Outsourcing facilities management creates many changes and possible disruptions to an organisation. But what are the most common pitfalls you must avoid to make your outsourcing a success?
Today companies go through changes more rapidly than they did 20 years ago. This creates needs for new best practices and processes to effectively manage employees through changes.
In relation to outsourcing, the purpose of a change management programme is to steer a company safely through the project by dealing with the people side of the business. This includes getting involvement, engagement and willingness to embrace the change. This can be achieved through communication, management of emotions and involvement of employees where and whenever possible.
Despite these insights, change management projects related to facility and service management outsourcing sometimes fail. Backed up by research and case studies, here are the eight most common reasons why.
1. Lack of formal change management process
During the last 15 years, change management has evolved into a more proactive and structured approach backed up by best practice processes, accepted terminologies and tools. Despite the development, most change programmes remain poorly planned with lack of formal processes. In many instances, communication and employee involvement can bring you far but when it comes to the actual change management, a programme with no formal process is more likely to fail.
2. Poor integration with project management
Project management and change management are two very distinct disciplines. Even with their differences in approach and execution, they are also interlinked and must be aligned. Research suggests that change and project management programmes are aligned in only 45% of all cases.
To make your change management project a success and avoid the common pitfall of misalignment, it is therefore of high importance that the project manager becomes a member of the change management team and vice versa.
3. Poor support from middle managers
When it comes to employees’ attitude towards change, a majority is concerned with the ”what’s in it for me” perspective. At the same time, studies show that there is a strong correlation between the overall support from middle managers and the level of resistance to change a project.
To prevent a change management programme from failing, it is therefore crucial to gain the support from middle managers right from the beginning of the project and ensure that the middle managers create transparency for the employees and spend time communicating and discussing the effects of change.
In the context of change management, the importance of middle managers and supervisors in the process cannot be overstated.
4. Low priority for change management
If a change management programme is not prioritised within a company, two unfortunate things often happen:
- Lack of visible sponsorship from the C-level executives
- Lack of resources made available to carry out the change management programme. Often limited by budget or time.
These two elements are the single biggest reasons why a change management programme fails.
5. No cooperation between customer and service provider
The level of overall satisfaction with the contract depends largely on the level of cooperation between the customer and the service provider. Poor cooperation between these two parties often leads to poor communication, mismanaged transition and high employee turnover in the outsourced business unit.
The seeds of poor cooperation can often be traced back to the RFP stage. Many RFP’s are counterproductive to a change management programme. During our research, we found many examples where the support functions from the customer organisation showed a visible lack of interest and priority given to the outsourced unit long before the handover. This resulted in a high employee turnover in the business unit and dissatisfaction from both the customer and service provider.
6. Change saturation
Many companies often find themselves in the state of change. At the same time – most of us have a saturation limit. Above this limit change becomes problematic. The change management team must try to assess the change saturation level in the organisation before the project gets under way. On the basis of this assessment, the team can adjust its activities accordingly. If the saturation level is too high, the team should even consider delaying the facility and service management outsourcing. The saturation level can be assessed by monitoring employee turnover rates, absenteeism, productivity levels, employee engagement levels, lack of inter-departmental cooperation and silo thinking as well as a general low level of trust in management.
7. Poor transition between the two companies
Our interviews identified several examples where the customer – especially the HR department – lost all interest in the outsourced employees several months before the official handover. This left the employees very dissatisfied, not knowing which organisation they belong to and feeling unwanted. Transition management is an important element of change management and if let out, it can negatively impact the entire change management effort.
8. Resistance from employees
Many of the common pitfalls listed above are likely to lead to resistance from the employees. For example, if the middle managers are not on board then neither will the employees be. If the organisation has gone through too many changes in a short period of time, then this may lead to resistance. Resistance is consistently cited as the single most important reason why change efforts fail and yet few change programmes use specific resistance management tools and processes to identify and manage resistance. Special effort should be put into managing resistance proactively instead of hoping that resistance will not occur.