7 Change Portfolio Management best practices

7 Change Portfolio Management best practices

Managing a set of change initiatives through a portfolio management approach is relatively new for some organizations.  This approach is drawn from the portfolio project management approach by dividing a set of initiatives into different groups.  This then becomes more manageable from a workload perspective.

Portfolio project managers are focused on investment funding, program management, governance, project execution and resource management. For portfolio change mangers, there are similar focus areas such as change program management, change initiative execution, resource management and quality assurance.  However, there are also several marked differences, including focus on business change governance, business change capability, change leadership, and change tools and methodology.

In practice, there is often a wide range of practices in the service delivery and model of portfolio change management.  Some focus purely on supporting project delivery, and in process fail to uplift business change capability.  Others tend to focus on general change capability through training and development and very little on change governance and supporting strategy implementation.

So, what are some of the best practices in change portfolio management?  How does the change portfolio management function position itself to be strategic, value-adding and seen as a driver of business results?  Here are 10 best practices.

  1. Use hard data.

A lot of change professionals often shy away from data.  We prefer to focus on behavior, leadership, mindsets, norms and culture.  Whilst the ‘soft’ things may matter we need to be comfortable in working with data.  Peter Drucker’s famous saying goes ‘What get’s measured gets done’.

Disciplines with a strong focus on data usually have a strong seat at the business table.  For example, Finance, Operations and Sales.  Even Marketing is not just about creative ideas and concepts, but there is a strong focus on cost, revenue forecast and customer responses.  Armed with data that drives business decisions and you get a strong seat at the decision making table.

What types of data should portfolio change managers focus on?  The standard change measures include training attendance, stakeholder ratings, and arbitrary business readiness ratings.  To really demonstrate value, portfolio change managers need to turn change management into a science and be able to quantify change.  Change Impacts is one great example.  By quantifying change impacts into discrete units one can start to measure and understand what changes are and how they move over time and across different parts of the business.

  1. Link change impacts with business outcomes

Continuing from the previous point – armed with quantitative change impact data, the portfolio change manager is able to analyze the data to find any correlations between change impact data and business performance data.  This can become a very powerful picture to take to the senior management team – drawing out the impact of changes on business performance.

Based on data from The Change Compass.  An organization has been able to draw significant correlations between change impacts and customer satisfaction levels.  This has since raised meaningful discussions regarding the approach of implementing changes and how to mitigate any potential negative impacts on the customer experience.  It does not necessarily mean minimize on change impacts on the customer. Instead, it challenges the group to think through how to better engage and prepare for the customer to transition through changes.  This is a great example of demonstrating the importance of linking change impacts with business outcomes.

  1. Focus on building change capability more than just execution

A lot of organizations treat change management as only discrete pieces of work that need to be carried out as a part of a project.  With this approach, these organizations have hired mainly contractors with some permanent change managers purely focused on project execution.  Whilst this work is absolutely required to successfully land initiatives, these resources come and go and at the end the organization is often no better off in managing change.

Instead, there needs to be a continual focus on developing business change capability.  This may be carried out in different ways.  With each project implementation the change manager may focus on uplifting change management capabilities in the business within its leaders.  Effective engagement and learning channels can be established to better aid the deployment of change initiatives.  These include self-paced training systems, know-how regarding establishing and measuring various learning interventions, and different types of employee engagement channels, both face-to-face and digital.

As change portfolio managers, a concerted focus on embedding business change capability can ensure that the business becomes more mature at undergoing change.   A strategic plan can be developed that includes different ways of targeting capability uplift and change maturity.  This requires business sponsorship and focus.  It is also a critical part of effective operational management.

  1. Design and manage change governance

Establishing effective change governance does not mean complicated multi-level governance with lots of documentation, policies and procedures and lots of head count to manage the processes.  Change governance means having the right processes to ensure there is sufficient oversight and visibility on what changes are going to happen and the effectiveness of change delivery.

Different organizations will establish different governance processes to suit the particular cultural and business environment.  However, at the most basic level, there should be a regular cadence where managers can see and visualize the changes that are going to happen, and discuss any risks and issues with the picture they are seeing.  At the same cadence there should also be a review of the previous changes and how they’ve been rolled out, with view to identify opportunities for improvement.

There should also be different levels of change governance for larger organizations.  For a business unit, there should be a change governance focusing on changes within the business unit.  There should also be an enterprise level change governance focused on changes across the organization.  At the enterprise level the discussion will be on strategic initiatives that run across the company.  There should also be discussions on any risks and issues with business readiness and progress of the change.

A standard meeting agenda for change governance would include the following:

  • Review the previous month’s changes including call outs of highlights, challenges, employee engagement, results and overall progress
  • Examining metrics around the amount of change and to what extent the level of changes can be digested by the business appropriately
  • Identifying potential contentions of concurrent changes within the plan. If there are concurrent changes being released into the business, discussions should zoom in on the quantum and nature of change contention, rationale as to why the business may not be able to handle the volume of changes, and implications if the releases were to proceed
  • Examining the data to ensure that all changes are captured and there is nothing missing. Change data should contain key projects being implemented, BAU changes and other corporate programs from groups such as IT or HR
  • Examining the overall upcoming change slate and identify upcoming risks and opportunities. Opportunities may include potential gaps where there is very little change, and where there may be opportunities for initiatives to land
  1. Leverage digital tools

Project portfolio managers manage the slate of projects using a structured process of funding, prioritization, analysis and review based on data.  In a similar vein, so should change portfolio managers.  The power that change managers have is not around cost or schedule data, it is on change impact and change readiness as discrete data points.  The challenge is how to collect, analyze, present and leverage the power of these data.

The Change Compass is a digital tool that quantifies and packages change impacts into data that can be easily analyzed and presented in a visual format to decision makers.  Initiative owners who own the source of the information update change impact data.  Up to date change impact data can be accessed at any time with reporting generated automatically.  The portfolio change manager is able to easily dissect, drill-down, and cut data to find out the change health of the portfolio:

  • Is there too much change?
  • How is our staffing resource impacted by change activities (especially for resource sensitive areas such as call centres)
  • What’s the change tolerance level for the business?
  • How are various stakeholder groups impacted by the changes?
  • How are initiatives under particular strategic themes impacting the business?
  • How are customers and their respective experiences impacted by our initiatives?
  1. Examine customer impacts

At a portfolio level, it is not sufficient to just focus on internal employee and stakeholder impacts.  The change portfolio manager also needs to place focus on how are customers impacted by the planned changes.  This drives at the core of the focus of a lot of the organizations on the customer.

One large financial services organization that was focused on customer experiences started analyzing data on customer change impacts across initiatives.  Through this, there was a significant realization that the same group of customers was impacted by 6 significant initiatives at the same time.  Across each of these initiatives there was no coordination and the silo approach meant that poor synchronization and coordination could lead to a very poor customer experience.  Subsequently, new roles and remits were created to manage this customer experience through facilitating a coordinated approach to planning and implementing initiative roll out.

  1. Iterative planning

Iterative planning is a core of agile ways of working.  At the core of iterative planning is the belief that we don’t always know the solution that we are striving for at the beginning of the change initiative.  It is when we start testing and getting feedback from users that we are able to refine our proposal and be able to come up with a solution that suits the organization.

To truly support agile ways of working, change management needs to be able to develop prototypes of the change approach, and be able to morph or tweak the approach as required based on feedback.  For example, a change approach can be tested on a particular team, the change champion group, or a selected trial group.  Communication and engagement approach as well as learning approach can be tested in these groups.

How to better manage a change portfolio?

How to better manage a change portfolio?

  1. Set up a simple, business-led change governance

Instead of a myriad of project-based governance bodies, establish a divisional business body focused on managing change impacts on people and customers.  This may be embedded into an existing monthly divisional leadership meeting.  In this governance meeting, the focus is on:

  • Reviewing the data and trends of change impacts (linking with other initiative data such as benefits and scheduling)
  • Identifying any risks regarding the pace and the ‘amount’ of change
  • Identifying opportunities to link change activities with key strategic themes so that it is easier for people to digest and absorb the change
  • Identify opportunities to integrate roll out activities such as training and workshops as appropriate
  • Decision making on the prioritization of change releases
  • Monitor the feedback from impacted groups on the effectiveness of change delivery

This is not to say that project-based governance is not required.  Business involvement is critical in project governance.  However, a key focus should be placed on understanding the overall picture first and what the business is going to go through.   From this clarity, it will then be easier to see how each initiative fits into the overall picture and if there are roll out considerations.

With clear change impact data, discussions will also be more swift, focused on more strategic conversations vs. gut feel and individual preferences.  In this way, change is also being positioned as much more rigorous, data-driven, and scientific, versus fluffy, undefined or worse, unimportant.

  1. Embed change impact management into the operating rhythm

One way to improve change capability in an organization is to focus operations on change and implementation, versus viewing change management as a separate piece of work done by Change Managers.  This involves:

  • Build the framework for initiative drivers to define and articulate change impacts, and own the update of initiative data in a central repository. When all initiative owners regularly update the data on change impacts, all stakeholders benefit.  Initiative drivers are able to see what else is impacting the business and how to avoid any implementation bottle-necks.  On the other hand, the business is able to better see the total picture.
  • Build agreement within the organization to create one integrated picture of change impacts, irrespective of whether a change initiative is deemed as a project, program or a business-as-usual activity. To do this, we need to adopt the perspective of the user impacted.   Changes for them could include everything ranging from policy changes, technology changes, process changes, restructuring, marketing campaigns, and product changes.
  • Build the management of change impacts into the roles and responsibilities of Operations. This includes a) considering change impacts in the process of resource planning, b) the ‘air traffic control’ of landing initiatives and their impacts, c) ensuring the impacted groups are ready and engaged, d) that the business has demonstrated the ownership and capability to adopt the change, e) managers accountable of driving the behavior embedment and monitoring of performance are clear.
  • The change impact data should be open for anyone to access and understand. This would then put the onus on everyone to own and drive change.  The frontline should also be able to look at the plan and understand the nature of the impacts on them.  This will add significant value within an environment of concurrent multiple changes.
  • Organizations should start with one division to test this model. Eventually, roll this out to other divisions.  Once the whole organization has adopted this, an enterprise level governance body may then be formed to promote cross-functional conversations in managing the ‘air traffic control’ and landing of initiatives.  The quality of this conversation will also then be a key precursor to maximizing benefit realization of initiatives

Check out our infographic on how to better manage a change portfolio.

  1. Quantify change impacts

One of the core problems faced by companies is how to quantify change impacts and make them more tangible, easier to visualize, measure and to manage.

Change impacts may be quantified in the following way:

  • The level of change. This denotes the intensity of the change impact.  A Likert scale may be used to define and illustrate the different levels.  For example, Level 1 could be minimal impacts, requiring the user only to attend a few meetings and reading a few emails.  However, at the highest level the impact could be defined as significant, requiring role changes, in-depth training and a new way of operating.
  • The type of change. Different categories of change may be listed, including technology changes, policy changes, marketing changes, product changes, etc.
  • Timing of change. This refers to the timing to which a change impact will occur.  The impact may be different for different groups of stakeholders.
  • Scale of the impact. This denotes to the number of employees impacted as an estimate.
  • Parts of the business impacted. This refers to which parts of the business are impacted by this particular change impact.
  • Change activity. This includes various change activities associated with the change impact, including training, workshops, formal communications, etc.

From the information provided, analysis may then be undertaken, looking at the loading of change, whether there is any potential change clash from a timing perspective, whether there is behavior consistency across initiatives rolled out, and whether the initiatives overall are driving the organization’s strategy forward.

Moreover, with sufficient historical data, the company may then be able to correlate the impact of the ‘amount’ of change on business performance.  From this, the change impact data may then be used to even ‘predict’ future business performance.  Such is the power of quantifying change impact.

  1. Clarify customer impacts to manage customer experience

A significant number of companies are now jumping on the bandwagon of focusing on customer experience.  This is because other value levers such as cost and efficiency are almost maxed out and there little additional efficiencies that can be achieved there.

To truly manage customer experience one needs to start by understanding the total picture of what the company is planning to change for a particular group of customers.  This includes:

  • Customer change impact data, such as change type, timing, scale, and level of change (similar to those for employees)
  • Customer type – this could be customer segments or other categorizations of customer groups
  • Positive or negative change from the customer’s perspective
  • Does the customer care about this change? How important is this change for the customer? It is critical to assess this from the customer’s lens, vs. the company’s lens?

After collecting these data, a customer’s experience may then be mapped out from the perspective of change impacts on their experience.  Is there a number of legislative initiatives that will create negative customer experience?  Is there too much change planned?  What would be the optimal ‘change loading’ for customers?  The customer impact data enables valuable discussions and decisions

Check out our ultimate guide to change portfolio management.

  1. Leverage technology solutions

For smaller organizations managing change initiatives, spreadsheets may suffice.  However, for large organizations managing a large portfolio of changes, spreadsheets may not be sufficient.

Technology solutions now enable both drivers and receivers of the change to access impact information any time and anywhere.  This promotes collaboration and effective conversations.  Companies will not need to rely on an army of analysts to constantly collect and verify the data, since the data is coming straight from ‘the source’.  Reporting efforts are also optmized by having standard, automated reporting, generated any time required.

Technology solutions are also great for agile-focused organizations where there is always a series of constant and iterative changes, and where change impact information could change rapidly from week to week.  Access to accurate and timely data is even more critical.

Stakeholders across the company are also able to see, in real time, the change impacts being planned.  From this, meaning conversations may be had in terms of the level and nature of change impacts from different stakeholder perspectives.  For example, does the business share the same agreement of change impact as the program?  This creates transparency and shared accountability in the ownership of change outcomes.

  1. Use data-based feedback to improve change capability

In implementing a data-based model of managing change impacts organizations will experience an uplift in change capability.  How?

After a division reviews the feedback from stakeholders after initiatives get rolled out, referencing indicated ‘amount’ of change planned, this reference ‘amount’ then becomes a yardstick for answering ‘how much is too much change’.

Moreover, with regular routines and reviews over time, the yardstick of change loading can then aid future decision making on 1) the optimal change impact loading for the business, 2) readiness activities required to better manage across changes, 3) prioritization required and 4) potential for synchronization across initiatives (e.g. communication or training efforts).

In this way, the business division learns to determine how best to utilize change impact data to prepare for changes, to avoid change fatigue and to maximize adoption.  The outcome of this is testing with ‘tactics’ of managing the change load, and improved business performance.  With open data sharing, there is also opportunity for cross-divisional learning to pick up tips from each other on how to manage multiple changes and still deliver operational performance.

Click here to download our infographic on How to Better Manage a Change Portfolio.