calculator, credit card, files, graphs, a hand in the middleCompanies usually underestimate the scale of change that is necessary when implementing a new corporate technology or when changing the type of customer or type of product or service.

Despite of the difficulties that a new system of change may entail, attention is usually focused on finding new corporate technologies or hiring the best suppliers. These aspects are important, but they are not enough to ensure that change happens in the practical behavior of our teams.

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Change management is a global system that implies complex interactions. It must affect not only technologies or suppliers, but the whole organization. Comprehensive influence starts with the individual change of each of the employees. These changes are summed up later and they produce interactions to achieve global changes.

However, producing this change is tough, especially at the initial steps.

Imagine a dedicated and motivated employee who has been working for the company for the last 20 years. As a result of his information and his long working experience, he knows exactly how all the mechanisms of the company work and how to achieve the things he needs and wants in his job. He is a good worker, even though he is using methodologies that may be suboptimal under current circumstances.

In order to accept and carry out changes correctly, this worker needs to take into account the influence model. In other words:

  • Training about how to carry out change, before starting to implement it and during the process.
  • Specific attention to the particular situation: it is very likely that change managers find themselves with objective obstacles to the daily operational implementation. The worker might need some tools to combine quality job criteria with new ways of doing things. Leaving him alone in this aspect will create strong friction.
  • It is necessary that the worker maintains his motivation Properly justifying change processes is essential.
  • Human support. It is important to accompany transitions through support teams not only engaged in technical issues, but also human, which will prevent the worker from developing fear of or disengagement from change.

However, even if change happens under the best conditions, it is common for companies to experience a small decrease in productivity and efficiency while adapting to new circumstances. Many recognized sources refer to this as the “valley of despair”. This valley’s duration and depth are correlated with time and difficulties experimented by workers in order to adapt to new work methodologies.

Traditionally, companies’ position towards this valley was simply letting time pass by, waiting for the storm to pass and believing that problems, in the end, would be solved.

Currently, change management implies an active response to those problems. It has been proved that organizational change management gets to minimize the duration and depth of this valley, using an appropriate communication that enables the education and entertainment of the staff.

Furthermore, it has been also proved that it can be a way of saving money. Investing a certain amount of resources on helping companies to prepare their employees for changes minimizes the negative impacts these changes may mean for their work and the productivity of the company, thus achieving a significant direct economic saving, since the depth and duration of the "valley of despair" is reduced. On the other hand, an earlier productivity rise is achieved when implementing new working technologies faster, bringing an increase of the company’s profits.

When you consider carrying out a new change on the working system of your company, we advise you to take into account these five principles:

Alienation of leaders with the project

Business team leaders tend to focus all their attention on “what” is needed to be completed within the project or what is the final product, without paying much attention to the “why” and the “how”. Nevertheless, these questions are the pillars of change management.

Many business leaders think that changes in organization management happen automatically. It is as simple as defining change for workers to adopt it. However, experience shows this doesn’t happen this way. Organizational change management methodologies are a set of techniques that have proven their effectiveness in implementing change in a company.

Invest on organizational change management

These new methods allow efficient change implementation. Investing on them will bring a quicker adaptation to the new systems and improve employee satisfaction, contributing to the productivity of the company.

Counting on specific organizational change management technologies and a specialized team will reach a more efficient implementation of changes.

It is a very profitable investment if you are willing to implement the change in your company.

Boost employees’ implication

Employees’ implication is crucial. Not only because they are the ones using those new technologies at their jobs day by day, but because they are the best teacher for the rest of the staff. Getting workers involved and trained in the new work systems will allow the rest to be motivated and learn much better, as they will have the support they need within an arm's reach.

Create knowledge transfer systems

Doing something for the first time is difficult, but repeating it with the experience and support of others is an entirely different thing – and a  much less daunting one.

Take into account that there are many barriers for the knowledge transfer between projects and internally towards every team project. Knowing how to recognize them in time will help you design effective knowledge transfer policies.

Leave written proof of all change processes. Let the experience acquired by few train others.

Keep on reading about change management on our blog:

How to cope with resistance to change in your organization

Change management: what we do or what we are

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unicorn on black backgroundToo much innovation can be bad

Innovation is dangerous. Despite the many benefits of marketing new products and services, it is important for any private organization not to underestimate the complications of practicing innovation on a day to day basis. In short, for a private organization with limited resources, too much innovation without sufficient control, can quickly lead to disaster.

Start managing your innovative projects in a unified portfolio with ITM Platform 

Innovative ideas are, by definition, very risky. When you launch an innovative project, the future, the success and acceptance in the market, and often the technical difficulties for its development are unknown.

Solution: portfolio management of innovative projects

Over time, some innovative projects will fail, while others will succeed, they will come to market and may even become established.

This means that, in order to achieve successful innovation, it is imperative to fail, close defective projects, expose oneself to risk and, ultimately, lose financial resources that will not produce results.

So that the risk of innovation does not overwhelm your organization, it is essential to treat innovative projects as a portfolio that is managed according to unified criteria. Therefore the team that manages the portfolio has the important task of monitoring the organization's innovative projects.

Responsibilities include the following:

  • Demand a clear business argument about the commercial feasibility of the development and its relationship with the needs of customers.
  • When there are no spontaneous candidates for innovation, it is essential to request new proposals in the strategic directions and areas that have been identified.
  • Establish evaluation criteria for proposals.
  • Evaluate the proposals, discarding those that are too risky or do not promise sufficient benefits.
  • Decide investment limits for innovative projects, as well as total risk capacity.
  • Compose a balanced portfolio.
  • Coordinate the management of projects that make up the portfolio, especially in the case of shared resources.

How to monitor a portfolio of innovative projects?

When composing the portfolio and with a view of monitoring innovation, it is important to:

  • Have an appropriate balance between different types of projects, such as small technical innovations that improve an existing product or totally new products and services; and types and levels of risk.
  • In addition, it is essential that innovative projects are not linked to each other and can fail or continue independently. Otherwise, if projects share risks and have dependencies, failure in a component could have an impact on the whole portfolio. The fundamental idea of ​​a balanced portfolio is diversification and experimentation: that each project has its own life.
  • Achieve a number of projects low enough to be feasible with available resources (which will often be shared) and high enough to allow the introduction of new products and an interesting flow of projects for the portfolio's half-yearly and annual evaluations.

Evaluation of innovative projects

As we indicated above, in order to evaluate innovative projects and decide whether to keep them in the organization’s portfolio, it is important to define a series of benchmarks. Although it will depend on the sector and the characteristics of each entity, some typical criteria are:

  • Estimated cost
  • Development time
  • Critical resource consumption
  • Alignment with the strategic factors of the organization
  • Innovative and differential character
  • Technical success probabilities
  • Commercial success probabilities
  • Ease of imitation by competitors

Once the criteria are selected, it is important that they be assigned a weighting that allows final estimates to be made. The relative weight of each factor is usually a measure of the organization's situation. For example, in consulting firms that rely on networks of collaborators, the consumption of critical resources will be of little importance, whereas the limitation of development time may have more weight than in other more stable organizations, where innovative projects can be developed with stability over the years.

The score is a good estimate of the value of the project. However, the viability of an innovative portfolio depends on special attention to the composition of its risks. Therefore, beyond that final score reached by the projects based on the selected criteria, it is recommended that the composition of the portfolio of innovative projects make use of an assessment matrix.

The assessment matrix of innovative projects

Many of our readers are already familiar with the ITM Platform risk assessment matrix. The evaluation of innovative projects allows a completely analogous technique to be used.

In the assessment matrix of innovative projects two variables appear:

  • Expected commercial return of the project
  • Risk level

returns/risk

Ideally, all projects will be placed in the upper left quadrant of the matrix, they may be scarce and there may be many projects in the balanced quadrants marked in blue (where returns are proportional to risks).

Bearing in mind that it is good practice to include projects of different types with different levels of risk and knowing that, no matter what we do, some of the innovations will not be successful, a good result is the allocation of the project budget with Percentages that follow a proportion like that of the illustration.

percentages in rectangles

From the location of innovative projects in the matrix and their combination with the punctuation according to the criteria listed above, it should be much easier to make the final decision about which proposals to accept and which to discard.

Innovation will remain risky; but well-organized monitoring will increase the organization's chances of success and learning, with the potential to turn unsuccessful projects into better, more ambitious proposals in line with the pulse of the market.

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