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Impact Analysis is a technique designed to unearth the "unexpected" negative effects of a change on an organization.

It provides a structured approach for looking at a proposed change, so that you can identify as many of the negative impacts or consequences of the change as possible. Firstly, this makes it an important tool for evaluating whether you want to run a project. Secondly, and once the decision to go ahead has been made, it helps you prepare for and manage any serious issues that may arise.

All too often organizations do not undertake Impact Analysis. This is one reason that so many projects end in failure, as unforeseen consequences wreak havoc.

The Challenge of Impact Analysis

The challenge in conducting an Impact Analysis is firstly to capture and structure all the likely consequences of a decision; and then, importantly, to ensure that these are managed appropriately.

For smaller decisions, it can be conducted as a desk exercise. For larger or more risky decisions, it is best conducted with an experienced team, ideally with people from different functional backgrounds within the organization: with a team like this, you're much more likely to spot all of the consequences of a decision than if you conduct the analysis on your own.

How to Use Impact Analysis

To conduct an effective Impact Analysis, use the following steps:

1. Prepare for Impact Analysis

The first step is to gather a good team, with access to the right information sources. Make sure that the project or solution proposed is clearly defined, and that everyone involved in the assessment is clearly briefed as to what is proposed and the problems that it is intended to address.

2. Brainstorm Major Areas Affected

Now brainstorm the major areas affected by the decision or project, and think about whom or what it might affect.

Different organizations will have different areas - this is why it's worth spending a little time getting this top level brainstorming correct.

Figure 1 below shows a number of different approaches that may be useful as starting points for identifying the areas that apply to you.

3. Identify All Areas

Now, for each of the major areas identified, brainstorm all of the different elements that could be affected. For example, if you're looking at departments, list all of the departments in your organization. If you're looking at processes, map out the business processes you operate, starting with the process the customer experiences, then moving on to the business processes that support this.

The extent to which you're able to do this depends on the scale of the decision and the time available. Just make sure you go far enough, without getting bogged down in micro-detail.

4. Evaluate Impacts

Having listed all of the groups of people and everything that will be affected in an appropriate level of detail, the next step is to work through these lists identifying and listing the possible negative and positive impacts of the decision, and making an estimate of the size of the impact and the consequences of the decision.

5. Manage the Consequences

Now's the time to turn this information into action.

If you're using Impact Analysis as part of the decision making process, you need to weigh whether you want to go ahead with the project or decision proposed. You'll need to ask yourself whether it's worth going ahead with the project given the negative consequences it will cause and given the cost of managing those negative consequences.

If you're managing a project which has already been given the go-ahead, you'll need to think about things like:

The actions you'll need to take to manage or mitigate these consequences.

How you'll prepare the people affected so that they'll understand and (ideally) support change rather than fighting against it.

The contingency strategy needed to manage the situation should the negative consequences arise.

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Impact Analysis helps you spot problems before they arise. This gives you time to prepare contingency plans for handling issues in advance. For many projects, this can be the difference between success and failure.

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Convince people that change is necessary. This often takes strong leadership and visible support from key people within your organization. Managing change isn't enough - you have to lead it.

You can find effective change leaders throughout your organization - they don't necessarily follow the traditional company hierarchy. To lead change, you need to bring together a coalition, or team, of influential people whose power comes from a variety of sources, including job title, status, expertise, and political importance.

Once formed, your "change coalition" needs to work as a team, continuing to build urgency and momentum around the need for change.

What you can do:

Ask for an emotional commitment from these key people.

Work on team building within your change coalition.

Check your team for weak areas, and ensure that you have a good mix of people from different departments and different levels within your company.

Step 3: Create a Vision for Change

When you first start thinking about change, there will probably be many great ideas and solutions floating around. Link these concepts to an overall vision that people can grasp easily and remember.

A clear vision can help everyone understand why you're asking them to do something. When people see for themselves what you're trying to achieve, then the directives they're given tend to make more sense.

What you can do:

Develop a short summary (one or two sentences) that captures what you "see" as the future of your organization.

Ensure that your change coalition can describe the vision in five minutes or less.

Practice your "vision speech" often.

Step 4: Communicate the Vision

What you do with your vision after you create it will determine your success. Your message will probably have strong competition from other day-to-day communications within the company, so you need to communicate it frequently and powerfully, and embed it within everything that you do.

Don't just call special meetings to communicate your vision. Instead, talk about it every chance you get. Use the vision daily to make decisions and solve problems. When you keep it fresh on everyone's minds, they'll remember it and respond to it.

It's also important to "walk the talk." What you do is far more important - and believable - than what you say. Demonstrate the kind of behavior that you want from others.

What you can do:

Talk often about your change vision.

Address peoples' concerns and anxieties, openly and honestly.

Apply your vision to all aspects of operations - from training to performance reviews. Tie everything back to the vision.

Step 5: Remove Obstacles

If you follow these steps and reach this point in the change process, you've been talking about your vision and building buy-in from all levels of the organization. Hopefully, your staff wants to get busy and achieve the benefits that you've been promoting.

But is anyone resisting the change? And are there processes or structures that are getting in its way?

Put in place the structure for change, and continually check for barriers to it. Removing obstacles can empower the people you need to execute your vision, and it can help the change move forward.

What you can do:

Identify, or hire, change leaders whose main roles are to deliver the change.

Look at your organizational structure, job descriptions, and performance and compensation systems to ensure they're in line with your vision.

Recognize and reward people for making change happen.

Identify people who are resisting the change, and help them see what's needed.

Take action to quickly remove barriers (human or otherwise).

Step 6: Create Short-Term Wins

Nothing motivates more than success. Give your company a taste of victory early in the change process. Within a short time frame (this could be a month or a year, depending on the type of change), you'll want to have some " quick wins" that your staff can see. Without this, critics and negative thinkers might hurt your progress.

Create short-term targets - not just one long-term goal. You want each smaller target to be achievable, with little room for failure. Your change team may have to work very hard to come up with these targets, but each "win" that you produce can further motivate the entire staff.

What you can do:

Look for sure-fire projects that you can implement without help from any strong critics of the change.

Don't choose early targets that are expensive. You want to be able to justify the investment in each project.

Thoroughly analyze the potential pros and cons of your targets. If you don't succeed with an early goal, it can hurt your entire change initiative.

Step 7: Build on the Change

Kotter argues that many change projects fail because victory is declared too early. Real change runs deep. Quick wins are only the beginning of what needs to be done to achieve long-term change.

Launching one new product using a new system is great. But if you can launch 10 products, that means the new system is working. To reach that 10th success, you need to keep looking for improvements.

Each success provides an opportunity to build on what went right and identify what you can improve.

What you can do:

After every win, analyze what went right, and what needs improving.

Keep ideas fresh by bringing in new change agents and leaders for your change coalition.

Step 8: Anchor the Changes in Corporate Culture

Finally, to make any change stick, it should become part of the core of your organization. Your corporate culture often determines what gets done, so the values behind your vision must show in day-to-day work.

Make continuous efforts to ensure that the change is seen in every aspect of your organization. This will help give that change a solid place in your organization's culture.

It's also important that your company's leaders continue to support the change. This includes existing staff and new leaders who are brought in. If you lose the support of these people, you might end up back where you started.

What you can do:

Talk about progress every chance you get. Tell success stories about the change process, and repeat other stories that you hear.

Include the change ideals and values when hiring and training new staff.

Publicly recognize key members of your original change coalition, and make sure the rest of the staff - new and old - remembers their contributions.

Create plans to replace key leaders of change as they move on. This will help ensure that their legacy is not lost or forgotten.

Reprinted by permission of Harvard Business Review. From " Leading Change" by John P. Kotter. Copyright © 2012 by the Harvard Business School Publishing Corporation; all rights reserved.

Kotter's 8-Step Model Infographic

See Kotter's model represented in our infographic:

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Kotter's 8-Step Change Model - Implementing Change Powerfully and Successfully

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Learn how Kotter's Change Model can help you prepare for change thoroughly so that you can implement it successfully.

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4.1 - c) Force Field Analysis Theory Questions

Selected questions/exam content from VCE Business Management are copyright Victorian Curriculum and Assessment Authority (VCAA), reproduced by permission. VCE® is a registered trademark of the VCAA. The VCAA does not endorse this product and makes no warranties regarding the correctness or accuracy of its content. To the extent permitted by law, the VCAA excludes all liability for any loss or damage suffered or incurred as a result of accessing, using or relying on the content. Past VCE exams and related content can be accessed directly at www.vcaa.vic.edu.au

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Describe your plan or proposal with the help of Force Field Analysis. 4 amazing examples to guide you through the applications of Force Field Ananlysis.

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Revision: Lewin's Model of Force Field Analysis

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Revision: Lewin's Model of Force Field Analysis

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Define your goal or vision for change, and write it down in a box in the middle of the page.

Step 2: Identify Forces For Change

Think about the kinds of forces that are driving change. These can be internal and external.

Internal drivers could include:

Outdated machinery or product lines.

Declining team morale.

A need to increase profitability.

Your external drivers could include:

A volatile, uncertain operating environment.

Disruptive technologies.

Changing demographic trends.

When you've identified the forces that are driving change, add them to the left-hand side of your Force Field Analysis.

Step 3: Identify Forces Against Change

Now brainstorm the forces that resist or are unfavorable to change.

Internal resistors and restrainers could include:

External factors might be:

Existing commitments to partner organizations.

Government legislation.

Obligations toward your customers.

Now add the forces against change to the right-hand side of your Force Field Analysis.

Step 4: Assign Scores

Next, score each force, from, say, one (weak) to five (strong), according to the degree of influence each one has on the plan, and then add up the scores for each side (for and against).

For a visual representation of the influence that each force has, draw arrows around them. Use bigger arrows for the forces that will have a greater influence on the change, and smaller arrows for forces that will have a weaker influence.

By now, your Force Field Analysis should look something like the example in figure 2, below.

Figure 2 - Example Force Field Analysis

Image adapted from " Tools for Knowledge and Learning A Guide for Development and Humanitarian Organizations " by Ben Ramalingam © Overseas Development Institute 2006. Adapted with permission from Ben Ramalingam.

Step 5: Analyze and Apply

Now that you've done your Force Field Analysis, you can use it in two ways:

1. To decide whether or not to move forward with the decision or change.

2. To think about which supportive forces you can strengthen and which opposing or resisting forces you can weaken, and how to make the change more successful.

If you had to implement the project in the example above, the analysis might suggest a number of changes that you could make to the initial plan. For instance, you could:

Train staff to minimize their fear of technology. The +1 cost of training increases "Cost" to -4 but the -2 benefits reduce "Staff fearful of new technology" to -1.

Show staff that change is necessary for business survival. This new, +2 force supports the change.

Show staff that new machines would introduce variety and interest to their jobs. This new, +1 force also supports the change.

Raise wages to reflect new productivity. The +1 cost of raising wages takes "Cost" to -5, but the -2 benefits reduce "Loss of overtime" to -1.

Install slightly different machines with filters that eliminate pollution. The -1 benefit of the new machines eliminates "Impact on environment" as a force against change.

These changes would swing the balance from 11:10 (against the plan), to 13:8 (in favor of the plan).
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Force Field Analysis - Analyzing the Pressures For and Against Change

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