I remember back in the 1990’s when I became a project manager. I especially remember my first project management course, in 1991, where the instructor dramatically announced that more than 50% of projects fail.
And today, in 2016, not much has changed. CIO magazine reports that the failure rate remains about the same.
McKinsey: 73% of transformation projects fail. 1 in 5 projects fail so badly that they threaten the existence of the business.
Why is it in this time we have not been able to solve such a fundamental problem? And what does this mean in an increasingly changing and volatile world?
Einstein: We cannot solve a problem with the same thinking that created the problem in the first place.
Incorrect underlaying assumptions
I am suggesting that some of the underlying assumptions of change management are incorrect.
So what makes me make such an outrageous statement?
Let’s go back to the very beginning. One of the core drivers in business is growth. Growth comes from increased productivity.
But there is one asset class, employees, that shows very different and unpredictable productivity behaviors.
This caused Human Resources Management (HRM) to emerge, followed by Organizational Behaviour (OB). HRM and OB attempts to solve the employee productivity problem by making the following connections:
- Increased profits come from growth.
- Growth comes from increased productivity.
- Increased productivity comes from increased motivation (changing behaviors).
- Increased motivation and changing behaviors come from rewards.
It then stands to reason that all we need to do is to address the rewards to achieve increased profits. Yet as we all know, it doesn’t quite work that way. But why not?
The problem lies with rewards. This observation itself is not new, and led to the concepts of rewards of an extrinsic (financial) and intrinsic (motivational) nature.
Herzberg, back in 1959, published the two-hygiene model that demonstrates that extrinsic rewards can not make us happy, only ‘not unhappy’.
Happiness lies in intrinsic rewards, and herein lies the problem.
Australian Institute of Management: 61.9% said, ‘A sense of meaning and Purpose in my job keeps me engaged’, while 30.1% said, ‘Reward and recognition keep me engaged’. – 2006
Gallop USA: Only 3 in 10 employees are actively engaged in the business, whereas 2 in 10 employees actively detracts. – 2013
This demonstrates a significant disconnect.
I believe the disconnect is because we complicate things. We may be able to develop complex models of change, change management, motivation, rewards etc, but if they don’t contribute to business success, what use are they? Do we simply use existing change management theory because we have nothing better?
We complicate things for ourselves
Let’s go back to the basics and look at it through simplicity, rather than complexity. I believe it is very simple.
Employees either change because they want to, or they have to.
When employees have to change, change fails. Plain and simple. The key lies in making employees want to change.
How do we make employees want to change?
There is one thing that takes change and change management to a new level entirely, and that is passion and purpose.
Passion is not a metric, or model, or process, or anything we can manage. Passion naturally occurs when we do what we love doing, and change leadership is about making a connection between passion and profit.
Change leadership is the missing link
The process I use can be summarised along the following lines:
- Be crystal clear on the business’s values and purpose.
- The value and purpose is passionately embraced by CEO.
- Know who the passionate employees are.
- Match passionate employees with important projects to drive change on a grass root level.
- Add passion as a core recruitment criteria.
Have you used passion and purpose to drive successful change and transformation? Do you see a role for change leadership in your organisation?
He is a published author of two books on transformation. Both are available on Amazon.
- ON PURPOSE – The Path to Extraordinary Business Transformation.
- FROM ORDINARY TO EXTRAORDINARY – How to Re-Imagine Yourself and Re-Define what is Possible.
Jesper is Swedish and apologises for any Swenglish creeping into his writing.
Latest posts by Jesper Lowgren (see all)
- Enterprise business transformation is only 26% successful. This is how you succeed! - October 5, 2016
- Purpose or Perish: Separating Fact from Fiction - September 28, 2016
- To Platform or to Perish.That is the critical CEO question! - September 20, 2016