Why most organizational change programs fail
To implement change successfully, we must understand and manage behavior, however beneficial the change might be.
Imagine you work in the IT department at Super Productivity Corporation.[1] You and your colleagues wish to adopt an automated process for IT help based on an electronic helpdesk, that works through an app on the employee’s computer. You have very good reasons to be excited about the process: it is much faster than the queueing of the phone-in process and will save time for everybody. After all, efficiency is a core value at the Super Productivity Corporation. For this reason, you don’t anticipate any problems—but, just to be safe, you still take the time to inform all employees about this change through emails, luncheons, and workshop demonstrations of how it’s used and what the benefits are.
Launch day finally arrives. You and the others in the IT department arrive and sit back, ready to enjoy what is sure to be a nice, relaxing day at work. With the new system, the constant ringing of phones will be a thing of the past! But your hopes for a perfect day are shattered when a colleague comes knocking at the door to relay their technical issues, and in a somewhat agitated manner…
The human side of change
The process of change in a business environment, much like in any environment, is dependent for its success on the willingness to change of the people involved, and their ability to easily do so. Studies show that the majority of major corporate change programs fail, often because human resource barriers such as lack of employee involvement and motivation are overlooked.[2]
As human beings, it is in our nature to contemplate, question, and even resist change. If we are not able to consciously process the reasons for the specific change and accept there is a need for things to be done in this new fashion, we often succumb to the status quo bias (our emotional preference for maintaining the current state of affairs) and consequently find ourselves resisting change—even when those changes might actually be helpful to us in the long run.
The human element of change is often overlooked, especially the changes we want to see are themselves rather easy to implement. Think of moving to a new house: while the process of packing & unpacking is a hassle, the sofa, TV, and washing machine will operate and serve the same purposes in the new environment once offloaded from the van, no negotiation or pep talk necessary. But for the family members who are changing neighborhoods, schools, and routines, the process is much more difficult and involves cognitive and emotional elements. There is ambiguity, a sense of loss, fear of the unknown...
Behavioral barriers to organizational change
The same applies to any changes within a company or organization that affect employees, from the introduction of a GDPR protocol or pandemic-induced processes, to organizational restructuring following a merger or acquisition. Interestingly, it also applies to smaller-scale events such as the adoption of new, fairly simple technology tools.
Research shows that 55% of our workday behaviors are habitual.[3] In other words, half of what we do is to respond automatically to cues in a way that has yielded some kind of reward for us in the past. This behavior is desirable most of the time as it helps us navigate our day, makes life easier and work more productive. There are instances, however, when routines inhibit organizational change and innovation, which is what happened at Super Productivity Corporation. When the employees ran into an IT problem, out of habit, they picked up the phone and called the IT help desk. But following the launch of the new app, that habit did not produce the desired result, and they started feeling stressed and frustrated.
When these negative feelings cascade throughout the organization, they can manifest as decreases in productivity and damage to employee morale. Organizations facing such a situation tend to find themselves spending substantial resources to temporarily recreate the old process and appease employees, while simultaneously trying to reintroduce the very simple, yet widely unpopular by now, new system.
Going beyond habits, in our imaginary scenario, we can also think of a few other possible reasons for the failed transition to the helpdesk app by borrowing insights from further research.[4] For instance, there could be an issue of information overload, which can lead to decision fatigue and feed into the employees’ tendency to cave into impulses and preformed habits (picking up the phone to report an IT problem). In addition, there is often an issue of confirmation bias among the change architects, in this case the IT team, leading them to ignore any contradictory or negative feedback from their colleagues.
Is there a better way?
For remedies, check out the full article on The Decision Lab’s Knowledge Centre on Why Most Organizational Change Programs Fail
[1] Soman, D., Yeung, C. & Sunstein, C. (2021). The Behaviorally Informed Organization. University of Toronto Press.
[2] Mosadeghrad, Ali & Ansarian, Maryam. (2014). Why do organisational change programmes fail?. International Journal of Strategic Change Management. 5. 189. 10.1504/IJSCM.2014.064460.
[3] Wood, W. (2019). Good habits, bad habits: The science of making positive changes that stick. Pan Macmillan.
[4] Behavioural Economics in Action at Rotman, May 2021. How Can Leaders in Organizations Use Behavioural Science to Communicate and Support Their Teams Effectively? By Grace Lou, Sunny Xiang, Tony Kuang, Anirudh Ram-Mohanram, Kayln Kwan, Dilip Soman, Sonia Kang, and Bing Feng. Link to interactive document: https://indd.adobe.com/view/5d063c4a-0775-45f6-8894-9452da3c21d6