© 2016 Gardeners not Mechanics

Most change fails to deliver business value

February 24, 2016

 

Change is ineffectively managed and fails to deliver business value. 

That's a central conclusion from a survey of 159 experienced change practitioners that I carried out at the end of last year.

 

  • 70% of people said that Change failed to meet sponsor expectations and three-quarters of people said that 60% or less of expected value was delivered.​

  • 72% of respondents said that organisations are more like ecosystems than machines but that the majority of organisational change initiatives took an approach consistent with a machine view.​

  • The predominant approach to change is big-bet, top-down initiatives that either press on with an inflexible Plan A, regardless of the results, or simply run out of steam and will-power.


You can download the full report and my thoughts on possible remedies by following this link.


Value shortfall

The first point will not come as a surprise to most people. I cannot count the number of times that I have seen people write "70% of change programmes fail". Actually, there's not much data to support that assertion, which is one of the reasons I wanted to do my own research.

However, I didn't to categorise initiatives into successes or failures. I wanted to understand how the business value that was actually delivered stacked up against what was expected. I also wanted to steer clear of organisational myths by asking about change initiatives in the respondent had personal involvement. And because I was asking for opinion, I asked for examples to support the answers given. Most people obliged, often entertainingly!

As the headline bullet above says, three-quarters of people said that 60% or less of the expected value was delivered. Dig a little deeper into the report and you'll see that over half of people said half or less of the expected value was delivered.

Stop and pause for a moment. Let's say you are working on a change initiative right now. And let's say the value has been quantified in some way. Now multiply the value by by 50% (or by 60% as a best case). Does it make sense to continue?

Be aware of two pitfalls:

 

  1. We are all subject to what psychologists call Optimism Bias. That innate bias tells us that we are much better and more determined than those idiots who only managed to deliver half the value.

  2. Organisations rarely adopt an approach that allows value delivery to be monitored as they spend money, rather than afterwards. So you might not even know for a couple of years whether it make sense to continue!

 

Gardeners or mechanics?


The second of the headline bullets points to what I believe is both the underlying problem and the mindset necessary for a solution.

 

 



It's fair to say that already had a firm view on this before doing the survey but I was careful to try to keep it under wraps, as much as possible, in the questions. For example, I didn't describe spell out the contrasting characteristics of machines and ecosystems. I left it to people make their own interpretation of the respective metaphors. 

And I had no idea how people would answer the comparative question of machine versus ecosystem. Some people do indeed believe that their organisations are much more like machines than ecosystems. Overwhelmingly however, the vast majority said that organisations are more like ecosystems but when it comes to change, organisations are treated like machines.

In other words, we treat organisations as if they are complicated, but with predictable outputs from a given set of inputs. Our belief, however, is that organisations are complex networks, in which predictability is rare and outcomes vary, depending on the prevailing context.


Big-bet top down approaches predominate

Unlike the other two headline bullets, the third is derived from what people wrote about their experiences, rather than the multiple-choice questions, which generated the previous two bulleted conclusions. As such, it is particularly revealing because there was nothing in the question to anchor people's responses.

What people said, however, was totally consistent with the previous bullets.

If organisations are like gardens then most leaders are planting all of their seeds on the same day in spring, into uncultivated soil, and returning on Midsummer's day to find half of them dead!


Summary

If you are currently engaged in a change initiative, ask yourself this question:
How much of the expected value do you think will be delivered and when will you know?

If the answers make you even slightly uncomfortable, you may want to take a look at the report, which also contains some ideas about what you could do differently.

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