Organizational change management (OCM) is often perceived as a soft skill focused on activities that are seemingly difficult to quantify, such as training people and enabling them to change behaviors with confidence. However, the changes and impact of OCM initiatives can be measured and charted when goals and strategies are clearly defined and a plan is effectively implemented.
Let’s explore the definition and causes of OCM, address the misconception about OCM only being a soft skill, and discuss how OCM success and ROI are measured.
What is OCM?
Harvard Business School defines organizational change as “the actions in which a company or business alters a major component of its organization, such as its culture, the underlying technologies or infrastructure it uses to operate, or its internal processes.”
Many factors can cause or even necessitate organizational change, such as new leadership at the top of the company or within departments, shifts in organizational team structure, implementation of new technology, and adoption of new business models.
OCM is the strategic process and discipline of navigating this transition, which typically includes three stages: preparation, implementation, and follow-through. A clearly defined OCM process that can be applied to both small, incremental changes and large-scale, transformational changes is essential to achieving success.
Debunking the Misconception of OCM as a Soft Skill
One of the primary purposes of OCM is enabling and empowering people to adapt to change. As a human-centric organization that prioritizes developing real solutions for real people, the human component of OCM is inherently aligned with Resultant’s core values. While the soft skills involved with OCM are very important, OCM can be measured quantitatively and offer tangible ROI.
Organizations should recognize that OCM is integral to project success, while poorly managed change can prove costly. For example, suppose you roll out a new platform that employees or customers are expected to use regularly. If you don’t let them know change is coming, seek their input about what they need from the platform and why change is needed, or provide training on how to use the platform, they probably won’t embrace the change.
To be clear, the soft-skill side of OCM that focuses on understanding and filling the needs of the people you serve is important, but that’s only one part of the OCM story.
Quantitative Metrics for OCM Success
The first step to successful, measurable OCM is identifying change goals and metrics upfront. What specifically are you trying to achieve? What does success look like? What are your ROI expectations from change initiatives? How will ROI be calculated?
Success metrics must be defined from both technological and individual perspectives, as technology implementation is often a prerequisite and driver of individual behavioral change.
Examples of metrics include:
- Active daily logins. When a new system is rolled out to employees, customers, etc., you can measure the success of the rollout by the number of logins. This shows people feel enabled and confident enough to use the new system. Setting goals for logins and tracking the number of logins will show the impact and ROI of the OCM plan and execution.
- User proficiency. This tends to fall more on the employee side. You can measure how effectively your teams are using a new technology or work process based on how long it takes to complete certain tasks compared to the old system or process. You can also measure their proficiency, before training vs. after training.
- System adoption. It’s natural for some employees or users to be resistant to change. Measuring the rate at which people start using a new technology or platform can help you identify gaps in the roll out process and objections that haven’t been addressed. You can assign number values to each of these factors to help keep the OCM plan moving and optimize for future changes.
There are numerous metrics that can be tracked to measure OCM success, adoption, and impact, such as engagement rates, training completion rates, job performance metrics, error reduction rates, and process efficiency improvement.
The Role of the ADKAR Model in Measuring Change
The Awareness, Desire, Knowledge, Ability, Reinforcement (ADKAR) model is a framework for measuring progress in individual and organizational change. The premise of the ADKAR model is that organizational change is only possible if individuals change.
- Awareness: Are employees aware of the change and why it’s necessary?
- Desire: Do they feel motivated to participate in and support the change?
- Knowledge: Do they have the skills, tools, and information to change?
- Ability: Do they have the capacity to implement the change?
- Reinforcement: What mechanisms are in place to ensure the change sticks?
By addressing each stage of the ADKAR model, organizations can overcome resistance to change and increase the likelihood of a successful outcome. Data-driven OCM strategies, including an initial assessment to benchmark current performance and identify baseline metrics, tracking progress through dashboards and reporting, and using employee feedback to adapt the approach, will help organizations navigate change and quantify ROI.
Quantifiable Benefits of Effective OCM
When properly implemented and tracked to achieve specific goals, OCM activities are measurable and deliverable quantifiable benefits. Productivity and efficiency increase, adoption rates of new technology and processes increase, employee engagement and satisfaction increase, and turnover decreases, resulting in cost savings. OCM also contributes to a better customer experience.
Final Thoughts
OCM helps organizations create and maintain competitive advantages and maximize efficiency in a constantly evolving business landscape. While the soft skills involved with empowering behavior change in employees are essential, OCM with a clearly defined strategy and goals is capable of delivering tangible ROI.
Resultant encourages organizations to adopt a data-driven approach to OCM to maximize ROI, while striking the right balance between human-centric and data-centric perspectives in achieving business success and reducing risk. Start by evaluating your existing OCM strategies to identify opportunities for improvement and measurement.
If you’d like to discuss how you can see better results from OCM, contact us to speak with a member of the Resultant team about our consultancy services.
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