Project gating? CFOs at Shell and Coca Cola really believe in it.

Shell CFO calls for open-minded approach to innovation – says the headline.
I was sent the article at the foot of this blog; it comes from Accountancy Age, Wednesday May 22nd, 2013 and shows that effective project management and accountancy are intertwined; you can’t have effective projects without having the financial systems to track them and you can’t honestly say you are in control of your business if you don’t have effective project accounting.

A good matrix accounting systems will ensure you understand the real business

A good matrix accounting systems will ensure you understand the real business

In the article, the CFOs of both Coca Cola and Shell praise the virtues of a gated approach to projects, where we see the whole project but give authorisation a stage at a time (depending on risk). These CFOs see gates as vital control points, being the decision point on whether to continue and terminate a project. It’s all about sensible business investment. Gates serve as points to:

  • Check the business case
  • Check the merits of the project against other work that could be done
  • Check we have the resources both to undertake the project and operate the outcome
  • Check the plan for the remainder of the work is achievable
  • And finally, provide the funding for the next chunk.

They are the BIG decision points and should not to be confused with what are often called “quality gates”, which look at, quality (believe it or not!). Like many terms in business, “gate” can be over-used and abused.

Properly applied, project gating can radically change business performance. I saw one case where product development output went up ten-fold due to effective gating, rather than the “shove it all in the hopper” approach. Time to market was also reduced dramatically.

To get this right, organisations need effective “project portfolio management”, where the project portfolio is effectively part of the business plan. This is where the business needs originate. If portfolio management is to work effectively, we need to be good at programme and project management as whilst the demands for projects come from the “portfolio”, the feedback on achieving the portfolio’s objectives depends on how well the projects are undertaken.

I was at the London Gartner Forum last year and the vital linkage of business strategy to portfolio to project kept coming out in the talks. Gating was seen as essential for this.

So what could this mean for your organisation?

Projects are the vehicles for change and making the business of tomorrow. A good strategy or business plan, without “good execution” is worth nothing. Programme, project and change management are vital disciplines in making it happen.

Programme and project performance can only improve so far through the efforts of project managers. It is only through effective portfolio management we can hope to improve further by making sure our projects really do meet the business need and ensure we stop authorising projects which we haven’t the resources to do – that just slows down everything and stresses our people.

If benefits result from projects, then it makes sense that funding goes to the projects and NOT to the departments who spend the money. . . and definitely not on an annual basis (unless you business is so old fashioned as to be based on the Venetian traders’ model). If you give any department money they will spend it, regardless, so really on cost centre budget control will prove disappointing!

If you are to give money to projects you need good project accounting capabilities which work on the “matrix” and not just down the silos.

The great thing is that companies like Coca Cola and Shell recognise this; the sad thing is that the state of corporate management is that such an approach is news worthy and that so many organisations are still tied to cost centre accounting and ad-hoc spreadsheet driven project “accounts” (if any). What sort of company are you in?

Learn more about this
To learn more about gates, see Part 2 of The Project Workout.
To learn more about effective project accounting, see Chapter 17 of the Project Workout.

Here is the article:
QUOTE: MANAGEMENT ACCOUNTANTS must be less “mechanistic” and take a more open-minded approach to innovation, according to the chief financial officer of Royal Dutch Shell. Writing in a report by CIMA and the AICPA on innovation in the finance function, Simon Henry, CFO of oil and gas giant Shell, has urged finance functions to play a greater role in driving company innovation.
Shell has an innovation programme that includes a $1.5bn (GBP 1bn) annual R&D budget and also invests around $4bn on innovation within the business. According to Henry, the role of finance within this is multifaceted.
“A finance function needs to be able to understand the business well enough to know what is a worthwhile activity, but also, in this part of the business, to have a bit more of an open mind. It is less mechanistic, and has the ability to live with ambiguity, to identify risk and to manage it,” Henry said.
“The business is all about proper evaluation of risk, whether it’s technological, market or otherwise. We want to encourage innovation and not stifle it, but not in a totally uncontrolled way.”
Describing Shell’s approach, Henry said the company has a ten stage “gate process” to provide funding for innovative projects.
“At each stage gate you can say, this is going to be funded by Shell through to the next four stage gates, at which point we’ll take another decision. Or we put it into a joint venture and we keep an equity stake. So there are different routes to commercialisation,” he said.
Similarly, Coca-Cola has adopted its own stage gate process to control how an idea gets prioritised and funded,
“We want to see the whole project and we want to budget for it, but those funds are not given at one go up front. Each stage has budgets allocated to it, and targets and metrics. If you get to the first gate and if you’re on track, you pass through that gate and get the funding for the next phase. And if you get through to launch, we can spend many, many millions of dollars,” said Doug Bonthrone, director of global services strategy at The Coca-Cola Company.
UNQUOTE

Is a functional hierarchy fit for modern day businesses?

 

The functional hierarchy is not the only way to run a business.

The functional hierarchy is not the only way to run a business.

If what people do counts more than the function or department they belong to and if, for reasons of efficiency, you want to use people to best effect anywhere in your organisation, what is the role of the functions? You know that no change, which is significant to a whole business, can be made within a single function in an organisation. You generally require people from a number of areas contributing to the processes, activities and projects you are undertaking.

In the traditional hierarchy, each head of function decides not only the strategic direction of their function, but also what each and every one of his/her  employees will do and how it will be done. The danger, if functions are too dominant, is that they will drive the business as they see fit from their own perspective. This may not be in line with the drivers that the organisation’s leadership wants to effect. The outcome is that the organisation becomes out of balance.

For example, efficiency is often seen as a good goal. So is responsiveness to customer needs. However, the latter may require you to carry excess capacity in order to meet customer needs at short notice. If one function is driving ‘efficiency’ up by reducing capacity while another is creating a proposition around responsiveness there is likely to be a mismatch and dissatisfied customers.

The projects approach, like the trend towards cross-business processes, aligns all the required skills and capabilities around the attainment of a business objective. In the case of a process, the objective is better operations. In the case of a project, the objective is change for the better. Thus, the functions are not leaders in driving the business, but rather suppliers of people and expertise to projects and processes. The accountability of a head of function is to ensure that the right people are available in the right numbers to service the business needs. They will be accountable for pay, employee satisfaction and personal development. Other key roles will start to become apparent. There will need to be those, expert at particular disciplines, who will create strategy, develop and maintain technical architecture, manage projects, or manage people. However, they will not do this just in the context of a single function, but rather in the context of the complete organisation, working wherever needed across functional boundaries to achieve the business objectives . . . . and that is where project portfolio management (or what Project Workout calls “business programmes”) comes in.

 For more on resource management see The Project Workout chapter 16.

Project management excellence is not enough

Beware of doing too many projects, even if they do fit your strategy and have a good business case.

Beware of doing too many projects, even if they do fit your strategy and have a good business case.

The opening plenary sessions of the 2013 Gartner PPM and IT Summit in London, set the tone for a mind-set shift in how Gartner looks at “IT management”.  To date they have focussed in on “IT” and the “CIO”, and, in my view, perpetuating the gap between what they term “IT” and the “Business” . This year, to my delight, they were starting to talk about “the business” and IT’s part in it. It’s a brave thing to do, but the right thing to do. Most organisations still have their IT split off as separate organisational units ,with a separate strategy and loads of money, which tries to work out what “the business” wants and then all too often fails to meet those expectations. What is guaranteed though, is if you give an IT department money, they will spend it all, even if the business need is unclear. . . . that’s the “business’” fault!

Mike Langley from PMI was a key note speaker and gave his view on the all important question of “how do we ensure our (IT) projects fit our strategy?”  Notice I put “IT” in brackets – the department is irrelevant as we want all our projects to align with strategy . . . don’t we?

Mike based his talk on PMI’s recent “Pulse of the profession” survey.

We are all familiar with “strategy” and “execution” (sorry for using the “e” word, but when at an American conference, you can’t get away from it!).  The story is that the business leaders set the strategy and then the “business” implements it. If it goes wrong, it’s usually the fault of the business and their dreadful requirements and poor implementation!  What new research for Harvard Business Review is now talking about is that implementation is part of strategy and we should not separate them. (look out McKinsey and Bain!.) After all, if your strategy doesn’t include how to implement itself, then it’s a poor strategy.  The new buzz words for making this happen is “portfolio management”. This is a discipline of making sure that the programmes, projects and other activities that a business decides to do are the rights ones in terms of strategic direction, fit and balance in terms of risk and skills use. It’s all about selecting the right projects.

Mike says his research shows that organisations which are good at portfolio management are more agile, and have better project outcomes. Portfolio management is integral to how the top level leaders want to manage their business; it’s an integral part of business planning. Traditional business planning adds up costs of departmental budgets, checks against revenue and makes sure there is “interlock” if different departments need to work together.  Usually this is done a year or so in advance and is therefore totally pointless for organisations in fast moving environments. It is however a neat and simplistic way to blame people when things go wrong or costs to much. Hence, getting portfolio management working right is as much to do with mind-set as having the processes, systems and operating model.

Getting this right, means organisations can continuously tune their plans, not be tied to outdated annual budgets and use their people and money where the benefit is most attractive.  The money will follow the business need, not the department doing the work. Now that is what I call true organisational agility and if you have read the Project Workout, it will be very familiar to you.

This isn’t new as a concept, but it is something many organisations struggle with.  Have a look at this article: Excellence is not enough from the Project Workout “articles” web page.

The secrets of successful programmes

CranfieldI recently went to the International Centre for Programme Management (at Cranfield) for a forum on learning and knowledge management  and as part of that we were given a white paper called “Beating the odds – the secrets of successful programmes”.

The white paper describes the findings from a recent two-year study of 21 major programmes of many types, with varying levels of success in a wide range of organisations in Europe. Those findings explain many of the causes of the differeing levels of programme performance and how business leaders can improve the success rate for their own organizations.

Seldom do I read an article or paper with the words “Yes, yes, yes” ringing in my head. It is packed with useful insights and wisdom, gleaned for the programme teams who took part in the study. The wisdom in this paper won’t be found in methods and processes, they are more about how experienced and skilled people apply them and the issues they face.

I recommend this to any person who considers themselves to be (or aspires to be) a business leader. As expected, there is lots about vision, strategic alignment, business readiness, foggy objectives, stakeholder engagement, business cases, planning and behaviours. If, as a business leaders, you believe you have a great strategy, then good for you. On its own, however, that is not enough. You need to be able to convert your vision and your strategy into action on the ground. Do you have the right mind set, tools, methods to do this?  Read this article and decide for yourself.

This is the executive summary:

  1. Strategic alignment. From the programmes studied, those identified as integral to the future business strategy were all at least partially successful. It could be concluded that the ‘positive’ nature of the programmes’ intentions meant that there was little stakeholder resistance to the initiative and hence the organisation was able to deploy its most capable resources. Senior management and executive involvement was sustained throughout the programme. Conversely those programmes that had primarily ‘reductionist’ intentions, e.g. restructuring to reduce costs or eliminate inefficiencies, were less successful. Executive involvement in the programmes was weak and stakeholders’ commitment quickly waned.
  2. Need and readiness. Interestingly and perhaps counter intuitively, in most of the successful programmes the need was ‘high’ – clearly recognised as a business priority – but initially the readiness was ‘low’. In these the argument for investment and change was endorsed at executive level and time and effort spent at the start to achieve the buy-in of the rest of the organisation and develop the ability to undertake the changes. In the majority of those that were partially successful the readiness appeared to be ‘high’ as well as the need. Why they were not entirely successful is best explained as over-ambition or even over-enthusiasm; rather too many optimistic assumptions were made at the start with little assessment of the potential risks involved.
  3. Value drivers,benefits and business cases. The more successful programmes were also based on a clear strategic driver plus a strong financial business case. Those with weaker strategic drivers but good financial cases gained less commitment and were usually less successful. Very often financial benefits were overestimated, while the risks and the problems in making the changes were underestimated, perhaps because realistic estimates might have made it difficult to secure funds and resources. During the programme, as the scope becomes clearer, this inevitably leads to changes to the costs involved and the benefits that can actually be delivered, but only a minority of organisations revisit the business cases as programmes evolve.
  4. Foggy objectives. Programmes cannot be fully planned in advance and have to adapt to both changing business conditions and programme achievements. This is not necessarily a comfortable position for senior management and requires a knowledgeable, accountable and empowered governance group to oversee and, where necessary, adapt the programme. Rather than decrease during the programme, uncertainty can often even increase, especially due to changes in the external environment.
  5. Planning. Some organisations thought they may have ‘over-planned’ things at the start, due largely to the demands of some stakeholders for detailed plans, which were then not really used. However, the planning activities were seen as essential to bring stakeholders together and for reconciling their different priorities and interests. The process of planning was more important than the plans produced and helped address many of the initial uncertainties.
  6. vision and stakeholders. Having a clear vision of the intended future business and organisational models and then allowing compromises and trade-offs in the detail of how they are implemented, is more likely to achieve stakeholder commitment than imposition. The successful transformation programmes usually addressed the organisational, people and capability aspects first, before dealing with the process and technology aspects. The less successful tried to do the reverse.
  7. Learning and un-learning. Most ‘strategic’ programmes require the development or acquisition of new capabilities and knowledge in order to be carried out successfully. Management generally underestimate how much has to be learned by the organisation and individuals to define, manage and implement a major programme. Introducing new ways of working may also require considerable ‘un-learning’ by large numbers of professional people – not easy to achieve without actually removing the old processes. If the programme relies heavily on the capabilities of suppliers (especially IT suppliers), they may exert undue influence over what is done – the scope and achievable benefits – rather than on how the programme can be successfully delivered.
  8. Realising the benefits. Most business change programmes involve at least two distinct and different phases – first to create a new capability and second to exploit it. In most of the cases the new capability, for example a global HR database or Finance & Accounting Service Centre, was created, but not always used effectively, hence the benefits achieved were often less than those originally envisaged. While creating a new capability can be done ‘off-line’, separately from business as usual, using and exploiting it often competes with other operational priorities or can have negative effects on other aspects of operational performance, as was observed in some of the cases.
  9. Organisation and governance. Programme governance structures and staffing profiles are likely to change significantly over the life cycle. There seem to be three basic approaches to organising programmes: (1) a separate task force, (2) as part of business-as-usual (BaU), or (3) a combination (matrix). Not surprisingly the last of these proves most problematic. Some programmes have dedicated change managers, others have senior managers assigned to the programme, but they can find it difficult to reconcile achieving change at the same time as sustaining performance. Running change programmes in parallel with BaU causes tensions within the organisation and a clear statement of priority for which takes precedence is essential.
  10. Portfolio management. Few organisations, as yet, have the capabilities in place to manage multiple concurrent programmes with varying levels of uncertainty, competing for the same resources over extended periods. No organisation in the study had an effective mechanism in place for managing a combined large portfolio of ‘strategic’ programmes and more traditional projects – although some are trying to address this issue. Managing multiple programmes (Programme Portfolio Management) requires an additional governance structure or regular strategic and operational review and reconciliation at executive level especially if there are programme inter-dependencies or contention for critical and scarce resources.

Do you want to know more?

Cranfield had very kindly let me make the full article available to you here

So why was I saying “yes, yes, yes,” to myself? Many of the lessons are embedded in the Project Workout:

  • vision, strategic alignment: are covered in the gated approach to projects, from the very beginning(Chapters 3 to 11)
  • portfolio management is covered in Project Workout as “Business Programmes” in Chapters14 to 17.
  • business readiness,is a prerequisite for Project Workout’s Ready for Service Gate (page 118)
  • foggy objectives,are discussed in Chapter 12, along with other types of “Eddie Obeng” projects
  • stakeholder engagement,is covered in Chapter 19 as well as threaded throughout the book
  • business case, is at the heart of the Project Workout’s business led approach
  • planning in Chapter 19
  • behaviours are covered in Chapter 18

Of course, in the “real world” these are not isolated activities but happen in a complex network of cause and effect and that is why it is all so difficult to do in practice.

What to do about ineffective sponsors

The sponsor's behaviours set the tone for everyone but are they always beneficial?

The sponsor’s behaviours set the tone for everyone but are they always beneficial?

Research from Scott Keller and Colin Price (McKinsey’s) in their book,”Beyond Performance: HowGreat Organizations Build Ultimate Competitive Advantage,” points to programme or project sponsorship as being the most critical factor in achieving project success. I agree with them. Unfortunately in organisations with low maturity in programme and project management, this role is often  totally missing, misunderstood or the behaviours promote the wrong outcomes. This doesn’t seem to be an uncommon problem. But what can you do about it? One writer, Peter Taylor, proposes that a PMO could act as a surrogate “sponsor” and be used to help senior executives understand and perform that role better.

Have a look at his full article here, and see what you think.

Now imagine, if sponsorship was done well, what a difference that would make: programmes and projects would link to strategy, be prioritised on the basis of business benefit and only done if the need or opportunity is compelling . . . even if money is left over in the annual budget!!! Perhaps we could even go as far as the funds being assigned to the projects themselves, rather than to departments (cost centres) doing the work; now there’s a thought. CFOs, pay attention! Also consider, how can “portfolio management” work, if the role of the sponsor is not understood?

Let me know your thoughts on this. Are the programme and project sponsors in your organisation effective? If so, how did you achieve that? If not, how are you tackling the problem? I think that this is one of the great challenges to improving programme and project performance; there is only so much the “middle” can do, the “top” needs to play their part too.

See also my blog, “Enemies within” in which I argue senior management get the peformance they deserve. Controversial, eh?

Functional thinking destroys business value

In my blog, Enemies within, I highlighted 10 reasons why projects continue to

People get cross with each other and, often, it's not their fault.

People get cross with each other and, often, it’s not their fault.

fail, despite all the methods, standards and training we throw at our people.  basically business leaders get the project performance they deserve as most inhibitors are institutional. This is what I said:

Functional thinking – not taking the helicopter, the organisation-wide view. This often happens when executives’ or individuals’ bonuses are based on targets which are at odds with the organisation’s needs, e.g. sales bonus rewarded on revenue, regardless of profit or contribution.

Let’s look at another aspect of this – cost management.  Most organisations set their annual budgets, top-down, based on an expectation of revenue and costs. The costs then trickle down to cost centres and managers of departments of functional specialists, or other segments of the organisation They have a budget for the year to work within. Sounds familiar? On top of that we put time recording and ever more rigorous (onerous?) procurement systems – after all, we must be hard nosed business people and make sure we only spend what is needed. Finance people then monitor the costs and do all sorts of jiggery-pockery to deal with their fiscal needs, accruals, internal transfers, prudence concept etc.

All this budget setting is done for a financial year, 12 to 15 months in advance.

Actually, that approach can work well for steady state bureaucracies, where next year tends to look rather like last year. It is what most people are familiar with and yet, how many people, nowadays, work in such a predictable, steady state organisation?  What if you are in a fast-moving, unpredictable sector where you are not sure what will make up your order book and what mix of resources you will actually need? They also realise that they need to deal with cross-functional projects and so they “interlock” the demands of the projects with the cost centre budgets.

A budget set to  12 to 15 months in advance on this basis looks rather optimistic. So what happens is this:

  1. department managers spend their all budgets (so they don’t lose it next year) regardless of the overall business need – after all they are targeted on their cost spend.
  2. projects get starved of resources, as the mix of resources and costs change as work is won (if customer facing) or initiated (if for internal transformation). This can be despite the “project budget” having enough funds, as all too frequently the departmental budget takes precedence.
  3. project managers get cross with functional managers who unilaterally withdraw their resources, despite the project budget being adequate
  4. department managers get cross with project managers for not predicting exactly what they will need up to 12 to 15 months in advance.
  5. it becomes a blame game
  6. the company and customer suffer

Managers:

  • who exceed their budgets are told they are bad managers
  • who undershoot their budgets are told they are bad at forecasting
  • who hit their budgets are told the budget was probably not stretchy enough.

So how can you deal with this?  The first thing is to realise that the above scenario describes a matrix organisation, where resources are shared across many projects and business activities. If you have a matrix organisation, the controls of the simple bureaucracy (cost centres) are totally inadequate – you need to have a full, matrix infrastructure in terms of portfolio, programme and cost management and for resource planning and assignment:

  1. Manage the business across the organisation not down the cost centres
  2. Allocate budgets and funds to projects (or other cross-company entities) not to cost centres.
  3. Create governance which crosses, the organisation, taking power off the costs centre managers
  4. Only give cost centre managers funds for training, management, holidays, sickness etc.
  5. Have a rolling monthly forecast, spanning financial years (“interlock” resets half yearly or even quarterly of often not enough).
  6. Let any person work on any work, anywhere in the company.

Done right, you will have a flexible, self correcting organisation, which is simpler to run and focused on business value not discrete costs centres. You will have tipped the balance of power away from the “silo” cost centres towards managing business value across the organisation.

Want to know more?

See the Project Workout, 4th edition:

  • Chapters 14 and 15 on matrix governance
  • Chapter 16 on resourcing
  • Chapter 17 on matrix systems to make it work

Whose success is it?

In my “enemies within” blog, we looked at how management get the project performance they deserve. In that blog we explored the important role of the programme and project sponsor in making sure that an organisation’s programmes and projects succeed. But what does “success” mean? Success is too often interpreted through the differing eyes of stakeholders.

Successful project management ensures the delivery of a specified scope, on time and to budget (PMI’s triple constraint). It is related to how efficiently a project is managed. This should be assessed during the project closure review, documented in a project closure report and measured by timeliness of delivery milestones, adherence to budgets and quality. This is commonly associated with the role of the project manager.

A successful project realises the business benefits it was set up to achieve as stated in a business case. It is related to the effectiveness of the project in meeting the objectives set. The post implementation review (post-project review) assesses this. Measures of success here must be indicative of the business objectives being achieved. This review therefore has to happen some time after the output of the project has been put into use. It is associated with the role of the project sponsor.

A successful organisation drives towards its strategic objectives while fulfilling expectations of shareholders, managers, employees and other stakeholders. Measures for this are at a corporate level and should be financial and non-financial, such as a balanced score card. This is associated with the role of the chief executive.

A project which has been successfully ‘project managed’, however, may actually deliver little of value to the organisation. Further, a ‘successful project’ may not further the strategic objectives of the organisation, as its objectives may be out of alignment organisations seeking to optimise their total portfolio of projects through the effective combination of project management, sponsorship and portfolio management. A failing company can be full of ‘successful project management’ and ‘successful projects’ all driving in different directions.

The PMI’s recent report, Pulse of the Profession 2013, has actually picked up the above themes, so may this will help senior business leaders realise the potential that effective and efficient project management has to drive their organisations.

Gartner goes one step further and state that organisations which grasp this first will have a enhanced competitive advantage over the others.

Whatever you do must help you move towards your strategic objective. Otherwise there's no point.

Whatever you do must help you move towards your strategic objective. Otherwise there’s no point.

References:

Enemies within – why it doesn’t work

Far too many projects fail.

Far too many projects fail.

Project management, in the modern sense, has been with us a long time now. Some people have spent most, if not all their careers engaged in it in one form or another. Research and anecdotal evidence, however, seems to indicate that we still don’t “get it”. Reports continue to be written on “causes of project failure”. Eminent committees are set up to “get to the root of the problem”, international and national standards are created and yet:

  • we still see failure.
  • we still see organisations which ignore the benefits.

Why is this? If I could answer that, then I would be able to charge massive consulting fees! The question is rather like that posed in “Hitchhikers guide to the galaxy” asking, “What is the meaning of life?”  As we all know, the answer is “42” – which doesn’t help us one jot. If I ever came across anyone who knew the solution to stopping “project failure”, I would be very skeptical.

So why can’t people grasp the significance and advantages of business-led project management? We have:

  • lots of good books – like the Project Workout!
  • National and international standards such as BS6079 and ISO21500
  • Leaned societies, like the APM and PMI
  • Conferences galore

Actually, when the Project Workout came out in 1997 it was probably the first to put project management in a business context; earlier books were focused on project management techniques.

Cover all four basesBack to the topic! Having good methods and process supported by good tools and systems with clear accountabilities is necessary but not enough. The critical difference comes from an organisation’s culture; how they behave and their values. Give me the right culture and mediocre process over poor culture and brilliant process, any day. Organisations where project management “doesn’t work”, are likely to have a culture which actively prevents it from working. For example, for project management to be effective, we need more than just good project managers; for example:

  • project sponsorship is vital if the projects are to be linked to strategy
  • portfolio management (called business programme management in the Project Workout) is necessary to balance risk and choose those projects which will get you towards your strategic intent faster
  • finance systems, which enable project sponsors, managers and teams to see, their operational figures “live”
  • resource management so you can take account of constraints in choosing and implementing your projects.

Hunter Thompson, in 1970, said “In a democracy, people usually get the kind of government they deserve and they deserve what they get.” In this he blames the people in a democracy. Organisations, however are not democracies and so I would turn that quotation on its head:

Senior teams get the project management performance they deserve“.

The CEO sets the culture and “the way they want to run their business” and the following list indicates where the culture and values promote failure, rather than success. Running a project is difficult enough, but we often make it more arduous than it need be by creating problems for ourselves. Here are a few examples:

  1. Reorganising – either the company or a part of it. Tinkering with your structure is usually NOT the solution to your problems, it just confuses people. If you are a senior executive, however, reorganising is a great way to hide non-delivery!
  2. Functional thinking – not taking the helicopter, the organisation-wide view. This often happens when executives’ or individuals’ bonuses are based on targets which are at odds with the organisation’s needs, e.g. sales bonus rewarded on revenue, regardless of profit or contribution.
  3. Having too many rules – the more rules you have, the more sinners you create and the less happy your people become. Have you ever met a happy bureaucrat?
  4. Disappearing and changing sponsors – without a sponsor there should be no project. Continual changing of the ‘driver’ will cause you to lose focus and forget WHY you are undertaking the project. Consider terminating such a project to see who really wants it!
  5. Ignoring the risks – risks don’t go away, so acknowledge them and manage them. If I said that a certain aeroplane is likely to crash, would you fly on it? And yet, every day executives approve projects when a simple risk analysis shows they are highly likely to fail.
  6. Dash in and get on with it! – if a project is that important, you haven’t the time NOT to plan your way ahead. High activity levels do not necessarily mean action or progress.
  7. Analysis paralysis – you need to investigate, but only enough to gain the confidence to move on. This is the opposite to dash in and ignore the risks. It is also a ploy used to delay projects: ‘. . . I haven’t quite enough information to make a decision, just do some more study work.’
  8. Untested assumptions – all assumptions are risks; treat them as such.
  9. Forgetting what the project is for – if this happens, terminate the project. If it is that useful, someone will scream and remember why it is being done.
  10. Executive’s ‘pet projects’ – have no exceptions. If an executive’s idea is really so good, it should stand up to the scrutiny that all the others go through. He or she may have a helicopter view, but might also have their head in the clouds.

I’m sure you can add to that list, so please do, by adding a comment. Over the next few months, I’ll investigate a number of the above symptoms.

In the meantime, you can find out more about these from The Project Workout (4th edition):

  • lessons on what works: Chapter 2
  • enemies within – page 41
  • sponsorship: Chapter 4
  • portfolio management: Chapters 14 and 15
  • resource management: Chapter 16
  • finances: Chapter 17