Whilst the availability of frameworks such as Val IT, and others, can help enterprises implement or improve their value management practices, at its core, any initiative to implement or improve value management is about organizational change. Over the past couple of decades, many enterprises have undertaken programs to improve corporate performance, yet many of these have failed. The underlying cause of these failures is that most failed to persuade groups and individuals to change their behaviour.
Here, even the use of the term “organisational change” can set false expectations by overlooking the emotional aspects of change. George H. Sejits and Grace O’Farrell of the Richard Ivey School of Business in London, Ontario wrote “One of the more important reasons that change efforts fail is that the idea of ‘organisational change’ is an illusion. Organisations do not change. It is the individuals within organisations that change their behaviours. Unless the need to change is perceived as an effort to create positive outcomes including…the expansion of personal power and a more interesting job, individuals can be expected to resist the initiatives that are part of the overall change effort.” In the context of value management, this can be even more difficult as it is individual board members and executives that are being asked to change their behaviour – behaviour that they may feel has served them well in the past.
Effecting change requires a well-defined and disciplined change management program. Such a program depends upon a number of critical success factors. One is strong and visible executive championship. Another is a clear and realistic vision of the future state. Another is adequate resources – change almost always requires an investment in expertise, funding, and infrastructure over and above the normal costs of conducting ongoing business operations. Management of the program must also be flexible enough to change the journey and, possibly, the destination as more information is known and/or internal or external circumstances change.
A critical element of any change management program is communication – a change-related communications plan should address the following four elements—as defined by William Bridges in his book, Managing Transitions :
• Purpose: Why are we doing this?
• Picture: What will it look like when we get there?
• Plan: How will we get there?
• Part: What will be my role, both in getting there, and when we get there?
While all four of these elements are important, it is the last one—What is my part?—that is typically the most challenging. Make sure that not only is the question “What is in it for me?” answered, but also, and perhaps even more importantly, recognise that resistance to change, whether calculated or unconscious, is a common challenge when working with both individuals and groups. Naturally, people question why change is necessary and wonder whether it will hurt them – it is “loss” which most people fear most of all from change. The initial reaction to change is “What am I losing?” Take the time to understand and acknowledge what benefits, rights, privileges or freedoms key stakeholder groups believe they are losing – again, don’t forget that individual board members and executives are human beings with emotions too – they will also be feeling this way, possibly more than others.
Don’t forget the reward system. As another colleague of mine once said “The good thing about reward systems is that they work – the bad thing about reward systems is that they work!” Align the reward system with the desired future state. Provide incentives for change. Define how achievements will be measured. And link these objectives to outcomes within the scope of each individual’s responsibility.
As Albert Einstein said, “The definition of insanity is doing the same things over and over again and expecting different results.” Introducing change is never easy – but it is necessary if we are to realize the full value of IT-enabled change.