly shown that employees pay most attention to the messages from their immediate boss and often disregard much of what conflicts with it. To maximise the effectiveness of the change process, committed local sponsors need to take personal responsibility for change in their areas. Without strong local sponsorship the change will not be implemented by employees and/or strong resistance will quickly emerge and not be addressed.
The role of the local sponsor is critical in connecting the work done at the organisational level to the reality that people have to change at the local level in order for the initiative to be successful. If local sponsors are bypassed and not enlisted by organisational level sponsors, at best installation rather than implementation will result.
Local sponsors should be:
- actively involved and provide hands-on leadership
- communicating, via their actions, their total commitment to driving the project forward
- accountable for the complete and timely implementation of the change in their area
Strong personal connection
A strong personal connection exists when individuals affected by the change recognise that they personally cannot continue to work in the current way, believe the solution is acceptable and understand how they can be successful in the future.
Commitment to the change needs to be built and maintained by local sponsors. As a minimum, people need to use the change, even if they are not yet deeply committed to it. Ideally—and in some changes, essentially—organisations need people to own the change, that is take personal responsibility for those aspects of the change that they can control or impact.
The creation of strong personal connection is critical to successful implementation of a major change. It provides:
- a platform upon which commitment to the change can be accelerated
- a means for initial engagement so that people can understand the need for change, giving people the essential prerequisite information and time to adjust before they start to be actively engaged and involved
- the chance for people to see personal ‘opportunity’ in the change, reducing the intensity of natural resistance
- a reduction in the probability of people being ‘detached’ from the change and staying in ‘denial’
Sustained personal performance
Change initiatives only become implemented when change leaders throughout the organisation pay careful attention to how those impacted are reacting to the change.
Many changes fail, even though brilliantly orchestrated, because people still have concerns, such as: being negatively impacted financially or positive work relationships becoming fractured. Sponsors, working with agents, need to identify these impacts and where possible work to eradicate or lessen them.
Failure to pay constant attention to managing personal issues before the change is fully anchored in the workplace can result in lost momentum or erosion of the change. If personal issues of committed individuals are ignored and their commitment is lost, the negative impact of a key change supporter withdrawing their support either openly or covertly will be highly damaging to the change effort.
Change is changing: it is becoming more frequent, radical and complex. Failure rates are high because organisations install new systems, processes or practices, but fail to implement the change fully—people are not sufficiently committed to the new ways of working. To overcome these challenges and build a sustainable change capability, the knowledge, skills and processes must be developed by people inside the organisation.
Change is not an ‘event’, but a dynamic process that unfolds over time. The fundamental challenge facing leaders is how to transform the business through major change initiatives, with minimum disruption, using mainly internal resources, at a time when they are more vulnerable to external competitive threats and internal disruption.
The sheer complexity of change today requires a more disciplined, informed, competent and structured approach, underpinned by a highly-committed, visible and determined leadership to support people through the disruptions and uncertainty of change. Quick fixes, while tempting, don’t deliver sustained change. A deeper, systematic, consistent and integrated approach is required now—and it is becoming an essential core competency of successful organisations.
There are six critical success factors (CSF’s) that must be in place for successful change implementation. These factors have been translated into a robust process which covers the key areas of implementation practice that change leaders need to excel at in order to develop the critical mass of commitment required to succeed.
To deliver the desired business objectives of change, employees must be ready, willing and able to change their behaviour. Understanding the key drivers allows change leaders to quantify and track the progress of change actions and take either reinforcing or corrective actions.
This change management process supported by a comprehensive assessment, planning and monitoring tool kit and utilised by a critical mass of skilled employees, helps:
- deliver increased success rates for major changes
- build on-going change management capability
- increase overall organisational capacity for change
- reduce the drop in productivity and quality that often occurs during im-plementation
About the author
David Miller has spent the last 25 years helping organizations implement major change. He has extensive expertise in directly managing major changes including strategy implementation, technology implementation, business process changes, restructuring and quality management. In 1995, David founded Changefirst, to help businesses build competitive advantage through creating and sustaining organisational change capability.
Through 25 years experience of change implementation, David has developed a deep belief that to successfully change, organisations must build their own capability to transform themselves and not be dependent on external support, which is explored in his recently published book Successful Change. David can be contacted at [email protected] www.changefirst.com