Money & Business

Study: Change Is Good, But Many Organizations Don’t Do It Well

By / Mar 21, 2014 (iStock/Thinkstock)

A new in-depth report from the Project Management Institute takes a look at why so many organizations are failing to implement strategic change. How to fix that? PMI details some best practices for success.

Nearly half of organizational strategic initiatives fail, according to a new report from the Project Management Institute.

That statistic equates to a loss of almost 15 percent of every dollar spent on strategic change initiatives, PMI’s “Pulse of the Profession In-Depth Report: Enabling Organizational Change Through Strategic Initiatives” found.

Incorporating and expanding on findings from the institute’s 2014 Pulse of the Profession study, which surveyed more than 2,500 project management leaders from around the world, and its Managing Change in Organizations: A Practical Guide, the new report details where organizations can create and successfully implement change.

“The success or failure of a change initiative is not just about initiating, planning, monitoring, executing, and evaluating the project that will drive the change,” the report stated. “It also involves preparing your organization for transformation, ensuring stakeholder buy-in, and engaging executive sponsors to champion and support the change before, during, and after its implementation.”

A majority of organizations (64 percent) are only moderately successful at change management, the study found. Eighteen percent are highly effective change enablers, and another 18 percent are minimally effective.

What are the highly effective organizations doing differently? The report lists five practices that this group identified as important factors in successfully managing change:

  • having well-defined milestones and metrics
  • ensuring senior management is committed to change
  • establishing and communicating concrete ownership and accountability
  • using standardized project management practices
  • having engaged executive sponsors

Meanwhile, the top two reasons organizations are failing at change management are insufficient communication and a lack of leadership. Former PMI research determined that half of unsuccessful projects were related to ineffective communication, for example.

“While defining milestones and metrics is a key first step, organization-wide communication of their impact to the initiative is essential,” the report stated. “The data shows that creating an effective communication plan, properly executing that plan, and identifying, measuring, and communicating the intended benefits of change are key factors that make an organization good at change management.”

Along the same lines, it is important to ensure that senior management is on board to lead and manage the organization through change—especially by effectively communicating how the change will benefit the organization.

For example, executives and employees see change differently, the report noted: “Senior managers typically see change as an opportunity for both the business and themselves, and employees typically see change as disruptive, intrusive, and likely to involve loss.”

By understanding and mitigating those differences, organizations are primed for greater transitional success, the report concluded.

Does your association practice effective change management? Let us know how in the comments.

Katie Bascuas

Katie Bascuas is associate editor of Associations Now. More »

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