Why does BMC fail every year

digitalization

Change projects in companies do not have a good reputation. Most of them fall short of expectations or fail completely, as various studies have shown. The good news: the causes of failure and the success factors in practice have now been thoroughly researched. IT managers can learn from this, as can business and project managers. This FAQ gives an overview.

What does change management mean?

It is not uncommon for the problems to begin with the terminology. The buzzword change management, which is particularly popular in the context of digital transformation, is understood and interpreted differently in practice. Project managers have a rather narrow view of the topic. Your aim is to implement changes in scope, time frame or budget for a specific project. Those responsible for IT infrastructure have an even more specific focus on approving, testing and installing a new IT component, be it a cloud instance or a current software release.

Associations such as the Association of Change Management Professionals (ACMP) or the Innovation and Organizational Change Management Institute (IOCMI) tend to view change management from a higher-level, organizational perspective. Each of these groups works with their own concepts, frameworks and specialist terminology. Yet they all focus on the human aspects of organizational change and how to deal with it. This must be distinguished from classic process-related changes, for which there are also a number of frameworks, including ITIL or Prince2.

Sheila Cox from the American consulting firm Performance Horizons gives a useful definition for change management aimed at organizational changes: "Organizational change management ensures that the new processes that arise from a project are also accepted by the people concerned."

When do companies need change management?

Organizational change management always comes into play when companies initiate programs or events that influence daily work processes. For example, a new software tool in accounting can lead to the work content of individual employees changing significantly. The acceptance of a new approach does not come automatically with the chic new user interface of the software.

In a number of cases, the roles of employees also change. Many IT specialists see their real value in their role as programmer, software architect or security expert. When asked to take on a different role, it can lead to discomfort and doubt. Employees with outstanding technical skills, for example, often fail when they are supposed to prove themselves as managers.

Fundamental changes can also affect the entire organization, for example when it comes to acquisitions or the separation of parts of the company. In such cases, usually only a small group of people around the top management are informed at an early stage and can adapt to changes. This does not apply to the majority of employees. You won't find out about planned cuts until much later and you may decide to leave the company. This doesn't make the change management process any easier.

What is part of successful change management?

In practice, various success factors for effective change management have emerged. This includes:

  • The right sponsor from management

A sponsor is critical to the success of organizational change management, practitioners and consultants agree on this. It is his responsibility to justify upcoming changes and to procure the necessary resources. To do this, he needs the support of top management.

In addition to the strategic overview, he needs sufficient detailed knowledge to explain, for example, why certain solutions are suitable or unsuitable for a problem. He has to understand the personal impact and at the same time be ready to convince even skeptics. This includes good communication skills as well as a certain tenacity. If job cuts or changes are pending, the sponsor should be able to justify this and support affected employees in the transition phase.

  • A culture that rewards willingness to change

To some extent, all organizations tend to resist change. Especially when there seems to be nothing wrong with the usual approach, the willingness to change is sometimes completely lacking. So sometimes you need some kind of wake up call. Consultant and author Bart Perkins cites the sexual abuse allegations against film producer Harvey Weinstein as an example. Only after the allegations became public did many companies seriously address the issue of sexual harassment and take action.

Good change management teams use the emotional energy present in the organization to encourage change. They communicate anecdotes from the company's history, speak a language that resonates with employees and highlight those parts of the existing corporate culture that fit the planned changes. They also put employees who show willingness to change in the foreground of their communication. Your goal is permanent positive reinforcement that has a medium to long-term effect on the culture and fuels the transformation process.

  • Individual willingness to change

Not only the organization, but every single employee must be willing to deal with new information and behaviors. Experience has shown that most people prefer the status quo. They only accept changes if they appear sensible to them and if they improve their work and their work environment.

  • Rewards and Consequences

Fundamental changes should be supported by suitable reward mechanisms. Individual target agreements with measurable results can drive the change process forward. The consequences should be clearly shown to those employees who do not participate.

An example of changed incentive and reward systems was provided by an American consulting firm that wanted to increase its profile. Management encouraged the partners to speak at specialist conferences and write blog posts. It is true that this did create new business opportunities for the entire company. On the other hand, the turnover that each consultant achieved per customer decreased. Up to now, however, consultants have been measured against this "hard currency"; it has a direct impact on their remuneration. The management was then forced to adjust the remuneration system. Otherwise some partners would have left the company.

What problems are there in change processes?

Three quarters of all change projects fail, claims Anand Narasimhan, professor of global leadership at the IMD business school in Lausanne. Implementation is no longer the crucial problem, he explains in an article for the specialist magazine "Harvard Business Manager". Together with his colleague Jean-Louis Barsoux, he researched the causes of failed change initiatives.

A key statement reads: In the run-up to transformation projects, there are often fundamental misjudgments: "Especially when the environment is complex and the pace of change is high, companies tend to make hasty decisions that steer the whole undertaking in the wrong direction." The bottom line is that the first step is not about how the change should be designed, but what needs to be changed in the first place.

Once the goal has been reached, there are further hurdles and problems. Changing attitudes and behaviors takes time. The change management team has a harder time than a project team that is supposed to implement a new core application. Milestones and KPIs in such technical projects are usually clearly defined, and progress is relatively easy to measure. Those responsible for change management have to deal with other challenges:

  • Change management is not deterministic

In contrast to computer programs, employee behavior can be illogical and unpredictable. Change measures that take effect in one group can fail in another. Messages that reach one team may not have any effect on another.

  • Change management needs personal contact

Email, video, and other mass communication channels can reinforce a message. But they are not enough to make employees feel that the company really cares about their concerns. Change management must seek personal contact with those whose behavior is to change. Sometimes it simply helps those affected to get rid of their frustration before they can accept the new reality.

  • Middle management and clerks need to be on board

Clerks and middle management can make a decisive contribution to whether a change project is successful or if it fails. They know the operational details and often anticipate potential problems and likely responses from customers. Involving these groups may initially mean more work for the change team. On the other hand, it strengthens the trust and commitment of the employees. Colleagues who see their suggestions implemented will later find it easier to acknowledge the result achieved.

  • Cultural differences make change management difficult

Different cultural norms can have a particularly serious impact. The change team should familiarize itself with local rules and behavior, even if top management has set globally standardized processes as the goal.

This includes, for example, different communication styles. While employees in Germany, the Netherlands or the USA usually address problems directly, this can be counterproductive in other cultures. Colleagues from India, Japan or Pakistan have a rather indirect style of communication and attach great importance to not "losing face" in conversations.

There are also big differences when it comes to dealing with appointments and punctuality. The latter is less important for colleagues from Spain, Thailand or Brazil than for the German or American business manager who wants to hold his meeting in a targeted manner. It is similar when dealing with hierarchies. While employees from Australia, Canada or the USA care little about it and call themselves by their first names, the position in the company hierarchy plays a central role for colleagues from India, Japan or Saudi Arabia.

  • Change management is only added in retrospect

When it comes to IT projects with profound effects on business processes, the topic of change easily gets out of focus. The large and small technical tasks associated with it are just too diverse. For example, the team has to create interfaces to other systems, harmonize data and solve many organizational problems at the same time.

If change management is not initiated in parallel in such scenarios, those involved may only recognize its necessity when resistance is formed on the part of the end user. It is not uncommon for those responsible to cut or cut the change management budget when the overall project costs threaten to get out of hand.

  • Change management is started too early

Another problem can arise if the change management process is started too early, for example for large IT projects. If the change team begins its work before important system details have been decided, the statements either remain vague or they simply describe what the new software is likely to achieve. If the implementation is delayed or if the promised functions are missing, disappointed expectations and a lack of acceptance by employees can quickly result.

  • Rational arguments are not enough

A common mistake in change projects is the one-sided emphasis on purely rational arguments for a change. Too often, project managers lack the ability to win employees over emotionally. It has often been proven that people are much more likely to change their actions if they see themselves as part of a whole and share a vision that also appeals to them emotionally.

Which tools help with change management?

Software alone does not solve problems. But it can help organize change processes more efficiently and create transparency for those involved. A number of relevant tools now follow this claim:

Freshservice

Freshservice is a cloud-based tool that companies can use to manage change projects. The range of functions includes a sophisticated problem and incident management system that, for example, manages support tickets and automates repetitive workflows. In addition, there is release management and various reporting functions that can, for example, indicate bottlenecks.

Gene suite

The change management software Gensuite helps teams to manage risks and compliance requirements that result from technical, organizational and personnel changes. The software also offers various identification, tracking and documentation functions. Changes and status updates can be automatically communicated to those involved. With the help of data mining, the compliance status can be determined and potential problems can be identified.

Intelligent service management

The Californian software company Serviceaide offers Intelligent Service Management. The system supports companies in planning rollouts and implementing changes. In order to make change processes more efficient, it uses various best practices. Among other things, users can use it to plan and manage communication and compliance measures. When rolling out technical systems, functions for process automation and a number of stored workflows that have proven themselves in practice help.

Remedy Change Management 9

Remedy Change Management 9 comes from BMC Software. The platform enables companies to keep the effects of organizational changes on IT service management under control. For example, the software recognizes potential conflicts due to change measures and provides those responsible with a detailed "impact analysis". The range of functions includes dashboards for various KPIs and process-specific reports.

Whatfix

Whatfix also supports companies in change processes. In particular, it should improve the introduction of new application software. The tool also offers interactive guides designed to help end users understand and use the new system. Context-based support is also included, which is based on individual needs and usage data. In addition, change teams have pre-defined approval processes and compliance management functions at their disposal.

With material from IDG News Service