Our Change Management 2020 Guide - What you need to know
Change Management theory and practice has been around for many years, yet many organizations still struggle with implementing change. While commonly cited that roughly 70% of change programs fail, it is only recently that organisations have started to realise that the successful delivery of their programmes is inextricably linked to the implementation of robust change management principles and interventions.
Table of Contents
This definitive Organizational Change Management Guide is aimed at those who are newer to the change management field. In this how-to, we cover off an introduction to change management and 5 key principles. Basically, its a great primer on what you need to know about organizational change in order to increase the chance of your programme succeeding.
What is Change Management and why you need it
To start, let’s begin with a definition of change management.
Change Management, also known as organizational change management, is the practice of effectively engaging stakeholders, minimizing risk to efficient adoption and maximizing benefits through a focus on the organizational, cultural and people aspects of business transformations.
« Change Management is the actual process of winning the hearts and minds of everybody who is affected by organizational change. »
– James Lewis, explainer video 🡪
To put it simply, change management is the practice of ensuring that people actually start adopting any new initiative.
Some therefore prefer to refer to Change Management as Adoption Management as it is a bit clearer about what you intend to achieve. Only once people start using a new tool or process will you see any benefit from your investment.
Key factors influencing the need for Organizational Change Management
So why now you may ask?
For the past few years the pace of organizational change has increased as organizations adapt to market and consumer trends. There has been a significant focus on digital transformation and technology change. So not only do people need to change – they need to change faster in order to keep up with all the initiatives coming their way.
Organizations looking to improve the speed of delivery of new products, have turned to new ways of working like Lean Start Up and Agile methodologies. So while the first factor was around technology and its impact on people, the second key factor is around process and the impact it has on people.
The final key factor is of course our own capability to respond to change. With the introduction of the coronavirus pandemic in 2020, that there has never been a period of higher albeit forced change, across the globe than now.
Change Management Trends for 2020
Prosci, founder of the ADKAR® Model for Change Management, recently surveyed over 1,778 change practitioners about the top trends facing the field of change management.
The top trends cited were:
- A greater awareness of organizational change management and its benefits,
- an increased application of change management principles and methodologies,
- an increase in the number of positions devoted to change management, and
- a greater need for change management training.
Included in this greater need for change management training is an awareness or understanding of the various change management approaches.
Change Management Approach
In our article on Building your Argument for Change Management, we highlighted a survey we conducted with 120+ organizations over a 5 year period. « Three out of 10 projects saw increases in performance directly tied to an effective change management approach. Moreover, in large projects, the return on investment (ROI) was 6.5 times higher when an effective change management approach was in place. »
Your change approach defines the phases that an organization will proceed through in transitioning from today’s current state to the defined future state.
There are several approaches or change management models including, Lewin’s Change Management Model, Kotter’s 8 step change theory, Prosci’s ADKAR model (introduced above) and we at MI-GSO | PCUBED have one as well.
As highlighted in our article 10 Lessons of Change Management, it is less important which organizational change management methodology you pick; it is just critical that you pick one.
Our 8E Change Management Model includes and applies best practice elements to ensure an integrated, end-to-end approach. And, it is fully integrated with our Programme Transformation Model to help change managers understand where the program is and to identify any specific needs and challenges.
Using the 8E’s, our change practitioners are able to remove obstacles and rapidly put in place exactly what the program needs to be successful.
In the remainder of this guide to Change Management we will walk you through the key principles that you need to focus on to achieve transformation success.
Here are five key Change Management Principles that you need to focus on:
1. Define the ROI or change benefit
In order for any change to be a success there must be a detailed account of what needs to change. All people involved need to have a strong understanding of both the endgame and why they need to change. This why is often described as the burning platform or the compelling reason for changing. Only with the « what » and the « why » defined, can you start to craft the message.
But as we highlighted above in trends, one key piece that we tend to miss, is identifying the measurable value of the change. This is not the message on « What’s in it for me », the WIIFM, though that needs to be clarified as well. But how will we know that we have arrived? What is the measurable change benefit or expected return?
As with any major initiative, the ability to measure and communicate the value of Change Management is key to winning over the hearts and minds of those impacted by change. While there is greater awareness of organizational change management as a profession, these quantifiable benefits are often hard to articulate.
Your first step in defining the change benefit is to look at the Business Case that is driving the change. It should include both a detailed description of the reasons for change and the benefits the organisation hopes to achieve.
Calculating the Change Benefit
The proposed benefits of a successful implementation must invariably have two properties. The first is that they are quantifiable or measurable. Typically this includes that the proposed change will improve the organisation’s bottom line whether it be through efficiencies or increased sales. Second, the proposed benefits will be based on a percentage adoption of the new changes by the organization.
Once the anticipated adoption levels and the business case benefit numbers are known, then it is a straightforward task of simple math to quantify the financial benefit, or dis-benefit of increased/reduced levels of adoption.
Let’s take an example of a change that is targeted at delivering $5M of in efficiencies based on 80% adoption. First off, huge congrats to the team for calculating the business case on more realistic expectation of 80% adoption versus 100%. However what if only 60% adoption is achieved?
In that case, your change benefit has just decreased by 20%. Now your new ways of working can only be expected to deliver $3.75M worth of efficiencies – quick equation of 5 x 0.8.
This assumes that the programme is delivered on time, which it will be thanks to your improved change management capabilities, and that none of the original benefits case has been eroded by other factors.
But it’s a good place to start when you are proving ROI. As there is no better way to get management on board than to link poor adoption to missing target savings. Next up, time to build a coalition for change.
2. Build a coalition for change
So you have a fantastic change initiative, fool proof even, and yet your presentation to the programme governance board has met with significant push back from some key senior stakeholders.
The second key change management principle is to build a coalition for change. In John Kotter’s 8 Step model for leading change, originally published in 1988, he highlights the need for « an army of individuals to guide, coordinate and communicate about the change ». It is still no different today.
You will need to spend time upfront, earning the support of your key stakeholders by communicating the vision. In these one to one discussions you need to explain the nature of what is changing and actively listen to any concerns they might have. Any negativity that would have aired in public can then be dealt with individually. When this job is done well, it builds engagement from influential people, ensuring advocacy at steering group level.
More importantly it builds top down advocacy within their functional areas. Do it well enough times and you will have built a coalition that will enable your governance presentations to run smoothly and receive the necessary sign offs.
3. Assess organizations' readiness
Our next key change management principle is to assess your organizations’ readiness for change. Are you ready for change? How do you know that? A poorly prepared change initiative often creates issues that are unmanageable down the line.
Fail to understand what the organisational and cultural repercussions of your change are and your lack of understanding will create roadblocks at every turn. You need a structured approach.
Three ways in which you can prepare for the change, before you start implementing include conducting:
- Change Management Readiness Assessments
- Behavioral and Cultural Readiness Assessments
- Change Management Impact Assessments
Change Management Readiness Assessment
A Change Readiness Assessment is an assessment of the willingness and ability of people within an organisation to adopt to a change. Through engagement with those affected, you can uncover a number of findings which point to root causes which can ultimately mean the difference between success and failure. Addressing these root causes can then become an integral part of your change management strategy.
The benefits of well run Change Readiness Assessments include:
- Safeguarding the delivery of expected benefits from change initiatives of any type
- Improving employee satisfaction by engaging them throughout the business transition
- Identifying and addressing sources of resistance and apathy surrounding the change
- Uncovering risks early-on enabling more cost-effective remedies, and
- Providing insight for improvement in other areas of the business
For more information on the Behavioral and Cultural Assessments, Change Impact assessments and other change management tools, read our article on the The Change Manager’s Toolkit.
Only when an organisation has used its change management toolkit to ensure that it is has adequately planned for the reaction to the change across every single impacted function and team can they then start to roll things out.
4. Making change relevant to every individual affected
One size never fits all and never will. Corporate ecosystems are underpinned by a variety of different functions with their own cultural idiosyncrasies. As such, all change journeys are highly personal to individuals and their teams. The key measure of success for cultural change will be the extent to which they buy into the new culture on a personal basis.
Therefore the fourth change management principle is to make change relevant to every individual affected. With this in mind, each employee needs to feel a keen engagement with the personal benefits that change will bring (both in terms of well being and efficiency). Remember WIIFM? What’s in it for me? Now is when it comes into play.
Key considerations for making change personal
The change manager needs to consider the following aspects when looking to understand how functions, teams and individuals prefer to consume change:
- The predisposition to change
- The history of previous change attempts
- The middle management support / resistance to change
- The organisational influencers (non hierarchical)
- Role based differences
- Function based differences
- Neuro-diverse differences
- Site based differences, and
- Hierarchical differences
Let’s take neurodiversity as an example. Neurodiversity reflects the combination of “neurological” and “diversity” highlighting the many variances amongst people in an organization with regards to our sociability, moods, behaviors and many other functions.
We recently held a webinar on Tips for Delivering Change Management into Neurodiverse Organizations. Access the recording here.
The fact is that people prefer to ingest change in very different ways and understanding their neurological profile is a big deal in terms of working out how to communicate and explain the change in question.
You may be asking how can you possibly be this specific in delivering change? The answer to which is that “its not as hard as you think if you have a decent change agent network”.
Change Agent Network
A critical component of any change programme is a robust Change Agent Network, facilitating organization-wide stakeholder engagement and communications throughout the change life cycle.
Change agents receive dedicated training enabling them to disseminate communications out to a wider audience. A well run network typically benefits from having advocates at three levels of the business: Sponsors/Leaders; Team Leaders/Middle Management; and Key or Super Users. This supports the mitigation of risk that middle management often presents in its opposition to change.
But having Change Agents in the mid and lower tiers of the business also ensures that people are receiving the change message from a source that they respect and who they feel understands their situation with regards to the change. Recipients of change are often most receptive to new ideas and ways of working when the changes are advocated and communicated by their direct line management.
For additional reading check out our case study on Next Generation Technology Program Delivery where our team developed an integrated roll out strategy across various stakeholder groups, ensuring collaboration while also satisfying essential regulatory requirements.
5. Measure to sustain performance of change
Our final change management principle is focused around sustaining stakeholder awareness around the change.
Most of us have a knee-jerk reaction to change. We will try out the new change initiative and struggle through any emotional resistance. Then when we have a deadline looming and pressure mounts, we revert to our previous behavior. That is when your change success rate can start to suffer.
It is critical to continue to take the temperature on change during large transformational programs. You can use the Change Readiness Assessment, running it again, or you can kick off a Stakeholder Assurance Assessment.
The result is a change dashboard that accurately identifies the pain points allowing senior management and the change team to accurately plan future change interventions in order to sustain the change.
Highlighting the paint points in this way is very attractive to time-poor executives who need straight-forward analysis. Once the areas that require attention have been highlighted, its time to work collaboratively through the identified challenges and develop robust solutions.
The key benefit here is the promotion of a culture that drives a repeatable and robust analysis of where pain points are in a programme, followed by a proven methodology for fixing the problems you identify in order to drive significant efficiencies.
In Summary, change is hard. We are not trying to dispute that. However with a greater awareness of organizational change management and its benefits, a change model integrated with programme delivery and a few key principles for change management introduced through this guide, we believe that you have a strong chance of improving your programme’s success.
Head of Change Management
@ MI-GSO | PCUBED UK