CDOs underestimate the need to assess change readiness. It reflects the attitude of corporate leaders in distinguishing themselves from the pack
5 min read
People hate any form of change. It is painful and hard to adjust.
Executives have come to understand that putting off digitisation will put their firm at risk. They have not come to terms that the risk of project failure is astronomically high. Executives think they have the situation under control.
Research studies prove that the reality is far less optimistic. A study by the Harvard Business Review found that 70% of digital projects fail to transform digital immigrants into digital natives. Projects that overrun are incredibly costly in terms of resources, lost opportunities, and reputation.
While the circumstances behind every project are unique, the underlying cause of project failure continues to be the same.
Where does change readiness fit in?
Recently, I was working on a client engagement where the executives think that any form of digitisation amounts to an improvement for them even if there are cracks. I hope to convince them that digitisation can actually make them worse off if they do not take Change Management seriously. Has it occurred to them that the new system may not work if the requirements have not been well defined?
So, not all changes make things better.
Executives can get themselves burned without a proper Change Management process in place. LeadershipIQ discovered that 31% of CEOs are fired for poor Change Management.
Having proper change readiness can do more than lifting a company out of a paper-based process. It can bring about new ways of working by breaking down silos across departments. Instead of having employees from the finance department send monthly reports via email to the sales operations team, workflows can be changed to grant access so that end-users can retrieve real-time information at any point.
Having information sooner can empower them to anticipate how the month will close so that resources can be assigned to support accounts that will make an impact on the top line.
Where does the CDO misunderstand change?
CDOs are certainly not so foolish to think that Change Management is redundant.
What they don’t understand is that having change intervention right at the inception stage makes a difference.
Change management should come well before a detailed plan is developed.
Unfortunately, executives put technology first and defer Change Management to a later stage. Ironically, they get themselves into a deadlock with their vendors and delivery partners because they could not get the required information they need. Assessing Change Readiness is key:
You can avoid this if you take the 3Rs into account from day one.
How can CDOs get change management right?
Readiness is more than having the budget approved.
Change readiness is determined by whether the leadership team has a clear and unambiguous vision of the future state to bring the right resources on-board.
Sadly, they have trouble articulating what a breakthrough looks like and what it brings for them and their customers. Without this, how can the rest of the organisation accept and embrace the change that is coming at them?
Change readiness should always be the first step to take, to bring about an alignment between the leadership team and the rest of the employees.
At a high level, change readiness means knowing the scope, type and magnitude of the affected areas and parties. For example, does the leadership team know the number of employees that will be impacted? Do they know what will be changed (e.g. number of processes, workflows, targets)? Do they know how they will be changed (e.g. tools, technology, platform, restructure)?
If executives are not sure, the best thing to do is to perform a change readiness assessment.
Organisations think they have given their full requirements to their vendors.
Have you inked all of your as-is processes? Often these are not documented.
These end users are often far removed from the people that are writing the requirements.
End users can be called data consumers, or data customers. This group utilises data from various systems for reporting and forecasting purposes. This group must be consulted during a technology implementation or process change. If not, decisions might be made by their manager’s manager.
There is also another group of stakeholders that are often neglected.
The data producers, or data creators.
They have an important responsibility to create data. Often, data producers are not told what data consumers need, nor how their data is being utilised. So, there is a disconnect between the two communities. Try bringing them into a conversation together. Establish a common understanding of the quality, format, type, timing, and amount of data needed to bring about change.
Change management at the onset becomes essential to facilitate the conversation that brings out the requirements and arrive at an agreement between data producers and data consumers.
There is no point in writing a policy on how someone should capture or handle data unless it is going to be enforced. By bringing these stakeholders together, you forge an alliance of expectations and ensure your data policies are acceptable to both groups before you enforce them.
Executives are fearful that resistance from the ground will hold back their digital initiative.
From my experience, it’s not that executives are constantly denying people’s right to be heard, but rather, they don’t know how to approach it to achieve a win-win outcome.
To succeed, companies must change behaviours. Specifically; how data is created, updated, read, integrated, presented, archived and destroyed. These new policies create a fundamental shift in how data is managed and handled.
To do this effectively, executives need to deploy Change Management techniques as part of their data governance program. You can use the Change Complexity Mapping technique to do this.
How to use Change Complexity Mapping to understand likely resistance to change
While a detailed list of Change Management questions is beyond the scope of this write-up, here are a couple of suggestions that should be asked for each domain area in a stakeholder interview:
- How much change is required to get the data from where it is today to where it needs to be tomorrow?
- This is the “Complexity of Change”
- How engaged or resistant are the staff in each domain to the idea of the program?
- This is the “Resistance to Change”
You can map stakeholder responses in a two-by-two matrix as shown in the diagram below. The “Complexity of Change” is along the vertical axis. The “Resistance to Change” is along the horizontal axis.
Using the Change Complexity Matrix
Now you’ve mapped use cases by complexity and resistance, how do you make sense of the results? See below:
- The Sweet Spot. The blue quadrant is what I’d call the sweet spot as it denotes areas that are low in both complexity and resistance. Resolving issues can be done here with minimal effort, so don’t sweat over it.
- Bloody Deadly. The red quadrant is the exact opposite where complexity and resistance are high in both regard. The amount of changes needed will practically bring about a reorganisation. Worst of all, there could be a conflict of interest among individuals advocating change while trying to save their jobs.
- Don’t Do It Alone. The top left yellow quadrant denotes areas that are low in resistance but high in terms of complexity. So issues here require a collaborative team effort and people are more likely than not to contribute their part because resistance is low.
- Offer An Olive Branch. The bottom right yellow quadrant issues are low in complexity but high in resistance. Stakeholders in this quadrant are unfortunately brushed aside because new initiatives happen without them. To solve this, use your empathy. This means you need to listen. Become invested in another person’s perspective even if you disagree with them. Extending an interest in their concerns has enabled me to gather information to raise a case to minimise the pain for affected parties.
How does this help with change readiness?
The idea is to provide a visual framework for executives to evaluate how much resistance they can expect to face, and then assign priorities and resources to overcome them.
From my experience, most cases will unfortunately fall within the red quadrant.
Executives face many issues ranging from new government regulations, new competitors, new technology trends all of which elevate their level of risk. This causes them to trample on their employees’ emotional upheaval. That is why, without a change readiness plan to establish new ways of doing things, most transformation efforts run the risk of becoming complete failures.
Internal change agents may be too fearful of the consequences to be blatantly honest when they are mapping out the issues. Their roles within a company might not be senior enough to risk ruffling feathers. That is where Change Management consultants can enter to provide an independent cool-headed mindset to look at a company’s set of circumstances.
Putting change readiness to use
In closing, executives think that these trivial matters can be dealt with later, especially if a corporate restructure is part of the digital plan. Change Readiness is about putting Change Management up-front and not halfway in a project. It will save executives a lot of firefighting later on.
So if you’re making plans to go digital, I hope the change process takes the driver’s seat for you and your team. Let me know what other considerations you have.
About the Author
I have spent most of my career helping executives in growth strategy and digital transformation.
With over 10+ years in market positioning and tech innovations, I have advised decision makers on their long-term vision and strategy.