Imagine launching major transformational initiatives worth millions of dollars with a success rate of only 30%. Sounds like bad odds, right? Yet, that’s exactly the scenario one of our global energy clients found themselves facing.
“They were lamenting that 70% of their initiatives—which were good ideas for the company—were not being successfully implemented across the finish line, even with a best-in-class Project Management methodology,” recalls RGP Vice President, Monica LaRue. “They discovered they were not addressing the ‘people’ side of the change they were introducing, and that was the crux of the failures.”
As a result, the company incorporated an effective Change Management methodology that is now mandatory in all their major initiatives going forward—and has seen a dramatic improvement in the successful implementation of all future initiatives.
“They were not addressing the ‘people’ side of the change they were introducing, and that was the crux of the failures.” — Monica LaRue, RGP Vice President
Accounting for the Human Impacts of Transformation
It’s a lesson that all organizations should take to heart as they plan for transformational initiatives, which often come with high stakes and high price tags.
Gartner reports that 75% of organizations expect to multiply the types of major change initiatives they undertake in the next three years. Technology innovation, including digitalization, cloud computing, AI and automation, continue to be key drivers. But so are business transformations, such as mergers and acquisitions, and regulatory changes, such as the California Consumer Privacy Act, which takes effect in January 2020.
Regardless of the types of projects you have in store for 2020 (and beyond), keep in mind that transformative change inevitably brings serious human impacts. That means change management should be a cornerstone of your strategic planning.
Even the best technology does not deliver the intended value if people don’t engage with and adapt to the new ways of working.Michael Blahnik, RGP Director of Change Management
Plan and Budget for Change Management
No one invests in a major change initiative thinking it’s going to fail. That’s why the first thing we advise our clients to do at the outset of any business transformation is to plan for how they will manage and support the necessary organizational changes.
This is a critical first step if you hope to positively drive adoption and utilization of new processes or technology.
Focus on Adoption of Critical Systems and Processes
In this era of digitalization and cloud-based computing, many of our clients are investing in new enterprise business processes and technology platforms such as ERP. But as RGP Director of Change Management, Michael Blahnik points out, “Even the best technology does not deliver the intended value if people don’t engage with and adapt to the new ways of working.”
In fact, the majority of project failures can be attributed to people-related issues such as leadership and communication.
“People-related issues account for 7 of the top 10 reasons that projects fail.1
My RGP colleague, Richard Klein, VP of Training and Strategic Communications, and his team work to improve the performance of individuals, teams and organizations as a whole. He advises our clients to focus on encouraging adoption of critical systems and processes.
“Make sure stakeholders and their teams understand how the change benefits them,” Richard says. “For example, don’t just create one-size-fits-all training and communications. Instead, customize that information to stakeholders based on their job roles.”
Think of Change Management as an Insurance Policy
Change initiatives involving new and updated technology, work processes, roles and policies can result in significant differences between how work is performed today versus in the future. If not addressed correctly, this transformed future state can result in organizational misalignment with significantly lower workforce productivity—a dip that’s often called the “valley of despair.”
You can mitigate that risk by investing in end users’ willingness and ability to perform their work better in the future state. An effective change management strategy accounts for the human impacts as well as process and technology issues, enabling you to reduce the time it takes your organization to return to productivity by 50%.
“An effective change management strategy can reduce the time it takes your organization to return to productivity by 50%.2
Build a Sustainable Foundation for Future Change
Don’t just focus on the project or initiatives that are currently in the works. Look ahead and develop internal change capabilities and reusable assets that can be honed on a major initiative and then leveraged for future significant changes.
For example, for a Fortune 50 retail, web services and cloud computing company, we developed a playbook that accounts for the human impact of digital transformation. Providing impact beyond the immediate project needs, the playbook provides ongoing value by enabling internal account teams and customers to assess and address the human and organizational impacts of a cloud migration journey.
Let’s Talk About Return on Change™
What’s driving change in your business in 2020? And how are you preparing for that change? We’d love to hear more about the transformation challenges you face and how we can help you successfully deliver a strong Return on Change™ for your initiatives. Drop us a note to learn more.