Project Smart ~ Exploring trends and developments in project management today

Calendar icon
Adobe PDF icon

Change Management: The Horror of It All

~ By Stephen Warrilow

Woman looking horrified

The failure rate of all significant change initiatives is approximately 70%. A recent reader of an article on my website challenged me regarding the source of that often quoted statistic. Here is a brief summary of a cross section of sources that I sent her and that reveal the horror of it all.

A global survey conducted in 2008 by McKinsey and Company offered the insight that organisations could only hope to survive by constantly changing, but approximately two thirds of all change initiatives fail.

In a recent "Call for Papers" for the Journal of Change Management, for a special issue entitled, "Why Does Change Fail and What Can We Do About It?", Professor Bernard Burnes of Manchester Business School makes the observation that whilst this does seem to be an astonishingly high rate of failure, it is in line with most of the literature on change, which consistently quotes failure rates of between 60% and 90% (Burnes, 2009). For example, consultants Bain and Co claim the general failure rate is 70%, but they indicate that it rises to 90% for culture change programmes. And in relation to the failure rate of BPR initiatives, prevalent in the 1990s, Hammer and Champy (1993) claimed a failure rate of 70%.

According to "Research Findings on Program Failure and Success" by Patrick Morley, Ph.D. Chairman and CEO of Man in the Mirror, "Two thirds of Total Quality Management (TQM) programmes fail, and re-engineering initiatives fail 70% of the time" (Senge, 1999). "Change initiatives crucial to organisational success fail 70% of the time" (Miller, 2002).

A Computer Weekly study in 2003 of 421 IT projects revealed the following:

  • 16% of all projects successfully completed (that is they were delivered in scope on-time and on-budget)
  • 75% of all projects were "challenged" in the following ways:
    • 35% behind schedule
    • 59% over budget.
    • 54% under-delivered on planned scope

A survey conducted by the Standish Group in 2003 showed that 66% of IT projects are either totally abandoned or fail against a measure of budget, scope, time or quality, i.e. "challenged."

It has been estimated that the cost to US business of failing or abandoned IT projects runs into hundreds of billions of dollars.

Closer to home, the UK Labour government have wasted 26 billion pounds on failed projects. An investigation by The Independent newspaper has found that the total cost of Labour's ten most notorious IT failures is equivalent to more than half of the budget for Britain's schools in 2009.

The world of mergers and acquisitions fares little better. The value enhancement trend for ten years of KPMG International's Manda survey shows that on average only 28% of mergers have resulted in enhanced shareholder value, whilst an average of 36% have led to a reduction in shareholder value. This value assessment is based on company share price movements relative to average industry sector movement during a two-year period.

In the film Apocalypse Now, the anti-hero Colonel Kurtz mumbles through the closing sequences:

…the horror…horror has a face…and you must make a friend of horror…

Colonel Kurtz

Any impartial assessment of all of the main types of significant change initiatives reveals the sheer horror of the colossal human and financial wastage perpetrated by organisational and political leaders.

The knowledge of how to successfully lead and manage change is out there in the public domain in a growing body of easily accessible work.

So it must be an appalling combination of ignorance and arrogance that causes the organisational and political leaders who preside over this litany of costly failures to be so desperately under-prepared as they embark on further change initiatives without facing (let alone making a friend of) the horror of change failure.

Or, god help us, has the marginal rate of increase in change now largely overtaken many organisations' capacity to deal with it?


Stephen Warrilow, based in Bristol, works with companies across the UK providing specialist support to directors delivery significant change initiatives. Stephen has 25 years cross sector experience with 100+ companies in mid-range corporate, larger SME and corporate environments. Stephen invites you to equip yourself to avoid the 70% failure rate of all change initiatives with the Practitioners' Masterclass leading your people through change, putting it all together and managing the whole messy business.


Comments

Be the first to comment on this article.

Add a comment



(never displayed)



 
2000
Enter the third letter of the word house.
Notify me of new comments via email.
Remember my form inputs on this computer.

Extreme Project Management

The running back dives for the first down with the defender on his back

Three war room strategies to try when you need to bring life back to a dead project, or save an engagement that is on the brink of disaster.

Project Planning Essentials

Tablet computer with project manager app and documents with Gantt and financial charts

Planning a project requires putting a series of tasks in order and determining dependencies between them. In practice it's never so straightforward.

What is PRINCE2?

PRINCE2 logo

PRINCE2 is one of the most widely used project management methodologies available. If you're looking to run successful projects, then PRINCE2 is an excellent choice.

My Budget is 10% Over, Now What?

10 percent red wood sign with golden background

Suffering a budget overrun? Here's three key things you can do mid-stream on a project to help get the budget back in line with the original plan.

PROJECT SMART is the project management resource that helps managers at all levels improve their performance. We provide an important knowledge base for those involved in managing projects of all kinds. With weekly exclusive updates, we keep you in touch with the latest project management thinking.

WE ARE CONNECTED ~ Follow us on social media to get regular updates and opinion on what's happening in the world of project management.


Latest Comments

Mohamed Bocsow Koroma commented on…
Understanding the Perspective of Your Team
- Tue 16 October 10:48am

Heather commented on…
The Role of the Project Manager
- Mon 15 October 6:22pm

Janice Paris commented on…
Better Coaching Using the GROW Model
- Fri 12 October 10:33pm

Latest tweets

General Project Management • Re: Which Project Phase is HyperCare? https://t.co/nqDy8fAK7q about 11 days ago

General Project Management • Which Project Phase is HyperCare? https://t.co/VpfYmrTcJS about 11 days ago

General Project Management • Advice on project management system with built-in CRM capabilities https://t.co/FX3hPKCxsu about 18 days ago