Reasons for Failure of Change Initiatives - Literature review Example

?REASONS FOR FAILURE OF AN ESTIMATED 66% OF ALL CHANGE INITIATIVES of Introduction Organisations seeking to succeed in the long term cannot bask on previous success. They must continuously remodel and position themselves as the best competitors (Randall & Coakley 2007, p. 325). As asserted by Charles Darwin, “it is not the strongest of the species which survive, nor the most intelligent, but rather the one that is most adaptable to change” (Ismail 2011, p. 2). Likewise, organizations must embrace change to ensure that they remain competitive. Change initiatives come under different names such as total quality management, restructuring, cultural change and rightsizing among others (Ismail 2011, p. 3). The main drivers of change include mergers and acquisitions, innovation, technological change, decreased sales or market share and reorganization. Other drivers of change are globalization, a sense of urgency and the case when 75 percent of the leadership in an organization honestly gets convinced that the organization, as it is currently, is not an acceptable plan (Kotter, 1995, p. 3). However, the main motivation behind organizational change is to enable it to deal with a new and more challenging market by introducing changes to the way it conducts it activities. Despite the critical role that organizational change plays, failure to maintain significant change occurs time and again (Kotter 1995, p. 3). This is even despite the fact that a significant amount of resources is invested in such initiatives as highly talented human resources and high capital investment. As noted by Ismail (2011, p. 3), changes intended to target improvement of quality, enhance culture and turn around corporate collapse only end up giving lukewarm results. They assert that more than 66 percent of these change initiatives fail miserably (Ismail 2011, p. 4). The paper seeks to presents the reasons behind such high failures of organizational changes. Reasons Why Change Initiatives Fail According to Kotter (1995, p. 3), after observing various organizations – be they large or small organizations – introduce change, only a few have been successful. Most of these change initiatives fail during the course of their implementation. The basic lesson learnt from the successful initiatives is that the process of change goes through phases which require a considerable length of time. In case a step is skipped in the process of change, the organization can never get satisfying results (Harris 2006, p. 37). In addition, any mistake made during any of the steps can spell doom for the success of the initiatives. One of the major mistakes which can lead to failure of the change initiative is failure to establish a large enough sense of urgency. Every successful change initiative starts when some persons or a group in an organization assess the competitive situation, technological trends, market position and financial standing (Harris 2006, p. 38). After identifying any drawback in the performance of the organization, such individuals are able to communicate such information pointing out to the potential risks and the potential opportunities available. In organizations which go through successful change, such information is communicated in a timely manner and the organization begins aggressive measures to bring changes. However, some organizations fail right from this initial step. As stated by Cummings (2008, p. 37), people are the greatest impediment to change. Consequently, when a proposal to bring changes to the organization are suggested, organization executives start feeling that introduction of changes can result in reduced morale among employees, the senior management will be apprehensive to such change proposed and that change may run out of control. Additionally, the executives may fear that the change could negatively affect the short-term targets of the business, that the stock prices would be negatively affected and that they can be blamed for causing crisis in the organization (Cummings 2008, p. 37). Senior management is to be blamed for lack of leadership to introduce any proposed changes (Rayner, Russel & Lorenzoni 2008, p. 373). They explain that most organisations lack of leaders but instead have managers and this is the cause of such change failure. The role of the management in an organization is to keep organizational risks at minimal level and ensure that the current systems are running. However, change requires creation of new systems and this demands leadership. Therefore, the first phase of introducing organizational change cannot progress until there is real leadership in the top management of the organization. The leader is required not only to play safe but also must pump a sense of urgency into the organization. According to Stanleigh (2008, p. 35), a sense of urgency is only present whenever 75 percent of the top management in an organization is convinced that “business-as-usual is totally unacceptable” and anything less than this can cause problems to the preceding stages. The other mistake which leads to the failure of more than 66 percent of the change initiatives is whenever an organization is not able to create a powerful guiding coalition (Bourne, Neely, Platts & Mills 2002, p. 1288). Although most change initiatives begin with one or two individuals within the organization, this leadership coalition grows with time. Nevertheless, in case no meaningful gain in the number of change agents is achieved early in the process, this leads to the failure of the initiative. In successful change initiatives, the change team comprises a powerful coalition in terms of information, expertise, title, reputation and relationship. Although in both small and large organizations, the guiding coalition of the change initiative may comprise three to five persons in the first year, in large organizations such number requires to grow to about twenty to fifty individuals before such process can transit into the third stage (Kotter 1995, p. 5). The senior management of the organization acts as a core group in the change but the team may also include board members, a representative of the customers and a powerful union member. Given that the guiding team comprises members from outside the senior management team, the organization should facilitate operation outside the hierarchy of the organization as failure to do so makes the representation of such members in the group inconsequential. The guiding coalition also requires a person to bring them together in assessing the organisation’s operating environment (Kotter 1995, p. 5). Organisations which fail in this phase have a history of lack of team work and underestimate the role of the described coalition. Lack of a vision is another cause of failure in organizational change. A vision clarifies the direction that an organization needs to take (Ismail 2011, p. 6). Initially, after organizational change is proposed, the draft strategy developed for achieving the proposed vision is usually blurred. Nevertheless, as the guiding coalition works together for several months, a better strategy is developed through the process of analytical thinking and brainstorming. Lack of sensible vision implies that the change process translates into a number of incompatible and confusing projects that can drive organizations into wrong directions. Organizations which fail at this phase have various plans and directive initiatives but have no vision. In the less successful organizations, the management had a picture of the place they intended to take the company, although this is too complicated or blurred. According to Ismail (2011, p. 6), a clear vision is one that can be communicated in less than five minutes and a response is received, which signifies both interest and understanding. The other factor attributed to over 66 percent change initiative failure is under-communication of the vision (Kotter 1995, p. 7). Although an organization can develop a clear vision, it may opt to communicate such a vision to other stakeholders during a single meeting or sending out a single communication document. The result of such an approach is that the employees do not get to understand the initiative and this causes its eventual death. In addition, there are some organizations where the management invests considerable time making speech to the employees about the proposed change. In such an approach, the employees are not able to understand the initiative either and cause its failure. Another pattern of communication that causes failure in change initiative is whenever resources are invested in developing newsletters and organizing speeches, but the senior executives are hostile to the overall vision. The effect of the three forms of communication is that cynicism in the organization increases (Kotter 1995, p. 5). Successful organizational change is only achieved when the majority of people in the organization are willing to help achieve the vision by making sacrifices. Employees are only ready to make sacrifices only when they believe that the proposed change is useful and this can only be achieved through credible communication. Credible communication help capture the minds and hearts of all the people to drive the strategy. Communication is undertaken in both words and deeds and therefore, the management must demonstrate change in behavior to be consistent with the words (Ismail 2011, p. 8). The other cause of failure of over two-thirds of the change initiatives is the inability to remove all the obstacles that can derail the new vision. Some of the obstacles which undermine change are the present organizational structures. Constricted job categories undermine any efforts of enhancing productivity within an organization or even make it hard to think about the customers (Cummings 2008, p. 37). Some performance and compensation appraisal systems within an organization can make employees opt for self-interests instead of the organizational vision. The other barriers to change are senior managers who refuse to adopt to change and continue making demands which contravene the change efforts. To ensure successful change, an organization must be able to identify any obstacles to change and have such blockers removed. In case it is a person, it is critical that the organization takes bold steps to have such individual removed in conformance with the new vision. The major obstacles should first be removed, be they on the current systems or the people barriers (Cummings 2008, p. 37). Lack of systematic planning and creation of short-term goals are another cause of failure in the majority of change initiatives. As explained earlier, real organizational change takes time to occur. Consequently, efforts geared to change can lose momentum in case there are no short term objectives which the organizations aim to achieve and celebrate on achievement. Most employees are always hesitant to go the march of organizational change until they are convinced that there will be compelling results to be achieved within the next one or two years. With lack of short-term targets, most people give up and join those individuals that were resisting change. Some of the short term wins in an organization may include enhanced quality of products or a reduction in the decline of the revenue. Declaring victory too soon is another cause of failure in the change initiative (Kotter 1995, p. 8). Following years of restructuring, the management of the company could be tempted to declare victory after improvements in its performance. Although celebrating win is good, it can be catastrophic. Changes initiatives must be given time to sink deep into the culture of the organization – a process that may take between five and ten years (Kotter 1995, p. 9). When victory is declared too soon, the initiative may still be too fragile and young and prone to regression. Declaration of victory kills the momentum to change and the forces that were against change can see the organization fall back to its traditions. Both change agents and resistors of change have a hand in premature declaration of victory but are driven by different motives. Those who were resisting change point out to the improved performance with an intention of showing that the war has been won and victory is eminent. Consequently, the change team becomes disbanded and the momentum is lost. The other cause of the failure of change initiative is the incapacity to have such changes anchored on the organizational culture (Kotter 1995, p. 8). The change must be rooted into the shared values and social norms in the organization; otherwise, they are subject to being degraded. To ensure that the change becomes ingrained into the organizational culture, it is critical to have the people understand that new approaches, attitudes and behaviors were critical to change and this must be sustained. In changing the organizational culture, it is critical to prepare the next generation which will drive the change. A wrong succession decision in an organization can spell doom for the success of change (Ismail 2011, p. 8). Poor succession occurs whenever the board of directors is not incorporated in the change process as this can make them compromised when selecting a successor in top management. Conclusion Change is a critical aspect for any organization that intends to remain competitive. However, researchers have identified that about 66 percent of all change initiatives fail for various reasons. Failure to establish a sense of urgency and forming a powerful guiding team are some of the causes of failure. In case an organization does not form a clear vision and communicate that vision to the people, this may also cause failure. The employees must also become empowered to act on the vision through elimination of the barriers and develop short term wins. Premature declaration of victory and failure to entrench the change into the organizational culture is also recognized as a cause of failure to most change initiative. Bibliography Bourne, M, Neely, A, Platts, K & Mills, J 2002, ‘The success and failure of performance measurement initiatives: perceptions of participating managers’, International Journal of Operations & Production Management, vol. 22, no. 11, pp. 1288–1310. Cummings, J 2008, ‘Why most change initiatives go thud’, Business Finance, vol. 14, no. 8, pp. 37–37. Harris, J 2006, ‘Managing change in it improvement initiatives’, Government Finance Review, vol. 22, no. 1, pp. 36–40. Ismail, K 2011, ‘Is immunity to change hardwired?’ Avidium Inc., pp. 1–10. 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