Summary:
- Change Management is widely recognized as an important component of organizational transformation. So, why do roughly 70% of organizational transformations fail?
- Organizational transformations work well when they are structured as programs with a strong executive sponsor who enables change management to maximize benefits realization.
- Better results are achieved when there is ongoing constructive dialogue between frontline staff, the project team, and senior management throughout the transformation.
Office Hours Insights and Reflections
Organizational transformation and change management are critical aspects of leading in today’s dynamic business environment. In a recent 8020 Excellerate weekly Office Hours session, we delved into these topics and reflected on why most organizational transitions flounder even though most people are aware of the necessity for change management.
The HBR article, 6 Key Levers of a Successful Organizational Transformation which identified six behaviours that consistently improved the odds of transformation success, served as a jumping-off point for the discussion.
Below are key takeaways from our conversation that identified actions that will improve your chances of organizational change success:
1. Modeling Emotional Resilience
The HBR article emphasized leaders’ critical role in navigating their organization’s emotional journey through change. While some leaders effectively motivate and energize their teams through mid-stream setbacks, others unknowingly allow negative emotions to spiral downward, having a negative impact on buy-in and enthusiasm for the desired outcome. Understanding and managing emotions is a critical skill for leaders during times of change.
2. Ongoing Self-Reflection
It is the leader’s responsibility to periodically “take a look in the mirror,” being honest and vulnerable, to acknowledge how they are personally adapting to the changes taking place throughout the transformation. Are they modeling the change and “walking the talk?”
3. Crafting a Meaningful Shared Vision
One of the six levers highlighted in the article is having a shared vision. We all agreed that the challenge in this task is transforming often vague, fluffy initial statements into something that genuinely resonates with the hearts and minds of everyone involved. Creating a compelling and tangible vision that inspires and aligns the entire organization will always be a significant task.
4. Committing to Change Management
During our call, 8020 Excellerate participants shared their experiences of transformation projects where change management (OCM) efforts were inadequate. The mere tokenism of hiring a few change experts does not guarantee success. Change management must be deeply understood at the highest levels and fully integrated into the Project Management Office (PMO) to avoid becoming a blunt tool in the management toolshed.
Teresa Veenstra, program co-founder and executive coach, endorsed establishing early on whether there are sufficient resources and budget to include sound change management. If not, don’t proceed at all.
Steven Wedge, CPA, MBA who is currently taking the 8020 Excellerate program, also highlighted the importance of educating top management on the importance of change management and how it is critical for success. If these key players don’t understand the power of sound change management to deliver better results, they may pay lip service but not really be invested.
5. Balancing Anticipated Benefits and Organizational Capabilities
The desire to achieve the promised benefits can distract many leaders from the limits of their organizational capabilities and resource capacities to deliver the anticipated outcome. It’s important to be realistic about the ability to execute on the vision. As Eisenhower said, “Plans are useless, but planning is indispensable.” Continuous course correction in light of those organizational realities is the way to get to the destination.
6. Transformation as a Program
Jane Morgan co-founder and executive coach, emphasized that all transformation initiatives are programs, not projects. Establishing an organizational transformation as a program based on best practices shifts the focus toward “responsible executive sponsorship” and “benefits management.” This approach recognizes the need for governance and strategic oversight throughout the transformation journey.
In the world of Organizational Change Management, some argue that there is no project or program portfolio, only change portfolios. Once a change is approved, then it requires project and program managers to plan, organize and manage them to deliver the benefits under the governance of the executive sponsor.
7. Build a Culture of Trust and Psychological Safety
The article highlighted the scarcity of trust and psychological safety in many organizations. The discussion revealed that our own experiences support this assertion. Hierarchical structures often impede open communication, making it difficult for leaders to hear the truth or benefit from the tacit wisdom present in the “lower ranks.” Cultivating a culture that encourages speaking truth to power is essential for shaping a successful transformation journey.
Project teams can develop a culture of trust by engaging in ongoing collaborative dialogues with front-line staff. This allows them to continually revise the plan to ensure that anticipated benefits are achievable based on organizational capabilities throughout the project. All these topics and more are discussed and included in the 8020 Excellerate program.
The Final Word
Organizational transformation is complex and challenging and requires leaders to handle their own and others’ emotions, shape a clear and inspiring shared vision, be realistic about the ability to execute, and embrace effective change management. A tall order to fill? Perhaps, organizational transformations, digital or not, have many arms and legs and building these success levers into your next organizational transformation will give you a huge advantage.