Why human-centric change management is key to transformation success

Beyond financial support, a human-centric change experience is vital to the success of transformation efforts.

With the COVID-19 pandemic precipitating many changes and greater uncertainty, organizations have had little choice but to accelerate their transformation efforts. Some organizations might have been adept at managing adaptive changes in the past, including the iteration of existing products, software upgrades, downsizing job roles or hiring new talent. However, they now find themselves challenged by the complex demands of larger transformational changes in the form of redesigned business models, M&As, culture shifts, remote working and new technologies. Be it small-scale adaptations or large-scale transformations, the agility and resilience of employees in adapting to organizational change have been tested time and again.

Even without the weight of the pandemic, transformations are hard. According to a study, which examined 128 global companies, 78% of organization change efforts were unsuccessful between 2016 and 2020, largely due to a lack of focus on inclusive initiatives for people.¹

To cushion businesses from the impact of the economic fallout from the pandemic, governments have offered fiscal stimuli to enable them to stabilize, transform and grow. In Singapore, the Government has offered numerous grants and schemes to support businesses in their transformation journeys. For example, the Enterprise Development Grant offers 80% funding for projects that help businesses upgrade, innovate or venture overseas. The Productivity Solutions Grant further supports companies’ adoption of IT solutions and equipment to enhance business processes in the face of the pandemic. Another example is the SkillsFuture Enterprise Credit, which encourages companies to embark on enterprise and workforce transformation projects with a one-off S$10,000 credit to cover up to 90% of their expenses. Such support schemes seek to empower companies to use this opportune time to undertake transformative changes in a sustainable manner.

Yet having the means to invest in transformation is only akin to preparing for a battle. Organizations are often let down by poor change management. When a company’s people are not fully with it on the transformation journey, it has arguably lost half the battle. Organizations typically face three common issues: inadequate stakeholder buy-in and resourcing, culture and resistance to change as well as poor measurement of change effectiveness.

Inadequate stakeholder buy-in and resourcing 

Organizations that do not fully understand the value of change management or underprioritize people-focused activities tend to dedicate insufficient resources to manage the change process. This can leave them unprepared for people-related risks that require greater cost and effort to resolve.

Organizations must be clear on who the impacted stakeholders are in the ecosystem — and this may well extend to vendors and partners beyond the organization. To secure shared buy-in from a potentially large and diverse community of impacted people, it is necessary to conduct a stakeholder analysis that segments all impacted stakeholders into different groups (e.g., influential, directly impacted, indirectly impacted, interested) and analyze each group’s nuanced needs, expectations and risks.

In addition, conducting a change impact assessment will help identify current processes versus future ones and the resulting change impact. Organizations should anticipate the types of activities, training, communications and resources that will be required to ease the transition for each stakeholder segment or risk facing a lack of employee support.