Rick's Reflections | The ROI of Change Management

How do you know you’re getting your money’s worth?

Leaders responsible for change management procurement decisions already know if they focus more intently and methodically on resolving or mitigating the challenges, issues and concerns of the people impacted by change, the outcomes will be exponentially better. Leaders also know if people impacted by change have the opportunity to contribute to the change process and share their feedback, their level of commitment will be higher. Finally, leaders know that if they are open, honest and transparent about the change, hold their direct reports accountable, and model the desired behaviors, the change will happen more efficiently and effectively.

Yet we are still compelled to put a dollar value on the return for the investment in change management.

Many organizations have conducted multiple studies to answer the question from a dollar and cents perspective.  A single answer percentage or dollar value applicable to all change though, is hard to calculate and defend.  The fact is, much of the data we need to answer the question is specific to the unique change itself and only available after it’s complete.

When answering the question of ROI, we need to begin with a commitment to invest in defining, measuring, reporting, and analyzing the performance of the organization before, during, and after change.  (We have done the calculations for LaMarsh Global clients and can share our process at your request.)  This can be both time consuming and expensive.  To me, a more valuable approach is to periodically reflect on the ROI Behavior Metrics:

  1. Adoption – People are applying the processes, using the tools, following the new procedures, policies and guidelines.
  2. Acceptance – People may not agree, but they are fully aware and understand why the change is necessary, what it means to them individually and their organization and they have a willingness to do what is required.
  3. Performance – People know what is expected of them.  They understand their actions will be measured and that they will be evaluated on their performance of the desired behaviors.
  4. Engagement – People are participating in the change process.  They are eager to contribute and value the opportunity to be part of the solution development.
  5. Results – The organization is achieving the goals and intended outcomes of the change.

If we practice sound change management discipline, the issue of ROI takes care of itself.  The conversation with those asking the question is – this is what we plan to do to increase the level of Adoption, Acceptance, Performance and Engagement – which will naturally lead to efficient and effective outcomes and overall Results.  Then, help leaders know they are getting their money’s worth when the degree, intensity and frequency of resistance issues are minimal and the success metrics are within reach.

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