Don't Trust Your Project Investments to the Status Quo

Don't Trust Your Project Investments to the Status QuoWe’ve all heard statistics on how often projects fail or produce disappointing results.  Most companies do a great job developing a business case, and many are very good at project management, which focuses on tasks, timelines, and resources.  Very few, however, have developed the ability to integrate a focus on the human element, which is often called “change management” or “change leadership”.  Robust change leadership, especially when viewed as a form of project risk management, can make the difference between getting the full return on your investment, preventing project failure or settling for sub-optimal returns.

Today, all companies must innovate to survive: those that do it successfully reap significant rewards. Recent statistics, taken from a series of surveys and studies (see references), create a clear a wake-up call to executives and leaders seeking to transform the organizations they lead.  

  •  17 percent of large IT projects go so badly that they can threaten the very existence of the company 
  • On average, large IT projects run 45 percent over budget and 7 percent over time, while delivering 56 percent less value than predicted
  • Only 40% of projects met schedule, budget and quality goals
  • 75% of project participants lack confidence that their projects will succeed. due to “fuzzy business objectives, out-of-sync stakeholders, and excessive rework”  
  • A worrying 78% of respondents reported that the “business is usually or always out of sync with project requirements”
  • 49% of organizations had suffered a recent project failure in the last 12 months. 
  • In the same period, only 2% of organizations reported that all projects achieved the desired benefits 86% of organizations reported a shortfall of at least 25% of targeted benefits across their portfolio of projects
  • 97% of organizations believe that project management is critical to business performance and organizational success, but
  • 50% of all Project Management Offices (PMOs) close within just three years. 


Successful change leadership involves a clear understanding of what makes projects succeed, and ensures those vital elements are in place.  While executives may be charged with change leadership, they are often too busy to manage the broad range of tasks involved. 

An IBM study states that people factors are the biggest barrier to success. Corporate cultural barriers were cited as an issue in 49 percent of projects. Failure to address changing minds and attitudes caused failure in 58 percent of projects. More strikingly, lack of senior management support undermined or lessened success in 32 percent of projects.

Strategy Execution with Organizational Change Management

I received my initial training in organizational change management when it was still in its infancy through a knowledge-transfer agreement with a change management consulting company in Atlanta. We weren’t looking to sell change management consulting services – we were just looking for ways to make our projects go better.  Learning and applying change management processes allowed me to improve my clients’ results.   Since then, organizational change management (OCM) has become a buzz word, with more and more demand for OCM services.  This new popularity is a double-edged sword, however.  Change management practices are as complex as the human behaviors we seek to help change, but people often think change management activities are limited to internal communications and training coordination.  While these activities are important to project success, they are usually delegated to junior members of the project team and don’t address the full range of human challenges.

 It’s now time to change the paradigm. At its heart, OCM is strategy execution. It’s about understanding the pressures and risks that can affect an organization’s ability to change and working to mitigate those risks.  It’s about understanding how humans tick, and helping leadership create an environment where people can thrive and give their best. OCM involves building relationships, creating trust, and then influencing people to pull together toward the objective your organization needs to achieve.

Leading Change

The risks are too great to ignore OCM.  Your organization wrote a business case, evaluated benefits and costs, did some risk analysis, and got the funding to move ahead.  You may be confident with the timeline to develop the product or the technology, install the equipment, and execute similar tasks, but how can you be sure that the people involved will embrace the initiative?  Have you identified all the people affected by the project? (It’s surprising how often leaders miss this step; according to the previously-cited IBM study, 35% of projects underestimate the complexity.)  Does your staff have the skills, the bandwidth, the understanding, the support, and the motivation to embrace the plan?  Can leaders navigate through change in an effective and motivating way?  What happens if some leaders resist the initiative or start squabbling over control?

Good change leadership involves understanding the business case, the environment in which change will be implemented, and the business risks and human factors that influence project progress and success.  It requires both skilled OCM professionals and a project team that manages all tasks and resources, and provides eyes and ears to tell leadership what’s needed to keep the organization engaged and on track.  While this sounds like project management, successful execution involves far more than one project manager can handle. 

Managing resistance through OCM is an integral part of executing a business strategy and achieving desired results.  Change management professionals are trained to understand and address cultural undercurrents and subtle behaviors that create potential problems.  Where others see unpleasant behavior, we see resistance, and gather and manage key insights regarding why a project is stagnating.  Where others may become punitive, we craft interventions to solve organizational problems that improve overall performance.  We do this while holding the business objective firmly in mind, including financial, market, and technical considerations, to optimize project results. 

The Value of Change Management Advisors

We don’t manage change alone, but engage with leaders who sponsor the project to keep employees motivated and engaged.  OCM professionals also teach organizations to become more resilient, to embrace and to get better at change and become more agile over time.  When project stakes are high, delegate internal communications and training coordination to those who do it best, and rely on trusted change managed advisors to achieve compelling results.

 

References

https://blog.capterra.com/surprising-project-management-statistics/

https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/delivering-large-scale-it-projects-on-time-on-budget-and-on-value

http://blog.mavenlink.com/21-shocking-project-management-statistics-that-explain-why-projects-continue-to-fail

 

Topics: OCM, Organizational Change Management