Wednesday, 18 January 2017

How to Convice Leaders that Change Management is Worth the Investment

The evidence is conclusive: excellent change management increases business outcomes of change initiatives. Why is this so difficult to communicate to business leaders?

Change management return on investment (ROI) is a popular topic at conference workshops and on LinkedIn chat groups. People are keen to demonstrate the investment case for change support so they can secure the resources to provide it. How can we prove that change management is worth the investment?

This is an important question because many leaders need to be convinced of the financial value of change management. It's more difficult to justify compared to technical guidance because it has fewer tangible measures. Leaders typically understand technical support is required to successfully install a new system, but may not feel that leadership coaching is essential or even necessary throughout the transition. "We have managed without it in the past; why should we spend the money to provide it now?"

The challenge is not about lack of data. Many acclaimed and credible organizations  Bain, Gartner Group, HBR, KPMG, IBM, McKinsey, Oxford University, Prosci, Towers Watson  have studied business transformations for decades. Most proclaim greater likelihood of achieving desired outcomes and higher ROI when people are well-supported through change.

So what's the issue? Statistics by themselves are not convincing. They are data points that lack context or examples; numbers alone rarely influence thinking or behaviour. Also, generic data can raise questions and skepticism about its relevance to a business' circumstances  does the data reflect my industry, geography or business environment?

Last week, a colleague and I tried a new approach when conveying the value of change management. We used a simple narrative, metaphors and statistics to build the business case. The story began with why transformations fail and destroy value. An iceberg metaphor (inspired by Torben Rick) conveyed the striking research. High-level statistics were positioned above the waterline and contributing factors placed below it. 

We shared examples of initiatives that had struggled and what we had done to realign them. We also inquired about past initiatives that had failed and why. The illustration and statistics guided the discussion without leading it.


Moving to the value creating side of the equation, we used a mountain metaphor to convey statistics advocating change management support. The tallest mountain represented the higher ROI gained from excellent change management programs. Below the peak were growth-multiplier statistics to reinforce the higher ROI. 

A smaller mountain provided a ROI comparison with organizations that had poor or no change support. Finally, a statistic on the importance of leadership sponsorship to success completed the change management support picture.

We shared stories of successful initiatives and what made them so, and heard about the company's past successes and how they had been achieved. The discussion progressed to how these benefits could be consistently achieved in the future. 

By themselves, statistics do not make persuasive cases. Painting pictures around them through simple metaphors and stories brings them to life so they are more tangible and relevant. The best investment case is the one that the person you are trying to convince helps build. Pictures and stories give them the tools to do so.

Phil




2 comments:

  1. Very well defined the change management is worth the investment .the point is very well explained with the help of diagram which is very easy to understand the concept of the gartner group

    ReplyDelete
  2. Thank you Allington. It is great to hear and I appreciate your feedback. I am now collecting new statistics and will customize the diagram based on the data that best addresses someone's need. Phil

    ReplyDelete