People stop change happening

Mar 22 2007 by Nic Paton Print This Article

It isn't inadequate processes, strategy or technology that lead so many organisational change programmes to run into the sand. The main reasons for failed change are all about people.

A study for Deloitte Consulting has suggested that change programmes ought to tackle issues in an integrated and focused way and, in particular, look at the people issues facing the business before, during and after the programme.

The research has come as a conference of 165 HR directors organised by PricewaterhouseCoopers has separately predicted that a growing focus on people issues means there will be a chief of human resources on the board of most organisations by 2015.

According to Deloitte, most change programmes fall into one of three categories: enterprise transformations, (such as a merger or acquisition, turnaround or restructurings), function transformations (ie revamping specific business functions, such as human resources or finance) and sourcing transformations, or putting in place shared services or outsourcing.

Within all these there are eight key people-related areas companies need to be addressing, it argues.

These are: people risk and impact management, leadership alignment and stakeholder engagement, communications, culture, organisational design and governance, talent requirements and HR programme, workforce transition and learning and capability transfer, it said.

"Companies don't transform themselves just for fun, but to stay competitive, innovative, and operationally effective," said Orlan Boston, senior manager with Deloitte Consulting's human capital practice.

"Most companies don't have a choice as to whether they transform they do, however, have a great deal of choice when it comes to structuring and managing the transformation to improve the likelihood of achieving their desired results," he added.

The PwC research, meanwhile, found nearly two thirds believing there would be a chief of human resources on the board of most organisations by 2015.

Of these, more than eight out of 10 believed attracting and retaining talent would be their biggest challenge over the next five years.

This was followed by providing clear metrics for HR performance, a strong relationship with the chief executive and the growing complexity of reward programmes.

Some four out of 10 believed executive pay levels across Europe would be more transparent by 2015.

Michael Rendell, partner at PricewaterhouseCoopers LLP, said: "All the evidence points towards organisations becoming more people focused in their outlook. As talent shortages loom for many industries across the globe, there will be more and more opportunities for human resource professionals to influence strategic decisions at a high level."

He added: "At the same time, the global HR community has a lot of work to do if it is going to step up to the plate. Being a board member is about being a leader across the whole business, not just a senior specialist. The ability to produce human capital metrics is a start, but boards need interpretation and direction, not just numbers."