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Do 70% of Organizational Change Projects Really Fail?

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In this presentation from the Oxford-Review we look at whether 70% of organizational change projects really do fail and what the real figures are.

http://www.oxford-review for free research updates and more

Published in: Leadership & Management
  • Very interesting. It just goes to show you cant believe all you read and you need to do your research.
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Do 70% of Organizational Change Projects Really Fail?

  1. 1. Common Myths of Organisational Change Dr. David Wilkinson
  2. 2. www.oxford-review.com
  3. 3. It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so. Josh Billings 1818 - 1885
  4. 4. Proposition: 70% of Change Projects Fail
  5. 5. Proposition: 70% of Change Projects Fail That’s a lot!
  6. 6. E.G.
  7. 7. E.G.
  8. 8. E.G. This wasn’t true. I tracked the book down and it makes no mention of any study nor the quoted results!
  9. 9. E.G.
  10. 10. Projects IT & Infrastructure Projects Training events New Sales Initiatives Marketing Campaigns Regeneration Projects Coaching engagements For these as well – Really??
  11. 11. A little suspicious
  12. 12. Sources
  13. 13. TRUST – Not all journals are equal
  14. 14. Validity & Reliability
  15. 15. Validity & Reliability
  16. 16. Impact Factor
  17. 17. Impact Factor 41.456 Highest impact / trust factor
  18. 18. Impact Factor 41.456 1.27 Lowest impact / trust factor HBR not considered a serious research source. Highest impact / trust factor
  19. 19. I searched Almost 1000 references going back 20 years
  20. 20. 1996 - John P. Kotter, published in the Harvard Business Review The most quoted source of the 70% change failure rate
  21. 21. But what did Kotter actually say?
  22. 22. What Kotter actually said “Over the past decade, I have watched more than 100 companies try to remake themselves into significantly better competitors. They have included large organizations (Ford) and small ones (Landmark Communications), companies based in the United States (General Motors) and elsewhere (British Airways), corporations that were on their knees (Eastern Airlines), and companies that were earning good money (Bristol-Myers Squibb). These efforts have gone under many banners: total quality management, reengineering, rightsizing, restructuring, cultural change, and turn-around. But, in almost every case, the basic goal has been the same: to make fundamental changes in how business is conducted in order to help cope with a new, more challenging market environment. A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.”
  23. 23. What Kotter actually said “Over the past decade, I have watched more than 100 companies try to remake themselves into significantly better competitors. They have included large organizations (Ford) and small ones (Landmark Communications), companies based in the United States (General Motors) and elsewhere (British Airways), corporations that were on their knees (Eastern Airlines), and companies that were earning good money (Bristol-Myers Squibb). These efforts have gone under many banners: total quality management, reengineering, rightsizing, restructuring, cultural change, and turn-around. But, in almost every case, the basic goal has been the same: to make fundamental changes in how business is conducted in order to help cope with a new, more challenging market environment. A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.”
  24. 24. “Most major change initiatives— whether intended to boost quality, improve culture, or reverse a corporate death spiral—generate only lukewarm results. Many fail miserably.”
  25. 25. “Most major change initiatives— whether intended to boost quality, improve culture, or reverse a corporate death spiral—generate only lukewarm results. Many fail miserably.”
  26. 26. What Kotter actually said “A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.”
  27. 27. 1993 Next most quoted source
  28. 28. “Sadly, we must report that despite the success stories described in previous chapters, many companies that begin reengineering don’t succeed at it...Our unscientific estimate is that as many as 50 percent to 70 percent of the organizations that undertake a reengineering effort do not achieve the dramatic results they intended.”
  29. 29. Nitin Nohria and Michael Beer -Cracking The Code of Change - 2000 The 3rd most quoted source
  30. 30. Nitin Nohria and Michael Beer -Cracking The Code of Change - 2000 Harvard Business Review
  31. 31. “The brutal fact is that about 70% of all change initiatives fail”
  32. 32. “The brutal fact is that about 70% of all change initiatives fail”
  33. 33. “People have been writing about change management for decades and still the statistics haven’t improved. With each survey, 70 per cent of change initiatives still fail” - 2008 self-published white paper by a management consultancy company, Bain & Company Now it enters common usage
  34. 34. In 2009 'The irrational side of change management' by Atkin & Keller consultants at McKinsey
  35. 35. 2009 'The irrational side of change management' by Atkin & Keller consultants at McKinsey “In 1996, John Kotter published Leading Change. Considered by many to be the seminal work in the field of change management. Kotter’s research revealed that only 30 percent of change programs succeed.”
  36. 36. What Kotter actually said “A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.”
  37. 37. 2009 'The irrational side of change management' by Atkin & Keller consultants at McKinsey "…in 2008, a McKinsey survey of 3,199 executives around the world found, as Kotter did, that only one transformation in three succeeds.”
  38. 38. This is what that study actually says…
  39. 39. 1. Extremely successful 2. Very successful 3. Somewhat successful 4. Not successful at all Spot the failure
  40. 40. 2008 McKinsey Global Survey Results: 'Creating Global Transformations’
  41. 41. 1. Extremely successful = 4.88% 2. Very successful = 30.51% 3. Somewhat successful = 48.96% 4. Not successful at all = 5.87% Spot the failure
  42. 42. 2009 'The irrational side of change management' by Atkin & Keller consultants at McKinsey "…in 2008, a McKinsey survey of 3,199 executives around the world found, as Kotter did, that only one transformation in three succeeds.”
  43. 43. What Kotter actually said “A few of these corporate change efforts have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.”
  44. 44. What is success?
  45. 45. What is success? Small firms = Survival Large firms = Profit (Reijonen, H. and R. Komppula 2007)
  46. 46. 2016 - Professor Jeffrey Pfeffer - Stanford University ‘Why the Assholes are Winning: Money Trumps All’
  47. 47. Only 4 companies made both Fortune’s most admired and their best places to work lists in 2015 Success Criteria
  48. 48. Admiration and criteria of organizational success boils down to “financial success in terms of stock price appreciation and wealth creation” Success Criteria
  49. 49. 2011 Mark Hughes - University of Brighton UK - failure rates of organisational change programmes and found that :
  50. 50. 2011 Mark Hughes - University of Brighton UK - failure rates of organisational change programmes and found that : “…whilst the existence of a popular narrative of 70% organizational- change failure is acknowledged, there is no valid and reliable empirical evidence to support such a narrative”
  51. 51. Not only is there NO EVIDENCE 70% of change programmes fail
  52. 52. Not only is there NO EVIDENCE 70% of change programmes fail What little evidence there is suggests the failure rate is most likely around 6%
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  54. 54. www.oxford-review.com

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