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Digital Transformation

Change Management – The soft side of projects? Not so fast!

How often do you hear Change Management referred to as “the soft side of the project?” Maybe you’ve even done it yourself.  Just last week, I was at a client site, describing what I do to a client employee, and the response from the client was, “Oh, you deal with people – the soft stuff.” I’d like to take a moment and challenge that assumption.

All projects should have a target return on investment (ROI), which is the benefit we hope to achieve by performing the project.  As Tim Creasey (Prosci) points out, that benefit can be broken down into two categories – benefits from install benefit and usage benefit.  Install benefits are the benefits we achieve simply by having the new system or process put in place.  These benefits may be cost savings (e.g., less maintenance), cost avoidance (e.g., meeting a regulatory standard reduces the risk of fines or data loss prevention), or something else.

Usage benefits are the benefits we achieve by people actually using the system.  For example, throughput increases with having a new order processing system in place that requires fewer clicks, leading to increased revenues or decreased costs (fewer human errors).  Perhaps customer service agents are able to more quickly respond to customer inquiries, leading to increased customer satisfaction, which drives increased sales.  Whatever the case may be, these benefits are only realized by people actually interacting with the new system.

It’s not uncommon for the usage benefit to represent to 70-90% of a project’s overall benefit.  Said another way, if we don’t get the adoption we desire, it’s conceivable that more than three-quarters of our target ROI is at risk!  For a project with an ROI of $1MM, that could equate to more than $750,000!  That’s the ROI of Change Management, and that’s not so soft.



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David Chapman

David is the General Manager for Perficient's Organizational Change Management practice, part of the Strategic Advisors Team. He has over twenty years of consulting experience and resides in Charlotte, North Carolina. Be sure to also check out David’s personal blog. It focuses on collaboratively building the breadth and depth of our collective change management knowledge based on insights and experiences shared to help one another grow.

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