Have you been challenged to justify the value of change management?

    Nov 16, 2017 | Posted by Michael Campbell

    challenge to justify change managementElevating the position of change management within a business requires business leaders to not only recognise the value of the practice but also to give it the people, money, time and personal commitment it needs in order to succeed in delivering its business results. The prize is worth fighting for; according to Prosci's Best Practices research 65% of projects in highly change mature organisations deliver their expected business results compared to 37% in organisations of the lowest change maturity.

    In order for business leaders to prioritise change they must first be able to realise the value of efforts made in the overall context of the organisation. When making the case for change management definitions, socialization of outcomes, shared understanding of vocabulary and roles are important. When all efforts are made to list off change management practices such as communications and training it can be easy for it to slip into the role of an optional add-on rather than a vital contributor to the project’s success. Change management is equal in importance to strong project management and executive sponsorship of the change if the ROI is to be achieved. 

    When justifying the value of change management it becomes crucial to focus on what senior leaders and project leaders care about: achieving organisational benefits and its contributions to overall project results and outcomes.

    When explaining change management to leaders, it should not just be a consideration of how much time, money and resource the deployment will cost but also one of how much resource is needed so we can best capture the on average 70% of a project's business  benefits that directly depend on people successfully changing the way they work.

    To help change practitioners shift this conversation we have put together a list of 5 questions which help to secure the required levels of buy-in for change management:

    Question 1: What is this project trying to achieve?

    A project without direction is rarely successful and it is by no means efficient. When all project teams and leaders understand what the project objectives are, efforts can become increasingly more focused, magnifying the ability to measure project effectiveness.

    Question 2: What are the organisational benefits of this project?

    These need to include the specific higher-level financial and non-financial reasons for implementing the initiative and often encompass increasing revenue or profit, achieving compliance with regulations and strengthening customer engagement or satisfaction.

    Question 3: What are the specific objectives of this project?

    This question will allow you to create an understanding of the potential outcomes of the project. These are typically measurable outcomes which ultimately result in the achievement of the organisation's identified benefits.  When the benefits and objectives of a project are defined it is easier to directly connect how outcomes need to be linked to people changing the way they work in their respective function.

    One part of achieving the benefit is the technical solution, for example, the building of the software or the installation of the new systems to the desired specification, on time and on budget. The other part of achieving the benefits is the people side of change: the individuals impacted by the project and the effects this will have on how they perform their roles. Indeed this people side benefit can be broken down further.

    By combining both of these elements, project objectives and organisational benefits can be realised.

    Question 4: What portion of this benefit depends on adoption and usage?

    Not all projects will have an equal reliance on people. While many changes are based on technological changes if the people impacted don't use the technically in the required manner, the ROI will not be high as anticipated. Indeed we say that some people side benefits derive from simply installing the new capability - installation benefits, whereas the remainder of benefits are linked directly to people adopting the new ways of working that are required - we call these realisation benefits. Most projects will have a relatively low percentage of installation benefits and a relatively high percentage of realisation benefits.

    Discussion and agreement over the relative percentages of installation and realisation benefits is a key component of building the business case for investing in change management in a project.  Furthermore we can break down these people-dependant realisation benefits and relate them to each specific project and organisational objective. This discussion can be faciliated by access to Prosci's Change Management ROI Calculator, a cloud application available for monthly rental.

    By reviewing each benefit and determining which portion of it requires adoption and usage we begin to anticipate the role change management will ultimately play in its success.

    Question 5: What percentage of this benefit will we achieve if no one changes how they do their job?

    Answering this "null hypothesis" question allows us to understand the full extent of just how people-dependant a project’s objectives are. Projects which are highly dependant on the behavioural changes individuals need to make to the ways they do their jobs realise very little benefit if no one adopts or uses the solution. 

    While it is unlikely that no one would change their behaviour at all, it is important to consider the implications of a zero change effort. This allows us to cement the importance of driving the people side of change while also providing a baseline for how we can increase the percentage of benefits which will be captured by increasing adoption and usage through a structured and customised change management strategy.

     If you are looking for additional insights into and a structure for how you can justify the value of change management, or secure commitment to a change management effort, the Prosci Business Case for Change Management Workshop, which can be delivered privately on site at your location is ideal.

    Register for the Prosci Business Case Workshop



    Download the Course Brochure

    One of the most difficult challenges that change agents face is to convince executives on the value of assimilating change management into the organisational capabilities DNA. CMC is hosting a one-day workshop to provide project managers, programme leads, project team members, and change management associates with the tools and skills to build a strong business case to persuade senior executives to buy into change management. 

    Read our Brochure



    Topics: change management