An important part of measuring meaningful change is to be able to design effective communication effectiveness change management surveys that measure the purpose of the survey it has set out to measure the level of understanding of the change. Designing and rolling out change management surveys is a core part of what a change practitioner’s role is. However, there is often little attention paid to how valid and how well designed the survey is. A survey that is not well-designed can be meaningless, or worse, misleading. Without the right understanding from survey results, a project can easily go down the wrong path. This is how this survey can be a powerful tool to ensure smooth transition for the change initiative.
Why do change management surveys need to be valid?
A survey’s validity is the extent to which it measures what it is supposed to measure. Validity is an assessment of its accuracy. This applies whether we are talking about a change readiness survey, a change adoption survey, employee engagement, employee sentiment pulse survey, or a stakeholder opinion survey.
What are the different ways to ensure that a organizational change management survey can maximise its validity and greater success?
Face validity. The first way in which a survey’s validity can be assessed is its face validity. Having good face validity is that in the view of your targeted respondents the questions measure what they aimed to measure. If your survey is measuring stakeholder readiness, then it’s about these stakeholders agreeing that your survey questions measure what they are intended to measure.
Predictive validity. If you really want to ensure that your survey questions are scientifically proven to have high validity, then you may want to search and leverage survey questionnaires that have gone through statistical validation. Predictive validity means that your survey is correlated with those surveys that have high statistical validity. This may not be the most practical for most change management professionals.
Construct validity. This is about to what extent your change survey measures the underlying attitudes and behaviours it is intended to measure. Again, this may require statistical analysis to ensure there is construct validity.
At the most basic level, it is recommended that face validity is tested prior to finalising the survey design.
How do we do this? A simple way to test the face validity is to run your survey by a select number of ‘friendly’ respondents (potentially your change champions) and ask them to rate this, followed by a meeting to review how they interpreted the meaning of the survey questions.
Alternatively, you can also design a smaller pilot group of respondents before rolling the survey out to a larger group. In any case, the outcome is to test that your survey is coming across with the same intent as to how your respondents interpret them.
Techniques to increase survey validity
1. Clarity of question-wording.
This is the most important part of designing an effective and valid survey. This is a critical part of the change management strategy. The question wording should be that any person in your target audience can read it and interpret the question in exactly the same way.
Use simple words that anyone can understand, and avoid jargon where possible unless the term is commonly used by all of your target respondents
Use short questions where possible to avoid any interpretation complexities, and also to avoid the typical short attention spans of respondents. This is also particularly important if your respondents will be completing the survey on mobile phones
Avoid using double-negatives, such as “If the project sponsor can’t improve how she engages with the team, what should she avoid doing?”
2. Avoiding question biases
A common mistake in writing survey questions is to word them in a way that is biased toward one particular opinion which may lead to biased employee feedback. This assumes that the respondents already have a particular point of view and therefore the question may not allow them to select answers that they would like to select.
Some examples of potentially biased survey questions (if these are not follow-on questions from previous questions):
Is the information you received helping you to communicate effectively to your team members through appropriate communication channels?
How do you adequately support the objectives of the project
From what communication mediums do your employees give you feedback about the project
3. Providing all available answer options
Writing an effective employee survey question means thinking through all the options that the respondent may come up with regarding the upcoming change. After doing this, incorporate these options into the answer design. Avoid answer options that are overly simple and may not meet respondent needs in terms of choice options.
4. Ensure your chosen response options are appropriate for the question.
Choosing appropriate response options may not always be straightforward. There are often several considerations, including:
What is the easiest response format for the respondents?
What is the fastest way for respondents to answer, and therefore increase my response rate?
Does the response format make sense for every question in the survey?
For example, if you choose a Likert scale, choosing the number of points in the Likert scale to use is critical.
If you use a 10-point Likert scale, is this going to make it too complicated for the respondent to interpret between 7 and 8 for example?
If you use a 5-point Likert scale, will respondents likely resort to the middle, i.e. 3 out of 5, out of laziness or not wanting to be too controversial? Is it better to use a 6-point scale and force the user not to sit in the middle of the fence with their responses?
If you are using a 3-point Likert scale, for example, High/Medium/Low, is this going to provide sufficient granularity that is required in case there are too many items where users are rating medium, therefore making it hard for you to extract answer comparisons across items?
5. If in doubt leave it out
There is a tendency to cram as many questions in the survey as possible because change practitioners would like to find out as much as possible from the respondents. However, this typically leads to poor outcomes including poor completion rates. So, when in doubt leave the question out and only focus on those questions that are absolutely critical to measure what you are aiming to measure.
6.Open-ended vs close-ended questions
To increase the response rate of change readiness survey questions, it is common practice to use closed-ended questions where the user selects from a prescribed set of answers. This is particularly the case when you are conducting quick pulse surveys to sense-check the sentiments of key stakeholder groups. Whilst this is great to ensure a quick, and painless survey experience for users, relying purely on closed-ended questions may not always give us what we need.
It is always good practice to have at least one open-ended question to allow the respondent to provide other feedback outside of the answer options that are predetermined. This gives your stakeholders the opportunity to provide qualitative feedback in ways you may not have thought of. This may include items that indicate employee resistance, opinions regarding the work environment, new ways of working, or requiring additional support.
Writing an effective and valid change management survey best practices for a specific change initiative is often glanced over as a critical skill. Being aware of the above 6 points will get you a long way in ensuring that your survey addresses areas of concern in a way that aligns with your change management process and strategy and will measure what it is intended to measure. As a result, the survey results will be more bullet-proof to potential criticisms and ensure the results are valid, providing information that can be trusted by your stakeholders.
Change saturation is one of the popular search items when it comes to measuring change management. How do we effectively measure change saturation without resorting to personal opinions? And how might we formulate effective recommendations that are logical and that stakeholders can action immediately?
Use this recipe to measure change saturation using The Change Compass.
Measuring change has become increasingly popular within the change management discipline. It used to be that change practitioners were more comfortable thinking and proposing that they are all about people, and therefore people factors are not hard and easy to measure. Areas such as change leadership, training, communication, and engagement were often the key tenants of a change professional’s key focus areas.
With increasing digitisation and focus on data and metrics, change management is also not exempt from this trend. Business leaders are now demanding that change management, just like most other business disciplines, demonstrate their value and work outcome through measurable metrics.
Using change management software to measure change
Even before the more recent trend of focusing on various aspects of change, change management software products have emerged. 10 years, when the basic idea for The Change Compass started, there was only 1-2 change management software in the market. Several years after that, there started to be 2-4 product offerings emerging in the marketplace.
Over the years, many of these software products have closed shop, or been sold to other companies. At the time, the need for change management software to measure change was not strong in the marketplace. It was perhaps an immature market where a lot of practitioners saw little need.
Types of change management software
There are many types of change management software. First, let’s spell out that we are not talking about technical change management software such as ITIL or technical change tracking software. The focus of this article is on organisational change management software.
The different types of change management software include:
Change project adoption measurement – Such as ChangeTracking that focuses on measuring the extent to which the project is progressing on track from a stakeholder perception and adoption angle
Change project implementation measurement – Such as Change Automator that provides a platform to automate project change delivery work that change practitioners focus on in capturing change deliverables, and overall change reporting and tracking
Change portfolio measurement – Such as The Change Compass that offers data visualisation for a change portfolio (collection of change projects) to help make portfolio level decisions on prioritisation, sequencing and delivery risks
Other organisational measurement – Such as OrgMapper that provides organisational network analysis maps and networks to understand relationship networks across individuals and groups
Data capture and automation
One of the key value propositions of a digital change management software is to provide some levels of automation in the capture of change management data, so that the data may be easily analysed and visualised. However, in our analysis of available change management software in the market, we found that there is a wide range of various levels of automation. Some have almost zero automation, whilst others have significant levels of automation.
In searching for an effective digital change management tool, ensure that you take into account the following in data capture:
To what extent is the data capture flexible and can be easily tailored
What are the system features to automate data entry?
Is there a range of data analytics from the data entered
Is the tool just a data depository without insight generation and data analysis features
Is the data capture too categorical? E.g. Agile vs Waterfall? And how useful are the data fields in terms of making decisions or generating insights?
Here is an example of automation from Change Automator where stakeholder data can be pulled from the company’s Microsoft Azure system to reduce the significant time required to input stakeholder details.
Change Automator example of using automation to save time
Data analysis & reporting
The power of digital software is that it can easily calculate, track, and visually show the metrics that we are focused on. Looking at raw data is meaningless if it cannot be turned into highly engaging and meaningful charts that generate an understanding of some kind of insight into the organisational situation with regard to initiatives.
Some change management software reports simple figures that may provide limited usefulness. For example, the number of impacts affecting each stakeholder group may be interesting but there is not much we can do with the data. This is because the number of impacts doesn’t indicate the overall severity or volume of the impacts.
Data visualisation should also support ‘drill-through’, where the user is able to click on the chart and drill into more details about that particular part of the data to better understand what contributes to it. This is a critical part of data analysis and understanding the story that the data is telling us.
Effective data visualization
Data visualisation formats are also critical. With the wrong data visualisation design, it becomes very difficult for people to understand and interpret the data. Ideally, the user should see very clearly what the data is showing them visually. For example, pie charts have become very popular in reporting. However, pie charts are only useful to contrast a few different data points. When there are too many data points and the data is too similar, the human eye finds it difficult to compare and contrast any differences.
Effective data visualisation should also allow the user to highlight a part of the data to create a visual emphasise to support a particular point. Making the visuals simple for the user is ultimately the most important part of chart design. The more complex it is, the harder it is for you to get your point across to your stakeholders.
To learn more about designing the right data visualisation to create optimal impact check out our infographic.
Insight generation & decision making
Ultimately, the change management software should be designed to provide insight into what is going to happen to the impacted people (whether it be employees, customers, or partners). The data should help you zoom into where is the source of the problem or the risk area, what the risk is, and potentially how to make a recommendation to resolve it. The drill-through capability is critical to support the insight generation.
The data visualisation should also directly support you or your business stakeholders to make business decisions on change. If the data was just ‘interesting’ it will not have much impact and after a while business stakeholders will lose their interest in the data. Instead, data and reporting should form a core part of regular business decision-making. Decision making using change data can be:
Within a project in making roll out and implementation decisions
Within a portfolio in making prioritisation and sequencing decisions
Within a business unit in making capacity prioritisation, business readiness and operational planning decisions
Across the enterprise in PMO and change governance settings on prioritisation, sequencing, benefit realisation and enterprise planning
Tailoring of data visualization
For those users who are more advanced with change analytics, there may be stakeholder requests to tailor charts in different formats. It could also be that for a specific organisational scenario, the user would like to create a tailored chart to show the specific problem that is not represented in existing off-the-shelf report designs.
In this case, the software should have the flexibility to allow these users to select their desired data fields and even types of charts that they want to work with to design the tailored chart without too much effort, and ideally not from scratch.
Here is an example from Change Automator where the user is able to easily tailor a chart by selecting the data fields, experiment with different charting, to come up with the ideal chart to influence stakeholders.
Example from Change Automator on easily tailoring charts
Trend analysis and predictive analysis through machine learning
Reading and interpreting individual charts can yield significant insights. However, the real power of analytics is to look at historical trends and even predict future trends based on data. Therefore, having the right data, over time, can create significant value. This is why investing in data is so critical, and why not just technology companies, but most industries are focused on digitising and leveraging the power of data.
The same thing applies to change analytics and change data. Invest in change data and the benefits can be enormous. By better understanding data trends with the assistance of machine learning, the system can highlight and draw your attention to critical observations and findings that you may have skipped.
With sufficient data, you’re also able to utilise machine learning to generate predictive data trends. Some examples of situations in which this can provide significant value include:
Typical times in which the business unit or team are busy with changes or operational challenges
Typically how initiatives of different complexities take to adopt and embed within the business
Typical delays in forecasted versus actual change implementation timeline
Stakeholder groups that tend to show the highest resistance or lowest engagement to initiatives
Predicted time it takes to realise targeted benefits
Investing in a change management software can create significant value for your organisation by measuring change and making it visual and easier to understand. Selecting the right tool is critical since there is a variety of options on the market. Examine closely the functionalities and how they enable you to make business decisions since not all charts may be useful. With the right software support, you will be able to not only tell a compelling, data-backed story of what is going to happen to the business, but also the logical recommendations that stakeholders find hard to dispute.
Change Automator example of leveraging machine learning in change analytics
Being more strategic in managing change is about being more focused on those aspects of driving change that will create the most value for the organisation. This is directly comparable to what strategy is about. Strategy is about choosing a particular path to achieve a particular set of goals, versus other paths. There are many paths and many ways to manage change and different paths may yield different results.
What are the advantages of being more strategic? Being more strategic means you are clearer in terms of the specific approach you are taking in leading change and how that translates to a particular set of results. It is not just about following a particular methodology blindly or whatever approach is ‘in vogue’.
Strategic change practitioners create greater value for the organisation. They are more able to connect with senior managers in terms of driving organisational impact and results versus being focused just on individual implementation tactics. They are also able to easily articulate why change activities are carried out and how they contribute to the overall outcomes. Moreover, they’re able to position the value of the change in the overall strategy of the organisation and why the change is important. In approaching the implementation they zoom in on the parts of the change that makes the most difference.
How does a change practitioner be more strategic?
Start with understanding and linking the initiative to the strategy
Every initiative exists to support a particular strategy that the company has created. Change practitioners need to have a good understanding of the organisational strategies, why they were created, and what they aimed to achieve. At a basic level, it should be clearly understood by all stakeholders why the initiative was created and the strategy it aims to support.
A clear grasp of how the initiative supports an organisational strategy helps the change practitioner position the size of the value delivered by the initiative. As a result, it helps with determining the focus and effort that should be devoted to and how to realise the objectives of this initiative.
Organisational strategy can also be understood using the 3 horizons model. Strategies and initiatives can fall within each of the 3 horizons.
Horizon 1 ideas provide continuous innovation to a company’s existing business model and core capabilities in the short-term.
Horizon 2 ideas extend a company’s existing business model and core capabilities to new customers, markets, or targets.
Horizon 3 is the creation of new capabilities and new business to take advantage of or respond to disruptive opportunities or to counter disruption.
3 horizons model (from Stratechi)
Most change practitioners would be involved in horizon 1 initiatives where there are immediate changes required to the business in the shorter term. However, there are also initiatives about transformation in horizon 2 concerned with building core capabilities. Horizon 3 is about building and launching new products or launching into new markets outside of the existing business. There may also be initiatives within this horizon. Understanding which horizon the initiative falls under helps with its positioning.
Improving business acumen:
Having good business acumen is critical to being a strategic change practitioner. If you do not understand how the business works then it is hard to be strategic. This is because without understanding key drivers of how the business works, it is hard to formulate the right positioning to support the change initiative in a way that supports the realisation of the strategy.
Don’t fret. There are a few focus areas that can point you in the right direction.
1. How the company makes money.
At a basic level, understand how the company is structured and how it makes money. Lay out all the various departments of the organisation. Focus on key operations of the business. This can be labelled as a value chain, or how services and products get produced and delivered to the customer. What are the key investments of the organisation? In a financial services setting the focus is on people, financial investment, and technology. In manufacturing, it could be on equipment and supply chain.
Focus on the key drivers for the company. Is the company focused on maximizing profit? Or is the focus on increasing revenue? Is there a focus on decreasing costs to increase revenue? What are the ‘big buckets’ in which cost savings can be achieved? And therefore how is your initiative supporting any of these drivers?
The critical part is to understand ‘why’ the company is focused on particular activities. There are the business-as-usual parts of the organisation focused on maintenance of the business (’keeping the lights on’), and then there are core drivers that can make or break the business and its financials. Seek to understand why particular strategies were chosen and what objectives they will help the company to achieve.
2.Competition and the market landscape.
After understanding how a company operates, the next step is to understand the landscape that it operates. A good model to be familiar with in analysing the competitive landscape of the industry is Porter’s 5 forces model. Seek to understand the interplay between the 5 forces. How do these shape the industry? As a result, how is the company positioned in the market? To be successful which forces is the company focused on managing?
Is your initiative involved in providing a better experience for customers because the landscape has been changing and customers are more demanding and have more choices than before? Is the initiative focused on launching a digital solution so that the company is not overtaken by rivals who offer better options to customers? Is the company’s profit suffering due to increased material/finance costs and therefore the initiatives are focused on containing cost? Is the program focused on improving efficiency through launching a systems solution and therefore improving customer delivery time or saving headcount?
5 forces model (from Visual Paradigm)
Focus on providing value to the organisation
We know that it is not always easy to prove the value of change management. People benefits are not always tangible and easily measured. However, this does not mean that it is less important or that measurement is not valuable. In the past, there have been efforts to try and measure change management in terms of return on investment (ROI). However, this may not be the most strategic way of demonstrating the value of change management.
Where possible, always focus on creating value for the organisation, as opposed to focusing on saving costs. The ultimate superpower of change management is about creating the right organisational environment so as to fully realize the benefits targeted by initiatives. Initiative benefits may not always be in financial dollar terms but are often in the hundreds of thousands to millions in benefits.
On the other hand, a focus on cost will always be compared against other costs. You can try and argue that the cost for change management is not large, but then there are always ways to reduce the cost. Going down the path of focusing on cost can only get you so far. This is for the same reason that a company that only focuses on reducing cost will not grow. Alternatively, focus on increasing value for the organisation means targeting a much bigger piece of the pie. Here is an example of why focusing on value often means creating a lot more impact than focusing on cost.
To adopt a rigorous logic-based approach in determining your change approach, use the MECE framework. MECE stands for mutually exclusive, collectively exhaustive. The framework is commonly used by strategy consultants when they analyse the organisation and determine what strategies to formulate.
MECE framework (from Case interview)
There are 2 aspects to using this model. The model is based on a scientific hypothesis approach to problem-solving. This means that you must always begin with a hypothesis, followed by branches that test the hypothesis. To goal is to prove or disprove the hypothesis. For example, “by open-sourcing change tactics, we will achieve a better change outcome”. Then you can draw a tree diagram that branches out the various factors that can either support or disprove this. For example, these could be the potential branches:
The culture of the company is hierarchical and employees are not always forthcoming in openly sharing their ideas and expect to be lead
The project has a particularly tight timeline and there may not be sufficient time to properly engage the community for various ideas
Program sponsor and key stakeholders already have a fixed idea of how they want to implement the change, and therefore may not be open to other ideas
The organisation does not have a history of undergoing significant change and therefore employees may not understand the effort required to drive and sustain the change
Tree diagram (from Case interview)
From each branch, there can be subbranches that call out the evidence or reasoning for each branch. In this case, there seems to be strong logic that this hypothesis is false. Therefore, this is not a good strategy to use for this initiative.
Use the MECE approach to strategize your change approach. A lot of practitioners tend to prefer to follow standard change management models and methodologies. This may be OK as a reference, or a reminder. However, an effective change approach that is strategically focused on what the organisation needs must be developed using a logic-based approach. One that is tailored and designed specifically for the unique situation that the company is in currently.
Your change strategy or approach should always be unique to the requirements of the organisation. It should never be a ‘copy’ of another initiative because no two initiatives are ever completely the same. There will be tactics that are similar across initiatives, such as engagement approaches utilised or impact assessment design. However, the change strategy needs to call out what is unique about this initiative and how the change strategy is specifically designed for this situation.
Build change measurement and tracking
Business strategy can only be successful if it can be measured. Without measurement, there is no way of knowing if the objectives are achieved or when to abandon the strategy and adapt/tweak as required. The same applies to change strategy and execution. The change strategy must come with a set of metrics in order to gauge to what extent the strategy is successful or not.
Be aware of not creating too many metrics that will lead to significant effort required to capture and report the metrics. Balance effort and outcome in the tracking and reporting of change management metrics. Having anywhere from 3-5 metrics is a good number to target. When you start to have more metrics, the effort required may be too overwhelming.
Application of strategic approaches throughout the project lifecycle
Let’s go through an example of how strategic change approaches can be applied throughout the project life cycle.
Scoping – Strategic approach to look widely at the effort involved
Typically during this phase of the project, change practitioners may tend to focus only on the operational aspect of scoping out the resources required to support the project and the level of impact on the organisation. However, it is also important to be clear about the strategic importance and positioning of this initiative.
In scoping out the change management effort required to support an initiative we need to understand the strategic importance of the initiative and where it stands compared to other initiative and organisational focus areas. Key questions to consider include:
What is the priority level of the initiative
What strategy is it supporting? What’s the level of strategic importance?
What’s the right level of focus to support this initiative, balanced against other organisational priorities? For example, what else would impacted stakeholders be focused on during the impact period, and therefore how do we support having the right priorities? (i.e. the right level of ambidexterity)
Are there opportunities to integrate the roll out of this initiative with other initiatives to simplify focus, organisational effort and aid change adoption (e.g. this could be done at a communications or learning roll-out levels)
Impact assessment – Utilise strategic analysis to understand business impact
In analysing the change impact of the initiative, a strategic approach means a depth of understanding of how the business is impacted by the initiative and what benefits will mean to the business. Each part of the business by definition has different focus areas, and the business impact will be different as a result. To conduct a strategic analysis of the impact of change undergoes the following:
What is the business environment including partners, customers and suppliers? How will the change influence the dynamics of this environment?
How will the work and value of the business unit be altered as a result of the change? Conduct this analysis at multiple layers of the business unit to tease out the implications?
Will there be financial, resourcing, time, cost or effort impacts on the business unit or stakeholder group?
Will the business unit’s own focus areas or strategies be altered as a result of the change? Will its metrics, tracking and reporting be altered as well?
Change strategy formulation
In formulating the change strategy for the initiative adopt the MECE approach as described previously. You may need to formulate different hypotheses and test them before arriving at the one that is the most applicable to the organisation. Feel free to share your tree branch with your stakeholders to take them through how the change strategy is formulated. Involve them to ‘test’ the assumptions as required in the formulation.
Systems and portfolio views of the organisation
A key part of strategic change management is approaching change from a holistic and ‘systems-based’ perspective. A change project should not be viewed in its isolation but as a piece of the overall system. This means you need to understand the potential relations of this initiative with other initiatives in supporting the same strategy, and what other initiatives are focused on by the impacted business units. Having a portfolio-level visibility of the various initiatives and their relative impacts on the organisation is a key capability to support planning and decision making. This also helps you to better position or clarify your initiative compared to other focus areas.
Examples of portfolio level views of change from The Change Compass
Strategic capabilities
Different organisations and business units will have different levels of capabilities in leading, executing, and embedding change. Within the timeline and resource challenges of one initiative, it is not always possible to address all the various aspects of capability gaps. In fact, you may even face multiple capability gaps that may potentially derail the project.
Conduct a strategic capability analysis to assess which capabilities are core and critical to the success of the project. Assign weighting to each capability in terms of importance and any existing gaps. Use this analysis to formulate the top one or two capabilities you may want to focus on supporting the business to ensure the rollout is successful. Strategy is about focus and making bets. By spreading your efforts too thin you might not be able to close any of the capability gaps.
Showing the value of change management is something that change practitioners have yearned for. Some senior leaders do not understand the value of change management and either see it as a normal part of general business management or don’t even understand what it is. For less mature organisations, change practitioners often need to spend significant time educating stakeholders and explaining why they are doing the work that they are hired for. Calculating and showing the financial value of change portfolio management can be the ultimate ‘proof’.
Calculating the value of change management has been a difficult task to accomplish since a lot of the work of managing change is deemed as ‘soft’ and about people and leadership. There are various attempts to calculate in financial terms the value of managing change. These approaches include ROI (return on investment) and cost-benefit analysis. However, this approach is purely focused on a cost level and does not look at the value of the impact of change management work.
At a change portfolio level, there is even less in the literature. Not only is there not a lot of content on how to manage a portfolio of changes, but there is also almost no mention in the literature on how to calculate the financial value of managing a change portfolio.
A lot of organisations do not invest in managing initiatives across the portfolio from a change management perspective. This could be due to a lack of change management maturity or experience. Managing initiatives across a portfolio requires not only senior leader sponsorship but also having the right change governance, operational routines, change management analytics and decision-making capability in conducting ‘air traffic control’, sequencing, and resource prioritisation.
One of the difficulties is in trying to measure the value of the whole discipline, which may be too complex and wide in breadth to take into account. A better approach may be to look at the tangible parts of value created from managing a portfolio of changes.
One of the key values of effectively managing a portfolio of changes is helping the organisation better prioritise the right initiatives, the right sequencing of initiative implementation, and therefore the right resources to support these initiatives. This includes not just the right resource focus and allocation from a project implementation perspective, but also from a business perspective when it comes to change readiness and adoption.
A McKinsey study showed that companies that are better at prioritising resources to support initiatives can reap an average of 40% more value than other companies. Note that this is not ‘up to 40%’ but an ‘average of 40%’. This is a significant finding and shows how much this impacts the value of the company.
How do we calculate this change portfolio financial value?
Step 1 – Calculating the value of the company
One simple way to calculate the value of a company can be calculated by using this simple equation:
Value = Earning after tax x P/E (price to earnings) Ratio
Earnings after tax = This number you should be able to get from Finance, or for public companies, this figure should be available in the published Income Statement.
Price to earnings ratio = There are several ways to get this figure. Market value per share divided by earnings per share. Or if this number is not available you can use the average P/E ratio number of 14 as the average for S&P 500.
Let’s take a few examples.
Your company’s earnings after tax is $100 million. And if your P/E ratio is not available, then the value of the company is $100 million x 14 = $1.4 billion.
Your company’s earnings after tax is $300 million. And if you’re P/E ratio is not available, then the value of the company is $300 million x 14 = $4.2 billion.
Step 2 – Calculating the value of prioritising resources to support your initiative portfolio
In the McKinsey study, the 40% increase in company value was over a 15 year period. Let’s assume this is taking into account the compounded effect of incremental value year in and year out. Using a reverse compounded interest calculator would equate to 2% per year in incremental value.
In the example where the value of company is $1.4 billion.
$1.4 billion x 0.02 (2%) = $28 million
In the example where the value of the company is $4.2 billion
$4.2 billion x 0.02 (2%) = $84 million
You can see now that we are talking about a significant chunk of money. This is because of the increase in the value of the company from making the right decisions in focusing and appropriately resourcing the prioritised set of initiatives and having the right business focus to support these initiatives. Creating the right focus, the right change sequences, the right change ‘packages’, and changes that are ‘bite-sized’ as needed can all contribute to optimised change outcomes.
Resources and organisational energy are also not wasted on initiatives that are less critical and perhaps more likely to fail or achieve less adoption. These then translate to enhanced overall benefit realisation, and therefore improved value creation for the company overall.
This contrasts significantly with the focus on individual projects and the calculation of ROI where change management is viewed as a cost to the business. At a per-project level this may make sense, however, most companies are executing multiple projects at the same time. Sure, you can try and calculate the change management ROI for every project and still not capture the total value. This is because “the sum is greater than its parts” to quote Aristotle.
How do we use this value?
There are many ways to use this financial calculation:
Business leaders who don’t understand the value of managing change across the portfolio and struggle to see the relevance or business benefit of investment in this area
Project portfolio managers who would like to better understand and articulate the ‘prize’ in focusing on change portfolio management beyond the existing project portfolio management focus areas
Operational leaders who would like to understand the value of ‘air traffic control’ of the various initiatives that impact their business units
Change practitioners who have been asked to prove the value of managing across the portfolio and why this is needed across multiple initiatives
Delivering constant changes is a requirement in implementing agile change management. With each iteration, a change is being designed and released as a part of ongoing agile development and project implementation. However, there is little mention in change management literature of how to go about delivering change constantly and be able to achieve optimum change adoption.
Continuous delivery pipeline
The concept of a ‘continuous delivery pipeline’ is a core part of the agile methodology. It refers to having a structured pipeline of continuous changes being released as required by the organisation. The pipeline contains a set of features and changes to be worked on, and the resulting prioritised changes are released when and as needed.
The three components of a continuous delivery pipeline that forms an agile release train include:
Continuous exploration – This is about defining and scoping what needs to be built using human centred design approaches to design the problem that needs to be solved from the user perspective
Continuous integration – This step involves taking those prioritised features from the backlog and investigating further to understand what development work is required to turn them into solutions for the user.
Continuous deployment – This is about turning the completed changes from the staging environment into production, meaning the live product that is ready to be used by the user. After the technical part of the solution is ready to be released, the business then determines when is a good time for this release to go ahead.
The ‘technical side’ of the agile team is fairly well defined in terms of the roles and responsibilities of each member, including project manager, developer, QA/testing, business analyst, business owner, etc. However, the role of the change manager is much less defined and black and white. This does not mean that there is no role for the change manager though. It just means that the agile literature has not well defined the details for the role of the change manager in an agile team. ‘Agile change management’ still has some work to do to make itself better known to other agile team members.
So how does the change manager get ready to deliver a series of constant changes?
Delivering a series of constant changes is no easy feat. The main issue is that most businesses are not designed to face multiple changes, and nor are they designed to face a series of continual changes either.
Change approaches are primarily written for working on one change at a time, and not in a setting where there are continual releases of changes going on. On the other hand, how many organisations do you know that are only facing one change? Or that only deals with one change within a month? This type of stable change environment may have been the norm years ago when the business environment was much more predictable and stable. Hence, using a waterfall project approach was appropriate at the time. Fast-forwarding to the 2020s most organisations are juggling with constant and multiple changes as the norm.
1. Derive a picture of the changes within the continuous delivery pipeline.
Deriving a clear picture of what changes look like within a project is critical. Without this, you will not be able to clearly communicate to your stakeholders what changes are coming down the pipeline.
To create this picture, use a human-centred approach and illustrate what the user will go through throughout the change journey. This is similar to a user journey map. However, a change-focused picture goes beyond just what the user will be going through. It also includes not just person-based changes, but also process, policy, system, governance, reporting and other changes. Outlining these changes will complete the whole picture of what each change release may look like.
A key problem in creating a picture of the changes early on is that the project team may not even know what the solution looks like. And without particular details of every change release and solution design, it may be hard to create this picture.
The recommended approach is to focus on what the outcome could look like versus focusing on various technical or process solutions. This means you may even need to make particular assumptions in defining what these changes look like. For example:
Release 1: Ability to turn recorded customer conversations into text. With this feature, there will be new risk and privacy processes and governance be put in place in the monitoring and storage of customer data.
Release 2: Ability to search for customer conversation history and flag follow up actions required. Specialist roles may be required to audit customer conversation text. Behaviour shifts in proactively checking on customer history and knowing what to look for in trends is critical.
Release 3: Ability to use analytics to predict customer turnover and use this to minimise customer turnover. Significant capability uplift is required to ensure that consultants are able to know how to use analytics to help minimise customer turnover. Analytics capability uplift is also required at operations management, supervisor and team leader levels.
2. Map holistic stakeholder impacts.
In order to implement constant ongoing changes, it is critical to understand holistically what the stakeholders are undergoing across all types of changes and other BAU impacts. Without taking these into account it is not possible to truly understand the capacity of stakeholders and when changes will best ‘stick’ when released.
Some of the items that should be inventoried and mapped include:
Impacts from the current project that you are working on
Other project impacts that affect the stakeholder at the same time as your project, including any benefit realization periods post project implementation
BAU-led initiatives that could include business improvement or quality, and may not classified as ‘funded projects’ per se
Key high work volume periods such as end of financial year, holiday season, etc.
Audits, planning or reviews where additional work volumes are forecasted
It does take investment and effort to collect all these types of data and most change managers do not bother to do this. However, it is not possible to implement a successful change when you do not understand what other changes or work priorities your stakeholders are undergoing during the change process.
It is also important to note that this type of impact data can change constantly and once the data is collected it needs to be verified on a timely basis with any changes and updates reflected over time. Doing this activity manually can be quite cumbersome so we advise using digital tools such as The Change Compass.
The collected data on what stakeholders are undergoing can be significantly valuable. Often stakeholders themselves have not undertaken this exercise to truly understand the change journeys and work priorities added together holistically. They may be surprised by the picture you are presenting to them. At the minimum, they will value this since it shows that you have a deep understanding of what they will be going through and therefore create more stakeholder confidence.
Examples of data visualisation from The Change Compass
3. Sizing and categorising the impacts of changes
After getting a clear picture of holistic change environment that the stakeholders will be undergoing the next step is to analyse the impacts from your project. In analysing the change impacts you should be ascertaining the nature of these change impacts including:
Size of the impact
How long the impacts will last
How much time these impacts translate to
Types of these impacts (e.g. people, process, system, customer, etc.)
To whom the impacts will be on
Quantitatively sizing your impacts makes them concrete and easily understood. Armed with this information you are able to examine to what extent the planned releases are the right ‘size’ for the impacted stakeholder groups. This is another critical part of agile change management. In determining this, the following stakeholder factors are critical:
Capacity bandwidth
Potential overlaps across various impacts either within the same or with other projects or initiatives
Change maturity level and experience with similar changes in the past
Leadership support and other change reinforcement mechanisms
Overall change readiness
Engagement level with the particular change initiative
When you have considered all of these factors you are ready to engage with your project manager, the PMO, and business representatives to assess to what extent the roadmap laid out is effective and will work to maximise the targeted initiative benefits.
4. Business operations routines
Now you understand clearly the change environment of your impacted stakeholders, various changes within yours’ and other initiatives, and the categories of the various change impacts. The next step is to clarify to what extent your impacted business units have the right operational process to receive ongoing changes. This is often a neglected part of agile change management.
More change mature business units have over time developed the right routines and processes to absorb changes, especially ongoing ones. What are some of these?
Effective engagement processes. Engagement processes are not just one-way communication channels. Having effective communications channels such as newsletters and town halls are a minimum for employees to hear about what is coming down the pipeline. Engagement processes include such as effectively choreographed Yammer channels, skip-level meetings (where managers meet with employees 2 levels down), focus group sessions with a small group of select employees, and effective team meetings where information is passed both up and down the chain of command
Effective learning processes. Effective learning processes at a business unit level includes business operations routines whereby employees have individual development plans (from which training plans can be incorporated), ongoing monitoring of development tracking against targets (e.g. completion rates), virtual learning processes (e.g. employee familiarity with virtual ways of self-initiated learning)
Change champion network. Most change champion networks are project-based and therefore have a limited shelf-life. This means that business change champions have a limited time to learn and develop as effective change champions. They also have limited time to practice and experience what it is like to lead and support change. A better design for business units undergoing ongoing changes is to have business unit based change champions that can support a myriad of changes across the board. This flexes their capability. Also, with constant exposure to changes over time, they are able to continuously develop and become better change champions. Organisations that have done this well, have positioned this as a ‘talent pool’ for frontline employees seeking to grow into other challenging roles.
Benefit realisation processes. Tracking and reinforcing benefit realisation is one of the most critical ingredients for success in the impacted business unit. Usually a month after go-live, the project would have already wrapped up and the business is left to continue the rest of the change journey and achieve the targeted benefits. To do this the business unit needs to have clear benefit realisation tracking and reinforcing mechanisms, involving Finance and business leaders. There needs to be constant oversight of how the benefit tracking is trending and leader discussions on resolving any obstacles and providing adequate managerial support to drive the benefit realisation process.
If your impacted business unit lacks one or more of these ingredients, it is critical that you work on this upfront. Highlight to business leaders the risk of not having these ingredients in place within the business. These processes may take significant time and investment to build up. Therefore, factor in the time required to develop these. Often, within the challenges of agile changes, these are left until the end, by which time it is too late to try and establish quickly to support the identified project changes.
Assessing the change process and conducting effective change impact assessment are critical tasks for the change manager. The reason is that a detailed change impact assessment is a map from which change interventions are pieced together to drive and manage the change process. Most aspects of change management deliverables are tied to the effectiveness of the change impact assessment. This means, if the change impact assessment was not thoroughly conducted, covering key angles and perspectives, then the overall change will likely fail.
Illustrating the effectiveness of change impact assessment is not always easy. However, we currently have a great example. Right now, Russia is attacking Ukraine with the goal of seizing Kyiv the capital. What does this have anything to do with change impact assessment and the change process?
This event is felt globally around the world in many different ways. Firstly, the most important acknowledgement has to be the horrendous human toll for the people of Ukraine. As this article is being written, there are hundreds of thousands of Ukrainian fleeing to neighbouring countries to find safety and refuge. Lives are lost and buildings destroyed.
It may seem to be that the conflict is only in Ukraine. However, the truth is much more than this. The effects of this war are felt across the world at many different levels. Let’s look into this more thoroughly as this illustrates precisely how change impact assessments should be done.
The above diagram is only a brief surface indication of a few of the impacts of the war. You can see that it is not just economic impacts, but political, social, humanistic and technological impacts. This complex web of different impacts evolve and form the overall change and disruption.
The same can also be said for organisational systems during change. Different change impacts compound and affects one another. What may be deemed as a simple process change, could impact operational factors, leadership factors, employee capacity, reporting process, system impacts, etc.
It is also worth calling out that when conducting change impact assessments different factors often converge and make it difficult to separate an impact from one category to another category. Since we are talking about a whole global system, different impacts affect one another.
Looking at this table and looking at what is unfolding in the attack on Ukraine there are some key call-outs that change managers should learn about when conducting effective change impact assessments:
1. Transitional states may be just as important as end state changes
During the change process, many things will evolve. The change impacts that happen during transitional phases need to be fleshed out and defined. Typically, what a lot of change managers do is to follow a change impact assessment template that focuses more on current state versus end-state gaps and focus on these as impacts.
However, without clearly understanding the impacts during transitions the change process will be not successfully managed and the outcome will not be reached. For example, if you had to do an impact assessment for the Russian attack on Ukraine, and you didn’t forecast the interim events that other countries will step in to support Ukraine or that Russian people will protest then the overall tactics used could be very different.
2. The change process may not be linear
A key observation of the change that is happening around the world resulting from the attack on Ukraine is that the direction, pace and volume of change is not linear. It is systemic and even organic/viral.
Within a war, setting change may be counted on a daily basis in terms of progress. In an organisational change setting, and particularly for complex changes, the same comparison can also be drawn. Complex changes are often not one-directional in terms of A affects B, or because of process change A, process B is changed as a result. There could be a complex web of changes with multiple processes impacting each other. There could also be impacted processes that as a result impact other processes.
When we look at the evolvement of this conflict, the human impacts are just as complex. First is the civilian tolls with mothers and children fleeing to neighbouring countries. Ukrainian men from neighbouring countries return to Ukraine, crossing the same borders in the reverse direction, to help the country fight. More and more civilians enlist as volunteer fighters. There are records that many residents dare to directly confront Russian military personnel. There are families across both Russia and Ukrainian borders that are caught in this conflict. There are even reports of discrimination against black refugees fleeing from Ukraine at border controls. The diverse nature of impacts is huge.
With complex organisational changes, similar comparisons can be made in that the change evolution can be systemic and organic/viral. Leaders, influencers and networkers can have a strong influence over the organisation. Formal and informal organisational networks such as internal communication channels, functional groups and centres of excellence all exert influences on shaping the change. The trick is to understand the key drivers of influence, change, communication and engagement within the impacted stakeholder groups and use these to design the change process.
3. Every perspective should be assessed to ensure potential gaps are covered
In implementing change often there are perspectives that are not considered and these usually show up during the implementation and can potentially derail the project. This often happens when the change seems simple and so stakeholders usually resort to what has occurred in the past. However, no company is operating in a vacuum and organisational situations evolve constantly.
The key is to thoroughly consider each perspective, whether it is the perceptions of each group of stakeholders, downstream impacts of process on operations and planning, or potential role changes resulting from workload changes or oversight required. Understanding the interplay between each of these is key.
4. Anticipate tactics in altering the change process
In a war situation, both sides constantly assess the situation in a super agile environment to constantly pivot from a tactical perspective to influence the outcome. For example, Russia resorted to strict censorship and mass arrest of domestic protesters to control any opposition to the attack. Russia also exerted significant influence over US social media channels in Russia to adhere to its censorship objectives.
On the other hand, Ukraine’s Prime Minister Zelensky resorted to grassroots support at a national level and an international rallying approach to appeal for support. He is constantly on social media to appeal to the people of Ukraine to take up arms and fight for Ukraine, and this is one of the key tactics in slowing down Russia’s advances. He also proactively appealed to international leaders for financial and military support.
In a change impact assessment setting, anticipate key tactics of key stakeholder groups to support or resist the change. Document and list down previous or likely tactics used by these stakeholder groups to drive the change further, to slow down the change, or to resist the change. Leverage these perspectives and build these into the change approach to derive a much more systemic approach to achieving the change outcomes.
In Summary, whilst our first response to what is happening in Ukraine is strongly on the suffering of the Ukrainian people and the wish for the suffering to end. As the conflict unfolds it teaches us some very important lessons about change and disruption and how complex, organic and dynamic they can be. There are some important lessons on effective approaches in conducting change impact assessments and assessing the overall change process.
Acknowledgement: Featured photograph from The Independent
The increasing pressure to change and evolve continues to challenge the very existence and design of every organisation. After waves of change and disruption from industry competition, technology evolvements, customer preferences, surge in commodity prices, and Covid, change is, more than ever, a constant. To meet with this rapid and increased intensity of change, organisations are resorting to agile ways of implementing change management to keep up.
Agile ways of implementing change often times mean that the outcome may be reached faster by team members, and sometimes with fewer resources than previously. With these promises, there are very few organisations that are not jumping along the agile bandwagon.
So what are the challenges of using agile change management?
1. Agile change may not suit every change scenario
Agile ways of change management may be great when we are developing a new product, a technical solution, a new process or a new way of working. However, not every change scenario. If the change setting requires strict adherence to complex regulations and standards, significant documentation, testing and quality assurance, full agile may not be the most suitable. Pharmaceutical companies would not use a pure agile approach in developing new drugs simply due to the level of regulatory and industry standards required to be met in the process.
However, this does not mean aspects of agile practices may not be incorporated alongside traditional approaches. For example, pharmaceutical companies have been incorporating practices of involving customers in product design, customer collaboration, and marketing communication to enhance customer satisfaction. The trick is to balance those agile aspects which would benefit the overall solution and outcome, versus others that may be less applicable due to organisational and industry challenges.
On the other hand, if the project is concerned with developing changes to meet a new government regulatory requirement for customer product disclosure, an agile change approach may be more suitable. Change iterations can be designed to form the solution required to both meet regulatory requirements and not negatively impact customer experience.
2. There are significant capability requirements in implementing agile changes
Implementing agile changes does not just mean using agile frameworks and techniques in the project team. Every team involved needs to ensure effective communication and transparent communication, including regular team interactions, to build up agile capabilities. This includes not just the technical teams, quality and testing teams, but also business stakeholders, and depending on the change, customer advisory teams as well.
Project teams may be used to agile methods and techniques after several projects. However, these may be foreign for business stakeholders, especially those accustomed to traditional project management environments. Sufficient education and capability building to tackle common challenges may be required in impacted businesses to undergo the change process. This is because without this experience, the impacted businesses may not sufficiently buy-in to how the change was designed and implemented. Moreover, without adopting agile practices, the impacted business teams may not be able to adopt the changes at the rate expected in agile environments, which could hinder a smooth transition to effective agile methodologies.
3. The agile methodology has not clearly specified change management elements
Agile project management methodology clearly lays out the roles of the various members of the agile team, including the project manager, business owner, quality and testing, developer, etc. However, a big hole exists for effective change management, emphasizing the crucial role that change managers need to play. The clear role for change management has been left out. For example, methodology and training providers such as Scaled Agile. In a seemingly detailed and comprehensive treatment of all parts of agile methodology, the specific details of the role for change managers are not mentioned anywhere.
To tackle this big gap, there are various attempts to try and close this gap such as Jason Little’s Agile Change Management approach that is possibly less comprehensive than those best practices detailed by the Scaled Agile Framework for the enterprise level.
Why is it that the role of the change manager is clearly omitted? It is not that the role of change manager is becoming obsolete. The increasing popularity of agile is matched by the increasing demand for change management professionals. There has been a consistent growth in the recruitment for change professionals year after year. It could only be that perhaps those in charge of documenting agile methodology don’t have a background in change management and subsequently have not ventured to detail any requirements within the methodology.
Imagine a world where change professionals won’t need to tip-toe and educate others about how their roles fit within an agile setting. Given the importance of change management is it not a gap that cannot continue forward? Perhaps we can garner the change community to drive this through in the 2020s?
4. Oversight of multiple agile changes is more critical than ever
One of the key challenges of using an agile approach is that often the end change outcome or the solution of the change is not clearly known at the commencement. With each iterative development, agile changes become more and more defined, and the project objectives may also evolve. Or at times, the solution may continue to evolve and pilot as required according to project requirements.
What this means is that at any one-time business stakeholders are dealing with multiple projects and their project progress that are constantly evolving. The impact of those projects may or may not be known depending on the development of the specific agile iterations. This could make it a nightmare to plan and get ready for multiple changes from a business unit perspective.
The solution is to develop oversight of the entire group of change initiatives. With constant oversight, the business is much more capable of preparing for change overall. And with the shifting iterations of agile across initiatives, the picture continues to evolve so that the business can keep a pulse on the changing nature of change. This includes not just the volume of impacts, but types of changes, role impacts, timing, change pace, readiness, and fostering a culture of continuous improvement, including regular feedback loops, etc. Utilise digital change management solutions to support your stakeholders as they continue down the agile change journey.
How will you support your business stakeholders as they charter through the ever-increasing environment of change and disruption? What digital tools are you adopting within this digital world to get ready for increasingly agile changes? Just like the agile principle of including and integrating multiple disciplines to promote collaboration, leveraging digital tools to aid change readiness and collaboration is key to future change outcome success.
To read more about agile change management articles visit our Knowledge Centre where we have articles such as:
From the beginning of civilizations, storytelling is a way to help us understand what is happening. In caveman paintings, the pictures reveal a lot about the significance of the pictorial story and the message being conveyed. Cave art is considered to have symbolic or religious purposes. Even oral stories can be passed down from generation to generation for thousands of years. The bible is an example of how stories can be passed down and documented. Children’s fairy tales are also examples of powerful stories.
Stories are easily remembered and inspire understanding and belief. This is why the industry of influencers is such a large market. We connect to influencers because we associate with them, find them interesting, or aspire to be them. Influencers share their everyday stories with us and through this, we grow increasingly connected and engaged with the messages they are conveying.
Here is an example of powerful storytelling. The Australian Broadcast Corporation which is a public TV channel aired a show called ‘War on Waste’. The purpose was to inspire the public to change personal habits to reduce waste. The show was hugely powerful.
A report by the University of Technology Sydney’s Institute for Sustainable Futures found that the show triggered 452 high-impact waste reduction initiatives. These include supermarkets and hospitality businesses deciding to remove plastic straws from their stores in Australia and New Zealand, and states banning single-use plastic bags. Almost half of the 280 organisations surveyed in the report based their waste reduction ideas from the show. These were all just 6 months after the show had aired.
‘War on Waste’ show showing clothing waste
Imagine using the power of storytelling with change management data?
Yes, we’ve all been there. Remember the last time that you were at a meeting where there were lots of figures and data thrown around. With each PowerPoint slide, the presenter aimed to cover as much information as possible. An hour later, what did you remember from all the various data points shared? Probably not much beyond one or two points at the most.
This illustrates the power of storytelling. Rather than flashing lots of data at the audience, telling stories is a much more powerful way of conveying messages. In this guide, we will cover various facets of how to convey powerful messages through storytelling with change management data.
1. Types of change management data
Collecting and sharing change management data is critical throughout the implementation of the change process. It tells the impacted stakeholders where the change is taking them and is also essential to help stakeholders understand whether things are on track or not.
In this guide, we will not cover in-depth the various types of change management data. However, the key types of change management include:
Change readiness surveys
Training assessments & evaluation surveys
Communications metrics
Employee sentiments/culture survey
Change adoption tracking
Change leadership assessment
Change maturity assessment
Change management heatmap
Other capability assessments (e.g. sponsor, change champion)
In any business meeting context is critical. Whether you are in a meeting to make a key decision, to brainstorm ideas, to critique an idea, or to track team progress, the context of the meeting is critical. Without a strong and clear context, participants will not understand what the meeting is about nor why they are there.
When I was at Intel, in every meeting room there is a poster listing key meeting effectiveness etiquette points. One of the most important points listed is having a clear meeting agenda prior to the meeting starting. Even before you walk into the meeting, ensure that you have already communicated to participants what the context of the meeting is and what you will be discussing. This could be as simple as listing this clearly in the meeting invite agenda or sending a clear email to participants prior to the meeting.
If the subject matter is particularly complex it may be helpful to send an email of any ‘pre-read’ materials so that audience has time to digest various content prior to the meeting. This is particularly important if the subject area is complex and requires a lot of information context-setting prior to the meeting.
When you first enter the meeting it is also important to once again establish the context of the meeting in case your participants did not read the agenda or are not clear.
B. Crafting the story
Crafting a meaningful and compelling story that resonates with your audiences is not difficult. However, it follows a logical flow. The challenge is to craft the story in a way that achieves the balance of painting the storyline that gives the user sufficient ‘colour’ of the plot, without having too much detail and overwhelming the audience. On the other hand, storylines that have too few details are may not be compelling or impactful.
Here is a useful structure to follow – The story structure ring by Tomas Puego.
This structure can be applied to any story and is particularly suited to business settings.
The Story Structure Ring by Thomas Puego
If you are making a presentation to managers to senior managers who are often impatient and have little time you will need to tweak your storyline and flow accordingly. Whilst the bulk of the storyline structure ring can still apply, it is better to add to this an initial step on the key takeaway right at the beginning of the presentation.
Initial situation. This is when we show what the situation was like when everything was normal and prior to the problem occurring. This is an important part before it reminds the audience what the situation was like before the problem started.
Problem. Here we explore what the problem is and what happened. Go into what this means for various characters and their lives. What’s the result of the problem and what pains did it cause? What has the characters tried to do to resolve the problem? What has or has not worked?
Midpoint insight. This is a key reflection of the story when there is a particular revelation or insight that changes the storyline. With the new insight characters realise something they did not previously.
Explore the insight. Explore what lead to the insight, and what the insight meant to the characters. How do the characters see the problem in the new light? Did the characters approach the problem incorrectly and now with the new insight they are able to see what was wrong?
Solution. The character(s) finally realise how to apply the solution using the insight. It could be a series of struggles of trial and error. It could be using data-based insights.
Aftermath. After implementing the solution the characters are able to address the problem and resolve the pain. If you are making recommendations in a business context, this may not have happened yet. Instead, you can use this step to outline what will be the aftermath after applying the solution.
3. Presenting to managers or within limited time
This is proposed by the Barbara Minto Pyramid model whereby there is a pyramid of information that is recommended using a top-down presentation structure. It starts with the end or the conclusion first to satisfy the informational needs of those impatient managers and also to create curiosity from which to engage the audience and present through the rest of the storyline.
In this way, the audience does not get flooded with a myriad of information, data, and arguments and is able to clearly understand where the story is going from the outset.
The other highlight of using the model is to summarize key points at a high level first before going into the details of each point. This way you’ve already provided a structure of the storyline of what the top-level points are before you start diving into each point. This is critical because without the structure it is easy for your audience to get lost in the details.
The Minto Pyramid by Barbara Minto
The Minto model is very useful for those who rely on PowerPoint or document-based presentations where they walk the audience through the materials. This is common practice and it may be easier from a preparation perspective since the content prompts the presenter on what to say. A better way of storytelling is always to rely on verbal storytelling at least in the beginning to engage the audience and fully connect with them before launching a series of slides.
If you are only relying on slides to make your points there is a big risk that your audience is spending more attention looking at the words and details of what you have shown in the slides and this may conflict with what you are talking about. If what you are saying is not what the audience is reading into on the slide content this may create confusion. Slides are good at the right time with the right content to complement what you are saying, not the other way around.
In presenting to managers you also need to be very summarised in your overall presentation. Err on the side of talking at a high level with some illustrations of details. Prepare more detailed data and information as needed so that if asked to elaborate you’re able to dive into the details. However, the flow of the presentation should be fairly succinct and to the point. Often, your presentation may be shortened due to other agendas running longer than expected. It pays to be focused and summarised in your presentation.
4. Storyboarding
Storyboarding is a way to graphically show the flow of the story. Whilst it is a common technique in product development or learning content development, it originated from film/play development.
For screenplays, storyboarding is about physically drawing out each key scene to outline the overall story. Stick figures are sufficient and the drawings do not need to be artworks. They are simple depictions of what key scenes would visually look like.
Think about the angle of each scene, what the main characters are, what happens, and where it happens. Then for each scene, write brief short bullet points describing what happens in each scene. Use quotes as needed to portray what characters are saying.
In business, a lot of people don’t visually depict the storyboard, instead, reply on comments for each scene. More visually explicit stories will be more powerful, so it is better to practice to visually draw out scenes along with written notes. It helps you to picture clearly and visually the characters you are centering on, how they are behaving, and what situations or environments they are in.
You also don’t necessarily need to make the story a long and drawn-out one. A storyboard can be as simple as 3 scenes. A more rich story outlining the setting and context can be longer. Try to stick to no more than 6 scenes when you work on your storyboard. This will enable you to have ample content to outline the development of the story, the climax, and the outcome of the story.
After you’ve crafted a story, it’s time to work on what data visualisation to show in your presentation or discussion.
Principle 1: Visual charts
The first principle to remember is to always error on showing charts versus raw numbers. Charts are inherently more memorable and in general more impactful for most people. Of course this depends on exactly the point you are trying to make. Even if you are comparing the data across two areas of the business it’s still a better idea to show a simple bar chart with the 2 data points, versus just quoting the raw numbers. The simple bar chart will visually show the difference between the 2 numbers visually, and you can still show the actual numbers in addition.
Charts are general impactful than raw numbers
Principle 2: Less is more
There is a tendency for business people to show lots of charts in meetings. The thinking is that the more information that is shown, there will be greater clarity and fewer questions. In fact, the reverse is true. The more data you show, often this leads to confusion and lack of clarity. It is harder to stick to a simple storyline when the audience is overwhelmed by lots of data.
The charts are only there to illustrate and support your storyline. The immediate reading of the chart should relate directly to the point you are making. If the chart is conveying lots of other information, be careful. This can launch other questions and discussions and therefore lead the flow of the story away from what you had intended.
Where possible, stick to 2 or 3 charts for your presentation. You can always have a few backup charts if your audience wants to dive into further details. Again, the key focus is on you telling the story and the key medium of communication. The charts are a supporting medium to make things visual, and easier to understand and remember.
Principle 3: Avoid visual distractions
This principle is about the chart is focused on the message being delivered and avoiding any visual distractions that could create ‘noise’ and distraction for the audience. These include any graphic design, use of colour, lines, sizing, etc.
Below is an example of a typical change heatmap table chart used to depict the level of change impact across different projects. Let’s take a closer look.
Change Impact Heatmap Using Traffic Light Ratings
3. Using different charts
A. Focusing attention on the right part of the chart
To help the user zoom in on the point that you are making, your data visualisation should also draw attention to the point that you are making. Use colour highlighting to draw your audience’ attention to the data point you are focused on.
For example, to draw attention to the particular week that you wanted to highlight to the audience, use a darker shade of the same colour to the rest of the charts to draw the focus. But be aware that using too many different colours may end up confusing the audience instead. This is preferrable than using a circle to highlight the same data point, since this may also be another source of visual ‘noise’ in distracting the user.
Change Impact across time
B. Using pie charts
Pie charts are very popular with business users. They are useful and effective in comparing different data points. However, when there are too many data points, it becomes quite hard for the user to read and compare the different data points. For this reason, be very careful in using pie charts. When you are using more than three to four data points in the same pie chart, it may be better to use other charts such as bars charts or line charts. This is particularly when the data points in the chart are similar in value.
Have a look at the below 2 charts. One created using a pie chart and the other using a line chart. Both are exactly the same data. You can see that with the pie chart it is almost impossible for the audience to tell which Project has more impact hours than the others. Comparing the data points within the pie chart is extremely difficult. On the other hand, looking at the line chart it is significantly easier to decipher the data difference across the projects.
C.Treemap charts
Treemap charts are a great way to show, in a neat and tidy way, the relative data value across a number of data set. Ideally, the data set is not so great that it becomes too complicated to read (i.e. over 20 data points). This chart is a great visual when you want the user to see and compare the size differences of data points.
Now have a look at the below chart. Once again this is using the same data. If you would like your audience to compare the different hours of impact across each project it is very difficult for them to decipher which one has more impact than others. What this chart may be good at is when there is a big range of differences in data points and you want to be able to show the range of the different hours. However, when the range in differences are not great, which is the case here, it is better not to use this chart.
Now have a look at the below chart. You’ll see that it is much easier to see the data size differences because the sizes are quite significantly different. For example, if you want your audience to visually just how much the impact difference is, then this is a good chart. If you want to, you can always show the numerical values, if you would like your audience to see the numerical differences as well.
D. Using bar charts
Bar charts are one of the most common forms of data charts. There is a very good reason for this. Humans are very good at comparing lengths when they are aligned neatly next to each other. We can naturally see the beginning and end of each bar chart and be able to easily decipher the comparative differences across the bars.
There are many different types of bar charts including:
Vertical bar chart
Horzontal bar chart
Clustered bars
Stacked bars
100% stacked bars
Waterfall chart
Some of the tips in using bar charts effectively include:
Avoid using too many colours since the audience may be overwhelmed and focus on the colours instead what the chart is trying to show in terms of comparative differences
Ensure labels are clear and easy to read
Use a zero-baseline so that the audience only focuses on the difference at the other end of each bars
E. Using bubble charts
The bubble chart is a very visual chart and easy for people to compare across data points. The bubble chart is a good chart to use when there is a number of data points, but no more than 20. If there is over 20 data bubbles it starts to get too overwhelming for the audience. There are many different types of bubble charts
Standard bubble chart where there are no axes, with each bubble representing the different sizes (e.g. impact size, completion rate, etc.)
Scatterplot with 2 axes and changing bubble size. This chart shows 2 dimensions of data, i.e. the 2 axes and the bubble size. For example, bubble size could represent number of people impacted, with impact size and change readiness rating on the 2 axes
Scatterplot with 2 axes and no changing bubble size. This type of chart is useful to show the differences along the axes. The ‘bubbles’ or dots are simply representations of different data points since they do not have bubble size differences. For example, the horizontal axis can show time, and the vertical axis can show change readiness, with each dot showing a different project.
Change Impact Bubble chart
4. Colour blindness
Approximately 8% of men have colour blindness. The percentage is less for women. So, it is important to note that you will likely come across audience members who may not be able to see certain colours. Most business people do not make a point of designing charts that take into account colour blindness. However, you do not want to risk making a blunder with critical stakeholders who may not be able to see what you are referencing.
To check that you are using colours that are not going to disadvantage colour-blind audience, use ColorBrewer and select the colour-blindness safe box to come up with the right colours.
Colour-blindess tool ColorBrewer
5. Examples of story flows
What are some of the examples in which change practitioners can use data-based storytelling to influence stakeholders? In this section, we look at a few examples.
A key ingredient in all of these story flows is that they all contain a logical sequence of stories. A good way to add ‘colour’ and bring the story to life is to add quotes, and observations to support the data. This balance of quantitative and qualitative data can be very powerful and persuasive.
The other call out is that in each of the 5 steps, data may be used to support the story flow. The use of data does not need to only be injected in the steps of ‘Problem’ and ‘Insight’. It can be every or any single step of the story flow. In this way, the story becomes even more powerful and convincing. However, note again that having too much data may overwhelm the audience and create confusion. So, achieving a balance is key.
6. Making recommendations
Essentially, data-based storytelling is not just about informing the business of what is going on or what is going to happen. The value comes when you use it to make recommendations. Recommendations are hard to dispute when the story sequence is backed by data. When you make a sequence of logical deductions backed by data, the audience is naturally convinced by the recommendation proposed.
It is also a good idea to come up with options when recommending a solution. Ideally, create two scenarios for your stakeholders to select from, or a maximum of three scenarios or choices. Describe clearly what each scenario could look like and supplement the recommendation with the advantages and disadvantages of each scenario option.
Below is an example of a chart from The Change Compass where an alternative delivery sequence is proposed. It illustrates what the alternative change impact looks like for impacted business stakeholders across projects. The star indicates planned go-lives.
Change Impact Scenario Bar Chart
Telling compelling and persuasive stories using change data takes practice. Through regular practice, you will discover what your stakeholders resonate with and what they find challenging to understand. Tweak your presentation accordingly. Note any individual stakeholder differences. Also, note any commonalities of preferences across your stakeholder groups.
