SUCCESS FACTORS OF TRANSFORMATIONS IN THE PUBLIC SECTOR
Research on the success factors of public transformation and a comparison to the success factors of private transformations
Master thesis, MscBA, specialization Change Management University of Groningen, Faculty of Economics and Business
February 2008
SUCCESS FACTORS OF TRANSFORMATIONS IN THE PUBLIC SECTOR
Research on the success factors of public transformation and a comparison to the success factors of private transformations
ABSTRACT
TABLE OF CONTENT
1. INTRODUCTION ... 6
2. THEORATICAL BACKGROUND ... 8
2.1 Definition of a transformation ... 8
2.2 Success factors of transformations in the private sector ... 11
2.2.1: Vision ... 12
2.2.2: Leadership ... 14
2.2.3: Implementation ... 18
2.3 Characteristics of organizations in the public sector that differ from the private sector 21 3. METHOD ... 25 3.1 Data collection ... 25 3.2 Data analysis ... 28 4. RESULTS ... 30 4.1 Descriptive statistics ... 30 4.2 Additional research ... 35 5. DISCUSSION ... 37 5.1 Conclusions ... 37 5.2 Limitations ... 39 5.3 Implications ... 40 REFERENCES ... 43
APPENDIX A: QUESTIONNAIRE PUBLIC TRANSFORMATIONS ... 47
APPENDIX B: ADDITIONAL RESULTS ... 54
APPENDIX C: OTHER SUCCESS FACTORS OF PUBLIC TRANSFORMATIONS... 58
1. INTRODUCTION
Organizational change appears to be happening with increasing frequency and magnitude in both public and private sectors (Coram & Burnes, 2001). Therefore, it is not surprisingly that a lot of literature is written on how to transform organizations (Beer & Nohria, 2000; Burnes, 2004; Cummings & Worley, 2005; Kotter, 2007). In this research the focus will be on transformational change. The definitions in the literature of a transformation differ, but for this research a transformation is defined as follows: a strategic, organization-wide change which has a deep influence on the core competencies of an organization, its environment, processes and performances.
Most of the major studies of change focus on the private sector and tend to derive their approaches to change from that sector (Coram & Burnes, 2001). Also, Capgemini (in cooperation with The Economist) developed an approach for transforming organizations in the private sector. According to Capgemini, there are three crucial factors for a successful transformation: vision, leadership and implementation. However, organizations in the public sector differ from organizations in the private sector (Sminia & Van Nistelrooij, 2006). Because of these differences, it can be questioned whether the approaches to transforming organizations are the same for the public sector as for the private sector. Are they the same as for transforming organizations in the private sector or totally different?
Objective and research questions
The objective of this research is to identify perceived success factors of organizational transformations in the public sector. Also, determine whether and how the success factors of public transformations differ from the success factors of private transformations.
Building on the objective of this research, the following research question can be defined:
What are, according to CEO’s and managers of organizations in the public sector, success factors of transforming organizations in the public sector and what are the differences with success factors of transforming organizations in the private sector according to the literature?
In order to answer this research question, it is broken down into the following questions which will be answered in this thesis:
• What is meant by a transformation?
• What are the success factors of organizational transformations in the private sector according to the literature?
• What are the, for this research relevant, differences between organizations in the public and private sector according to the literature?
• What are, after empirical research, the success factors of public transformations according to CEO’s and managers of organizations in the public sector?
2. THEORATICAL BACKGROUND
2.1 Definition of a transformation
Developing technology, the changing needs of the stakeholders and economic pressures all contribute to the need for organizations worldwide to significantly modify the way they do things (Oakland & Tanner, 2007). For organizations, being able to change became a way of surviving in the competitive world. However, there are a lot of different changes that an organization can undertake. One can distinguish between planned versus emergent change, strategic versus operational change, transformational versus transactional change, etc. (Burke, 2002; Burnes, 2004). In this research, the focus will be on transformational change. Before we continue with describing the success factors for transformational change, it is necessary to define what a transformation actually is. Capgemini defined a transformation as follows:
‘a strategic, organization-wide change which has a deep influence on the core competencies of an organization, its environment, processes and performances’.
This definition contains six elements that will be elaborated on further now.
Strategic change
Organization-wide change
A transformation is an organization-wide change, which means that a change will affect the whole (or at least a great part of the) organization. For a change to be labeled transformational, a majority of individuals in an organization must change their behavior (Cummings & Worley, 2005; Kirkley, 2000). From this point of view, changes that take place in one department that do not influence other parts of the organization, are not organization-wide changes and therefore not transformations.
Influence on core competencies
Core competencies of the organizational level are the collection of knowledge, skills, abilities and other characteristics of an organization as a whole that are the organization's strengths (Lahti, 1999). These core competencies allow access to a vast number of business markets, substantially contribute to the customer’s value of an end product, and are difficult for an organization’s competitors to emulate (Lahti, 1999). Also, the core competencies are utilized most effectively when they are incorporated into the strategic architecture of an organization (Prahalad & Hamel, 1990). This means there is a strong link between an organizations strategic architecture and its core competencies. When an organization is transforming on the strategic level, a consequence will be that this also influences its core competencies.
Influence on environment
Influence on processes
Choice of strategy affects internal organization characteristics (Daft, 2001). One of these internal organization characteristics are the processes of an organization. With a transformational/strategic change, a new way of working will be needed. So when a transformational change within an organization occurs (which means a strategic change), this has influence on the processes of an organization.
Influence on performance
2.2 Success factors of transformations in the private sector
About 70 % of the transformation initiatives fail (Beer & Nohria, 2000). This means that only 30 % of the transformations will lead to a success. Because of this big failure rate, knowledge of how to achieve successful transformations is necessary. There is already done lots of research on which factors influence a change process and why some change efforts succeed and others fail. Some researchers argue that there is no one best way for organizations to change. Although it could be that there is no one best way to transform, there are several factors identified in the literature that actually contribute to a successful change.
Capgemini, in cooperation with The Economist, also conducted research on the factors of transformation success in the private sector. The outcome of their research is that vision, leadership and implementation are success factors of an organizational transformation in the private sector. Consulting the existing literature about change management, it appeared that a significant amount of research recognized the importance of these three factors when transforming an organization. Through this whole paper, with ‘the research by Capgemini’ this research is meant.
Vision, leadership and implementation are factors which all have influence on each other (see figure 1) and therefore it is difficult to separate them. For example, a leader has to have a vision and a vision is needed for implementation. Despite these reciprocal influences, it is tried to make the distinction between vision, leadership and implementation as clear as possible.
FIGURE 1
Reciprocal influences of the success factors
In this part, there will be elaborated on the three success factors of transformations. Implementation
Vision
2.2.1: Vision
For an organization to reach a successful transformation, it is necessary to have a vision. A vision provides a valued direction for designing, implementing, and assessing organizational changes (Cummings & Worley, 2005). A vision contains two elements; a futuristic orientation expressed in some form and references to tangible courses of immediate action (Landau et al., 2006). The futuristic orientation of the vision reaches toward improvement of the present conditions of the organization. Besides this futuristic orientation, a vision also contains the ability to take action and progress to reach this desired future. So, a vision contains both a picture of the desired future as well as a strategy to reach this future state. The strategy does not necessarily has to be in detail, but must be specific enough to provide direction for the employees of the organization. This is in line with what (Nutt & Backoff, 1997) say; a vision outlines a strategic and lofty action plan. The strategic aspects suggest important actions. To be lofty, the vision must be sufficiently imaginative to be engaging and inspiring.
Many authors agree on the fact that having a vision is crucial for a successful organizational transformation (Cummings & Worley, 2005; Gouillart & Kelly, 1997; Kotter, 2007; Nutt & Backoff, 1997). A vision serves several important purposes (Jones, 2003; Kotter, 1997). First, it simplifies the multitude of smaller, more detailed decisions required to implement change. Second, it motivates people to take required action. A transformation often means that people within the organization need to change something and therefore they must step out of their comfort zone. Because of this, people within the organization could show resistance and discomfort to change. A clear vision helps to overcome the resistance and discomfort associated with change. It also energizes commitment to change by providing members with a common goal and a compelling rationale for why change is necessary and worth the effort (Cummings & Worley, 2005). Third, a vision helps to align individuals. It coordinates the actions of the different employees of the organization, which is a task that can be difficult, especially in organizations with hundreds or thousands of employees. Clarity of vision helps people understand their role in the overall scheme of things (Jones, 2003).
(Gouillart & Kelly, 1997). When an organization is transforming, it means that a lot of changes will be made within the organization. So an ambitious vision of the future is necessary to actually be sure that this transformation reaches the desired outcome (which is totally different from the present situation). Although a vision should be ambitious and challenging, it is important to make sure this vision is realistic and reachable (Nutt & Backoff, 1997). A too ambitious vision does not motivate people within the organization, because they think they are not able to achieve this desired future. The vision should be realistic enough to be a source of concentration and motivation (Gouillart & Kelly, 1997). Besides that, the vision should be inspiring. Visions inspire by drawing people to them, suggesting what it would be like at a point in time in the future to live in this new possibility space (Nutt & Backoff, 1997). A vision should be inspiring so that it enables people to be creative and take required action.
The vision should shine clearly for everyone in the organization to see, however, so that they can all know where they are heading for, and use it to judge the appropriateness of their actions (Burnes, 2004). By constructing a vision in this manner, the organization not only has a picture of what is whishes to become but also some concrete targets to aim for (Burnes, 2004). This means that, next to the described attributes that a vision must have it is also necessary to translate a vision in measurable goals. By doing this, loose and intangible ideas of the vision become transformed into achievable medium-term goals that people can relate to and pursue (Burnes, 2004).
However, according to Kotter (2007), one of the major reasons why transformation efforts fail is because the vision is under communicated. So, for a successful transformation you do not only have to have a vision, but also communicating this vision is crucial. A transformation requires help from people within the organization; this often means they have to step out of their comfort zone. In order to make sacrifices, the employees must believe that useful change is possible. Without credible communication, and a lot of it, the hearts and minds of the troops are never captured (Kotter, 2007).
make sure the vision is shared and committed to is to involve people in developing the vision. Actually, several authors argue that involvement of different stakeholders is crucial for successful transformations (Cummings & Worley, 2005; Fisher, 2005; Nutt & Backoff, 1997). For example, stakeholders can be shareholders, employees, customers/clients or government. In many cases, leaders encourage participation from different stakeholders in developing the vision to gain wider input and support for the transformation. A vision that incorporates the views of many stakeholders with dissimilar interests and ideas increases the prospect of a successful transformation (Nutt & Backoff, 1997).
Concluded can be that, within vision, the following factors are crucial for successful organizational transformations in the private sector:
1) A vision must be ambitious, inspirational and challenging, but realistic
2) A vision must be translated in measurable goals
3) Different stakeholders must be involved in developing the vision
4) A vision must be communicated through the whole organization
5) A vision must be shared within the organization and the whole organization must be committed to the vision
2.2.2: Leadership
Concerning the great amount of literature on leadership and change, it is evident that the role of leaders in the change process has a significant influence on the success of a change. Although there are uncountable books and articles written about leadership; according to the experts, leadership always has something to do with influencing others (Cummings & Worley, 1995; Kotter, 1990). Leadership is primarily focused on movement and changing of others. Leadership in the context of organizational transformation is therefore: influencing the behavior of employees to reach goals by a person who a formal position has with respect to employees.
problem solving (Kotter, 1990). Leadership is something different; leadership produces movement by establishing direction, aligning people, and motivating and inspiring (Kotter, 1990). Thus, management produces a degree of predictability and order, while leadership produces change. While change must be well managed – it must be planned, organized, directed and controlled – it also requires effective leadership to introduce change successfully (Gill, 2003). So, both are necessary for successful change, but it is leadership that is needed to produce change. Therefore, leadership is one of the most important factors in order to reach a successful organizational transformation.
The literature on large-scale organization change, thus transformations, is consistent on at least one aspect, namely that executive leadership matters (Nadler & Tushman, 1990). It is clear that individual corporate leaders can and do play roles in periods of change which enable dramatic transformations to take place (Carnall, 2003). Also, Tushman & Romanelli (1985) argue that only executive leadership is able to initiate and implement strategic changes. As a consequence, the executive is a critical actor in the process of organizational change. Therefore, in this research, the focus will be on executive leadership (which means leadership in the highest level of an organization) and where leadership is written, this can be interpreted as executive leadership.
There are many authors who all have an opinion about which elements of leadership are appropriate for successful change. On one hand, these opinions have several similarities and on the other hand, there are also many differences. Also, many research has been done about the personal characteristics and competencies of an effective leader. In this research, the focus will not be on these personal characteristics or competencies, but more on the activities of an effective leader. An overview of important elements of leadership that will have a positive influence on the success of a transformation in the private sector will be given in this part.
From the research on transformations in the private sector by Capgemini, it appeared that the most effective leaders are those that lead ‘from the back’ – leaders who actively empower their staff to take risks and set ambitious targets, provide them the tools to achieve those targets, and step back and let them get on with the job. Also Gill (2003), Graetz et al. (2006) and Wren & Dulewicz (2005) emphasize the importance for leaders to empower employees in order to reach successful change. Bennis (1999) even argues that empowered teams are the key to real change. Empowerment is the delegation of power and responsibility to subordinates (Burnes, 2004). In an environment characterized by intense global competition and new technology, many top managers believe that giving up centralized control will promote speed, flexibility, and decisiveness (Daft, 2001). Therefore, empowerment is important for an organization to survive in a world of change. Also, empowerment of employees will lead to increased motivation of employees (Daft, 2001). Having motivated employees in an organization is needed to reach a successful transformation.
Another outcome of the research by Capgemini is that for long-term success of transformations, having executives in the company who champion business transformation is crucial. A champion is an individual who identifies with a new development, using all the weapons at his command, against the funded resistance of the organization (Pinto, 2007). Here, championing a transformation can be interpreted as promoting and supporting the transformation. This can be done by, for example emphasize the benefits which can be achieved by the transformation. A very important effect of championing transformation is that it can overcome resistance to change in an organization.
Kotter’s leadership model suggests that strong interpersonal skills – not technical and analytical know-how – are a key contributing factor to effective change leadership (Graetz et al., 2006). He argues effective leadership constitutes establishing direction by developing a vision of the future along with strategies, aligning people by communicating and motivating and inspiring people.
cooperation or compliance may be needed to make that direction a reality, and doing so in as clear and credible way as possible. Other authors agree on the fact that communication by the leader is a key to successful change (Cummings & Worley, 2005; Kirkpatrick, 1985; Klein, 1996) The way Kotter (1990) sees it, this communication challenge comes down to communicate the vision and strategy. However, the vision and strategy are not the only things that need to be communicated. Communication is something that must happen through the whole change process; from the time the change is announced until the time it is implemented (Kirkpatrick, 1985). For example, publicizing successes is especially important during the changing stage of the change process (Klein, 1996).
Motivating and inspiring is another element of leadership that is needed in order to reach a successful transformation (Cummings & Worley, 2005; Gill, 2003; Kotter, 1990). Effective leaders motivate and inspire people to want to do what needs to be done (Gill, 2003). According to Kotter (1990), motivating and inspiring include energizing people to overcome major obstacles toward achieving a vision, and thus help produce the change needed by satisfying very basic but often unfulfilled human needs. In order to produce change, people must step out of their comfort zone, get over barriers and remove obstacles to change. These are all activities that demand extraordinary energy and effort; therefore it is important that a leader energizes people within the organization because this energy is needed to reach a successful transformation.
invests time in building teams that have the required competence to execute and implement the change and in creating structures that make it clear what types of behavior are required throughout the organization (Nadler & Tushman, 1990).
Concluded can be that, within leadership, the following elements are crucial for successful organizational transformations in the private sector:
1) Empowerment of employees 2) Champion the transformation
3) Communicating through the whole change process 4) Motivating and inspiring
5) Instrumental leadership
2.2.3: Implementation
‘Implementation is the Achilles heel of transformations’. That is one of the most important conclusions of the research by Capgemini. Also, the literature suggests that implementation is often the most difficult part of the change process (Daft, 2001; Smith & Mourier, 1999). Although implementation seems to be the riskiest stage of a business transformation project, it is also one of the three success factors for a successful business transformation project. Implementation refers to the activities that take a design and make it operational (Smith & Mourier, 1999) and occurs when organization members actually use a new idea, technique or behavior (Daft, 2001). Until people use the new idea, no change has actually taken place (Daft, 2001). In this part, an overview of important elements of implementation that will have a positive influence on the success of a transformation in the private sector will be given.
operating from geographically disparate locations/cultures), and (3) how to commit the right mix of functional, change management and project management skills to the team. When these transformation skills are present, this will contribute to the success of a transformation. Although these transformation skills are very important, they are not always present in organizations. From the research by Capgemini, it appeared that 70% of the respondents claimed that these transformation skills are not something their company excels at.
Faced with competitive demands for lower costs, higher performance, and greater flexibility, organizations are increasingly turning to employee involvement to enhance participation, commitment, and productivity of their members (Cummings & Worley, 2005). The importance of engaging employees through the implementation process was also one of the results of the Capgemini research. Besides that, a lot of attention is paid to the involvement of employees when a transformation takes place. Concluded can be that the involvement of employees is crucial for a successful transformation. Employee involvement seeks to increase members’ input into decisions that affect organization performance and employee well-being (Cummings & Worley, 2005). However, there are different levels of involvement. The greater the effect on the individual, the deeper the level of involvement required if successful behavior change is to be achieved (Burnes, 2004). This increased employee involvement can lead to quicker, more responsive decisions, continuous performance improvements, and greater employee flexibility, commitment, motivation and satisfaction (Cummings & Worley, 2005). These effects of employee involvement have a positive influence on the implementation process of a transformation.
Concluded can be that reward systems can actually contribute to a successful implementation of a transformation.
From the respondents of the research by Capgemini, 65 percent argued that support from senior management is a factor which is likely to lead to successful transformation projects. Not one leader is able to implement successful change on its own and is therefore dependent on other people within the organization. The support of top management is crucial; without their support the change probably would not even take place. Daft (2001) also argues that successful change requires the support of top management. Besides a success factor of transformations, the lack of top management support is also one of the most frequent causes of implementation failure.
An element of implementation that is not mentioned in the outcomes of the research of Capgemini, but is mentioned a lot in the literature on change is that the changes must be embedded in the company’s culture. Kotter (2007) argues that not anchoring changes in the corporation’s culture is one of the major reasons why transformation efforts fail. Until new behaviors are rooted in social norms and shared values, they are subject to degradation as soon as the pressure for change is removed (Kotter, 2007). He states that two factors are particularly important in institutionalizing change in corporate culture. The first is a conscious attempt to show people how the new approaches, behaviors, and attitudes have helped improve performance. The second factor is taking sufficient time to make sure that the next generation of top management really does personify the new approach.
Concluded can be that, within implementation, the following elements are crucial for successful organizational transformations in the private sector:
1) Transformation skills
2) Employee involvement
3) Adjust reward system in order to reinforce the kinds of behaviors needed to implement change
4) Support from top management
2.3 Characteristics of organizations in the public sector that differ from the private sector
Many research is done about the differences between organizations in the private sector and organizations in the public sector (Boyne, 2002; Bozeman, 1987; Nutt & Backoff, 1993; Rainey, 1983; Rainey & Bozeman, 2000; Robertson & Sonal, 1995; Sminia & Van Nistelrooij, 2006). The main difference is their ownership. Whereas private firms are owned by entrepreneurs or shareholders, public agencies are owned collectively by members of political communities (Boyne, 2002). Therefore, public sector organizations are controlled predominantly by political forces, not market forces (Boyne, 2002). There are several other differences between the public and private sector where is widely agreed upon in the literature. These differences can be categorized as follows: organizational environments, organizational goals, organizational structures and managerial values. The differences that are relevant for this research, that is those that could have influence on the process of an organizational transformation, will be described below.
Organizational environments
Complexity. The environment of public organizations is very complex. This complexity arises because public agencies face many, and a large diversity of, stakeholders, each of whom places demand and constraints on managers (Boyne, 2002; Nutt & Backoff, 1993; Sminia & Van Nistelrooij, 2006). The requirements of the various stakeholders are often in conflict with each other. For example, conflicting requirements of consumer groups and producer groups or of taxpayers and service recipients. These conflicting requirements of many stakeholders increase the complexity of the environment of public organizations. Also, because organizations in the public sector are subject to political rather than economic controls, they are likely to face a multitude of decision-makers that are potentially conflicting (Boyne, 2002; Sminia & Van Nistelrooij, 2006).
Absence of competitive pressures. The absence of competitive pressures is another thing that is typical for public agencies. Public agencies typically have few rivals for the provisions of their services (Boyne, 2002). Therefore, the commercial imperative for improvement, the survival driven to be better, is not always as visible or as strong as in commercial organizations in the private sector. Besides that, the public service cannot pick, choose or target its customers in the same way that a private sector business can. A public service must meet the needs of all eligible citizens or business and there can be no question of focusing only on particular customer segments, which is common practice in the private sector.
Driving force for changes. Another difference between private and public organizations is the driving forces for change. For public sector organizations, the main incentive has been to reduce costs (Bach & Della Rocca, 2000). The main driving force for changes in the industrial enterprises has been suggested to be new technology and changes in the competitive environment (Baines & Langfield-Smith, 2003).
Organizational goals
Distinctive goals. When it comes to organizational goals, it has been argued that public agencies have goals that are absent in private organizations, such as accountability and equity. These goals stem from the common ownership of public organizations, and from attempts to control their behavior in order to achieve collective purposes (Boyne, 2002).
Organizational structures
More bureaucracy. One of the main characteristics of organizational structures in the public sector is a bureaucratic organizational design (Boyne, 2002; Robertson & Sonal, 1995; Sminia & Van Nistelrooij, 2006).
More red tape. A possible side-effect of bureaucracy is the existence of red tape in public organizations. Red tape implies an unnecessary and counter-productive obsession with rules rather than results, and with processes rather instead of outcomes (Boyne, 2002). However, red tape today refers not to rules and procedures themselves but to the delays and subsequent irritation caused by formalization and stagnation (Bozeman et al., 1992). Thus, compared to private organizations, many public sector organizations are subject to a greater range of rules, regulations, and procedures fixed by the authority of a superior body (Bozeman, 1987; Rainey, 1983). An example of rules and structural arrangements over which external oversight agencies have authority are personnel and purchasing regulations (Rainey & Bozeman, 2000). In a study by Rainey, Facer and Bozeman (1995), it appeared that public managers argued that the constraints under their organizations’ personnel rules made it hard to fire and to reward with higher pay, while business managers disagreed (Rainey & Bozeman, 2000).
Lower managerial autonomy. Compared to private organizations, managers in public organizations have less freedom to react as they see fit to the circumstances they face (Boyne, 2002). It has been argued that public managers’ discretion on personnel issues is especially low because rules on hiring, firing and promotion are inflexible (Boyne, 2002).
Managerial values
Less materialistic. Public managers are believed to be less materialistic than their private counterparts, and are less likely to be motivated by financial rewards (Boyne, 2002). Hence policies such as performance-related pay, or promises of financial bonuses and other perquisites, are unlikely to enhance staff commitment or improve organizational performance (Boyne, 2002).
rewards (Boyne, 2002; Rainey, 1983; Rainey & Bozeman, 2000). This concern to promote the public interest has been contrasted with the desire of private firms to meet the demands of individual customers (Boyne, 2002).
Lower organizational commitment. The level of organizational commitment is believed to be lower in the public sector than the private sector, largely because of the inflexibility of personnel procedures and the weak link between performance and rewards (Boyne, 2002). Because incentives often are not based on personal achievement in the public sector (Nutt & Backoff, 1993), it is difficult for public agencies to instil employees with a sense of personal significance. Therefore, it is difficult for public employees to observe any link between their contributions and the success of their organizations (Boyne, 2002).
3. METHOD 3.1 Data collection
This study aims to find out what the perceived success factors of public transformations are and how they differ from the success factors of private transformations. Many research is done on the success factors of private transformations; also Capgemini did research on the success factors of private transformations. Because there is already so much literature and data about private transformations, it was chosen to discover the success factors of private transformations by analyzing the existing literature. Because there is not that much literature and data available on the success factors of public transformations, an internet-questionnaire was used in order to find out what the perceived success factors of public transformations are. In this section, it will be described how the literature research and internet-questionnaire were used as a method, including the decisions that were made which concerned these methods.
Literature research
The research of success factors of private transformations by Capgemini was used as starting point for the literature section. From this research, it appeared that vision, leadership and implementation are success factors of private transformations. These factors were made operational which resulted in five elements for each success factor. Again, the research done by Capgemini was used as starting point for making the factors operational. The elements from Capgemini’s research did not totally cover the success factors; therefore they were complemented by elements which were found in the existing literature on success factors of transformations. After indentifying these success factors of private transformations, two conversations with consultants of the practice Public Transformations who had experience with transforming private organizations took place. During these conversations it was checked whether the consultants agreed with the success factors of private transformations that were found in the literature.
Participants
Second, it was necessary to approach people who had a key position in the public organization in order to make sure that if a public transformation took place, they were actually involved in it. Keeping these two requirements in mind, 570 people were approached to fill in the questionnaire (the goal was to reach a response of 100). So many people were approached because an internet-questionnaire often has a low response rate (Michaelidou & Dibb, 2006). After the respondents completed the questionnaire, there were again two requirements that must be met before their results were used for this research. First, they had to be involved in a public transformation. Only people who were actually involved in a public transformation have an opinion that is based on actual experience with public transformations. Second, they had to be involved in a public transformation that was successful. Only people who were involved in a successful public transformation are able to judge whether several factors actually leaded to a successful public transformation. People who were not involved in a successful public transformation can also have an opinion about success factors of public transformations, but they do not know whether these factors could actually lead to a successful transformation because they do not have experience with successful public transformations.
People were invited to fill in the questionnaire by email. They received an email with a link to the questionnaire. In that email it was explained what the occasion and the goal of the research were. Also, it was mentioned that the research was confidentiality, and that the respondents received an overview of the results if they filled in the questionnaire. About ten days after the first invitation to cooperate, a reminder was sent.
The email addresses were collected in two different ways. First, the internal network of Capgemini was used. The managing consultants, principal consultants and vice presidents of the practice Public Transformations of Capgemini were asked to give the email addresses of people in their network who met the two requirements described above. In this way, the participants were approached on a via-via basis. Second, email addresses were collected from the Staatsalmanak. The Staatsalmanak is an appropriate source for gathering email addresses because it gives an up-to-date overview of people, their function and email addresses who work in the public sector.
Internet-questionnaire
a useful research method because it provides access to people who would be difficult to reach through other channels. This is also the case for this research where people with relative high positions in organizations were approached to cooperate. Usually, these people are busy and difficult to reach personally. By sending the respondents an email, the respondents could be reached personally relatively easily. Because research suggests that data collected via an online survey are equivalent to data collected via the traditional mail survey and since the online survey is cheaper, faster and has a higher response rate than the mail survey (Deutskens et al., 2005) it is chosen to use an internet-questionnaire for this research.
Questions
The questionnaire consisted of three parts. Part one served as an introduction to public transformations and gave information about whether the respondents were actually involved in a transformation process in the public sector. The second part contained questions about the success factors of public transformations. In this part, the respondents were asked to rate the 15 success factors of transformations that were found in the literature (described in the theory section), for public transformations. Because the respondents have relative high positions within organizations, it is assumed that they know what is meant by these factors. It could be that the respondents argue that all factors are important for successful public transformations. Therefore it was asked which factors within vision, leadership and implementation were most important for a successful public transformation according to them. In part three, the participants were questioned about the future of public transformations. In appendix A, the questionnaire can be found (only the parts that were used for this research). The results of part one and part two of the questionnaire were used for this research. Capgemini used the results of part three for other research.
three is perceived to be unimportant for a successful transformation. Also, there was one open question in the questionnaire. This question was ‘Which other factors (besides vision, leadership and implementation) are important for a successful public transformation according to you?’. Chosen was for an open question here, otherwise the participants were restricted to a number of factors where they had to choose from. So, in order to let them think for themselves and to get as much data as possible from this question, an open question was used here. Despite this one open question, there were only closed questions in the questionnaire which is appropriate for a questionnaire; otherwise it would take the respondents too much time to fill in the questionnaire.
Research Capgemini
This research is part of a bigger research on success factors of public transformations done by Capgemini. The outcomes of this research will be used as input for about 30 depth-interviews with persons who have a key position in organizations in the public sector. Therefore, the success factors were defined relatively abstract so that these results could be discussed in the interviews and more detailed information could be gathered from the interviews.
3.2 Data analysis
4. RESULTS
In this section you will find an analysis of the data which is gathered by the questionnaires. First, the descriptive statistics (frequencies and means) will be described, where after some additional research will receive attention. The outcomes of the ratings of every success factor can be found in appendix B. From the 570 people that were approached to fill in the questionnaire, 99 people actually filled in the questionnaire. This comes down to a response rate of 17,37 percent.
4.1 Descriptive statistics
Of the 99 respondents, 95 are or were actually involved in a public transformation and are therefore valuable respondents for this research. All the respondents who had been (or are) involved in a public transformations rated all the dimensions of a public transformations (a strategic change, an organization-wide change, deep influence on the core competencies of an organization, deep influence on its environment, deep influence on processes and deep influence on performances) higher than four on a scale of one to five.
FIGURE 2
Respondents of the internet-questionnaire
45 50
4
respondents who where involved in a successful public transformation
respondents who were involved in a public transformation at the moment the research took place/responents who were involved in a public transformation that reached some goals respondents who are or were not involved in a public transfromation
From the respondents who were involved in a public transformation, 45 were involved in a successful public transformation (that is, a public transformation that reached all the goals or the most important goals). The other respondents were involved in a public transformation that reached some goals or were involved in a public transformation that still took place at the moment they filled in the questionnaire.
Vision
Question 7 of the questionnaire is ‘When you look at the public transformation project(s) where you were/are involved in; to what extend was/is vision important for a successful public transformation?’. From the 45 respondents, 44 argued that a vision is important for a successful public transformation. The average rating for the importance of a vision is 4,53 on a scale of one to five.
In the literature section, five elements were identified within vision: (1) a vision must be ambitious, inspirational and challenging, but realistic; (2) a vision must be translated in measurable goals; (3) different stakeholders must be involved in developing the vision; (4) a vision must be communicated through the whole organization and (5) a vision must be shared within the organization and the whole organization must be committed to the vision. All these elements of vision seem to be important for successful public transformations according to the respondents, because all these elements have a mean score above three on a scale of one to five (see figure 3).
FIGURE 3
Mean ratings of importance of the success factors within vision
4,47 3,73 4,2 4,44 4,22 1 1,5 2 2,5 3 3,5 4 4,5 5 success factors m ea n
a vision must be ambitious, inspirational and challenging, but realistic
a vision must be translated in measurable goals
different stakeholders must be involved in developing a vision
a vision must be communicated through the whole organization
a vision must be shared within the organization and the whole organization must be committed to the vision
FIGURE 4
Most important success factor within vision described in percentage of respondents
46,70% 15,60% 8,90% 13,30% 15,60% 0,00% 5,00% 10,00% 15,00% 20,00% 25,00% 30,00% 35,00% 40,00% 45,00% 50,00% success factors p er ce n ta g e o f re sp o n d en ts
a vision must be ambitious, inspirational and challenging, but realistic
a vision must be translated in measurable goals
different stakeholders must be involved in developing a vision
a vision must be communicated through the whole organization
a vision must be shared within the organization and the whole organization must be committed to the vision
Leadership
Question 10 of the questionnaire is ‘When you look at the public transformation project(s) where you were/are involved in; to what extend was/is leadership important for a successful public transformation?’. Almost all the respondents (42 out of 45) argued that leadership is important for a successful public transformation. The average rating for the importance of leadership is 4,62 on a scale of one to five.
As is described in the literature section, five elements were identified within leadership: (1) empowerment of employees, (2) champion the transformation, (3) communicating through the whole change process, (4) motivating and inspiring and (5) instrumental leadership. All these elements of leadership seem to be important for successful public transformations according to the respondents, because all these elements have a mean score above three on a scale of one to five (see figure 5).
FIGURE 5
Mean ratings of importance of the success factors within leadership
3,98 4,62 4,36 4,4 3,71 1 1,5 2 2,5 3 3,5 4 4,5 5 success factors m ea n empowerment of employees
champion the transformation
communicating through the whole change process
motivating and inspiring
When the question ‘Can you choose one factor from these factors which is the most important for a successful public transformation?’, ‘champion the transformation’ and ‘motivating and inspiring’ were mentioned most frequently (see figure 6). The chi-square of the results in figure 6 is 14,44. With the degrees of freedom being df = 4 and a significance level of α = 0,05 this exceeds the critical value of 9,488 and therefore the difference between the expected results and the observed results that can be seen in figure 6 is significant.
FIGURE 6
Most important success factor within leadership described in percentage of respondents
11,10% 15,60% 31,10% 6,70% 35,60% 0,00% 5,00% 10,00% 15,00% 20,00% 25,00% 30,00% 35,00% 40,00% success factors p er ce n ta g e o f re sp o n d en ts empowerment of employees
champion the transformation
communicating through the whole change process
motivating and inspiring
instrumental leadership
Implementation
Question 13 of the questionnaire is ‘When you look at the public transformation project(s) where you were/are involved in; to what extend was/is implementation important for a successful public transformation?’. All 45 respondents argued implementation is important for a successful public transformation. The average rating for the importance of implementation is 4,76 on a scale of one to five.
FIGURE 7
Mean ratings of importance of the success factors within implementation
3,84 4,42 2,31 4,64 4,13 1 1,5 2 2,5 3 3,5 4 4,5 5 success factors m ea n transformation skills employee involvement
adjust reward system
support from top management
embed the changes in the culture of the organization
When the question ‘Can you choose one factor from these factors which is the most important for a successful public transformation?’ was asked, ‘embed the changes in the culture of the organization’ came out as the most important element of implementation for a successful public transformation (see figure 8). The chi-square of the results in figure 8 is 17,33. With the degrees of freedom being df = 4 and a significance level of α = 0,05 this exceeds the critical value of 9,488 and therefore the difference between the expected results and the observed results that can be seen in figure 8 is significant.
FIGURE 8
Most important success factor within implementation described in percentage of respondents
17,80% 0,00% 17,80% 37,80% 26,70% 0,00% 5,00% 10,00% 15,00% 20,00% 25,00% 30,00% 35,00% 40,00% success factors p er ce n ta g e o f re sp o n d en ts transformation skills employee involvement
adjust reward system
support from top management
embed the changes in the culture of the organization
When the question ‘Which of the three factors (vision, leadership and implementation) is most important for a successful public transformation according to you?’ was asked, most people (68,9 % of the respondents) answered with leadership (see figure 9).
FIGURE 9
Most important success factor described in percentage of respondents
15,60% 15,60% 68,90% 0,00% 20,00% 40,00% 60,00% 80,00% success factors p er ce n ta g e o f re sp o n d en ts vision leadership implementation
Other success factors
There was one open question in the questionnaire, namely ‘Which other factors (besides vision, leadership and implementation) are important for a successful public transformation according to you?’. In total, 30 respondents out of 45 answered this question. In appendix C, an overview of the given answers can be seen. Success factors of public transformations that were mentioned more than once are (political) stability, support (political support and support from employees), persistence and the attitude and commitment of stakeholders.
4.2 Additional research
5. DISCUSSION
In this section the conclusions of this research will be described. After that, some limitations of this research, implications of the results, recommendations for further research and a reflection on this research will receive attention.
5.1 Conclusions
The research question for this research is as follows: ‘What are, according to CEO’s and managers of organizations in the public sector, success factors of transforming organizations in the public sector and what are the differences with success factors of transforming organizations in the private sector according to the literature?’
According to CEO’s and managers of organizations in the public sector, the success factors of public transformations are vision, leadership and implementation. Besides these success factors, it appeared that (political) stability, support (political support and support from employees), persistence and the attitude and commitment of stakeholders are also perceived to be crucial for successful public transformations.
Besides vision, leadership and implementation, there are some other success factors that are typical for transformations in the public sector. These success factors are (political) stability, support (political support and support from employees), persistence and the attitude and commitment of stakeholders. The fact that these success factors are perceived to be more important for successful public transformations than for successful private transformations could be a consequence of the more complex, political and instable environment of public sector organizations (Boyne, 2002; Sminia & Van Nistelrooij, 2006).
Although there are a couple differences in success factors of public- and private transformations, most of the success factors are the same. Thus despite the differences in the public and the private sector, there are many factors in both the public- and private sector that need attention in order to reach a successful transformation. This outcome is not congruent with what many authors argue, namely that management practices and change approaches can not simply be transferred from the private to the public sector. From the results of this research, it appears that although the public and private sector differ from each other, these differences do not have so many influences that a total different change approach needs to be applied to the public sector. This finding is supported by earlier research on the public- and private sector. According to Rogers (1981) one perspective on the public- and private sector is that despite the differences, the different sectors also have many similarities. Proponents of this view maintain that all large organizations face generic management problems, regardless of in which sector they are (Rogers, 1981). These similarities present opportunities to interact and learn from each other (Euske, 2003). Focusing on the similarities in the organizations rather than the differences can facilitate the exchange of ideas and learning across the public and private sector (Euske, 2003). However, because the success factors of transformations are not totally the same for both sectors, the differences between the sectors should be kept in mind when dealing with a public transformation.
this thesis, communication is an element of both leadership and vision. In the results section (figure 4 and figure 6) it can be seen that these communication-factors have a relatively low score compared to the other factors. Thus, in order to reach people when transforming a public organization, there needs to be done more than only communicating.
5.2 Limitations
From the 570 people that were approached to fill in the questionnaire, 99 people actually filled in the questionnaire which is a response rate of 17,37 percent. Low response rates can damage the credibility of a survey's results, because the sample is less likely to represent the overall target population (http://knowledge-base.supersurvey.com/survey-response-rate.htm). A response rate of 17,37 percent is a relatively low response rate and therefore it can be questioned whether the answers from the persons that completed the questionnaire are representative for all the respondents. But because the group of respondents who filled in the questionnaire is very diverse and consists of CEO’s and managers from different public institutions (ministries, local authorities, operating units, etc.), it is a good representation of the target group. Therefore, there is a great chance that the results from this research are representative. However, the results would be more reliable when the response rate was higher.
Besides the low response rate, there is another limitation of this research. The outcomes of this research tell us what the perceived success factors of public transformations are. Although it is very useful to know which factors contribute to a successful public transformation, the success factors described in this research are still somewhat abstract. The results are a framework for CEO’s, managers and consultants where they should pay attention to when a public transformation takes place, but the results do not go into detail about it. For example, one of the success factors is ‘motivating and inspiring’, but from the results of this research nothing can be said about how to do this.
5.3 Implications
The most important contribution of this research is that vision, leadership and implementation are perceived to be essential for successful public transformations and that public transformations have a lot of success factors that are the same for private transformations.
Implications for science
This research adds new literature to the existing literature on organizational change. Most of the major studies of organizational change focus on the private sector; less research is done on organizational change in the public sector. Therefore this research contributes to the existing literature on organizational change in the public sector.
Many researchers argue that change concepts and approaches can not be the same because of the many differences between the public- and private sector (Boyne, 2002; Robertson & Sonal, 1995; Sminia & Van Nistelrooij, 2006). This research gives a new insight, because it indicates that many success factors of successful transformations are the same for both sectors. Based on the results of this research it can not be stated that the same change approaches can be used for both sectors, but despite the differences between both sectors there are many elements where must be paid attention to in both the public- and the private sector.
For this research, the answers of the respondents who had been involved in a successful public transformation were used. In appendix D, it can be seen that the results of the answers of all the respondents (besides the respondents who had been involved in a successful public transformation, also the respondents who were involved in a public transformation that reached some goals or were involved in a public transformation that still took place at the moment they filled in the questionnaire) do not differ from the results of the answers of the respondents who had been involved in a successful public transformation. This implies that people do not have to be involved in a successful public transformation in order to judge what success factors of public transformations are. This might be useful information for researchers who are doing or planning to do comparable research.
Implications for practice
attention to when transforming an organization in the public sector. For CEO’s and managers of public organizations, it is useful to have knowledge of the importance of success factors of public transformation to improve their performance when transforming their organization. The results of this research also have added value for consultants who work in the public sector; they help public consultants to be more successful in their job. When they are transforming an organization in the public sector, the likelihood that the transformation will be successful will increase when they focus on the success factors that came out of this research. Consultancy agencies can provide training for consultants on how to transform organizations in the public sector and focus on these success factors; this could lead to consultants who are more successful in their job which is beneficial for the reputation of the consultancy agencies.
Implications for Capgemini
The outcomes of this research will be used by Capgemini as input for about 30 depth-interviews with CEO’s of organizations in the public sector. The success factors of public transformations will be discussed in more detail during these interviews. With the results of this research and the interviews, Capgemini has more knowledge about how to successful transform an organization in the public sector. Since the practice Public Transformation of Capgemini only exists for one and a half year, they still have to put a lot of effort in convincing public organizations to hire Capgemini to guide the transformation. With the knowledge gained from this research they can profile themselves and show public organizations that they know how to make a public transformation successful which could lead to more ‘public transformation assignments’ for the practice Public Transformations of Capgemini.
Suggestions for further research
research and organize a session to discuss the results and go more into detail about the results of this research.
For this research, organizations in the public sector were the target group. This target group is very broad, because there are many different organizations in the public sector (for example ministries, operating units, local authorities, etc.). Because ministries have a lot to do with policies and the activities of operating units have a lot of operating activities, it could be that different organizations in the public sector have different success factors of public transformations. This could be investigated through the use of a questionnaire or interviews with people from different organizations in the public sector.
Another suggestion for further research is investigating whether employees of a lower level (other than CEO’s and managers) within a public organization have a different opinion about the success factors of public transformation. It could be that they have another view on things because they experienced a public transformation another way than CEO’s and managers do.
Reflection
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