Less than half of change management projects meet their intended objectives despite the fact that delivering change is increasingly becoming a top organisational priority.
According to the 1500 respondents in an IBM-sponsored survey of change management professionals across the globe, 200 of which came from ANZ, only 41% said they met their objectives in completed change management projects.
They said the top reason for undertaking a change program is cost reduction (57%) followed by delivering higher customer satisfaction (48%) and increasing revenue sales (40%).
The major obstacles to a successful change process include what IBM’s Steven Davidson describes as the “soft stuff”: changing the mindsets and attitudes of an organisation (58%), its culture (49%), and underestimating project complexity (35%).
Davidson, IBM’s vice president for strategy and change consulting in Asia Pacific, described the top change managers in the survey as the “change masters”. These people did a multitude of things to make their projects successful. The first is to understand the challenges ahead before committing. “If you go in with your eyes open you are more likely to succeed.”
Those who are also more likely to succeed will have a change management methodology, and more importantly, follow it. “The worse thing you can do is make it up as you go along.”
Only 24% of practitioners in the study consistently used formal change management methods. Seventy-six percent said their approach to change management was usually informal (25%), ad hoc (8%) or improvised (43%).
For Telstra’s executive director of procurement operations, Ian Wheatley, who is currently involved in a change management program at the telco, through the implementation of a new hosted supply chain system, the biggest factor for its success has been communication.
“Communicate, communicate and then triple it,” he said.
During its supply chain rollout, which commenced in late 2006 and continues today, he said Telstra first went around and spoke to other organisations that had successfully been through such a process and asked them what were the issues they faced. “And they said communication,” he said.
“So we had a robust communications plan and we then shored it up with business unit champions – people in the business that own the outcome -- and then we communicated. We kept making sure people were well aware.”
Personnel is also very important, according to Davidson. A successful implementation will have a dedicated change manager (“not just a project manager”).
In addition, the company cannot afford an ad hoc approach to change management. The change manager needs to work full time on the project, know what are the business objectives and what change needs to happen, and know how to measure that change, he said.
But according to the information retrieved from the respondents, companies do not need to spend big to achieve targets. Davidson said the change masters spent an average of 13% of their IT budget on their projects whereas the “novices” -- those that failed, spent 10%.
“Spending a bit more gets you a return, but you do not need to spend too much. Spend it in the right way,” he said.
For more information about the survey, click here.
(Howard Dahdah attended the IBM Insights conference in Shanghai as a guest of IBM).