The Frightening Statistics and How to Beat the Odds

Historically nearly 70% of change initiatives in companies don’t succeed in creating the original objective. Employing a Project Manager often doesn’t work. Specialist Change Managers often focus on the technical aspects, technique and elaborate language, but forget the one critical element to change that will either make it, or break it.

The life blood of an organisation is not the product, the market, the economy or the sales pitch. It is the people. It is the management, the staff and the clients, and how they react to change and the inherent stresses that change places upon them.

But so often these become the casualties in the ongoing battle to ensure business survival in a rapidly changing world. By investing time in ensuring you staff and customers are “on board” with your plans, you will reduce or eliminate the resistance to change, reduce conflict and increase acceptance, productivity and positive contribution.

It all sounds so easy, but it’s not in reality.

Every person in your organisation has a different view of you, your management team and your business methods. The interaction between their peers and others in the organisation, and your client base has a tendency to disintegrate into disharmony and create an environment of high stress when a major change program is commenced. Ignore that at your peril!

The Facts

In any organisation, based on statistical evidence:

• Only 21% of staff are actively committed to their job and are fully productive. These are known in HR circles as “Engaged Employees”.
   
• 61% are Not-Engaged Employees – Employees are essentially “checked-out”. They’re sleepwalking through their workday, putting time –but not energy or passion—into their work.
   
• 18% are Actively Disengaged Employees – Employees aren’t just unhappy at work; they’re busy acting out their unhappiness. Every day, these workers undermine what their engaged co-workers accomplish.
   
• A Gallup Organization poll in 2006 estimates that actively disengaged employees cost Australian businesses around AU$32.7 billion per annum

 So 82% are not working in the interests of your company and of those 18% are actively working against the success of the company, whether they understand the effects of their actions or not.

On their own, these are frightening statistics. Now add the fact that any change in a company or organisation, be it simply the introduction of a new product or system, or company wide change of culture and focus, adds enormous stress to staff and ALWAYS creates resistance. That resistance further adds to the group of Not-Engaged and Actively Disengaged Employees and often takes a business into the realms of critical and fatal meltdown. It is a fine line to walk, especially when undertaking culture and focus change projects.


The Solution

Let’s look at these statistics from a management and profit point of view. Do you notice how closely the surveyed percentages match the often quoted 80/20 rule? It means that in this case most of your profit is driven by 20% of your staff. That is not to say that you can get rid of the rest because they often do the “robot” support work that is essential.

But what would happen to your profits in the following two scenarios?

1. You raise the number of “engaged employees” from 21% to 40% without increasing staff numbers and costs.
2. You undertake a change program within your company knowing that a properly formatted program was going to achieve its objectives and increase productivity.

By increasing productivity within an organisation by retraining and reframing the attitudes of staff and management toward the company and each other, the company’s bottom line increases exponentially.  If you currently operate at a profit of 10%, the change is likely to double or triple profit very quickly through:

• Reduced employee costs by reducing sick days, time off and poor or negative performance
• Reduce staff turnover and retraining costs
• Increased productivity
• Improved customer perception of your company and staff
• Clearer and more focused thinking at management and staff levels
• A better, more enjoyable, more passionate workplace for everyone

So how do you do that? Typically HR and Project Management staff have a limited set of tools to use. An ordinary Project Manager should NEVER be expected to handle the special needs of a change management program.

People are individuals. They have unique knowledge and skills. They have their own unique problems with family and life in general, including financial. And most important, they each have a self image that could range from extremely poor and fragile to over-inflated and aggressive. They interact with others differently and expect different things from the organisation and management. Even long term employees who have settled into a role can become extremely unstable under certain conditions of change.

Change can and will cause a dramatically increased level of anxiety in most individuals. If it happened in only one or two it would not affect the running of an organisation and would work itself through as a change program was completed. But significant change is different.

A change in or addition of new product creates learning anxieties in many.

A change in a system or procedure will create elevated stress levels in most people since this involves interaction with new computer software and paperwork, and changes the dynamics of groups of people within an organisation. Handled poorly a significant percentage of the staff involved will consider the change unnecessary and will ACTIVELY RESIST the change. This applies to all of the “Actively Dis-engaged” and some of the “Not-engaged” employees.

A company wide culture change or change in focus and direction will create high stress levels in most of your staff and critically high levels in around 20-30% of your staff. If the change is poorly communicated this figure can go to 80% of your staff and management causing mass walkouts, high absenteeism and ultimately the failure of the business.

It is essential that you use staff with high level of skill in human communication and stress management, together with a clear understanding of the business and the requirement for change. Preferably use external consultants who are not perceived to be aligned with the senior management. In other words get someone who will be allowed by your staff to do the best thing for them as well as the success of the company. The trust and belief level increases with good project design and communication, and your staff is fully informed by an independent source about the desired outcomes and what is in it for them.

Add to this a clear clinical understanding of how anxiety affects people and how it changes the interaction between people and groups of people (known as stakeholders in the HR jargon), and a change project has a dramatically higher chance of success.

The added benefit of such a method is that the percentage of “Engaged Employees” will also increase from 21% to double or triple that number. Jack Welsh, celebrated CEO of the vast GE empire took the company from a market capitalization of $12 billion to $500 billion prior to his retirement in 2000, by recognizing the need to deal with staff and systems in a cohesive and inclusive way.

A great example to follow……………………..

If you are a business owner or manager, Project Manager or Change Manager, GMF can help you navigate through the mudding waters of change and ensure your staff are ready, willing and able to help you complete your strategies and goals.