Uncontrolled and poorly executed change significantly increases risk in organizations. This risk can manifest financially (e.g., cost overruns, unrealized business case benefits), operationally (e.g., inefficient processes, manual workarounds, control gaps, errors, change fatigue), or reputationally (e.g., service failures, regulatory censure).
Mitigating these risks requires a disciplined approach to identifying and managing risk throughout the entire change lifecycle. This blog outlines the fundamentals of an effective change management framework, covering all stages of the change lifecycle, from the initial concept and funding approval to implementation and benefits realization.
Prior to allocating scarce financial or human resources to a project, it’s crucial to evaluate it in terms of:
In essence, is this a priority for your organization? If so, allocate initial funding for a feasibility study and the development of a comprehensive business case. If not, minimize losses and consciously decide to cease further investment in it.
REAL EXPERIENCE: Triage before the work starts.
“Many organizations expend significant effort on proposals and finding support for projects that ultimately aren’t selected. While these projects may be feasible, if they don’t align with organizational priorities or meet investment criteria, they should not divert resources from more aligned projects. I recommend a ‘front door’ process to triage potential change projects before work starts. This can save time and frustration down the line.”
All change incurs cost, whether it’s internal resource allocation or external spend on vendor products and services. In today’s cost-constrained environment, it’s vital to effectively allocate limited discretionary investment funds. While most organizations enforce minimum ROI hurdle rates, payback periods and other “qualifier” metrics, many falter in scrutinizing project costs, benefits and assumptions in the level of detail required. To lessen this risk, consider these critical questions:
The single biggest change management risk is a project failing to deliver the promised benefits outlined in an investment case created months earlier and after significant expenditure. To mitigate this risk, invest time upfront validating project benefit computations and assumptions before allocating a limited investment budget. Consider these questions as part of your validation:
REAL EXPERIENCE: Challenge optimistic vendor assumptions.
“Bear in mind that when a vendor responds to an RFP, their response will likely reflect the ideal scenario (e.g., seamless onboarding, unlimited availability of business SMEs and IT resources, no infosec or other governance requirements to navigate and minimal configuration effort required on their part). Make sure you challenge any assumptions behind time-to-value claims and ask for testimonials from similar clients to verify the realism of costs and projected benefits associated with their solution.”
Funding approval should not be seen as a blank check. Make use of governance routines to monitor the vital signs of active projects to maximize return on investment across the change portfolio. For each project, regularly evaluate:
If the answer to any of these questions is no, consider necessary course corrections, impacts on forecasted benefits and whether revised costs and benefits still meet your investment criteria.
For larger projects, use formal tollgates tied to key milestones to manage the phased release of funding. With the most recent and accurate information at hand, assess whether the project remains the best use of resources.
REAL EXPERIENCE: Exercise caution when reducing scope to save time or money.
“In my experience, hastily reducing scope to cut costs or meet deadlines can have long-term consequences, often leading to manual workarounds that introduce operational risk and negate expected time savings due to errors, inconsistencies and poor controls. These workarounds then become the “new normal” because there is seldom funding or desire to make good sub-optimal processes after the fact.”
As the go-live date approaches, focus typically shifts to implementation and expectation builds. Commercial considerations and stakeholder demands can pressure implementation of change that may not be ready.
Address this risk with a disciplined approach to business readiness approval. Establish minimum go-live criteria with all stakeholders during planning and adhere to these standards in a formal “Go/No-Go” decision point.
Define clear business readiness tollgate criteria and schedule a formal “Go/No-Go” decision point with stakeholders. Consider the following factors:
REAL EXPERIENCE: Pay close attention to corrections and fixes.
“Avoid shortcuts in user acceptance testing and defect prioritization. If fixes need to be deferred after go-live, consider: Is an interim manual workaround required? Are business and customer impacts fully understood? What is the target delivery date and confidence level in achieving it What is the contingency plan if this date is not met? Are all stakeholders in agreement with proposed treatments?”
Ultimately, assess if your project delivered the benefits originally committed in the business case. Organizations often overlook tracking and reporting benefits realization. Due to the effort required to complete a project it can be tempting to move on to the next priority. It’s crucial to validate benefits and value creation as a key component of your change management framework.
If the project has not achieved the anticipated benefits, consider the following:
REAL EXPERIENCE: Embed scrutiny of benefits delivery throughout the project lifecycle.
“Benefits delivery should not be an afterthought. The solution lies in integrating rigorous scrutiny of project benefits into your end-to-end change management framework, from initial scoping through business case approval to implementation and transition to business as usual. This transparent approach will lead to more objective prioritization of competing change projects, increased accountability and improved return on investment across your change portfolio.”
With more than two decades of real-world change management experience, Bridgeforce has helped our clients design and embed change management frameworks and routines. This enables clients to identify and mitigate the financial, operational and reputational risks inherent in their change portfolios. To find out more, or to discuss how we can customize a solution that meets your specific requirements, contact us today.