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Change Management's Fatal Flaw

Some 500 years ago Italian philosopher Niccolò Machiavelli had this to say about change management: "There is nothing more difficult to carry out nor more doubtful of success nor more dangerous to handle than to initiate a new order of things [i]."

Few would argue that managing change is easy, and yet it seems that everyone is an expert. So what have we learned over the course of the past 5 centuries? Until recently, not much: we really only started seeing the development of change management methodologies around 50 years ago.

While there is no unequivocal founder of change management, we know that some of the first methodologies were documented by pioneers of the industry in the late 1940’s and early 1950’s. Commonly cited examples include Kurt Lewin’s three stage change process and Everett Rogers’ book “Diffusion of Innovations”. The Kübler-Ross 5 stage model of Denial, Anger, Depression, Bargaining and Acceptance of change was prevalent in the 1960’s, but it was not until the 1980’s and 1990’s that Change Management really became accepted as a mainstream business discipline.

Between 1981 and 2001, General Electric (GE) increased revenues by more than $100 billion by applying a revolutionary approach to performance improvement – using change management. The proprietary approach borrowed liberally from existing performance improvement methodologies such as sociotechnical theory, quality management, Toyota’s lean manufacturing and even Motorola’s Six Sigma approach.

The approach resulted in timely recommendations, expedited action plan development, secured the buy-in of all affected parties and could be implemented almost immediately. The resulting change initiatives and process improvements happened very quickly – and so GE became nimble and agile.

The business world took notice and Jack Welch’s “GE Workout” quickly became a household name. The approach was the first of its kind and it was during these years that the first management consultancies began to develop their own change management practices and performance improvement models.

However, by the turn of the century the lesson learned was that the use of standardized sets or different combinations of change and process improvement methodologies cannot consistently produce predictable results. Further, the interactions and overlap between the two are often misaligned, and, the definition of change management as we know it today is often misinterpreted and applied unfittingly.

In fact, in the few decades that change management has existed as a discipline only one trend has remained constant: research studies are consistently finding that around 70% of all organizational change projects fail to meet their stated objectives.

Such a dismal success-rate is staggering if one considers the time, resources and dollars that are committed to projects around the world every day. This evidence would suggest that something is missing or fatally flawed with current change management methodologies.

But wait, before we write-off 50 years of research and return to the drawing board, let's consider an alternative explanation. The underlying principles of the massive portfolio of change management methodologies that exist today are all strikingly similar, and, they are actually quite good. Instead, it is the capacity of management to implement change that remains catastrophically underdeveloped.

For the past 50 years we have increasingly allowed managers to outsource the execution and accountability of change management to external consultants, instead of building the organizational design infrastructure and capacity for the business to effectively flow change across the enterprise.

It does not matter if change is local and affects a small group of people, or, involves a large scale IT implementation with major business transformational impacts across the globe. The ownership and ultimate responsibility for successful execution of change must reside with business management, align with business strategy and resonate with the business culture.

Building operational change capability requires a significant investment of time and effort and the process begins with training for your key people. Understanding that sometimes, usually for major capital projects (e.g. ERP implementations), additional resources are required to boost immediate capability for a fixed term. But recognizing that for the most part building change capability is an internal exercise in developing human capital - that's the key to avoiding the fatal flaw.

[i] The Prince, by Niccolo Machiavelli, The Harvard classics (translated by N.H. Thomson), New York: P.F. Collier & Son, 1909-1914.

#ChangeManagementHistory #ChangeManagementTraining #ChangeManagementStrategy

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