Benefits and Organisational Change

To be effective, the Benefits Realisation Management discipline needs must work in concert with an organisation’s Project, Programme, Portfolio and Change Management capabilities; this presentation highlights some key, mutually beneficial and interdependent, aspects common to each.

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Natural Change Lifecycles

Gaining an understanding of the natural lifecycles associated with the elements of a certain change can greatly advantage the ensuing change performance. The Change Manager can achieve this by learning as much as is ‘reasonably’ possible about an intended change and its context. It follows that it is possible, with enough ‘learning’, to identify the ‘natural lifecycle’ for a given change. Working to fully understand what the change objectives are; the nature of the change, the context for the change, the people and systems impacted by the change and also an understanding of the environment that the change will be undertaken in, provides the Change Manager with the information he needs to build up a picture of the ‘ideal’ change management requirements and inferred lifecycle. If available, historical records of similar change experiences would also help inform the change (Kolb, 1984). Given this information it is possible for a Change Manager to define the optimum lifecycle (the optimum ‘natural’ lifecycle) for a given change and, given such an optimal view, be better enabled to effectively manage the change.

Also, once the natural lifecycle has been identified and the need, business or otherwise, arises that requires it to be compromised, then this can be done from an informed position and, thereby with a degree of premeditation, the Change Manager can work to minimise any ensuing negative consequences. 

The attributes of the change lifecycle can be built up over time with recorded real time experiences factored into the resulting perspective. The variables to be considered include:

  • Type of people impacted
  • Number of people impacted
  • Extant cultural elements e.g. pride, discipline
  • The expected time change is to be made over
  • Complexity
  • Change imposed or internally conceived
  • Geographical location
  • Type and number of systems involved
  • Nature of change i.e. working or living conditions, cultural, working practices

 Things not considered as part of the lifecycle but seen as change management environmental variables include:

  • Whether the impacted community has experienced a similar change before
  • Whether the personnel administering the change have had a similar experience before
  • Whether the change is welcomed by the people it impacts
  • The amount of change activity the organisation has experienced in recent times

These are contextual factors and would, in context, have a modifying effect of the natural lifecycle. 

References:

Kolb, D (1984) Experiential Learning, New Jersey, Prentice-Hall, Inc

Measurement – an essential capability

Much of the assessment, forecasting and monitoring of change is heavily reliant on metrics and measures. Metrics are those values that are taken as a direct result of an activity or function and Measures are those values that the organisation uses to gauge performance and make decisions. There are many instances where metrics can be used directly as measures but frequently a measure is derived through a combination of two or more metrics. 

Consider answers to the following questions: 

  • If you are considering a change, how do you know your current level of performance?
  • If you are undertaking a change how do you know it is on course to deliver its benefits? 
  • If you have completed a change how do you know you have been successful?

Robust answers to these and similar questions are essential prerequisites for successful organisation change and can only be enabled through considered and effective measurement management.

However, measurement is a non-trivial ‘discipline’. Notice the use of the word ‘discipline’ here. There are many variables associated with effective measurement. These include (in no particular order):

  • What standards are applicable to this measure?
  • What units are the measures to be taken in?
  • What frequency is the measure to be taken?
  • Is the measure to be used directly or used to derive other measures?
  • Where is the measured data stored when it is taken?
  • Who is responsible for taking the measure?
  • Who is the measure intended for?
  • How long is the recorded data to be retained for?
  • Is there a security issue associated with the data?
  • How are the measures to be reported?
  • For what purpose is the measure being taken?
  • What techniques will be used to analyse the resulting data?
  • What mechanism will be used to take the measure?
  • Is the measure to be used in supporting some trend analysis?
  • Is the measure to be taken as an output from existing processes and activities?
  • Does the required measure require a special process, function or tool to be utilised?
  • Over what period should the measure be taken?
  • Is the measure to be used in conjunction with other measures? If so how is their correlation assured?
  • How and where are measurement results to be communicated?

Some measures can be associated with more than one change and, as the number of measures being taken increases, so the risk of unnecessary duplication or confusion increases also. It is clear that an organisation-wide measurement capability that establishes and maintains an organisational ‘measurement dictionary’ can help alleviate such problems and make the measurement of change more effective and efficient. The measurement dictionary is used to record the answers to questions drawn from the list above.

‘Contract’ or ‘Pay-as-you-go’?

‘Contract’ or ‘Pay-as-you-go’? What do these terms, used in the mobile phone market, have to do with change management strategy?

Although Change Vista would normally promote the utility of establishing an indigenous Change Management capability, it is recognised that some businesses and organisations are not in a position to achieve an acceptable return on investment for such a capability.

Whether a Change Management capability is contemplated or not depends greatly on the organisation’s understanding of its real Change Management needs and its overall strategic approach to Change Management. In the main, if an organisation does have a strategic position it will probably be underpinned by alignment to one of the two overriding paradigms:

  1. ‘Pay-as-you-go’: on an as-needs basis rely on external Change Management support. This means deferring the upfront investment in a change capability and, when the need for change does arise, establish the minimum Change Management knowledge and resources required to achieve the required changes which, when the change is completed, are then released
  2.  ‘Contract’: become self-sufficient in the ability to address the current and future change needs and commit to, and invest in, an optimised ‘on-tap’ level of Change Management capability

There is not necessarily a particular right or wrong approach for a given organisation, however the contextual size and scale of the following attributes could be used to inform the decision on what is the best for a given organisation:

  • number of people in organisation
  • number of different external stakeholder groups
  • staff turnover
  • prevailing culture
  • nature of market
  • structure of organisation
  • diversity of product or services offered
  • market maturity
  • market volatility
  • number of competitors
  • potential for predatory arbitrage activity
  • reliance on cutting-edge technology
  • degree of global operation
  • scale of overall operation
  • nature of business
  • regulatory pressures
  • reliance on economic environment
  • history of frequent change for whatever reason

Note: In the main each of the factors identified above can be assessed quantitatively and as such are well able to support the development of a business case (should one be required) for the investment. If a benefits driven approach is taken when constructing the case, the positive impact on the organisation’s work force can be factored into the case e.g. morale, confidence

Generalisations

Organisations with strong and aggressive competition (and therefore it follows with a need to adapt to environmental changes quickly) would be well-advised to consider adopting the organisational capability approach. The emergence of cloud computing has in itself challenged many of the norms regarding investment in infrastructure. Lower investment needs coupled with the increased availability of multi-configurable, high-access applications mean that organisations are more able to react and advantage themselves. But this of course is also true for the competition. Organisations operating in markets with large infrastructure investments and operating in niche or slow moving markets might be better advised to adopt the ‘as needs’ approach with minimum on-tap capability.

What the above criteria shows is that it is possible for an organisation to make an informed decision on which approach is right for it.

Some of the pros and cons surrounding these two distinct approaches are described below:

As needs approach (Pay-as-you-go):

  • Pros
    • low near-term cost
    • able to go to ‘market’ to select required ‘current’ change management expertise
    • no strategic training investment costs
    • no need to establish and fill permanent change management posts
    • organisation not ‘burdened’ with permanent individual responsibility toward organisational change
  • Cons
    • unable to draw on assured level of Change Management knowledge or capability
    • inability to predict duration of change initiative
    • organisational tendency towards only entertaining change when pressures for change become high profile and demonstrably intolerable
    • workforce must be ‘unfrozen’ from a near ‘deep-frozen’ position in preparation for change
    • mobilisation of in-scope organisation must be achieved; those involved with the change, those impacted by the change and also those that are aware that a change is to take place. Most change initiatives affect the majority of personnel within a given organisational scope.
    • must pay market rates for required Change Management knowledge

 Capability approach (Contract):

  • Pros
    • organisation maintained in a change-ready state of mobilisation
    • opportunities to exploit change driver ahead of pay-as-you-go competitors gives competitive advantage
    • Change Management knowledge and capability can be established and maintained within ‘whole’ organisation
    • Change Management memory provides organisation with ability to record and capitalise on lessons learned
    • latest Change Management thinking, tools and methods can be evaluated and assessed for appropriate implementation off-line e.g. BRM
  • Cons
    • relatively high near term cost
    • organisation must come to terms (educated) on need to achieve such a change capability
    • no place to hide. All change drivers are scrutinised and decisions (from wherever they are taken) are qualified and recorded for future reference

The required assessment to decide the most appropriate approach that should be taken can be achieved using internal personnel. However, the need for significant objectivity requires that an external mediator should, where possible, be used. External mediators may be found within other areas of the subject organisation e.g. this does not have to be undertaken using an external supplier.

Investment consideration

The establishment of an appropriately sized Change Management capability need not attract sizeable additional funding. In fact, by centralising aspects of the Change Management function from a headcount and expended man-hours point of view, the efficiency of the capability could result in direct savings. By utilising pre-existing Change Management spend data the resulting business case should reflect an overall improvement in cost efficiency.

Sustainability

In order for it to remain fit for purpose such a capability would itself need to be continually tested to ensure that it meets the needs of the organisation and its people. This ‘testing’ should be an integral function of the capability itself but scrutinised by the overarching organisational quality and compliance function.

To conclude

It is clear that, in the current economic climate and with an ever increasing pressure and frequency of change, an organisation owes it to its people to get Change Management right. Establishing an indigenous Change Management capability sends out the message that the organisation takes change seriously, respects and cares about the well being of its personnel and, above all, is determined to succeed. But as this text shows the choice must be made on the merits of each and every individual business or organisation.

The people factor

myfpimage1People have always been important to business and the functioning of organisations but recent developments have resulted in a shift in the way people think and behave. Significant drivers in this ‘evolution’ include:

  • Increased access to knowledge and information
  • Increased awareness of their environment
  • Greater expectations of others in positions of ‘authority’
  • The ability to join with others to question the status quo

The net effect of these developments is that people feel increasingly empowered to influence their environment.