By David Lee
In a previous article, we discussed the level of change management required for a company to achieve true transformation. Just as a reminder, the mutually inclusive elements include:
- Employing an Enterprise Change Strategy
- Developing Your Change Management Framework
- Enhancing Your Change Leadership Capabilities
- Growing Organizational Competency for Change
Thinking in terms of these key elements, we can see how organizations mature their change management competency from immature or nonexistent through institutionalizing change management, to making it a strategic advantage of the company.
This progression is not necessarily linear. In fact, many companies start off quite capable of responsive change, able to adapt and adjust to their environments; then as they begin to pivot and add process and procedures, they become siloed and less agile. Ironically, as the companies mature, their change management competency becomes less mature. Then at some point, hopefully without the aid of a disruptive crisis, they may realize their position and begin the long road back to responsiveness.
When it comes to Change Management, most companies we encounter in our digital transformation practice are somewhere between “Isolated Application” and instituting “Project Level.” Few have the self-awareness to understand the need for change management at all much less a greater level of maturity. The reasons for this lack of foresight has been discussed in other places, so let’s chalk it up to inexperience and/or ignorance of the rate of failure and consequences.
The difference between Project Level and Enterprise Level change management is the difference between building a building and developing an entire city complete with transportation systems, electrical grids, emergency response systems, etc. It is the scale and interconnectedness of the functions that require greater planning and sophisticated execution.
So, if we say Enterprise Level is required for successful digital transformation and most companies are well below that, the question becomes, how can an organization get there and how fast? Well, before we can answer that question, there are a few other questions to answer first:
- What is the scale of the organization? Before making any decisions, we must set out to understand the scale of company that is changing. Are we talking about hundreds, thousands or tens of thousands of employees that are going to be impacted? How many divisions, process, functions are involved? The greater the complexities, the more difficult it is to advance. At the same time, the more necessary it becomes.
- What is the level of expected disruption? Connected to #1, what is the level of the disruption that digital transformation will bring? As we have established, the disruptive impact is not very predictable, but some will be greater than others. If it starts out as a major change, then it is likely to have more unintended consequences. The greater the complexity, the harder it is to be successful.
- What is the leadership’s attitude toward change management? It’s common knowledge that leadership involvement is key to successful change, but does leadership really see the importance of it on an organizational level? Enterprise Level change management requires C-Level attention on a daily basis. Companies at Project Level are often stuck because leaders only believe change management is needed on large, key initiatives. At the same time, companies that have not gone through the Project Level phase often cannot see the need in a broader context. Without full backing of top leadership, companies can rarely achieve higher-level phases of change management.
- What investment are they prepared to make? We have seen large enterprise companies driving 20 to 40 changes in their organization feel that they are making an investment by hiring a single change manager who reports to a mid-level executive. Let’s be clear, at this level, there can be no impact from that change manager. Likely this person is simply administering a process without actually impacting the outcome. To achieve Enterprise Level success, the investment needs to scale to the impact. Often this means executive level attention with some serious investment in infrastructure.
- How independent are your advisors? On the other hand, we have also seen companies throw money, resource, and time into training dozens and even hundreds to be change management “practitioners” often at the advice of the certification providers. If your advisors (internal or external) facilitate this expenditure, it is time to consider their competency. This kind of investment can be a massive waste that we have rarely seen actually improve the organizational change performance. Yes, training people in a base method is important to success but handing out certificates like hamburgers at McDonald’s is not the answer. Rather, start with a strategy for scaling to your need beginning first with leadership and then selecting a few key resources to develop expertise, become coaches, build centers of excellence. You will save a lot of money and have a bigger impact.
- What tools and measures are in place? Managing a change portfolio can be an intensive effort. As with any major function in a company there are tools and measures that help monitor the effectiveness of the program. Any company that is still at Project Level or below is unlikely to have developed these tools or measures. Still, if the company has had a PMO or other similar programs, they may have the underlying capabilities.
Reaching the Enterprise Level of maturity depends on a number of variables. Organizations that embrace it and strive for it realize that they are building a business model for a much more successful future, one that enables them to learn and adapt faster to changing environments, and one that can even enable more engaged employees. By achieving Enterprise Level companies will see benefits such as:
- A consistent and unified change management approach across the entire company
- Faster time to execute on projects
- Common tools, templates, and resources for driving organizational change
- Building organizational fitness by reducing change saturation and fatigue
- A serious step toward creating a real, sustainable competitive advantage
Taking change management maturity seriously is the first step. Having a focus will pay dividends in protecting your investment in the technology. Not focusing on it, statistically, almost guarantees you will pay the price in the long run.