Change Project Success IndicatorsSurvey Results

3/03/2014

Executive Summary• Change Factory is investigating the factors that lead to change

management project success or failure. By participating in the survey, respondents help validate theories about what works and what doesn’t. Leadership, user engagement, training and communication were some of the influencing factors investigated.

• The key factors found to influence the success of a project include:• Documented strategy• Communication• Analysis of resistance and risk• Engagement tactics

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About Change Factory• Change Factory transforms businesses by changing people’s behaviour.

• Change Factory is a Melbourne-based consulting company that specialises in change management and business transformation. We work across Australia, Pacific Islands and South East Asian countries.

• Our services include:

• Building change capability• Developing people• Driving performance • Creating strategy

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Purpose of Change Factory’s Survey• Change Factory is investigating the factors that lead to the success or

failure of a project. This presentation is the first round of analysis from around 76 organisations around the world.

• Currently, there exists many myths, self-help books and numerous models to explain how to manage a successful change project, however, change managers are still uncertain as to how specific factors lead to the success of their specific project.

• This presentation demonstrates the correlation between a success of a project and specific factors, such as communication, training and documented strategy.

• This presentation is filled with numerous hyperlinks to provide the reader with more research and best practice articles. To access these links, please have this in full presentation mode.

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Some published results

1993 Hamer and Champypublished their estimate of 30% success rate

2008 Kotter observation of 100 companies: 30% success rate

2009 McKinsey study: 68% success rate

2013 Economist: 56% success rate

• The most well known statistic for failed change projects is ‘70%’

• However, that figure had been based on ‘observations and estimates’ that do not produce valid and reliable data.

• It was only in 2009 that McKinsey produced more valid data, showing that more than half of the projects succeeded. These statistics are very similar to those found in Change Factory’s current research

• The irrational side of change management | McKinsey & Company

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SURVEY CRITERIA

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Factors Investigated During the Survey1. Organisation demographics2. Strategy3. Tactics and Planning4. Integration to business as usual5. Implementation6. Measurement and Outcomes

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Types of Respondents

Questions Data

Number of organisations respondents >100 organisations filled in the survey. Projects were based around the world, including Australia, USA and South Sudan.

Completed projects 72%

Near completion 9%

Incomplete 12%

Year completed Most projects were completed in 2013 (48.7%)

Demographics

Length of Project Number of people affected

0.0%5.0%

10.0%15.0%20.0%25.0%30.0%35.0%40.0%45.0%50.0%

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1-49

50-9

9

100-

199

200-

499

500-

999

1000

-199

9

2000

-499

9

5000

+

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Position During Project

0.0%

5.0%

10.0%

15.0%

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25.0%

30.0%

35.0%

40.0%

45.0%

Project manager Part of the project team Project sponsor Department head affected bythe project

Other

Position during Project

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THE RESULTS

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What is a successful project• Change Factory is measuring three aspects required for the

success of a project:

1. Delivered in the allocated timeframe2. Delivered in the agreed quality measures3. Demonstrated a return on investment

• Although there are other factors that lead to the success of the project, these factors have been investigated in the question looking at internal success criteria. These criteria are based on previous result conducted by Change Factory

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Was your Project a Success?

84%

68%71%

66%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Successful Time frame Quality ROI

Success rate

• When asked ‘Was your project considered a success?’, 84% of respondents responded yes.

• However, when asked more detailed questions around meeting timeframes, quality measures and ROI (what Change Factory believes are the minimum success criteria of a project), a significantly lower number of respondents answered positively.

• In this survey, Change Factory uses 3 factors as the key criteria of a project succeeding – Timeframe, quality and ROI

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Internal Criteria of Success• A large number of respondents

measured their projects success by an increase in revenue and productivity.

• Engagement was considered to be the third most important internal criteria of success.

• Later in the presentation, it is demonstrated the importance of engagement in meeting the three criteria of success

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Increase ofrevenue

Increase ofproductivity

Engagement ofemployees

Use of product Increaseorganisationalengagement

Internal Criteria of Success

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Explanation of the Data Graphics• The following bar charts in this presentation depict Change Factory’s 3 main

factors of a success of a project:

1. Timeframe 2. Quality measures3. ROI

• The green bar depicts the success rate that had the title element (for example, documented strategy)

• The red bar depicts the success rate of projects that did not have the title element.

• Results, where a significant impact was found by including or not including a title element within a project, are part of the survey results. For example, where a documented strategy was included or not included. Based on Change Factory’s experience, research and observation, comments have been included on probable causes

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Explanation of the Data Graphics

66%

77% 76%

46%

70%

46%

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70%

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90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Documented StrategyThe green bar depicts overall successful projects that had the title element (for example, documented strategy). In this case, those projects that were deemed a success and had a documented strategy were more likely to be successful than those who did not have a documented strategy.

The red bar depicts the success of projects that did not have the documented strategy. This clearly shows that if there was no documented strategy, the success rate for reaching the quality measures dropped significantly.

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RESULTS: STRATEGY

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Documented Strategy

66%

77% 76%

46%

70%

46%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Documented Strategy • If a project had a documented strategy, it was more likely to notmeet the project timeframe. In Change Factory’s experience this could be due to a documented strategy taking longer to develop and the leadership team implementing longer decision making processes

• By having a documented strategy, there is a significant positive impact in projects reaching their quality measures and achieving ROI

• Implementing Strategy -Change Factory

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Analysis of resistance

65%

72%75%

56%

72%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No Yes No Yes No

Time frame Quality measures ROI

Analysis of resistance• Conducting an analysis of

resistance does not have a positive impact on timeframe, it did have a significantly positive impact on the quality measures and ROI being reached.

• From our observations, measuring resistance of the employees undergoing change allows the leaders to ensure there are solutions in place to get employees engaged in the change process.

• Investigating Resistance -Change Factory

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Risk Analysis

69% 68%

84%

44%

73%

52%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Risk analysis• Conducting a risk analysis at the

beginning of a project allowed for more projects to reach their quality measures and ROI.

• In our experience, conducting risk analysis allows project managers to prepare for the possible risks that could derail a project.

• Managing Risk – Change Factory

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Critical Success Factors

71%

52%

74%

57%

71%

43%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No Yes No Yes No

Time frame Quality measures ROI

Critical success factors• A project team that measures

critical success factors are more likely to achieve the three main success factors than those projects that do not measure critical success factors.

• By consistently measuring the success factors, the project can be assessed as to whether it is meeting the factors required to label it a success.

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RESULTS: TACTICS AND PLANNING

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Communication Strategy

66%

74%77%

57%

74%

48%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Formal communications strategy • Implementing a communication strategy in a project may push the project time frame out, however, by having formal communication documentation, there is a significant positive impact on the meeting quality measures and ROI

• Implementing an effective communication strategy encourages engagement during the change process

• Communication choices during Evolutionary Change –Change Factory

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Communicating the Benefits

79%

46%

83%

46%

79%

38%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Calculated benefits • Clearly communicating the benefits of the change to employees positively impacts on the success of the project in all three factor.

• In our experience and from our previous research, this clearly follows the principle of ‘what’s in it for me?’ and its benefit of communicating. By clearly communicating the benefits, employees are more engaged and more likely to work towards the success of the project

• Driving EDRMS Adoption | Change Factory

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RESULTS: INTEGRATION TO BUSINESS AS USUAL

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Change Factory’s Engagement ModelLevel Description

1 Understanding the change and the details of the program (the WHAT)

2 Believing in the change (the WHY) and believing it will benefit them

3 Prioritising and caring about the change (the WHEN)

4 Planning to make the change (the HOW, WHO and WHERE)

5 Implementing the change (the DO)

Click here for more information from our websiteEmployee Engagement – Change Factory

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Engagement: Understand the purpose of the change

69%

60%

73%

40%

68%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No Yes No Yes No

Time frame Quality measures ROI

Understand the purpose of the change • When employees are clear about

the purpose of the change, the success of a project increases significantly

• What the purpose of the change is will vary in levels of importance to employees. Most employees respond more to one of the following when the purpose is reflected in:

• The individual• Colleagues• Organisation• Society• Environment

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Engagement: Care about Change

69% 68%

80%

46%

64%

55%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Managers care about the change• Surprisingly, managers caring

about the change do not have a significant impact on keeping within a timeframe or going above it

• However, it does not have a large impact on whether quality measures were met within a project and slightly less of an impact of whether the ROI was met.

• In our experience, managers caring about a project are more likely to make them prioritise meeting the quality measures.

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Engagement: Prioritise changes

70%65%

83%

35%

73%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Prioritise the change in day-to-day jobs

• Another surprising result was that for those who prioritised the change versus those who didn’t prioritise, didn’t have a significant improvement in reaching the timeframe

• Possible reasons could be that prioritising changes concentrated more on meeting the quality measures, thus having an impact on the ROI

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Engagement: Plan the change

68%65%

84%

32%

74%

42%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Plan the change • The most significant difference in meeting the quality outcomes, was impacted by whether employees plan the change in their everyday work

• Employees who plan the change in their everyday work were more likely to achieve the success factors of the project from our observation. This high level of engagement in the change project significantly impacted the projects success

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Nominated manager for business unit

70%

55%

80%

45%

77%

35%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Nominated manager for each business unit

• Engaging a nominated manager to look after implementing the change in separate business units significantly leads to the success of a project

• From our observations, by having a nominated manager in business units affected by change, they were more likely to have a type of ‘change champion’ to advocate the change.

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IMPLEMENTATION

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Post implementation support

68% 69%

78%

44%

70%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Yes No Yes No

Time frame Quality measures ROI

Post change implementation support • Unsurprisingly, providing post

implementation support had a positive impact on the quality measures and ROI of the project. However, a number of organisations did not provide post implementation support.

• Post implementation support could include the continuation of change champions, post-implementation training and opportunities to speak to ‘change experts’

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FINAL NOTES

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What was old is now new again• Change Factory conducted research to investigate the impact of certain

factors on the success of a project.

• Based on the analysis, it was found that the following factors had the most significant impact on the success of a project, specifically on timeframes, quality measures and ROI.

• Documented strategy• Analysis of resistance• Risk analysis• Critical success factors• Communication strategy• Communicating benefits• Engagement strategy• Nominated manager• Post Implementation support

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Questions• Please contact Change

Factory’s research team, if you have any questions about: 1. How we analysed the research2. Any findings specific to your

future projects3. Change Factory’s change

management services4. Booking your 30 minute

consultation5. Ideas for future research

Rohita Atrirohita.atri@changefactory.com.au

+613 9614 8177

www.changefactory.com.au

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