Why is Change Communications so Important?

Studies show that only 20% of all change projects succeed. The main reason for their failure is a lack of communication.

Initially it was volatile markets and megatrends like e-mobility that forced the automotive industry to make changes. Then Corona came along with production stops and logistics chaos. Its consequences are still being felt and already we find ourselves in the midst of the next big challenge: the war in Ukraine. Raw materials and parts are in short supply. Factories are at a standstill, and nobody knows what the energy-supply situation will be like in just a few months. All this leads to higher costs in the automotive industry, and to supply bottlenecks, process changes, and quality issues, to name just a few of the problems. And other industries are struggling with similar challenges.

Companies need to react quickly and flexibly to the current situation. At the same time, they need to initiate changes that won't actually take effect for a few months or years. Because simply returning to business as it was before the pandemic is simply not going to cut it. The various sources of pressure to change show that the adjustments required are manifold. Experience tells us that this often leads to companies trying to execute an all-encompassing, highly complex, and protracted change project, or they launch a number of small change initiatives simultaneously or consecutively that overlap to varying degrees. The success rate of this approach is only 20%!

Numerous studies reach this conclusion: "Change management fails due to inadequate communication," is the assessment of the consulting company Mutaree. Because "only 38% of employees feel like they are well integrated into change projects." The Porsche Consulting Change Management Compass 2020 shares this view and identifies poor communication and a lack of staff integration as the main reasons why only 20% of strategic transformations in German companies achieve the desired result.

The present situation pressures management to react immediately, and that although both the pandemic and the war in Europe are new and entirely unforeseen events for which there are no blueprints. All the more important it is to think about change communications from the word go. Skimping on communications risks allowing the necessary changes to fall by the wayside. The daily business is neglected, employees lose motivation and money gets invested without the change projects achieving their prescribed goals and the company being able to remain competitive.

Instead, executives and change managers should take the time right at the start of a project to set up the communication strategy properly with the aid of experts, and then implement the planned measures without fail throughout the course of the project. They should analyze the results and adjust the strategy where required. Communicating project progress motivates staff and gains management attention, which helps prevent the initiatives from running out of steam along the way. Good change communications cannot guarantee success on its own, but it is key to ensuring that in their everyday work the employees breathe life into the desired changes to secure the medium-term success of the company.