Change Whisperer on ProjectManagement.com

“If you do not change direction, you may end up where you are heading.”—Lao Tzu

There is a back-room mindset in times of change: “Change the people or change the people.”  It means either convince (or coerce) the existing staff to adapt to the new way of working or fire them and hire someone else.  This phrase has always irked me.

Looking for some objectivity and additional insight for this series, I partnered up with senior change practitioner, Jennifer Frahm. You may know Jennifer from her terrific blog“Conversations of Change.”

We applied ourselves to articulating why this mindset is a fallacy, to considering what leaders are doing instead, and then finally to whether advancements will actually make Change Management, as we know it, extinct. 

“Change the people”

In this mode, organizations force change mechanically, like a bulldozer or a crow bar. The Program team designs/builds the new thing, implements, and then de-commissions old. The work is focused on driving implementation as quickly as possible.

The Program Team:

• Works alone on solutioning and design, assuming they know better than  others how to build a better mouse trap (i.e., “we’ll change what you do”)
• Pays lip service to communication with broadcast, compliance-driven announcements and progress updates (talking heads announce what, why, how, and when) (i.e., “we’ll change what you know”)
• Installs new capability with technical training to people who are largely unaware of, and ambivalent about, the reasons for the change (i.e., “we’ll change how you do it”)
• Implements a re-organization justified by the increased efficiency of the systems or processes; people are assigned different roles and some number of people are “downsized,” “packaged out,” or offered “early retirement” (i.e., “we’ll change who does it”)
• Repeats, program after program, as if one size change fits all

Sure, we are exaggerating some for effect, but not much.

This process basically assumes that people are homogenous, interchangeable and dispensable “resources.” Success assumes that when one changes out parts, that the machine will automatically function better. It is a hang-over from an industrial era when people were most often cogs in an assembly line.

There is a critical element that the “change the people” mode overlooks—people have discretion over their performance. We can ramp up to passionate commitment or ramp down to bare minimum compliance. This affects the speed of implementation and also quality of outputs. If for no other reason than this, Program Teams are waking up to deploying more effective change management.

Many of us have been on both sides of that industrial mindset, have felt that pain, and even exerted that pain. Further, we all know that this mode imposes irresponsible hard and soft costs on the organization, particularly in context of continuous change.

Without doubt, organizations do need to change constantly. We must be vigilant in the pursuit of relevance in a world dominated by rapid technological and social shifts. But is the answer really to “change the people” constantly? 

Costs of “change the people”

Organizations seem numb (or oblivious?) to the reality that there are real costs to “muscling through” change and the more change the organization is experiencing, and the more transformational the change, the greater the costs. 

So what costs are over and above the usual when organizations muscle through? Here are a few examples that come to mind for us:

• Lost productivity
• Resource churn
• Downgraded conditioning of the organization

1. Lost productivity: Let’s take it down to a personal level then back to organizational. We have all experienced it—the agitation of uncertainty and or ambiguity. When we don’t have a confidence or clarity in our future we:

• Seek answers by talking the situation over with anyone who might have more information than we do, which has the unfortunate effect of fueling gossip channels
• Attempt to connect the dots, the pieces of information that we have, and often do so erroneously and head off in the wrong direction
• Hold on to what we know and hold back from moving into the future
• Create options, often including a personal job hunt

From a neurological perspective, our amygdala (the part of the brain where emotions are housed) goes in to hyperdrive and this prevents the front brain (where our clear, logical thinking is housed) from operating well. We can’t possibly be productive when faced with the threat of uncertainty: We’re thinking fight, flight, or freeze. For a great reference on this see David Rock’s “SCARF: a brain-based model for collaborating with and influencing others”).

All of these distractions suck valuable mindshare, actual time, and momentum away from the transformation. Imagine:

• If this represents even 2% of employees’ time then it is 9.5 minutes a day
• Assuming a 40-hour work week, that quickly adds up to 9.5 hours/Qtr or about a week/year per employee!
• Multiplied by the number of agitated employees and their hourly rate this can add up to a pretty significant cost. For 100 employees impacted by a strategy that takes a year to implement and at an average hourly rate of $40 ($80K annual), that comes out to $166K.

Of course, this is an unscientific calculation with no justification. However, for argument’s sake, go with it for a minute. If we multiply by 50,000 employees, which many of our large global corporates have, we are talking about $83M. Of course, the counter-argument is that many of the business benefits of these large-scale transformations are predicated on a billion-dollar return being realized. $83M is chump change…but it’s not just about the short term. 

The legacies of these kinds of forced transformations tarnish the future transformations. So the 2% of employees’ time becomes 4%. It’s a spiral of ever-decreasing benefits realization over the long term.

2. Resourcing churn: This kind of cost takes many forms, including:

• Flight risk: Valued resources get nervous, fearful that their jobs will change and fearful as to whether they will have jobs in the new environment. They begin looking around and some will leave. This requires the organization to incur the additional costs of recruiting for their replacements, lost productivity while that position is open and while new recruits come on board, and lost institutional memory and the corresponding decrement in productivity. In cases where these are client-facing resources, there is the additional risk that they could go to a competitor and take some clients (or the volume of their transactions) with them.  One could put rough numbers to this fairly easily: What if two of those 100 employees left? What is the cost of acquiring a new resource? Consider the time to post the position and then to screen, interview, select, negotiate, and onboard. Hours of time goes into this and sometimes direct costs to professional recruiters. What if one of those fleeing employees took 2% departmental revenue?

• Re-org gap: Re-organizations are still practically a default tactic and we have done our share. To the extent that this is an entirely legitimate requirement of the transformation, what are the aspects unique to “muscling through”? When organizations bulldoze change they announce a re-org and check off all the required processes. They follow legal process for letting people go and often offer Employee Assistance and/or career counseling. For those staying in new roles or even in the same roles surrounded by change, they run various Town Halls and Team meetings. If lucky, within a week or two it is considered “done.”  But we have worked in organizations where this can take months. Regardless of the time taken to implement the procedural side of a re-org, the inconvenient fact is they have barely scratched the surface. There is a timeline for developing commitment to change that is not “done” with “understanding.” Positive Perception, Experimentation, Adoption, Institutionalization, and Internationalization all must follow to drive business results. What are the costs of stopping short on implementing a re-org? Most leaders probably assume that this will get worked out through business-as-usual coaching and through the performance appraisal cycles. The problem today, with the rate of change that we must accommodate, is that these operational processes are usually too little, too late. There is often a gap between installed and realized. We don’t measure benefits on adoption and institutionalization, only implementation.

3. Downgraded conditioning of the organization. Every time an organization muscles through change, it is painful and costly. Somehow, the organization carries on.  It becomes normal. However, this suboptimal performance becomes part of the way we do things around here. This may be the most insidious of costs.

It reduces employee engagement and morale.  It robs the organization of the discretionary effort that employees want to bring to a job that fulfills them. What if that represented a gap of 2% across the whole payroll? (If your resources truly earn their pay every day then this is not even a true reflection of the “cost” to the organization because the lost benefit is closer to 2% of gross profit.)

Sure, this is not a scientific approach; we don’t think we need one. Anyone can cast an eye over these examples and come up with more or better. Do your own cost analysis on specific cases if it lights up your brain.

“Free” is not free

The point here is that “changing the people” is not free to the organization. There are indirect costs that are substantial and long term.

Furthermore, there is a case to be made that one can only “muscle through” a certain degree of change. Incremental change (single silo, stepped change) can be forced through, in reasonable quantity. However, transformational change (requires Enterprise adaptation, incurs political and system adjustment, is long term and emergent) is more akin to wrestling a herd of greased pigs than it is to shearing sheep.

The larger questions that intrigue us, are: Are there better ways? Is it justified to “change the organization”?

More on this in the next post. Don’t want to miss it? You can subscribe top left.

Thoughts? Reactions? We invite you to comment.

Related posts:

• Change the organization or change the organization? The evolution of change management.  Post 2 of 3
• Will “Change Management” become extinct? The evolution of change management. Post 3 of 3
• Breakthroughs in strategy
• What’s missing from strategy execution?
• Building/evaluating change management capability

Change Whisperer by www.gailseverini.com is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License.

“All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” —Arthur Schopenhauer (1788-1860)

As the economy picks up again and as more growth and innovation strategies begin taking root again, the term “Strategy Execution” seems to be picking up steam, and formality.

What is this all about? Is this an approach whose time has come? Are organizations actually approaching execution in a systematic way? Or are consultants just promoting the next fad?

Who is talking about Strategy Execution?

On November 11, 2013, a Google search yields ~30M responses (which compares to ~699M responses for Project Management and ~48M for Change Management). Granted, this is a very blunt instrument with which to measure activity but it is interesting. Thirty million responses suggests there is some chatter.

I happen to monitor Strategy Execution because I figured out about a decade ago, on reading “Execution: The discipline of getting things done” by Larry Bossidy and Ram Charan, that this is what I do. I realized then that I had deep insight and experience in only a few components of it and set out to get an understanding of the broader picture. Even last year when I put together the series on “Strategy Execution Methodologies” it was not such an easy or straight-forward piece of work. There are many who talk in terms of principles—motherhood, if you will—but very few who can translate this into operational process.

Back in 2002/03, references to strategy execution were lower case, as if it were a category like performance improvement or operational efficiency. Not too many people were talking about Strategy Execution. Don’t get me wrong, many consultants use the phrase “strategy execution,” typically as a generic reference to a set of competences or processes, but not as a standard discipline.

Years ago, when I started looking for thought leaders on Strategy Execution, outside of the usual consulting firms who promote their services but publicly provide little in the way of research or process, I found only Conner Partners. Granted, the firm’s inception out of ODR in 2004 gave it a very OD-related perspective; however, the innovative approach was also peppered with bottom-line concepts including strategic alignment, installation vs. realization, and the integration of change management and project management. The firm has continued innovating and you can catch the latest perspectives on “Successful Strategy Execution” in this 21^st Century Business Television Series showing across various US cable networks in November 2013.

Emerging Offers

Other distinctive training and consulting offers have emerged. Here are some examples:

• Franklin Covey has added Business Execution to its list of training and consulting solutions. In April 2012, three of Franklin Covey’s senior practitioners partnered to publish “The 4 Disciplines of Execution: Achieving Your Wildly Important Goals” (Sean Covey, Chris McChesney and Jim Huling). For leaders and senior managers, this provides important high-level principles regarding execution.
• INSEAD, one of the world’s leading and largest graduate business schools, launched a Strategy Execution Program earlier this year. It also covers many of the strategic mindsets and operational concepts that leaders need to consider in taking an integrated approach to execution.
• Root Inc., formerly Root Learning, has evolved quickly over the past few years. It is leveraging its incredible capabilities in communications (icons, infographics, drawings, conceptual illustrations, and metaphors to tell stories visually) to bring insight and facilitation to the front end of creating alignment, accountability, ownership, and advocacy at all levels of the business, by giving every person in a company a system-wide view of the strategy, the objectives, and their role in that system.
• Palladium Group Inc., which was The Balanced ScoreCard Collaborative, Inc. until 2005, has been building Enterprise approaches to close the execution gap since the 1990s. Robert S. Kaplan and David P. Norton began with the“Balanced Scorecard: Translating Strategy into Action” (1996), then moved into “Strategy Maps: Converting Intangible Assets into Tangible Outcomes”(2003), “Alignment: Using the Balanced Scorecard to Create Corporate Synergies” (2006), and, most recently, “The Execution Premium: Linking Strategy to Operations for Competitive Advantage” (2008). They are continuing to build out their offers, and in September 2013 launched a three-day program entitled “Leadership for Strategy Execution.”

Of note, although a lesser-known name, Joe Evans at Method Frameworks is producing some very insightful and pragmatic tools, techniques, and approaches.

What’s that chatter all about? And why is it “hot” now?

There is a general recognition that the rate and degree of change that organizations are required to make to remain competitive is still increasing. Further, there is a level of anxiety around the low success rates that most organizations have with strategy execution (more on this in “Time to kill the phantom 70% failure rate?”).

As the complexity of strategy has increased and the pressure rises to implement faster, organizations are pressed to coordinate and deliver to higher standards. This is creating interest in the nascent discipline of Strategy Execution.

However, this is not your mother’s Project Management. Project Management emerged years ago and has continued to evolve. It has moved faster than leaders’ understanding of it. Program and Portfolio Management are still not widely appreciated. And yet, only just this August, PMI released a discussion paper on integrating change management (more on this in a subsequent post).

Agree and disagree

There is no standard definition of Strategy Execution so some approaches will agree on some components and disagree on others.

To my mind Strategy Execution is the C-Suite-to-front-line, beginning-to-end conception-to-execution of strategy—from approved Business Case to sustainable results.  This means integrating three key components:

• Determined stewardship of strategic intent.  Often strategy is handed off to the project team in the form of a Business Case and then it is iterated through Charters and Requirement documents until finally a variation is delivered. This may be fine for straight-forward incremental change however for transformational or emergent change it is radically insufficient.  To ensure a complete alignment and deep commitment to strategic intent (future state / scope), as its design is refined, the leadership team must be actively involved—all the way through to realization of results.
• Efficient organization of resources, i.e. Project, Program or Portfolio Management. Given the maturity of this capability in most organizations, this is usually the no-brainer. Conventionally this focuses on scope, timeline and budget. However, there are usually two hitches: how to integrate this with the other components and how to oversee realization of results after installation and team is adjourned.
• Vibrant commitment of people through Change Management. The more we ask people to change the way they think about their roles (identity), what they do (competency) or how they do it (capability) then the more important it is to help them through the transition.  When optimal success depends on adoption, utilization and proficiency speed (thank you, Prosci) and on discretionary effort then we must bring people along. This often requires adjustments in organizational design, compensation and even culture.

Where most thought leadership still falls short, though, is in how to operationalize these in a comprehensive and, yet flexible, approach.

Sure, there is a commercial angle here. Most of the sources noted are consultants and training providers, so if you want to know more about how to execute, you should, of course, retain them and/or take their training. Buyer beware though, in my opinion, most of these are still emergent. My own experience and networking suggests that many large organizations that have thoroughly reviewed some of these offers are still faced with cobbling multiple approaches together to create “ABC Company’s Delivery Approach.”

What is “bigger” than Strategy Execution?

As fast as we are running to help organizations become better, faster, and more effective at Strategy Execution, most organizations are also missing a bigger opportunity.

Surely it has become clear that the notion of stepped change (i.e., make a change, then milk that new competitive advantage, then later change again) is an anachronism. Organizations need to change constantly. This will continue to be a process, but it need not be an ordeal. Organizations need to develop competencies around change. They need to develop a culture of change, an appetite for change.

Many thought leaders have written about “change agility” and the “nimble organization,” but it seems that most organizations are focused on current needs rather than developing deeper capabilities.

Meanwhile, newer organizations in newer industries such as technology and communications seem to have been born into a more dynamic state. Organizations such as Apple, Amazon, and Google live to change.

Imagine the impact on our economy if all of our organizations were highly adaptable.

We are just scratching the surface of this topic.  More to come.

So, who do you follow on the subject of Strategy Execution? Or on creating a nimble culture?

Comments welcome.

The “70% failure rate” has been exploited enough already. It’s time to stop beating this dead horse and give it a decent burial.

I get why it resonates with most of us. Strategy execution is hard. Some falls short of objectives and some fails outright. The more transformational the change the more likely that it will fail in some way. We all abhor failure. Any failure feels like too much. It feels like 70%.

And I get why it is used—fear is a standard sales technique (I am recovering from this nasty habit myself). You know the drill: convince the leaders there is a high risk of failure unless they follow a different prescription. This is used internally to expand execution budgets as well as externally to tout execution services and solutions. Notwithstanding the intentions of either internals or externals, the origin of this legend was never a real statistic. Yes, you read that right. Where did the “70%” come from then? More on this below.

Furthermore, there is better data. In August 2013, The Economist published the first third-party (can anyone say “objective”) survey, “Why good strategies fail: Lessons for the C-suite.” (http://www.pmi.org/~/media/PDF/Publications/WhyGoodStrategiesFail_Report_EIU_PMI.ashx) How about we all do a three-point turn? What are the right questions to ask or conversations to have around success/failure?

First, how did we get here?

As I said above, as far as I can tell, the legendary failure rate is not an actual statistic.

Since I last wrote about this topic I was referred to an excellent article that attempts to track the source of this so-called data. The abstract of “Do 70 Per Cent of All Organizational Change Initiatives Really Fail?” (http://www.tandfonline.com/doi/abs/10.1080/14697017.2011.630506#.UoE8F_lJOHc) (Journal of Change Management, Mark Hughes, 2011) hits it hard: “This article critically reviews five separate published instances identifying a 70 per cent organizational-change failure rate. In each instance, the review highlights the absence of valid and reliable empirical evidence in support of the espoused 70 per cent failure rate.”

Let’s review that: “the absence of valid and reliable empirical evidence.” Wow. That’s pretty amazing, don’t you think?

Hughes reviews each of the five instances—you will probably recognize some of them:

• “Reengineering the Corporation: A Manifesto for Business Revolution,” Hammer and Champy 1993
• “Cracking the code of change,” Harvard Business Review, Beer and Nohria, 2000
• “Sense of Urgency,” Kotter, 2008
• “Leading change management requires sticking to the plot,” Bain and Company, Senturia et al, 2008
• “The inconvenient truth about change management,” McKinsey and Company, Keller and Aiken, 2009

For each instance, Hughes provides the original reference verbatim and also provides some context. I highly recommend this article.

The bottom line is that we don’t know, from the sources cited, what the real failure rate was at that time. We only know what a handful of pretty smart and experienced consultants / academics estimated it was based on their limited exposure.

To be fair, many academics and consulting firms have run surveys. Some consulting firms even run them annually. Their data comes pretty close to 70%. The one that comes to mind is “Success Rates for Different Types of Organizational Change,” (http://onlinelibrary.wiley.com/doi/10.1002/pfi.4140410107/abstract) Martin E. Smith, Performance Improvement Journal, International Society for Performance Improvement, 2002.

This is a “meta survey.” In other words, Smith analyses 49 surveys and drives out median success rates (the median failure rate being, obviously, the rest). What is also useful about this survey is that it identifies by type of change (e.g., restructuring has a 54% failure rate, culture change has an 81% failure rate). With that, one can arrive at a median 70% failure rate. So, maybe one can argue that there is a real 70% failure rate, or there was sometime before 2002 (11 years ago).

What’s new?

In March 2013, The Economist’s Intelligence Unit, sponsored by The Project Management Institute, initiated a survey of 587 senior executives globally and then undertook a series of in-depth interviews with additional executives and academics.

The result was a current and objective (non-commercial) touch-point on what executives believe. As noted on the PMI website:

“Key findings include:

• 61% of survey respondents acknowledge that their firms struggle to bridge the gap between strategy formulation and day-to-day implementation
• 44% of strategic initiatives did not succeed in the last three years
• 51% percent of survey respondents say the leading reason for the success of strategic initiatives is leadership buy-in and support
• Rather than micro-managing, C-suite executives should identify and focus on the key initiatives that are strategically relevant”

So there it is. These executives believe the failure rate on “strategic initiatives” is 44%.  

So while that’s a fair distance from 70%, it is still a very high risk.

The reality

So let’s review: we have looked at five original references that turned out to be opinions of thought leaders, a meta survey of 49 sources, and a survey of 587+ executives.

It seems odd, in this light, to realize that this is actually not primary research (i.e., real-time tracking of actual change initiatives on their performance against stated objectives).

This would be the real test, wouldn’t it? One hopes that inside of organizations there might be an appreciation for tracking success/failure and for improving strategy execution over time. Project management protocol calls for a Post Implementation Review and Lessons Learned, but this is rarely converted into organizational learning or harvested into enterprise best practices.

Proposal

Strategy execution is hard, damn hard. It often fails or falls short.

We may disagree on the degree of risk but no one can predict the probability of success or failure for a particular initiative/organization based on a general survey.

What if we all at least started this conversation from more relevant space? For example, “What is this organization’s experience with strategy execution? Let’s have a look at the data and see how we can help you improve your results.”

Maybe organizations would begin to think about establishing strategy execution as an organizational competency and managing it across the organization, and in working to improve their performance would drive better results to the bottom line. Now, that would be good for all of us.

Credits

Earlier this Fall, I facilitated a discussion entitled “What if it’s not true that “70% of change initiatives fail”?” in the Organizational Change Practitioners Group in LinkedIn and many experienced and insightful practitioners chimed in—some agreeing and some disagreeing. Around the same time Jennifer Frahm published an excellent post entitled “70% of change projects fail: Bollocks!” (http://conversationsofchange.com.au/2013/09/02/70-of-change-projects-fail-bollocks1/#!).  Much of my thinking above has been informed by their contributions. 

There are three basic key players in strategy execution: the Leader, the Program Manager and the Change Management Lead.

What if we partnered?

It all starts at the beginning.

The reality in most organizations is that strategy is parsed into Strategic Business Units and / or Divisions and the Leader assigns it to a Program Manager to organize (I am not endorsing this approach?I have other thoughts here).  This cascade is often one-directional and the Change Management Lead is buried deep in the project with very little access to the Leader. 

In transformational change where ROI depends on people, at all levels, changing the way they think and what they do then Change Management takes on a heightened priority.  These shifts in mindsets and behaviors, sometime shifts in culture, cannot be dictated or taught.  Rather they must be led.  The Leader and the Change Management Lead need to collaborate directly to achieve success. 

Imagine what might happen if, when Program Managers resourced a project, they tee’d up change management (CM) differently? What if:

1.       The Program Manager identified the senior change management practitioner they want to work with and introduced them to the Leader this way:

• “We have identified a terrifically qualified CM practitioner.  The only criteria we need you to sign off on is: are they a fit for you?
• The CM practitioner’s role is to help all of us address the human risks involved in implementing change.  The CM practitioner will be our guide in identifying issues and opportunities and in designing interventions.  Often the interventions have to come from you to be most effective – the CM practitioner will be your coach so it is important that you develop a close working relationship.
• When can I schedule an interview for the two of you?”  

2.       The CM practitioner entered the conversation with the Leader this way:

• “I have reviewed the initiative and I have significant related experience ….
• Based on that experience, and acknowledging that every organization and initiative is different, I expect that we will encounter issues such as ….
• This is likely to require activities from you such as …
• Does this seem likely to you? What other issues do you anticipate?
• The way I work is this … [spell out what you need to be successful as specifically as you can – have a look at this post from Daryl Conner “Addressing Sponsor-Agent Relationship Issues (free download)”]
• What else do you need from me? How do you like to work?
• Do we think we can partner up on this work?”

3.       Once retained, the relationships really need to take on a deep partnering for success: 

• Information sharing
• Brain storming
• Dynamic and collaborative decision making
• Test and learn cycles
• Feedback loops

What if you sent this to your favorite Program Managers and asked them to take it into consideration next time around?

It might open productive conversations and whole new working relationships with them also.  They may want to negotiate a few parameters to begin to get comfortable with this dynamic but that should be quite achievable. 

What are you waiting for? You want to be successful? You already know what it takes. Require it.

Related Posts:

• What’s missing from Strategy Execution?
• Change Management Methodology
• Crack or chasm between project management and change management?

I always laugh when I see the new Snickers commercials—I admit it, I sometimes even rewind them. 

They remind me that “You’re not yourself when you’re under the stress of change.” 

Have you seen Robin Williams on your projects lately? This is the “Fourth and loopy” commercial where the usually very intense and focused coach is momentarily an incarnation of Robin Williams. Very funny…because we can relate.

 “Signs of distress”

There is a point at which any of us reach our optimum performance?many of us refer to this as “The Zone.” Then, under continued pressure, we tip over and become less and less productive. We know intuitively when it is happening but we’re not always conscious of it.  

The pressure also affects our project team and the people in the organization impacted by change (change targets). 

In Managing at the Speed of Change, (1) Daryl Conner identified the signs of distress. Have you seen these in your projects? Here are some excerpts (quoted with permission):

Symptoms of low-level stress:

• Brief irritation which may divert attention from work
• Poor communication and reduced trust
• Decreased honesty and directness
• Defensive and blameful behavior
• Reduced propensity for risk taking
• Increased conflict with fellow workers
• Decreased team effectiveness
• Inappropriate outbursts at the office

Increasingly dysfunctional behaviors:

• Lower morale
• Physical symptoms, such as headaches and stomach pains
• Chronic absenteeism
• Apathy or compliance behavior
• Feelings of resignation

Severe dysfunction:

• Malicious compliance
• Overt blocking of company tasks or procedures
• Covert undermining of organizational leadership
• Actively promoting a negative attitude in others
• Strike
• Sabotage
• Substance abuse or other addictive behaviors

Tangible and measurable

What you might observe is that, as the levels of change increase, dysfunctional behavior becomes more apparent and more severe. 

You may also note that many of these symptoms pose immediate, tangible, and measurable impacts on productivity (and potentially on quality and safety), not to mention ultimate ROI of the initiative. 

Why does this happen?

Our capacity for change is limited, and yet manageable

One perspective on the capacity of humans for change comes from Alvin Toffler: “Future shock is the shattering stress and disorientation that we induce in individuals by subjecting them to too much change in too short a time.” (2) 

This sure sounds like many of the transformational initiatives I worked on early in my career. 

In Managing at the Speed of Change, Daryl designed a working definition for future shock as “that point when humans can no longer assimilate change without displaying dysfunctional behavior.” 

I have seen that switch flip. Have you?

So, what is capacity?

• “Capacity is a measure of the physical, mental, and emotional energy an individual has available to use in adapting to change. Inadequate adaptation capacity poses a key implementation risk.” Glossary, Change Thinking

Daryl explains capacity for change with a metaphor:

• “Individuals experiencing future shock are like saturated sponges. Although they are already soaked, someone walks in with another two-gallon pitcher and pours it on them. In organizations around the world, change is typically poured onto the physically and emotionally saturated sponges of the workforce while management watches helplessly as their intended objectives run down the drain.” (Managing at the Speed of Change)

We often hear targets inside of change initiatives say, “It’s raining change,” “When will it stop?” and plaintively, “When can we go back to business as usual?”

The challenge is that organizations must make so much change annually now that “business as usual” really doesn’t exist for many people any more.  

If you need your people to assimilate a change (to become proficient and even excel with it) and there is more, and perhaps concurrent, change coming, then learning how to manage capacity for change is crucial. This is a moral and a business imperative—ROI depends on it. It is a key component of organizational change management (i.e., helping people transition through change).

Fiduciary duty to optimize capacity and balance demand

Many leaders and project teams make an implicit assumption that capacity for change is unmanageable. This is both dangerous and untrue.

If you understand that change demands can put individuals and organizations under enough pressure to impair their ability to deliver daily tasks as well as impact their overall well-being, then you must acknowledge that it will become untenable at some point. Knowing where that point might be is a fiduciary responsibility. The moment it affects quality and safety, the organization has crossed into liability space.

Furthermore, if this risk jeopardizes the project ROI then it likewise requires attention.

What can we do about capacity and demand?

In the fourth post of his “Capacity and Demand” series, Daryl presents “Putting It All Together—The Mechanics of Capacity Management.” As he notes, the objective is to “determine the desired balance between demand and capacity (stretch the organization’s limits while keeping change-related dysfunction within acceptable boundaries).”

Activities should include:

• Determining current and anticipated demand
• Determining current capacity levels
• Evaluating interventions required to align demand and capacity
• Developing plans for optimizing on a rolling basis

Interventions can include the following:

• Education on the nature of change and capacity/demand: The ability of leaders and project members to identify, understand, and explain both the dynamics and risks is a powerful advantage.
• Prioritization of the overall change portfolio and consideration of the unimaginable: What if we try to muscle this all through? What could we re-schedule, re-plan, or shelve?
• Insightful change management interventions: This will prepare and engage people more, and help leaders coach their people to understand and manage their own reactions to change.
• Development of resilience (capacity for change) within this organization
• Development of a nimble organization that can adapt to change more readily

What now?

Is your project, and your team, suffering the negative impacts of change overload?

Is your ROI in jeopardy? This is serious risk. 

Four things you can do:

1. Share this blog post with your project team, and even your business sponsors. It will help them decipher what you are seeing. It validates that capacity exists, is limited, and can have very real negative impacts on the project, its ROI, and even on current quality and safety in production.
2. Introduce the Snickers bar commercial as a kind reminder that “we are all under stress and can get a bit loopy” (i.e., it’s not just about you or me—let’s support each other).
3. Read more about “Capacity and Demand” on Daryl’s blog here.
4. Consider undertaking an assessment to determine your project’s and your current organization’s capacity/demand for change, the risks, and potential mitigations.

References:

(1) “Managing at the Speed of Change: How Resilient Managers Succeed and Prosper Where Others Fail,” Daryl Conner, Random House, New York, 1992, 2006

(2) “Future Shock,” Alvin Toffler, Bantam, New York, 1984