Your portfolio is ready, stakeholders are overloaded

now what?

Abstract

“Change Saturation,” the state of an individual or organization's inability to absorb any additional incremental change, is an increasing phenomenon in a world where increasing amounts of change are the “new normal” in business. This growing volume of change is causing negative impacts to organizations that have tangible and measurable impacts and costs.

In this paper, we introduce new methods and tools that provide organizations with the ability to anticipate where and when change saturation is likely to occur within the enterprise. Having this awareness and using this knowledge to make decisions related to timing, approach, sequencing, and integration of key change efforts are key advantages to organizations applying these tools. In short, knowledge and action, driven by new levels of visibility into an organization's change portfolio, will mitigate the real risks and costs of change saturation.

This paper identifies the sources and symptoms of change saturation. It introduces you to enterprise change heat maps, and provides a view into the best practices when establishing and using enterprise change heat maps to manage risk and drive greater impact of an organization's project investments. Finally, the paper concludes with an exploration of the future of enterprise heat maps and data visualization as a key program management tool.

As the volume and speed of change increase in organizations, the ability to capture change data and visualize areas of impact will be a critical advantage for companies who want to build sustainable agility into their workforces.

Executive Summary

In this post-recession era, organizations continue to demand more from their employees: more hours, more meetings, more responsibilities, and more change. As the demands increase and the volume of change grows, we're seeing a commensurate increase in “change fatigue” and “change saturation,” employee and organizational conditions that impact performance, behavior, and employee engagement. The negative impact of these conditions is measurable and noteworthy. As the intensity grows, these conditions manifest themselves in productivity dips, decreased morale, and greater employee turnover. In short, change fatigue and change saturation are real and increasingly risky conditions that threaten profit and market performance in too many of today's organizations.

We all recognize that the intensity and pace of change is unlikely to ease any time soon. So, how does an organization manage the rising trend of change fatigue and saturation while ensuring successful adoption of key initiatives and programs across the enterprise?

By proactively managing the organization's change portfolio. A well-managed portfolio prevents “change collisions,” proactively minimizes change saturation, and supports efforts to effectively engage employees in the change processes.

By creating visibility into the portfolio of changes across the enterprise over a set period of time, organizations have the ability to identify potential risks and take necessary actions to avoid change saturation and change collisions. This awareness is a key weapon in protecting against the negative performance impacts of too much change.

Is the idea of a change portfolio new? Yes! Even in cases where proactive change management occurs, we rarely see a holistic view of what is happening across the enterprise. Although change is frequently assessed by identifying the highly impacted stakeholders for a specific project, rarely is a company-wide view analyzed that looks beyond that project. An enterprise change portfolio provides insight into multiple projects or initiatives across the enterprise, creating a kind of change mosaic that clearly illustrates the impacts on each stakeholder group within the organization. Taking a broader view yields a new set of data that empowers organizations to proactively manage change in a more informed and coordinated fashion. By identifying and managing change impacts at the enterprise level, organizations can protect their teams from the risks of change fatigue and saturation.

Change Saturation, Change Fatigue: What Does it All Mean?

Enter the terms “change saturation” or “change fatigue” into your favorite search engine, and you're likely to see millions of results. So why are these topics so popular? Because today's organizations are saturated with change and their employees are fatigued.

Change saturation and change fatigue occur when individuals or a group of people have reached their capacity for change. It is important to understand that fatigue and saturation are not simply human emotions, but rather conditions that impede performance. When an employee or a team is in a saturated state, when they can't absorb new or incremental changes, performance drops and failure rates increase. When brought to a state of fatigue and saturation, the impacts are real, measurable, and frequently felt on the bottom line.

Ongoing and Increasing Change: The New Normal?

Recent studies show that the business world has changed and is expected to stay in a state of continuous and increasing change for the foreseeable future. According to Towers Watson, most organizations (65%) expect employees to work more hours than before the recession; and over half (53%) expect this to continue. This trend is putting a particular strain on professional level employees (Towers Watson, 2012). While not an ideal state, organizations have been able to continue to expect these levels of effort largely, because the labor market has had less mobility since the recession began in 2008. However, as the lagging symptoms of the recession and the impact on the job market start to fade these expectations, what we call the “new normal,” may start to directly impact organizations in the forms of increased turnover and loss of key personnel.

Prosci's most recent Best Practices in Change Management survey also backs up this trend. Since 2007, Prosci has tracked data on organizations reporting change saturation. In 2007, 59% of organizations were reporting increased change saturation (Prosci, 2007). By 2009, it was 66% (Prosci, 2009), and, in 2011, the most recent year available, it had climbed to 73% (Prosci, 2012).

The Symptoms of Change Saturation are Real and “Show Up”

As stated earlier, the impact of change saturation and fatigued is real, measurable, and often results in delivering negative consequences on an organization's overall performance. Near-term impacts may be more visible in the morale and tone within the organization, mid-term impacts are often financial in nature, and long-term impacts can limit the enterprise in meeting its strategic goals.

While the impacts of change saturation may manifest themselves differently over time, they are typically delivered through three key channels: (1) individuals, (2) projects, and (3) the collective organization.

For individuals, symptom fatigue generally manifests itself in changes to behavior or attitude. Quite often, fatigue shows up as disengagement, apathy, frustration, stress, burnout, resistance, confusion, and cynicism, among others. In one way or another, this impacts profitability by impairing performance and productivity, not just of the individual, but those with whom they work. It is important not to dismiss the impacts of too much change to individuals, particularly when the recent data on employee engagement are taken into consideration. For example, a Towers Perrin study has indicated that a 15% change in employee engagement can boost a company's operating margin by more than 17% (Towers Perrin, 2009). If an employee is in a state of saturation and fatigue, clearly engagement declines. Additionally, Gallup's research has consistently shown that a strong connection between employee and customer engagement are two vitally important factors in driving company success (Gallup, 2006).

When we turn our attention to projects (projects and project teams), the bottom line impacts are more apparent and easily measured. Change saturation and fatigue related to project outcomes most often means a failure of users and stakeholders to adapt new processes, tools, or programs. When this occurs it is difficult for any project to meet its stated objectives or deliver against a planned business case or set of anticipated benefits. Additionally, we often see trends where resourcing projects becomes challenging, because fatigued employees don't have the capacity or willingness to take on new project work.

If we look at the outcome of change fatigue and saturation at the macro level, assessing what the impact is on the organizational level, again we see the negative consequences becoming more apparent. The most measurable and visible impact is often an increase in employee turnover. When we factor in time and productivity lost to vacancies and onboarding, we begin to see the significance of these “hidden costs.” In fact, the costs of turnover are usually estimated at 30% to 50% of the annual salaries of entry-level employees, 150% of middle level employees, and up to 400% for specialized, high-level employees. (Jack Phillips Center for Research, 2009) Beyond these costs, we must also consider other factors that negatively impact profitability, including increased absenteeism, loss of focus on business basics, and negative morale.

Failure is not an Option, but it's a Reality for Many Organizations

Companies spend millions of dollars on investments to run their businesses more effectively and profitably. But quite often, these investments do not garner the expected results. Let's consider the following:

  • 59% of projects were considered unsuccessful (IBM, 2008)
  • US$63 billion is spent on IT projects that fail in the United States annually (McCafferty, 2010)
  • Unplanned absences drove a 54% decrease in productivity/output and a 39% drop in sales and customer service. (Mercer, 2008)

Does your organization continue to make these investments and not see the desired results? Are these investments aligned with a complementary investment in actively managing the change to increase the success of these investments?

When Prosci asked organizations: “Do you have a structured process for managing your change portfolio?” Sixtyone percent of respondents said, “No.” Of the 24% who said they were managing their change saturation, the top tactics in use related to using portfolio management tools to identify changes and then focusing on prioritization as the key mitigation strategy. Surprisingly, most of the organizations with awareness of their own change saturation, report doing “nothing” to address the risks. (Prosci, 2012)

Why Enterprise Change Heat Maps?

Typically, change management efforts are taken at the project level, but this approach only provides a one dimensional view of the impacts for that specific project. However, organizations are not static, and more likely than not, there are many change efforts underway at any one time. Sources of these programs can come from many directions, including IT initiatives (new systems or tools), corporate initiatives (new programs, processes, or changes to the business strategy), and departmental driven initiatives (new HR, procurement, or budgeting processes for example). When you combine those efforts with the “rhythm of the business” activities, which have their own highs and lows of activity (i.e., annual audits, peak season for sales, etc.), things can start to get quite overwhelming. The risk then is when taking only a project lens to assessing readiness for change, identification of the other activities impacting your employees and teams is missed. This form of analysis often results in a failure to estimate the amount of support required to successfully implement a project or initiative.

Only in taking an enterprise view can a more holistic picture of the organizational impacts emerge, allowing for better planning and informed and improved coordination across the portfolio of efforts. Whether the change efforts are underway or in the planning stages, Enterprise Change Heat Maps can provide valuable insights via data visualization of the change portfolio and the related impacts.

In short, enterprise change heat maps introduce a new concept for providing a line of sight into the multiple projects or initiatives in play across the enterprise. The output of a heat map provides a change mosaic that clearly illustrates the impacts on each stakeholder group within the organization. Finally, taking this broader view yields a new set of data that empowers organizations to proactively manage change in a more informed and coordinated fashion.

Four Steps to Enterprise Change Heat Maps

Using a four-step process, an organization can establish Enterprise Change Heat Maps as an integrated part of managing a change portfolio.

Start with the end in mind

Before undertaking this journey, an organization should define specific success criteria and use these criteria to track progress throughout the project. Throughout the implementation, return to the success criteria to ensure that the project is on track to meet organizational goals. Examples of success criteria might include:

  • Build enhanced visibility for the executive team of all enterprise change initiatives
  • Identify opportunities to smooth the amount of change over a 12-month or multi-year cycle
  • Ensure high-value programs receive priority focus and attention to ensure a greater likelihood of success

In short, standing up Enterprise Change Heat Maps should be treated like any other project and managed and measured accordingly.

Step 1: Collect

The initial collect phase is all about governance. We recommend that you begin by establishing parameters for what will be measured, starting with the definition of an “enterprise” project. Spend the time to determine the criteria for measuring change impacts consistently across the organization. Following are some questions that should be considered:

  • What is the initial scope for the heat maps? A business unit, geography, etc.?
  • What are the parameters that define which projects will be included?
  • How many degrees of change are needed to present relevant change data to my organization? (i.e., a three-or five-point scale)
  • What are the thresholds for each level of change impact and can they be measured consistently across the organization (i.e., is a high impact from an IT project the same as a high impact from a facilities project?)?
  • What are the time intervals to be measured (months? quarters? etc.)

After these up-front questions have been resolved, the next step is to collect the change impact data. The specific information required to be collected should be determined by what the priority elements the organization wishes to measure. The change data attributes may include: project, duration of the change impact, active quarters, functional areas (business unit/department/role/etc.), geography, and so on.

Establishing a governance process to review and validate the data is the key step that completes this phase.

Step 2: Visualize

With the change data collected and validated, the next step is to create the views that will have meaning for the organization. For example, a business unit executive may wish to look at the change data from his or her functional perspective, whereas a project manager would prefer to see the data distilled from a project view.

There are several options for creating data visualization in enterprise change heat maps:

Excel/Access

Exhibit 1: Excel/Access.

Using Microsoft Excel or Access allows for a manual mapping of change impacts across an organization and projects. This method allows for high levels of customization and input of detail, but can be difficult to manage and see in a rolled up view. The example at left was for an organization of 3,500 employees for their 7 enterprise initiatives and 20 supporting projects. In this view, approximately 10% of the data was able to be captured on screen at any one time.

Organizational Chart View

Exhibit 2: Organizational Chart View.

Heat mapping within organizational charts is a useful view for many executives. In this sense, the data represent how each group within the organization will be impacted. Additionally, including the quarterly views, as shown in the image here, provides a good representation of the impacts over time and how they change quarter-to-quarter.

Enterprise Change Heat Map tool

Exhibit 3: Enterprise Change Heat Map tool.

The strength of the heat mapping tool is that it allows for additional views of change impacts. Because the tool runs off a common dataset, there is an ability to change filters to bring forth different views of change impacts. These views include a project-based view of change, a time-based view, and a view showing not only the level of change in the organization, but the volume of change by quarter.

With multiple views in hand, the attention should turn to identify risks or opportunities that can weaken or strengthen the various program outcomes respectively. We recommend starting this analysis by looking for the “change collisions.” Change collisions occur when there are multiple changes hitting individuals or a team of people over a common timeframe. Often, change collisions are a small number of high impact changes. In some cases, however, these collisions may be a high volume of low impact changes that didn't garner attention until understood in the aggregate. Keep in mind that other “rhythm of the business” activities, driven by the organization's calendar of events, should be taken into account as well when considering the volume of change activity.

Other known scenarios for identifying when change saturation is likely to occur include:

  • When two or more high-impact initiatives are deploying to the same stakeholder group at the same time
  • When multiple (three or more) initiatives are deploying to the same stakeholder group at the same time
  • When leaders are anticipating that change thresholds have been reached, driven by a history of concurrent change

When assessing risk, it is also critical to consider the capacity for adapting to change of those who are impacted. Assessing the level of risk requires organizational knowledge to discern how much change is “too much.” There is no consistent measure — it must be driven by the organization's culture and other factors. We recommend looking at change capacity on a case-by-case basis.

Step 3: Govern

Today many organizations have implemented some form of an Enterprise Portfolio Management function. Typically, these functions include: strategic planning, capital funding, IT project management office, connections, or oversight to other program management offices (PMOs), and internal change consultants. Leveraging this structure or establishing a similar cross-functional team is a critical step in governing a portfolio of projects.

Once you've established a governance body, with relevant heat maps in hand, share the heat maps. Use the different views to build awareness and explore impacts. Highlight the areas of risks and potential collisions using the methods described above.

Once a common understanding is established, prioritize the risks, and begin to discuss options to mitigate change collisions, fatigue, and saturation. While taking projects off the table is rarely an option, when there are known areas of risk, there are a variety of other choices available to mitigate the impacts:

  • Adapt: Change the deployment timing of your effort to maximize the best possible timing for adoption
  • Adjust: Find “noise” that can be removed. For example, are there ‘rhythm of the business’ activities that can be changed – delayed, removed, or scaled back?
  • Integrate: Should the initiatives be consolidated toward certain stakeholder groups – in other words, should communication and training efforts be rolled into one?
  • Shift or Sequence: Should one project go before the other to mitigate change saturation?
  • Intervene: What intervention should be applied to mitigate the risk of change saturation? More resources added to the project? Additional change management activities to ensure readiness?

Step 4: Sustain

Implementing Enterprise Change Heat Maps isn't a one-time fix; rather, it is part of building an ongoing strategy for managing an organization's portfolio of change; so, rather than setting a completed enterprise heat map project “on the shelf,” consider how it will become part of the day-to-day business operations.

Once Enterprise Change Heat Maps are an established tool, organizations should monitor progress, continuously collect updated change data, and continue to measure the mitigation efforts and success of each of the projects. Additionally, as stated up front, revisit the success criteria to see if the goals are being met, and what adjustments may be needed. Last, the scope should be revisited periodically to determine if the “right” projects are captured in the tool, and whether the scope needs further expansion.

Best Practices in Establishing Enterprise Change Heat Maps

Launching Enterprise Change Heat Maps requires an investment of both time and resources. To facilitate success, employing the following tactics can help smooth the way to greater visibility of change impacts in your organization.

Ensure success is defined up front:

Although the definition of success will vary for each organization, it's best to understand the expected benefits of implementing Enterprise Change Heat Maps. To best quantify this, start with measurable outcomes, such as “X percent reduction in project delays due to adoption issues,” or capturing data on the number of change collisions identified and mitigated. Think in terms of business results to best present success to executive leadership.

Keep it simple to gain credibility and buy-in:

Going from zero to enterprise can be a daunting task, even for a medium-sized organization. Start with a defined pilot to demonstrate success before implementing as part of an enterprise-wide standard. There are a few ways to do this, including piloting by type of project, by a functional grouping, or for projects going live in a defined time period, among others. Demonstrating success and being able to quantify the investment in this new solution will help to make a palatable business case for leadership.

Secure executive sponsorship:

Find a senior leader to champion the cause. Having this person on board can help smooth the way for the initial investment of resources, and can facilitate bringing other leaders on board. He or she may also be able to help secure a pilot group—where success will be more likely and may set the stage for further expansion into an enterprise standard.

Treat this effort like any project—create a project and change management plan:

As a change management professional, don't forget to bring colleagues and stakeholders along for the ride. Plan the implementation carefully and apply the same resources and rigor as a project from any other part of the organization to pave the way for implementation and adoption success.

Invest in effective data validation:

Effective data validation is a critical part of the process and is required to build trust in the solution. In short, a heat map is only as good as the information captured in the tool. To ensure a foundation of good data during the data gathering process, involve an “owner” for each set of data. Have this individual be accountable for the data and validating it throughout the process and into the maintenance phase. Data validation is an iterative process—it's not just the gathering of the initial inputs, it also requires discussion to align information to ensure comparisons are being made accurately (i.e., that a “high” level of change from an IT project has the same level of impact on a stakeholder group that a “high” level of change from a finance project will). Note this type of quality and consistency should be worked out during the governance process established as part of the pilot program.

Integrate into current processes where possible versus creating net/new:

In an organization with some established change management and/or project management practice, identify ways to bring data gathering and enterprise views into the existing project planning process. Some simple tweaks to the existing portfolio review process could be an easy way to bring enterprise change heat maps into the mix.

The Future of Data Visualization and Enterprise Change Heat Maps

Implementing data visualization tools, such as Enterprise Change Heat maps, is a revolution in helping to proactively identify potential areas of change saturation in organizations; however, the visualization itself is only one part of the equation. As organizations are better able to understand and leverage data, additional uses will become available.

Some interesting and emerging trends include:

  • Correlating HR employee indicators (absenteeism, employee satisfaction, turnover, and productivity) to identify saturation thresholds. While enterprise change heat maps look forward to predict potential areas of change saturation, HR indicators are a look backward. Connecting these data sources will help to identify areas of change saturation that may have been missed and can provide more information on predicting thresholds for change in future efforts.
  • Develop a Change Index to indicate differing levels of change resiliency for different Business Units or Departments. Understanding the change resiliency of different groups allows for better planning, including proactive organization development efforts to increase the capability for change in areas where it may be needed.
  • Use Change Heat Maps to track adoption of change over time. Like HR indicators, entering change data to take a historical look back can help provide information on the gap between planned change implementation and adoption, giving measurement to change efforts. Further, identifying gaps in adoption rates can shed light on groups or initiatives that may need a different approach to obtaining a more successful change.
  • Integration of Enterprise Change Heat Maps into Strategic Planning into strategic planning processes. This provides a preview of change saturation at the earliest decision points: avoid saturation before it even starts!

References

Gallup (October 2006). Engaged employees inspire company innovation. Gallup Business Journal, Retrieved from http://businessiournal.gallup.com/content/24880/gallup-study-engaged-employees-inspire-company.aspx

IBM (2008). Making change work. IBM. Retrieved from http://www-935.ibm.com/services/us/gbs/bus/pdf/gbe03104-usen-01-mcw-qr.pdf

Jack Phillips Center for Research (2009). Retrieved from http://humancapitalstrategy.blogspot.com/2009/04/calculating-employee-turnover-cost.html

McCafferty, D. (June, 2010). IT management slideshow: Why IT projects fail [Electronic Version]. Retrieved from http://www.cioinsight.com/c/a/IT-Management/Why-IT-Projects-Fail-762340/

Mercer (October, 2008). Survey on the total financial impact of employee absences. Portland, OR: Mercer Health and Benefits LLC.

Prosci (2007). Best practices in change management, Prosci.

Prosci (2009). Best practices in change management, Prosci.

Prosci (2011). Best practices in change management, Prosci.

Towers Perrin (2009). Turbocharging employee engagement. Retrieved from http://www.towerswatson.com/assets/pdf/629/Manager-Recognition_Part1_WP_12-24-09.pdf

Towers Watson (2012). Leading through uncertain times, 2011/2012 Talent Management & Rewards Survey. Towers Watson and World at Work.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

© 2012, Beth Montag-Schmaltz, Briana Sharp
Originally published as a part of the 2012 PMI Global Congress Proceedings – Vancouver, Canada

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