Performance Management Solutions

Let’s be entirely honest here. According to research data, more than 70% of ‘change projects’ and ‘change management projects’ fail to deliver the desired results and often deliver needless disruption and a negative return on investment. Some organisations, however, buck the trend and consistently deliver desired results, often with a much higher return on investment than anticipated. The question we need to ask is: why?

In over twenty-five years as a change management practitioner I have found that the answer to the question “why do most change projects fail?” is (1) organisations try to change the wrong things, (2) they fail to engage their people, and (3) they make changes that are not needed.

Let’s unpack that a little.

Changing the wrong thing

Changing the wrong thing often means that individual processes are being modified without a full understanding of how that process is linked to others in the organisation. When an organisation is regarded as a machine, and this seems the predominant way managers think about organisations in western economic models, then the process mentality comes into play and the inner workings of the machine are set up to work in an interlinked way with the output of one or more processes acting as the input for a subsequent process. If a decision is then made to modify either the input or the output of a process then it has an immediate impact on the process either side and this has a continuing knock-on effect throughout the organisation.

Generally speaking, a process has a very narrow performance band within which it has to operate if it is not to be disruptive and care needs to be taken not to create conditions under which that performance band is breached. So, even undertaking routine software upgrades and replacing old equipment can and do cause disruption, some of which will not have been foreseen or anticipated. If such upgrades are planned, then it is essential that the organisation tracks all the performance line through all the processes to see what else will need changing.

And then, of course, there is the change that is generated by tactical actions taken for the right reason but without the process analysis being done. For example, the sales team are tasked with increasing sales by 10%: this seems like a logical tactical activity but a 10% increase in sales, unless there is an excess of stock, will require a 10% boost in production and all the processes that contribute to that. Such a demand thus requires a significant change in a great many processes, some of which will not kick in until much later and usually lead to a delayed stock increase sometime after the sales boost and this leads to the need for a reduction in performance. Thus the roller-coaster affect kicks in and the ROI boost expected from the sales boost turns into a negative ROI later on.

The golden rule is that as far as possible change should be considered only in long-term strategic situations and avoided in short-term tactical ones.

Not engaging the people

For far too long managers in organisations have held the belief that all they have to do is ‘to issue an order’ to their workforce to do things in a different way and it will happen. But long gone are the days when the relationship between organisation and employee was that of ‘master and slave’ and simply ordering something done was acceptable. In the current western economic model the relationship has shifted significantly towards a mutually beneficial one and full recognition of the portability of skills. In other words, people work for organisations only so long as they wish to and evidence shows that a person leaving an organisation and actively seeking another post will usually find one with better conditions and higher pay within a few months.

When people work for any organisation they are usually employed to undertake some specific duties and some unspecified but related duties, and to do so on a continuing basis. This means that the employee is required to deploy a fairly limited range of behaviours and skills on a long-term basis, and by doing so these become habitual behaviours or habits.

From a behavioural perspective, an organisation can be considered “a collection of habits with a common goal” simply because habits are “a limited set of frequently (or continuously) used behaviours that enable the individual to deliver a steady performance within a bounded environment, usually without a sense of risk”.

Somewhat obviously, if the “common goal” is changed for any reason, then the habits that are deployed to achieve it also have to be changed, and failure to do so will result in regression to the previous performance. In other words, if you want a different outcome then there has to be a change in what you are doing. There is nothing fancy about that, it is not a deep psychological insight, it is simply a self-evident truth and one with which we are all very familiar with. However, despite its obviousness, it is simply ignored by many, especially those seeking change.

Part of the problem is that habits under-pin our “comfort zones” which are defined as “a behavioural state within which a person operates in an anxiety-neutral condition, using a limited set of behaviours to deliver a steady performance, usually without a sense of risk”. Comfort zones are, therefore, a set of habits and an organisation is a set of comfort zones – so, if seeking change in the way people work we need to change people’s behaviours and habits and this requires a significant understanding of the methods that can be used to assist people to discard old habits and adopt new ones. And anyone who has ever tried to break a long-term habit of their own will know just how hard and time consuming that is.

Making changes that are not needed

This is, unfortunately, a rather recent and disturbing trend born, I suspect, of the speed and frequency of changes in market conditions. Faced with changing demands within the market, organisations must obviously make changes so that they and their goods and services remain relevant in the market, and this has led to a tendency towards an almost knee-jerk reaction within the strategic planning section of the organisation. This is not helped by the fact that changes in technologies are taking place with increased speed and frequency and this doesn’t look like changing in the near future – if anything, it may even get faster.

Such is the importance of responding quickly to the disruptive market that exists in the western economic model, strategic management has shifted from being a proactive supply-side activity and become a reactive response to a shift towards demand-side market conditions: organisations are simply responding in desperation to survive, and strategy has become tactical and very short term. Managers are, therefore, having to ‘think on their feet’ rather than having a thought-out plan and this inevitably leads to grabbing at straws as they scramble to stay close to their comfort zones.

The outcome is multiple contemporaneous changes, high levels of stress and anxiety, and the need for agile and flexible responses, often without allowing a change to settle before the next round of changes is demanded. Whilst this sort of thing can be very exciting and even exhilarating to the managers, it leads to huge disruption and loss of performance amongst the transactional workforce and it cannot be recommended for the long term. Whilst not a change management issue, per se, it feeds into change management and creates instability, a lack of continuity, a declining performance, and potential disaster. There needs to be a return to forward planning, an increase of trust in and expenditure on innovation (and subsequent R&D where appropriate), more thinking and less reaction. Unless this happens then the change manager is always going to fail as today’s changes are not allowed to drive performance before they become yesterday’s failures. Clear, stable goals have to exist as a prerequisite for successful change.

Alasdair White has been a professional change management practitioner for 25 years and heads the Business Academie’s Change Management training programme (accredited by AMPG). His Change Management consultancy work work is structured around addressing the issues that lead to setting up successful change programmes whilst the training programme is aimed at providing change management practitioners with the tools, knowledge and understanding needed to lead successful change programmes.