Your business is likely to be going through continuous change as companies grapple with shifting consumer habits, new technologies and digital disruption. As a CEO, you are likely to have to lead your team through digital transformation. You may need to transform one or more departments. Perhaps you have to change business operations at a legacy company. Or you may be trying to change customer behaviour to embrace digitalisation and boost revenue. But be warned, many of these types of projects fail and can come at a financial, reputational and human cost.
Here are five things that cause projects to fail:
1. Lack of planning
I spoke to almost 50 companies for the book Going Digital and they all took a systematic approach to planning, giving them a higher probability of success by thinking ahead, setting objectives, and having a vision of what they would like to achieve. There are different versions of planning – some are meticulous, while others are fluid evolving sequentially, especially in a fast-paced digital world.
By using data to back up your way forward, and making a clear roadmap, you will give yourself a greater chance of delivering the project than if you left things to chance. A plan will help you to sell your idea to your colleagues, aiding their understanding of why the project is necessary and what it means for the business – and possibly their roles. Without a plan, you will not be able to review and you will not know whether you are on track.
2. Lack of support for change agents
Senior leaders should support their change agents. This backing is vital to the success of a transformation project and must be continuous. If you have asked a team leader to oversee a project, you should be clear about their remit and how far it extends. Also, be prepared that they are likely to have to go back to you many times to make their mandate clear because their status to carry out transformation can – and will – be challenged by others.
Prosci, a change management company, reported that in 2020 change leaders in 11 out of 11 studies identified effective executive sponsorship as the top contributor to success. Without senior management’s support, there is a risk of failure, as managers are likely to encounter hurdles and people will question their authority.
3. Poor communication
Misunderstandings can arise due to a lack of information and unclear communication. Decisions can be perceived as being imposed, with teams having little input or consultation. A shortage of time to get used to the idea of transformation and digest what it means for their careers can also lead to rejection. This tends to occur if plans have been drawn up in secret and lack transparency.
Typically, in this situation, trust will be low between managers and employees. It takes a brave person to make a very clear statement at the beginning and for most people to actually believe in it. If that important interaction is lacking, the situation becomes political and when it is political it becomes emotional. When that happens, it can be very difficult to deal with and can escalate into conflict. This is when external mediators may be asked to step in.
4. Fail to involve
Encourage people to participate because they may spot ways to improve the process. Listening to their ideas and using their suggestions can help because it starts to give them ownership. Giving them a voice can make them feel validated and appreciated. You can also give people responsibility for helping you drive the change. This may lead to long-term buy-in. But this method does have drawbacks. It can be time-consuming and it will have to be managed carefully. It is also important to make clear what can or cannot be realistically done to avoid frustration if you decide not to use their suggestions.
5. Stop a failing project
Chief executives may say they embrace failure, but when it comes to it, they find that difficult to do. Looking at ways to experiment can be harder than it appears because you will need to realise when a project is failing and close it down quickly when something is not working. If you are failing too long, with your project dying a slow death, the problem is you are not achieving what you set out to do. This wastes time, resources and money.
Spot typical warning signs early and take action. These can include:
- A loss of focus: you may even no longer know why you are continuing to run a project
- Consistently not reaching milestones: stakeholders start to lose interest in the project as the project becomes mired in delays
- Failure to review: feedback and monitoring progress may have tailed off
- Loss of budget: other projects are being funded and not yours
About the author: Lyndsey Jones is the lead author of Going Digital, co-written with Balvinder Singh Powar and published by Pearson, priced at £17.99.