Change is an inevitable aspect of any modern organization, requiring an effective strategy for successfully navigating tech transformations. Key performance indicators (KPIs) are vital tools for measuring the impact of change, as they provide insight into the effectiveness and long-term acceptance of change initiatives.
Change management is different for every business, but there are common KPIs to measure employee engagement, adoption rate, and goal progress across companies, industries, and geographical locations.
This article discusses the use of these KPIs in change management, including their role in overcoming process inconsistencies, increasing business agility, and keeping projects on track.
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Change management KPIs
The following 11 KPIs are highly useful in tracking the success of change management initiatives:
- Adoption rate
- Rejection rate
- Time to adoption
- Cost to change
- Change success rate
- Stakeholder satisfaction
- Employee satisfaction and engagement
- Employee training attendance and effectiveness
- Number of unauthorized changes
- Number of incidents caused by change
- Backed-out changes rate
Adoption rate
Adoption rate is the percentage of employees who have successfully adopted a change, such as a new workflow, process or application. It’s a measure of the level of acceptance, integration, or utilization of a change within an organization.
Tracking a change’s adoption rate provides insight into its overall effectiveness and the extent to which the workforce has embraced it. A low adoption rate could indicate that the change will have a low return on investment (ROI).
Rejection rate
The rejection rate is the percentage of proposed changes that are rejected or never implemented. It’s a measure of the resistance level to a change or the challenges of implementing it.
The causes of a high rejection rate may be specific to the change or rooted within the organization, including culture, structure, technology or employee training.
Common reasons for rejecting a change include:
- Poor change design
- Inadequate communication
- Lack of stakeholder engagement
- Insufficient training
Some proposed changes may be poorly designed, but even well-designed transitions can be rejected because they do not solve their intended issues. Inadequate communication and lack of justification for a change are additional reasons for rejection. In both cases, key stakeholders may not understand the need for the change or its benefits.
Other factors may also result in a lack of stakeholder engagement, such as a lack of involvement of stakeholders affected by the change. This deficiency in the change process can lead to a lack of acceptance and ownership over the change, resulting in high change resistance by stakeholders.
Insufficient training /lack of support is another common reason some change initiatives fail, often stemming from a lack of resources like funds, personnel, and time to effectively implement the change. It can also occur when an organization fails to provide employees with the technical skills or change management training needed to support the change.
Analyzing the change rejection rate helps identify barriers changes face and drives them toward implementation. Addressing these issues can also improve stakeholder acceptance, enhance the organization’s change management processes, and effectively achieve strategic goals.
Time to adoption
Time-to-adoption measures the time needed to achieve the desired business outcome once a change has been implemented. It’s similar to the adoption rate, which measures the level of the change’s adoption within an organization at a given time.
The most common method of obtaining a change’s time to adoption is to measure the time needed for users to fully adopt the change after it’s introduced. This metric provides insight into the efficiency and speed of the change’s adoption process.
Cost to change
Cost-to-change is the total cost of implementing a change. These costs commonly include the value of the employees’ time and other resources needed to implement the change.
Additional costs include both the direct and hidden costs of training employees, new technology or upgrades needed to support the change, and the cost of disrupting current processes. Change leaders should carefully track these costs to evaluate the financial impact of the change initiatives and ensure they effectively manage the needed resources.
Change success rate
Change success rate is the percentage of change initiatives that achieve their intended objectives. It assesses the extent to which a change has been effectively implemented by delivering its expected benefit.
Several methods for measuring change success exist, depending on the nature of the change. Analysts frequently tie change success rate to other metrics that align with the change’s objectives, including adoption rate, employee engagement and KPIs specific to that organization.
Stakeholder satisfaction
Stakeholders may include any individual or group affected by the change, such as customers, employees, leaders, managers, and suppliers. Measuring their satisfaction with a change is essential for assessing their level of support for it, as well as their perception of the change’s success and engagement with the change.
Measuring stakeholder satisfaction requires analysts to develop a quantifiable metric that, in the end, is often unique to that organization. Common sources for such metrics include stakeholder feedback, rating scales, and satisfaction scores.
Employee satisfaction and engagement
KPIs that show employee satisfaction rates help analysts assess employees’ perception of a business transition, in addition to the level of their involvement and the sense of commitment.
These metrics provide insight into employees’ response to change, which can greatly affect their performance and productivity when working with those changes. Data sources for measuring employee satisfaction and engagement KPIs include Net Promoter Score (NPS) surveys, pulse surveys, and anonymous employee surveys.
Employee training attendance and effectiveness
Organizations often experience challenges in training employees when implementing a change. Overcoming this challenge requires them to invest in training programs for their workforce, including training in change management, before the transition and training of the new, required skills.
Training metrics should measure the impact and success of onboarding new employees and retraining existing employees on skills related to the change, whether that change is a new application, workflow, process or organizational structure.
They may also help to gauge the workforce’s readiness and ability of employees with new skill sets to leverage the change.
Metrics that track the effectiveness of training include the total number of employees who have completed a particular course and the number of training programs the company has organized. They may also measure the level of knowledge the employees have acquired.
Number of unauthorized changes
The number of unauthorized changes that occur over a given period assesses the quality of the change approval process. A lower number indicates a robust approval process that has effectively managed change.
A major goal of change management should be to minimize the number of unauthorized changes relative to the number of authorized changes. Organizations typically count unauthorized changes for regular business cycles – per month, quarter, and year.
Number of incidents caused by change
IT professionals know that changes don’t always go according to plan. Some create a cascade effect in which adverse incidents cause other incidents, resulting in a spike in support tickets.
The number of incidents caused by change indicates the extent to which a particular change affects other operations. A high value indicates that change leaders should communicate more effectively regarding the change, especially when they already know the change will affect multiple services across the organization.
Backed-out changes rate
All changes need a rollback, or back-out plan, before implementation. The change team must be able to restore systems to their previous state in case anything goes wrong during the installation.
The backed-out change rate is the percentage of implemented changes that had to be rolled back as a result of problems encountered during implementation. A high value for this metric suggests that too many of the changes going through the Request for Change (RFC) process are poorly planned or executed.
Analysts can track this metric with change enablement software. Features to look for in these solutions include an intuitive, customizable dashboard that allows users to view change management metrics.
How to select and develop change management KPIs
Change management should use a one-size-fits-all approach, as each organization has its own operating environment. As a result, change leaders must define the KPIs that best measure the success of their unique change initiatives.
The steps for developing change management KPIs consist of the following:
- Understand the change initiative in relation to the business goals
- Identify benchmarks
- Define key areas of impact
- Ensure the KPIs are specific, measurable and actionable
- Develop data collection and reporting methods
- Monitor and evaluate the results continuously
- Leverage technology to track the KPIs
- Understand the business goals and change initiative
Change leaders need to understand what they’re trying to achieve with a change before developing KPIs for it. They must be able to articulate a specific objective, such as increasing operational efficiency, increasing employee engagement or improving customer experience.
The KPIs for the change should objectively measure a quantity that aligns with the organization’s goals. For example, simply saying that a change should “improve operational efficiency” is not thorough enough to develop KPIs. Instead, the goal should be quantifiable and measurable, like reducing the average processing time by 10 percent.
Identify benchmarks
Change leaders should set benchmarks when developing KPIs, which provide a basis for the comparison of milestones and objectives. These benchmarks thus serve as a standard for measuring the change’s performance, so they should be based on credible sources like internal historical data, external performance, and industry best practices.
Leaders must also use this step to establish deadlines for achieving the change’s objectives. In addition, they should align these deadlines with the overall timeline and identify milestones for that change. This practice gives team members a sense of urgency and provides them with a clear target to work towards.
Define key areas of impact
The next step in developing KPIs is identifying the areas within the organization that the change will affect. This involves analyzing the existing workflows and processes to identify areas where the change will have the greatest impact.
Change leaders should also consider new risks that the change may introduce, along with opportunities for competitive advantages. They should prioritize the areas of impact, focusing on those with the greatest potential for opportunities.
Ensure KPIs are specific, measurable, and actionable
It’s crucial to select specific KPIs based on identified issues; nebulous KPIs that don’t help reach goals can cost already struggling businesses even more resources in the long run. Change leaders should also decide how to measure KPIs, including selecting the right benchmarks for comparison.
All KPIs should be directly actionable by the organization, focusing on metrics that guide decisions and drive meaningful action. Similarly, change leaders should avoid KPIs that can be met only by factors outside their organization’s control.
Develop data collection and reporting methods
Change leaders must gather data to measure KPIs, which requires a strategy for consistently collecting data throughout the change initiative. They must also generate reports based on that data to show progress and support decisions.
Data collection
The data measuring KPIs should be both quantitative and qualitative. The sources of that data are also important considerations; they may include customer feedback, employee surveys, financial records, and performance reports.Data collection methods include focus groups, interviews, observations, surveys, and dedicated software.
Change leaders should define each step of the data collection process, including the responsible party, the data stakeholders will gather, and guidelines for ensuring the consistent handling of data.
Additional considerations for this process include the timing and frequency of data collection, so leaders should establish a schedule that ensures regular updates to the data.
Reporting
The best reporting frequency depends on the needs of the various stakeholders and data availability, but it can range from real-time updates to monthly or even quarterly reports.
The reports should effectively present the data via visual-based mechanisms like charts and graphs to highlight trends.
Automate the reporting process where possible by using data visualization tools. This process is vital for streamlining the generation of many reports while minimizing human error. It also allows the data to be analyzed quickly.
Monitor and evaluate the results continuously
The continuous monitoring of KPIs requires a system that constantly collects and analyzes data with tools like dashboards, real-time reports, and surveys so that change leaders can identify service gaps and lagging goals. An automated process management tool with artificial intelligence (AI) capabilities is the best, most powerful solution for such a system.
Leverage technology to track KPIs
Data-driven decision-making becomes possible when change leaders leverage technologies like dashboards, portals, and reporting systems that provide real-time visibility into KPI performance.
Pipefy’s no-code business process automation (BPA) solution automates tasks and streamlines communication between teams, departments, data, and processes. Our built-in, user-friendly dashboards centralize data streams into a single platform by quickly and easily integrating with legacy software. Check out our free, customizable change management template for our take on the thorough business transitions your company needs.
