The goal of many Lean Six Sigma projects revolves around making a successful change in how a business operates that will result in reduced costs or revenue growth. But many companies continue to fall short when it comes to making a successful transformation.

That persistent lack of success is part of the latest McKinsey Global Survey that focuses on core issues involved with a successful transformation. The report provides insight for those interested in learning how to make organizational change a success. That’s a front and center issue for practitioners of Lean and Six Sigma who seek to make changes that streamline operations.

It’s also needed, according to McKinsey. The survey found that the more “transformation actions” a company takes, the greater the chances for success. However, McKinsey also found that “the average success rate has remained persistently low.” They report that less than one-third of respondents who had participated in a transformation in the past five years saw it as a success in improving and sustaining those improvements.

What Most Impacts Organizational Change?

The McKinsey Global Survey, which involves information gathered from thousands of executives at companies around the world, found three main factors that contribute to success in transformational projects.

More Actions

The more actions a company takes when attempting to make a change, the higher the rate of success. Those that took 24 separate actions achieved success 78% of the time, compared to a 31% success rate for all transformations.

Implementation Issues

The survey also broke down when the maximum financial benefit of a transformation was lost by phase. Companies lost the most value (35%) during the implementation phase, according to survey respondents. The loss by each phase:

  • Target setting (22%)
  • Planning (23%)
  • Implementation (35%)
  • After implementation (20%)

Making Changes to Business as Usual

Companies that chose to “embed transformational disciplines into business-as-usual processes” also had a higher rate of success. This includes getting executive buy-in by making these disciplines part of regular executive-level weekly briefings. Other business-as-usual processes mentioned in the survey included monthly or quarterly business reviews, individual performance dialogues, and annual business planning, budgeting, and forecasting.

Getting Employees Involved

The report makes clear that involvement of people at all levels of an organization fosters a better chance for success. The report states: “It’s not enough to set effective and ambitious aspirations for the transformation. People need to understand what these goals mean for their day-to-day jobs and what they will be expected to do differently; if they don’t know how they connect to the transformation, their behaviors and how work gets done won’t change.”

That’s a point driven home by business leaders interviewed for a Quality Magazine article on continuous process improvement. Organizational change can not only reduce costs and improve revenues, but also recognize employees for their contributions and improve their work life.

They note that process improvement and positive change can take the form of a Lean or Six Sigma project, a Plan Do Check Act (PDCA) cycle, kaizen events or benchmarking. They also note that there are no shortcuts. Accomplishing successful change takes hard work, an understanding of the tools and techniques of process improvement, and knowing how to correctly apply them.

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