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Excelerate Consulting | Change Management Experts

Change Management Metrics and KPIs

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Change management doesn’t end with implementation. In order to ensure long-lasting and sustainable organizational change, it’s important to encourage feedback and access change management strategies. This way, organizations and change leaders can ensure the change is having the intended effect and that the change plan is effective. Measuring change management includes evaluating metrics and key performance indicators (KPIs) to ensure adequate outcomes.

Change Management Measures and Metrics 

It’s important to spot gaps and discrepancies using change management measures and metrics. It’s when this is done that change managers can understand whether or not a change initiative is successful, and how to handle problems that have arisen. They keep organizations accountable, determine progress, and prove that the change initiative is getting results.

Change management metrics and KPIs can determine both initiative and program-level measures of progress. In fact, doing so makes change initiatives 7.3 times more likely to succeed.

Performance measures vary depending on organizations and change initiatives. However, many organizations choose to focus on financial change management measures while not giving adequate attention to other key performance indicators that are critical to the change management plan. In order to measure organizational change accurately, it’s important to look at a variety of metrics and measures.

The following should be taken into consideration when determining which change management measures to utilize:

Additionally, organizations must understand the type of change that’s taking place and consider their goals. They should then use this information to create metrics and KPIs, including those that measure the change initiative’s health and performance.

That being said, in the simplest terms, measuring change management consists of measuring the following:

  • Change management activities to complete 
  • Outcomes of the change management activities at the individual level
  • Outcomes of the change management activities at the organizational level 

Types of Measures in Change Management 

Organizational Performance Measures 

Organizational performance measures examine how well a change initiative has achieved an organization’s desired outcomes. This consists of measuring change management at the macro-level and understanding big-picture results. Some key metrics include:

  • Adherence to the plan
  • Change readiness 
  • Performance and improvements in it 
  • Project KPIs 
  • Return on investment 
  • Timeline adherence 
  • Speed of execution
  • Benefit realization 

Individual Performance Measures 

While organizational performance measures look at how well an organization fares, individual performance measures focus on the people side of change. In addition to determining how well employees are adjusting to the change, these also show change leaders how they can improve and optimize their change management strategy. Since people make up the change, this is a valuable metric to calculate project success, and includes the following:

  • Understanding of change 
  • Awareness of change 
  • Employee engagement and participation 
  • Employee satisfaction 
  • Employee feedback
  • Compliance and adherence 
  • Usage and utilization 
  • Proficiency measures 
  • Support requests 
  • Behavioral change 

Change Management Performance Measures 

Organizations must also consider metrics that specifically look at the performance of the change management itself. Some change management performance metrics overlap with organizational and individual performance measures because many metrics provide insight into multiple areas. This helps determine whether the change was successful in itself. 

The Balance Scorecard 

Kaplan and Norton realized that financial measures should be combined with metrics pertaining to knowledge-based assets like employees. Their solution to this was the balance scorecard, which includes financial metrics along with three other categories so change managers can effectively measure change and plan accordingly.

Financial Measures 

Financial measures include monetary metrics, including economic value added, cash flow generated, return on investment, and sales growth. 

Consumer-Related Measures 

Consumer-related measures include business performance indicators that relate to customers. These include metrics such as customer retention, new customer acquisition, profitability, market share, and customer satisfaction. 

Internal Business Measures 

These metrics are based on internal business processes and include response time, quality, and cost. Measuring the effectiveness of processes allows organizations to ensure positive outcomes for all stakeholders.

Innovation and Learning 

This category combines procedures, systems, and people. All the other categories are used to determine gaps, and this category reveals the gap between existing capabilities and those required to achieve the vision. Improving innovation and learning is the key to reducing gaps and enabling improved infrastructure.

While each organization will customize metrics to best serve their needs, they should ensure they’re being selective instead of simply using every metric they can. According to McKinsey, most organizations end up using only 29% of the metrics they measure during change initiatives. Instead of focusing on metrics that aren’t ultimately useful, organizations must focus on the frequency of measuring change management. When the change is a large-scale one, the following is suggested:

  • Teams should review changes weekly
  • Sponsors and committees should review performance monthly or quarterly
  • The enterprise value should be measured either once or twice a year

By frequently measuring change management, organizations can ensure that they’re constantly learning and improving, and applying best practices.

Summary and Conclusion

No matter the project on hand, it’s critical that organizations measure change management and its performance based on appropriate metrics. Look at organizational, individual, and change management performance measures to ensure you fully understand the change and its effectiveness. In addition to giving organizations insight into change adoption, it also provides an opportunity for constructive feedback and revision implementation so organizations can learn and adapt as the change process continues.

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