A major study has confirmed that most organisations neglect human capital, despite growing awareness of its fundamental importance to project management.

The survey, carried out by Lane4, has revealed that 88 per cent of businesses had experienced substantial change over the last two years but only 9 per cent said they had been truly successful at managing this change. People factors and leadership ability were the most significant barriers in effecting successful change.

The report titled Emerging stronger: strategic insights for leading in tough times revealed that 51 per cent of companies had experienced some success, leaving 40 per cent whose change initiatives had failed to achieve their intended objectives.

Executives were asked what were the most challenging barriers to change. Those quoted were people factors (36 per cent), leadership factors (34 per cent), practical factors (25 per cent) and external factors (5 per cent).

People factors:
• Employee resistance accounted for 53 per cent of the barriers that related to people factors. Respondents talked about uncooperative staff who were hostile to change.
• People-related cultural constraints - 22 per cent talked about a culture of caution and bureaucracy.
• Lack of necessary skills accounted for 15 per cent of the people barriers.
• Lack of engagement accounted for the final 10 per cent of the people component.

Leadership factors:
• Leadership accounted for 32 per cent of the leadership barriers. Respondents said that leaders lacked the knowledge and skill to lead change effectively.
• Inadequate communication - 30 per cent said messages were unclear and communicated too formally, preventing employees from really understanding what the change was about.
• Lack of consultation - 14 per cent said that change was too top-down and that leaders failed to involve the people who would be impacted by the change.
• Other leadership barriers included lack of vision and lack of alignment.

Practical factors:
• Change is too rapid explained 23 per cent of the practical barriers. The sense that there will be another change along in a minute meant that initiatives were rarely embedded before the next one was launched.
• Too much change - 21 per cent talked about the amount of change as overwhelming.
• Lack of time to implement change properly accounted for 16 per cent of responses.
• Other practical concerns related to the size and structure of the organisation, lack of money and ineffective processes for change.

Katie Warriner, research consultant at Lane4 commented: ‘Our survey findings indicate that people factors require the most attention. Therefore, to ensure successful change, leaders must consider engagement as a mindset rather than a stage on a project plan. By developing and communicating a compelling story for change, shaping an effective process and enabling the people, leaders can ensure that people understand the reasons for change, care about initiatives being a success and are equipped to make it a success.’