Governance Bites #126: Why most change initiatives fail, with Dr Richard Carson

In this episode, Mark Banicevich speaks with Dr Richard Carson about why most change initiatives fail — and what boards can do differently. They explore the common traps leaders fall into, the importance of people-centred strategies, and how governance structures can support rather than hinder transformation. With real-world examples and practical governance advice, Dr Carson highlights how boards can secure employee buy-in, measure meaningful progress, and challenge top-down approaches that miss the human element. Packed with insights for directors, executives, and governance professionals, this conversation offers a roadmap for leading change that truly sticks.
Richard H. Carson is a consultant, author, and academic researcher with a 40-year career focused on organisational change management. He is the CEO of Carson & Associates, a consultancy he established in 2017 to serve public-sector and non-profit organisations. The firm specialises in making organisations more performance efficient and cost-effective through services like strategic planning, human resources, and executive coaching.
Dr Carson’s has served as a senior policy analyst for three Oregon governors and held numerous public sector management roles. His doctorate research in organisational psychology at Washington State University resulted in his trademarked “People Sustained Organizational Change Management (PSOCM) model”, a comprehensive, three-phase, 10-step framework for managing workplace transformation.
Dr Carson authored “The Book of Change” (see https://www.bookofchange.com/ for a free PDF), a practical, step-by-step guide written for business and government executives, consultants, and students navigating organisational change. Dr Carson has also served on several boards, including the Oregon Development Network, the American Planning Association in Oregon and Washington, and Kit Carson Historic Museums.
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Transcript

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My name is Rich Carson. I'm an ex, kind of 30-year manager, consultant and academic, and I specialise in the area of organisational change management. And really, what I'm here to talk about is the book. It's called The Book of Change, and it's on the web at bookofchange.com. It really spells out a process for doing organisational change management both for the private sector, public sector and nonprofits. Hi, I'm Mark Banicevich. Welcome to Governance Bites. Today I have the privilege again to speak to Rich Carson. Rich, thank you very much again for your time. Thank you. Our topic today is why most change initiatives fail. We're going to talk about common traps that leaders fall into and how to shift towards people-centred strategies. I really appreciate your time again. Thank you so much. You mentioned The Book of Change and that it's available. You've got bookofchange.com, and they can get in touch with you for a PDF copy of that. Yes. To start with, in your experience, what are the most common traps that executive teams and boards fall into when they're planning and executing change? Well, the biggest problem is that boards are made up of people, and they come with their own preconceptions about what needs to change. What they think needs to change and what actually needs to happen may not be the same thing. So, the biggest problem I have had is getting people to understand that, what they come into this process with may not be exactly what they thought. The other problem, in terms of some boards, is they hire consultants for this, to kind of do their dirty work. In other words, they hire you and they say, "Look, we want you to do this." So, they don't really want a thoughtful process to devine what the issues are. They just want you to make a bunch of recommendations that they want, because they don't want to look like they're the bad guys. The same thing with potentially the CEO [Chief Executive Officer] or executive director. So, those are the two biggest problems. If you don't understand what the issues really are, then it's going to fail. I think McKinsey & Company], the consulting firm, actually said that something like 70% of change management initiatives fail, and it's really because either it is a failure right from the very start, or they don't deliver. They don't provide adequate resources, timelines and bottom line accountability in terms of implementing the recommendations. It's one thing to just say, "Well, look, here's the problem."Here's what you folks need to do," and then kind of throw it on the shelf, or just pay lip service to it, or not really provide the adequate resources to implement it. One of the things that I think personally needs to happen and doesn't always happen is that once you've got the recommendations down, you know what you need to do, you can't do everything at once. And if you do it through a strategic plan and multi-year budgeting, you can kind of prioritise what you need to do now and what you need to do tomorrow and the next day. And that way, you can also make, you know, you have to assign real accountability to people and say,"Okay, we'll give you the resources, we'll give you the timeline,"and we're going to make sure this happens." Yes. Right. Moving on to the board. How should a board's governance structure support and oversee change initiatives rather than hinder them? Well, I think the most important thing is to have somebody who's kind of, a person who is responsible for overseeing this on behalf of the board. It's one thing that you want to do that as, the board wants to do that with the CEO or the executive director, but it's nice to have continuity on the board itself and have people on there, a person or persons, who really understand, have gone through the change management process. So it's not something foreign to them. So, I think having somebody on the board that actually understands that is good. It's also really important to educate the board. Change management is really a fairly new profession. It started post-1947 with Kurt Lewin as actual kind of a field of study and consulting. So, I think it's really important to educate a board in terms of what the change management process is, and to manage their expectations. Okay. That makes a lot of sense. Can you share an example of a time when a board's oversight directly prevented a change from failing? You know, you've been on a number of boards yourself, particularly in the nonprofit sector. You've consulted to boards. So, an example of when a board's oversight directly stopped a failure. I was on a board. I was fairly new, and they wanted, they asked me and another person to do a change management process. And what happened is they were so offended by the recommendations that they didn't do anything. What bothered them was we basically said, "Look, first of all,"your board's too big. You need to really narrow it down in"terms of fewer voting members. And you can still have these other"people doing whatever they were doing before, but you really need to"narrow that down." That, and the other thing, was really term limits. We talked about term limits and the fact, you know, I'm a big fan of term limits, because boards tend to stagnate over time. You get the same people with the same ideas over and over and over. And they're not going to change their minds necessarily. If you bring new people on board, it may, it could be people you bring other people on in terms of what trends have changed. But I think term limits are important, and they found that offensive, too. So, basically, we put a lot of time and effort and thought into the change management document, and they just ignored it. And basically, they told me, they said, "Look, we don't want you to"publish this anywhere." In other words, they didn't want anybody to ever know what it said. How big was the board when you started the process? Well, it was probably about 10 people. And what was the size you recommended? Oh, probably down to five. Right, right. Five voting members. Everybody could maintain their same job. Basically, you needed a President, a President-Elect, Secretary and Treasurer, and I forget what the fifth person was. But those are the basic board essentials of any board. Those are the basic functions. You can have a lot of add-ons depending on what the board is. Is this a board of, you know, you have people who do programming, things like that. Right. Anyway, they went nowhere. Right. Yes. I've been in a similar situation, where you're trying to educate a board around what governance is, what their job is, and the struggle with trying to get heard, and stop people from simply just doing management tasks that they've been doing forever. Well, and if you're not a big, you know, if you're not an echo chamber in terms of what they want, that can be problematic, too. Like I said, a lot of times they're hiring you to do what they want and not necessarily what needs to be done, and that's not personally, that's not something I'm really interested in. It's interesting that the structure that you talked about, the very traditional structure of a President, President-Elect, Secretary. There's been a movement in New Zealand sport, for example, away from that traditional model to a more corporate-style board of directors where you've just got five, seven directors. They're all directors. That's their job. Somebody is the chair of the board, and all the other administrative roles fall inside the organisation. So, the secretarial role falls inside the organisation. They're not a board role. Sure. So, yeah, there is a bit of change in that space. What's the primary reason leaders fail to get buy-in from employees during a change initiative? Well, first and foremost, they don't care what they think. You know, I have worked with CEOs and executive directors who are very dictatorial. And like I said, either a board or the CEO or executive director person wants you to put together a report in terms of what they want. And, you know, basically, if they're not sincere in terms of empowering, involving the staff, either internally or externally — vendors, customers, etc. — then they're not going to get a good product. If they think they know what the problem is, that's the first problem, because maybe they're wrong. And a lot of times, if you have a board, and like I said, you bring new people on, and they basically come in with an agenda that they think something needs to happen, whether it's rational or irrational, whether it's going to be profitable or not. So, the biggest issue for me is always to convince the board and the, you know, let's say the leadership, to convince the leadership to involve everybody, all the stakeholders. They can always reject what they're hearing, but if they involve all the stakeholders, first of all, it gets, it gets rid of this resistance to change. If you go to somebody and say, "You're going to do this," like I said, their response is usually, "Well, we always did"it this way. Why would we do that?" But if you go to them, if you go to anybody and ask their opinion, they're flattered. Yes. And go to the staff and ask their opinion, and get their buy-in, involve them in the process, you'll not only get a better product, but that actually will get implemented. Well, from a board perspective then, what governance mechanisms can be put in place to ensure that those change strategies are people-centred, as you say? What can you put into the governance structure to say, you know,"This is how we do things around here when we want change. We need"to have the people involved." Well, are you talking in terms of what you do with the board or how you implement it? Yeah. What you do with the board. How you put something in place so that the board will do the right things around involving the team. Well, like I said, I mean, you get them to kind of put their money where their mouth is and create a strategic plan and do multi-year budgeting. And once that's in place, basically, they live with it. It's their, I mean, they take ownership of the plan and the budgeting, which is their job, and make it official. You've, as a board of directors with a CEO and a management team, how can the board then ensure that the CEO and the management team are focused on that human element of change? You know, if as a board you're getting together once a month, once every six weeks, you're discussing things. You might have the CEO, some of the other members of the management team coming into the room. You're not necessarily talking directly to staff. How can you ensure that they're focused on that human element? Well, a couple ways. Number one is know who you're hiring, okay. Just to start with. Your biggest opportunity to get it right is to hire the right person who understands that that is important. Secondarily, if you've got a person who basically is the problem, you need to basically make them understand that they're going to be accountable to the board, and they need to, either — I had one of the people that worked for me, basically, when I explained this process to them, he said, "Well, I don't necessarily agree with you," he goes, "but I can tell that you're either on the train or off the train." And he's right. You know, either — I had people that were not on the train, and eventually had to, you know, phase them out of their positions because they really didn't, they either didn't get it or didn't want to implement it for one reason or another. So, either you hire the right people who understand that involving employees is an important aspect of their job, or bring them around to understanding that that is the expectation. Right. Yeah. Great. Thank you. What metrics should a board be looking at to measure the success of people-centred change? Well, you can use several things. One is you can do surveys of both internally and externally of staff and of vendors, customers, etc. You can do focus groups of any of those on a regular basis. Or, finally, you can actually sit down with work groups. Once, let's say, once a year, you have the board has a luncheon with a particular work group, and just talks about, and maybe the manager is there or not there, but I mean, they basically talk about how things are going, how they feel about making these changes, how, are they successful or not. So, there are different tools you can use, that a board can use, to connect with the line staff. Either through, like I said, surveys where you can actually measure performance. You can measure perceptions over time, too, just like you can measure cost. Right. Right. So, one is by collecting data to report up to the board, which is the idea of your surveys, and the other way is by creating mechanisms for having the board actually talk to people within the business and find out how things are going. Yeah. Great. Yeah. Like, you know, what gets measured gets done. And if the CEO or executive director knows that the board is tracking these things — tracking perceptions, tracking cost — it makes that person accountable, and they can go back to that person and say, "Well, look,"okay, you're doing really well here. It's not just a matter of my opinion."We've got metrics, and you're doing well here, you're doing well here, but not so well over here." Metrics are really, really important, both perceptually or in reality, in terms of cost. Yeah. Thank you. How can a board foster a culture of open communication to address employee concerns, particularly during periods of significant change? So, how do you get a culture in an organisation, and how does the board create this culture of having employees being able to raise their hand and saying, "Hey, I've got a problem here." There are a lot of different ways. Some that are, you know, kind of more obvious than others. I mean, you could actually create a newsletter, you know, in terms of the positive. You could have a regular newsletter that goes out, say, monthly or quarterly, that has information from not just from the executive director, CEO or departments, but also from the board. You know, one of the things I did was, when you walked into my offices, on one wall, I had the, you've seen org [organisation] charts, right? Well, I had a massive org chart of the entire organisation with a picture of every person in it with their name and their title, and it showed what group they were in. And it would change over time as people got promoted, people came on, people left. But things like that create a sense of group that you belong to something. And it was nice for, if you were a new person in my organisation, you could go over to the board and figure out who was who. Yeah, that'd be really helpful. Because you don't, you know, you're in an organisation of 165 people. You don't have a clue what's going on from day one. So, there's a lot of things that a board can do like that, that really creates a sense of group, sense of belonging. You know, and the other is, just like I said, a great deal depends on the people you hire to make sure that, you know, one of the things that I found that is really important as a manager is being a good listener. I had a boss once, and I would be talking to him, and he would stop and say, he would say, "You're not listening. Just shut up and listen."I'm going to tell you something." So, being, you know, as a manager or a board, you need mechanisms so that people know that you are listening to what they're saying. Because a lot of times if it's a very top-down organisation, you're just told what to do, and your opinion doesn't matter. So, actually, like I said, focus groups, surveys, get-togethers, there's a lot of ways to help people feel like, not only feel like they're part of something, but actually have a voice. Yes. How can a board effectively challenge management on a change initiative that appears to be too top-down? Something where it's being dictated from the top rather than, as you're saying, you've got to get the people involved at all levels of the organisation. There are a couple things you do. The toughest is replace people. That sounds pretty callous, but a lot of times you've got people that are in the wrong position. They don't have the aptitude. It's kind of like the Peter Principle. I mean, they may have got promoted to a position that they are, they're not adequate, they're not able to even handle. So that's, another way, you know, of course you can provide people with, where people lack skills, you can provide them with training. If, you know, and not as a punishment, but I mean, basically, if somebody is serious about growth as a professional, as a manager, then you need, you know, you need — managers are not necessarily born, they're created, and they need, if you provide them with adequate training. There are all kinds of, you know, the thing with training is if people perceive it as kind of like, "You're bad, you've done something wrong, so we're going to"send you to the work education camp," then it's not going to work, you know. But if people really embrace it like it's professional, personal growth, and they really get into it, then that works great. Yeah. Cool thing. I've got one final question for you. In your governance career, you've been on a number of boards, particularly in the not-for-profit space. Yeah. What's the best governance advice you've received? That I've received? Well, I think, like I said, one of them was to be a better listener than a talker. You know, that was personally. I mean, I'm fairly glib. So, I got that lesson from not only a boss at one time who told me to shut up and listen, but I got that advice from my wife, who basically told me,"Look, I'm not here to debate this. I want you to listen to what I have to say." So, that probably is the most important lesson I've learned personally. The other is where, and this is true in terms of CEOs or executive directors, where you are not strong, where you need help, get help. Like I said, I put my human resource person in the office next to me because I felt that I needed a sounding board when talking about cultural empowerment, when talking about staff issues, dos and don'ts, that kind of thing. So, where you need to get a strength, find somebody that that compliments you. Awesome. Richard, thank you very much again for your time. Yeah. I want to just note again that your website's bookofchange.com, - Yes. - and the PDF of the book is available. If they can't find it on the website, they can get in touch with you and get a copy of the PDF to read. Yes. In our previous conversation, we talked about the 3Es model of change, which was really interesting in itself. So, I'll look forward to catching up again soon. Great. And to seeing you next episode. Okay. Thanks. Thank you for watching this episode of Governance Bites. We have more episodes on YouTube and your favourite podcast channel where I interview directors and experts on various topics relating to boards of directors and governance. We'd love to see you back, and please like, subscribe, and share the videos and podcasts.