Cross-industry studies ascertain that strategic change projects have high failure rates - perhaps as high as 60 to 70 percent. The most frequent example of failure: the erosion of the original strategic change objectives, resulting in only incremental gains. For all your efforts, strategic change projects should bring dramatic, noticeable, and profitable changes!
The failure to achieve solid, long-lasting results is a by-product of several typical problems with predictable root causes. The most common pitfalls in strategic change projects are:
To prevent these pitfalls, enterprises should conduct a mid-course quality checkup. In an effort to uncover potential problems, team members can rate themselves and their progress against specific critical indicators. The checklist contains items which change experts who are experienced in industry, consulting, and case research consider important for successful strategic change projects. The evaluation process looks at areas such as sponsorship, strength of the governance structure, clarity and strength of the business case, resources, participation on the project, benefits, and the change management dimension. The process is straightforward and swift.
Long frustrated by inadequate management attention, one company's project team decided to take the difficult step of performing a self-assessment to highlight risk and opportunity areas for their Marketing process creation project. They used the Strategic Project Performance Check-up which helped this organization change behavior within its project governance structure.
The Performance Checkup is a quality assurance tool for project evaluation. It provides definitions of each criterion and a standard rating scale for guidance. Facilitated by an unbiased change management practitioner, the team could openly discuss project performance across subprojects, identify risk areas, and recommend improvements and remedies where appropriate. Within weeks, they were sharing the information frankly with their Steering Committee.
The results: within a short period of time, the Steering Committee began to monitor the project with enthusiasm, actively and personally redirecting the project.
Such a technique has been used in other organizations to examine several projects in relation to each other and to identify common dimensions of strength or weakness across projects. For instance, a portion of the checkup results from one organization are shown in the table below. Scores range from 10 (Excellent) to 0 (Poor).
A look at the data (shaded in table) in this case shows that on average, the company does very well on the Information Systems and Technology dimension of all projects. This is due to the I/T organization playing a prominent leadership role in strategic change and providing a large complement of resources to each of the strategic change initiatives. Across the other axis, the Order Fulfillment project is in trouble, with an average score against all criteria of 3.4. Two of the critical project dimensions inhibiting this project are Strategic Context and Team Participation.
The Order Fulfillment process creation is difficult because the company is going to be supplementing its established products with whole new product and service lines. The strategic uncertainty regarding business direction and offerings, however, means that the project can only reengineer Order Fulfillment for the classical and low growth products. Additionally, in this part of the business, they have not assigned project team members full-time. As a result, the line business team participation is weak and the project is driven by the full-time Information Technology personnel.
In both cases, the business organization used a Strategic Project Performance Check-up to surface issues and gain consensus for changes. In the first case, subprojects within a single initiative were evaluated. In the second, multiple projects within the overall company were assessed. In both cases, the strong and weak dimensions of the projects were identified and evaluated against standard change management practices recommended throughout industry. Overall, by taking the opportunity to assess your own projects in mid-course, corrective actions can be executed, and you can "beat the odds" so often referred to in change literature. With this approach, you can reduce the risk of failure and experience a greater probability of success in meeting your strategic change objectives.If you or your colleagues have questions about how such an evaluation could be applied within your organization, Hoskins Davis would be pleased to discuss strategic change best practices with you and determine whether a Strategic Project Performance Check-up would provide value to your company.