Monday, January 14, 2019

17 Lessons Project Managers can learn from Crisis Management

17 lessons project managers can learn from crisis management
In my spare time, I enjoy reading books on topics from other industries or disciplines that are related to project recovery and project management. One of the disciplines that I like to read about is crisis management. The reason is probably pretty obvious. Many of my engagements as a project recovery consultant start with a project in a crisis situation.

Over the years I have read quite a number of articles and books on crisis management and from them I have distilled a set of principles and practices that are valuable for project managers. Besides these principles and practices, I have written down my own lessons learned from project crisis situations.

These combined notes have helped me a lot over the years, and I think they can help you as well. Read on for my 17 lessons on effective crisis management for project managers.

Lesson #1: Immediately respond to early warning signs.

Before any negative event occurs, there are always some signs. Your job is to learn to detect those signs and take immediate preventive actions.

Be aware of persistent customer, stakeholder or project member complaints; rumors; turnover in the project; and resistance to change due to innovation or technology. These issues always seem to start off small and begin to swell. Don’t ignore them, and dig in to find out if there is the potential of a problem coming at you.

Once you have detected warning signs, you need to develop a plan of preventive actions to eliminate the problem, or at least to minimize its negative impact to the project. Usually such actions are specified in your risk management plan. A good project manager has such a plan.

Lesson #2: If you can’t prevent a crisis, at least contain it.

After a crisis has occurred, you will want to contain it as quickly as you can by getting accurate information as to what was the real cause of the crisis and what the ramifications are. Next, you need to act quickly and decisively, communicating correctly to all levels of the organization while behaving ethically as you attempt to contain the crisis.

Lesson #3: Make decisions as quickly as possible.

During a crisis, your decisions should be made quickly because you do not have time to conduct a deeper analysis of the problem. Meanwhile, the decisions should be well weighted. Remember, you shouldn’t act as quickly as possible, but you should make a quick decision.

Lesson #4: Be realistic but optimistic.

When a crisis happens, don’t panic! If you become very pessimistic during the crisis, your project is likely to fail because you won’t be able to generate effective solutions and make quick decisions. So be optimistic when seeking solutions.

A realistic assessment of the situation will help you find feasible workaround solutions. Your optimism will inspire the team with enthusiasm so they will be ready to follow your lead and carry out your instructions of effective crisis management.

Lesson #5: Never run out of altitude, airspeed and ideas at the same time.

To ensure your project does not come to a screeching halt during a crisis, you should keep attention on the following three areas:

Altitude – This relates to maintaining focus on the big picture required for the leadership of a project such as project vision, critical thinking, ability to prioritize, motivation, and continually moving forward to accomplish objectives.

Airspeed – This relates to the velocity and forces that make a project go forward such as building relationships, having a good sense of humor, creating motivation through follow-through, being willing to listen, having the capacity to convey respect to others and their ideas, and having the confidence to tell project team members what they need to know. All of these fuel us to provide the airspeed to keep the project moving onward.

Ideas – This relates to your ability to brainstorm and incorporate creativity, maintain enthusiasm while challenging existing processes, and invite input from others from a variety of perspectives, as well as your willingness to try novel approaches and champion innovation. 

Lesson #6: Face reality.

There comes a time when you must formally acknowledge that a crisis has occurred and communicate this to everyone. Don’t ignore or deny the urgency and severity of the crisis; rather, confront it and take charge of the situation. Don’t blame other people or external events for the cause of the crisis. Your job is to resolve the situation as best you can.

Lesson #7: Legal threads are reputational threads.

All legal threats—e.g., threatened lawsuits, regulatory investigations—are potential threats to your organization's reputation and should be brought to the attention of whoever is responsible for reputation management/PR as soon as they're identified.

Typically, however, legal counsel and even senior company management delay notifying their  PR advisor, internal or external, until the shit hits the fan or will do so imminently. Rushed consideration of PR strategy and messaging is seldom as good as that which can be produced given more lead time.

"The court of public opinion can destroy your organization much more quickly than a court of law” —Jonathan Bernstein

Lesson #8: Take ownership of communications.

When a crisis takes place, people in the organization and project look for leadership to take charge. That is you, the project manager. Your task is to tell the facts, to define the situation and to provide hope that the situation is in good hands. The project manager should consider what needs to happen to lessen the crisis, what ambiguities needs to be cleared up, what needs to be communicated and what people are most concerned about. Be aware of your non-verbal body language so that it is in sync with both your spoken and written messages. People can sense when they don’t match.

Lesson #9: The big five of crisis communications.

The big five of crisis communications is a template for crisis communicators to follow and a standard by which the efficacy of crisis communications can be assessed. According to this template, crisis communications must be:

a) Prompt – or rumor and innuendo fill the gap.

b) Compassionate – if you don’t deal with people’s feelings first, they won’t listen to the facts.

c) Honest – no lying by commission, omission, or understatement, and/or exaggeration for the purpose of obfuscating the truth (“spinning”).

d) Informative – answering the basic journalistic interrogatives of who, what, why, when, where and how.

e) Interactive – in our digital age, providing stakeholders multiple ways to ask questions and engage in constructive commentary.

Lesson #10: Create a crisis management team.

The crisis management team (often called a task force) is responsible for the overall management and response to a crisis. This team should be created as soon as a crisis occurs, and it must include appropriate individuals from across an organization. The key to using this team is only activating it when necessary. Team members should know where to report to and their immediate responsibilities when the team is activated.

Lesson #11: Document all parts of your crisis management and actions.

Many crises will result in audits and intense internal, if not external, investigations of why a crisis occurred, how it was handled, and what could have been done better. As a result, all crisis management plans and actions should be thoroughly documented in the record.

Lesson #12: Encourage and demonstrate transparency and honesty.

As a project manager, do you squash debate in favor of politeness or do you encourage robust differences of opinion? After a problem throws you off-course, you want to make sure that you get your project back on track as soon as possible.

You want your team and the stakeholders to be open and feel free to express any and all alternatives to solving the problems caused by the crisis.

It is also much wiser to encourage and even reward internal whistle-blowing than to find  yourself at the wrong end of news coverage, a lawsuit and/or a governmental investigation prompted by a whistle-blower.

Lesson #13: Know your limitations.

During a crisis, you can feel overwhelmed with responsibility and many project managers are tempted to try to solve the problem all by themselves. Knowing your strengths and weaknesses and admitting to your limitations will actually benefit you. Acknowledge them, and it will enable you to find the right people to help you resolve the situation. This action will in fact strengthen your leadership ability since nobody really expects you to have all of the answers or go it alone.

Lesson #14: Respond appropriately to the media.

When a very serious crisis occurs, many large organizations have public relations (PR) specialists who respond to the press, but they need the detailed facts before taking action. You, the project manager, need to:

> Cooperate with the PR specialists and not obstruct their discovery efforts

> Minimize the lag time between the time the problem occurred and the response needed

> Gather the facts as quickly as you can

> Avoid responding to unfounded stories

> Be transparent and avoid “no comment” situations. If you don’t know, then say you don’t know and convey that you will find out the answers as soon as possible

> Avoid minimizing the situation by comparing it to worse ones. Remember the PR disaster after the BP oil spill?

> Communicate effectively and don’t try to confuse the facts

Lesson #15: Sometimes it's wiser to make peace than to be right.

Don't get into a public spat with government agencies or the media. They carry bigger sticks than you do, and they have long memories.

Lesson #16: Have a spokesperson trained before you need one.

The ability to make a flawless personal presentation to 1,000 people at a conference does not, automatically translate to an ability to conduct an on-camera media interview related to a crisis. Training is essential.

With rare exception, media interview skills are not part of a CEO's scholastic experience, and even if they were, if the CEO hasn’t kept up with them they have certainly eroded to the point of uselessness.

Effective spokespersons in a crisis must come across as compassionate, confident and competent.

Lesson #17: Learn from your crisis.

A crisis is unfortunate, but it provides an excellent learning opportunity for an organization, its employees, its upper-level management and its stakeholders. When each crisis is over, draft a set of recommendations and “lessons learned,” which can be used to prevent and effectively manage future crises.

If you don’t engage in a thorough post-crisis analysis, your crisis preparedness and response is unlikely to improve – ever.

Over the years, these 17 principles and practices have helped me to stay focused and on track when faced with a crisis situation in project management. I hope that they will prove useful to other project managers ans sponsors, and help you to mitigate and contain any crisis situations that come up in your organization and its projects. 

Read more…

Monday, January 07, 2019

7 Technology Project Management Trends and Predictions for 2019

7 Technology Project Management Trends and Predictions for 2019
As the old saying goes, “The only constant is change.” And nowhere does that sentiment seem to hold more truth than in the field of technology and the projects that implement technology.

The biggest shaping trends in technology project management that I see for the year 2019 are:

1) Approaches will be more tailored to projects.
2) Skills will start to be more important than certifications.
3) Remote working will continue to increase.
4) Stronger focus on the benefits of projects.
5) Cloud acceptance in all industries.
6) Attitude regarding data privacy and security is changing.
7) Growth of the project manager’s influence and responsibility.

Approaches will be more tailored to projects

For decades, executives believed that the best way to control project management from the top floor of the building was to create a single project management methodology that could be applied to all projects.

But with an increasing demand for flexibility to adapt and roll with the punches, organizations will move away from pre-set and rigid project management approaches.

Project managers should have always been making the best methodology choices for their projects, but some organizations didn’t lend themselves to doing so.

Now, those organizations will embrace tailoring in a way that forces project managers to make more choices about how to best run their project.

This shift means that project managers will have to lean on their own critical-thinking skills and professional judgment more than ever before.

Many organizations are already witnessing the positive impact of giving project managers room to customize their own methodologies.

Skills will start to be more important than certifications

While certifications will still hold some importance—especially for more traditional employers—they may no longer act as the be-all and end-all for landing project management roles.

A credential like the PMP certification is a valuable asset to boost your pay packet and demonstrate your expertise, but experience and skills—particularly technical and leadership skills—will carry far more weight with employers than they did in the past.

I am of the opinion that, in order to lead a strategic technology project, you need:

> to understand technology
> to understand the business
> to have project management skills
> to have leadership skills

Most certifications only look at project management skills, and only by testing whether or not you can memorize a book. With agile certifications it is even worse—you only have to memorize 20-something pages.

Project managers that are able to learn and adapt by working and thinking flexibly are the ones that are going to be the most successful at delivering projects. When it comes down to it, the foreseeable future is going to have a need for project managers that are comfortable walking across shifting sands.

Remote working will continue to increase

The International Workspace Group (IWG) found that 70 percent of the world’s workers work remotely at least once a week. Remote working is becoming more and more commonplace, so we expect to see project managers adopt it in greater numbers in 2019. Although project management offices (PMOs) will continue to grow in popularity, it’s very likely they won’t all be physical offices.

Not being bound to a workplace, whether as a permanent employee or a contractor, helps workers become more adaptable and blend their work and home lives together in a way that suits them.

Project managers will benefit from having access to a much wider team candidate pool without having to manage offices abroad or travel frequently. Having the freedom to hire around the world will require them to maintain high standards of visibility and communication for their teams.

In addition, the role of project manager will become more flexible and remote working will become more widely adopted.

While a team of curated staff is ideal, if that team’s members operate in different time zones and/or different languages, it brings its own new challenges. A great deal of scheduling and performance tracking is needed to keep a project on track when that project is dispersed around the globe.

A stronger focus on the benefits of projects

Competitive pressures and the volatility and uncertainty of the operating environment are feeding an increasingly competitive atmosphere in the marketplace. Technology in particular is creating winners and losers. Senior executives are on the lookout for anything that may provide a competitive edge.

Blockchain? Big data? Internet of Things? 5G? Artificial intelligence? It’s a bit like ‘project fear’, because nobody wants to miss the next big thing and get left behind.

When commissioning projects that are intended as transformative or that make a lot of promises, there is now a heightened need for results that really measure up against what was envisioned.

Organizations are going to want more return on investment from project spend.

It used to be that ‘on time and on budget’ was the universal standard by which to measure whether a project was a success. However, this is no longer the case. The coming year is going to continue to see a requirement for projects to deliver results which support the long-term strategic goals of the organizations that commission the projects.

Cloud acceptance in all industries

Forget internal servers; the cloud is the panacea. While you can’t reduce the discussion to this simple phrase, it is a fact that more and more companies are switching to systems in the cloud. And sooner rather than later.

The fears of not being able to reach the system at a critical moment, insufficient performance, and external unauthorized data access seem to have relaxed somewhat.

Of course, there are industries that don’t want to rely on cloud-based server solutions due to extreme secrecy, but they are fast becoming the minority. Many banks, insurers and auditors have already made the switch, and even the Pentagon has joined the cloud revolution.

The attitude regarding data privacy and security is changing

Regarding data security, those responsible in the organization are beginning to understand one thing: The biggest security hole is not technology but man. Successful hacker attacks on the server infrastructure of Microsoft, for example, are less likely to occur than data piracy committed by a disappointed employee.

Regarding data privacy, GDPR and related laws will continue to play a big role in technology projects. Also, the scrutiny on companies like Google and Facebook when it comes to their handling of data privacy will have a continued impact.

The growth of the project manager’s influence and responsibility

The organizational structure of many companies is now becoming less hierarchical. That is why often project managers take on part of the responsibilities of middle and executive managers.

Among the many tasks carried out by a project manager, strategic thinking is becoming one of the most critical.

Project managers will continue to be the leaders and managers who manage the creation of value, drive change, and are responsible not only for financial results but also for the vision of the project.


It’s clear that these trends, considered in a historical context, are part of a running narrative that has been evolving over the last few years. In truth, there is nothing really new here.

But what is clear is that these trends all tie together and make sense as they support two central ideas:

1) Project management is being shaped by the problems that need to be solved and not the other way around.

2) Projects drive change, and change drives projects.

Read more…

Sunday, January 06, 2019

The opposite of risk management is crisis management

The opposite of risk management is crisis management
I was recently asked to design and facilitate a workshop about technology project risk management for an insurance company. When we started to discuss the desired outcome of the workshop it became apparent that what my client really wanted to know about was how to manage an unforeseen crisis.

This wasn’t the first time that a client of mine had merged the concept of a crisis into the concept of risk, so it led me to write this article.

Consider the following circular definition of risk:

A risk is a problem that has yet to occur, and a problem is a risk that has already materialized. 
Before it happens, a risk is just an abstraction. It’s something that may affect your project, but it also may not. There is a possibility that ignoring it will not come back to bite your ass.

As a logical consequence risk management is then the process of thinking out corrective actions before a problem occurs, while it’s still an abstraction. Or as Timothy Lister words it; “Risk management is project management for adults”.

The opposite of risk management is crisis management—in other words, trying to figure out what to do about a problem after it happens.

So a crisis is the result of one or more events that have already happened. It is usually something that is unforeseen, public in nature, and has the potential to cause great harm to a project and an organization in terms of finances, revenues, reputation, market positioning, and service delivery.

Here are some examples of project crises I have personally experienced:

> The sudden departure of the only person that could explain how that ancient legacy system works.

> The main supplier going suddenly bust because of a lost litigation case.

> The main supplier being bought by our biggest competitor.

> Discovering that your supplier oversold big time; the key system functionality that drives your business case does not exist, and will never exist.

> Your whole external consultant team being poached by another competitor.

> Performance problems shortly after going live, so bad that complete teams were walking out of the building because they could not access their documents anymore.

The manner in which a project team, an organization, its executive team, and its board responds to and handles a project crisis will often determine the overall impact the crisis has.

Being on the front foot with a crisis management plan and scenario planning, acknowledging what has happened (and expressing authentic empathy towards people who have been affected), accepting responsibility, offering assurances and following through quickly will ensure the best possible outcome.

Conversely, being slow off the mark, deflecting responsibility and doing little else is likely to exacerbate the situation and lead to greater negative consequences.

Managed well, a crisis situation shows the organization that the project is resilient and well run.

Effective risk management and crisis management starts with the project manager. Regular updates of your RAID lists that analyze these critical risks, their monitoring and responses provide the steering committee with strategic information regarding the key drivers of the project.

The steering committee’s role in monitoring these risks is not to ensure they don’t occur, but to help you with seeing the bigger picture, because the project manager does not have all the information.

One of my upcoming articles will be about what project managers can learn from crisis management.

Read more…

Wednesday, December 19, 2018

Project Management Principles vs Practices

Project Management Principles vs Practices
After reading “Principles” by Ray Dalio for the second time this year I was thinking about what principles do I have in the area of project management? And how are these principles different from practices?

 We are always looking for simple ways to apply good principles (patterns of advice) with meaningful practices (specific actions). This is the crux of delivering consulting advice in most situations. So what is exactly the difference between principles and practices? Here is one example.

 The Boy scout motto – “Be prepared” – is a timeless principle.

 “Buy a plunger before you need a plunger” is a practice that applies this principle in a memorable way.

Principles are good ideas or good values stated in a context-independent manner. Practices are applications of these principles stated in a context-dependent way.

Project Management Principles

When you look at project management I firmly believe in the five principles of project success as defined by Glen B. Alleman in his excellent book “Performance-Based Project Management".

These principles are best stated in the form of questions. When we have the answers to these questions, we will have insight into the activities required for the project to succeed in ways not found using the traditional process group’s checklist, knowledge areas, or canned project templates.

1) What does “done” look like?

We need to know where we are going by defining “done” at some point in the future. This may be far in the future—months or years—or closer—days or weeks from now.

2) How can we get to “done” on time and on budget and achieve acceptable outcomes?

We need a plan to get to where we are going, to reach done. This plan can be simple or complex. The fidelity of the plan depends on our tolerance for risk. The complexity of the plan has to match the complexity of the project.

3) Do we have enough of the right resources to successfully complete the project?

We have to understand what resources are needed to execute the plan. We need to know how much time and money are required to reach the destination. This can be fixed or it can be variable. If money is limited, the project may be possible if more time is available and vice versa. What technologies are needed? What information must be discovered that we don’t know now?

4) What impediments will we encounter along the way and what work is needed to remove them?

We need a means of removing, avoiding, handling or ignoring these impediments. Most important, we need to ask and answer the question, “How long are we willing to wait before we find out we are late?”

5) How can we measure our progress to plan?

We need to measure planned progress, not just progress. Progress to plan is best measured in units of physical percent complete, which provides tangible evidence, not just opinion. This evidence must be in “usable” outcomes that the buyer recognizes as the things they requested from the project.

It does not matter what practices you use to manage and deliver your project. It also does not matter what kind of a project it is. As long as it is a project, the five principles of project success are valid.

Project Management Practices

Most often there is a principle, a truth, a reason, behind the practice you use. Are you aware of the principles behind the practices you have in your project?

- Why do you create a project plan and schedule?
- Why do you do risk management?
- Why do you create a stakeholder map?
- Why do you create RAID lists?
- Why do you use OKRs to define project success?

We must know why we do something otherwise we are just copying someone else.

If you just do something because someone, or some company, you admire is doing it you are following the practice. This will create a sense of legalism in your project team – just following a good idea, or even worse, making good ideas the rules, something you and all your team must do. When we do this we have no inner conviction to help us over the hurdles, when things get hard we’ll give up.

Instead of mindlessly copying we need to consider the principles, the truths we want to build our project on, and then carefully think through the best practices for our team to learn and grow in that truth.

Read more…

Tuesday, December 11, 2018

10 Leading indicators of troubled projects

Leading indicators of troubled projects
In project management, we often talk about “lagging” and “leading” indicators. Lagging indicators are typically “output” oriented, easy to measure but hard to improve or influence. Leading indicators at the other hand are typically "input" oriented, harder to measure but easier to influence.

Let me illustrate this with a simple example. Let's imagine you are responsible for managing a customer support team, and your goal is to resolve any high priority incidents within 48 hours. Currently, you only succeed in 70% of such incidents.

The output is easy to measure: You either solve these incidents in 48 hours or not. But how do you influence the outcome? What are the activities you must undertake to achieve the desired outcome?

For instance: Make sure your team starts working on such incidents immediately when they occur. Make sure that incidents are assigned to the right people with the right skillset and that this person isn’t already overloaded with other work.

This could be translated into the following “leading” indicators
> % of incidents not worked on for 2 hours.
> % of open incidents older than 1 day.
> % of incidents dispatched more then 3 times.
Average backlog of incidents per agent

When you would start measuring these indicators on a daily basis and focus on improving these, I would think it is extremely likely to see an improvement in reaching your goal.

Lagging indicators for projects

As I have written many times before, it's essential to work actively with the organization that owns a project to define success across three levels before you start a project:

1) Project delivery success is about defining the criteria by which the process of delivering the project is successful.

Essentially this addresses the classic triangle "scope, time, budget". It is limited to the duration of the project and success can be measured as soon as the project is officially completed (with intermediary measures being taken of course as part of project control processes). 

2) Product or service success is about defining the criteria by which the product or service delivered is deemed successful.

For example, the system is used by all users in scope, uptime is 99.99%, customer satisfaction has increased by 25%, operational costs have decreased by 15%, and so on.

These criteria need to be measured once the product/service is implemented and over a defined period of time. This means it cannot be measured immediately at the end of the project itself.

3) Business success is about defining the criteria by which the product or service delivered brings value to the overall organization, and how it contributes financially and/or strategically to the business.

For example, financial value contribution (increased turnover, profit, etc.) or competitive advantage (market share won, technology advantage).

All these measures are so-called lagging indicators. A lagging indicator is a measurable fact that records the actual performance of a project. They all represent facts about the project, the resulting product/service and the benefits of it to the organization.

But things can start to go wrong in a project well before the performance measure turns the traffic light on the scorecard red.

Using metrics that measure past events is like driving while looking through the rear window. It’s easy to miss an opportunity or threat on the road ahead until you hit it.

Leading indicators for projects

A leading indicator is a measurable factor that changes before the project starts to follow a particular pattern or trend. Leading indicators are used to predict changes in the project, but they are not always accurate.

Examples of leading indicators for a project’s success:

1) Poorly defined (or undefined) done: Project failure starts when we can’t tell what “done” looks like in any meaningful way. Without some agreement on our vision of “done,” we’ll never recognize it when it arrives, except when we’ve run out of time or money or both.

2)  Poorly defined (or undefined) success: A project can only be successful if the success criteria are defined, ideally upfront. Therefore the lack of these definitions on the three levels as described above is a great leading indicator for project trouble.

3) Stability, quality, and availability of project team: a lot of change in the project team is a good leading indicator for trouble. The same for missing skills and experience. Also, team atmosphere is a great leading indicator.

4) Engineering practices: the practices that are implemented are a good leading indicator of engineering quality.

5) Risk management: the presence or lack of risk management is a great leading indicator of the impact of negative surprises.

6) Availability of up to date RAID lists: the quality of these lists are a great indicator for awareness of trouble.

7) Engagement of stakeholders and Steering Committee: When the stakeholders do not care about your project, then why should you?

8) Runway: the burn rate of a project is a lagging indicator as it describes how many money is spent (or lost) for any period of time. The runway is a leading indicator as it predicts how long the budget would last with a specific burn rate.

9) Milestones: missing or achieving the deadline on a milestone is a lagging indicator. But it is also a leading indicator for following milestones.

10) Project size: the bigger the project, the higher the probability it fails.

All leading indicators can be used for identifying troubled projects before it is too late to do something about it. Just be aware that because a leading indicator is positive, it does not mean the final outcome will be positive. Nor will a negative leading indicator means automatically a negative outcome.

Read more…

Wednesday, November 21, 2018

Effective strategy execution in 10 steps

Effective strategy execution in 10 steps
After you have defined your organization's strategy you can start implementing it. This is also called strategy execution. As explained in a previous article on strategy execution, I fully agree with the approach of Jeroen De Flander who defines this process as “helping people make small choices in line with a big choice”.

This article gives a 10 step approach on how to successfully execute your strategy.

After you have defined your strategy <link> you can start implementing it. This is also called strategy execution. As explained in a previous article on strategy execution <link>, I fully agree with the approach of Jeroen De Flander, who defines this process as “helping people make small choices in line with a big choice.”

This article gives you a 10-step approach on how to achieve this in your organization.

Step 1: Visualize your strategy

One of the challenges of strategy execution is simply understanding what a strategy is. An effective way to improve this understanding is to visualize the strategy via an illustration that shows both the important elements of the strategy and how each relates to one another.

Frameworks such as the Strategy Map by Kaplan and Norton, the Activity Map by Michael Porter, or the Success Map by Andy Neely can help you with this.

Step 2: Measure your strategy

Key elements of your strategy should be assigned an easily understood performance measure. The full set of strategic performance measures can be organized into a dashboard, a Balanced Scorecard, or some other framework like OKRs, so everyone can determine if progress is being made toward executing the strategy.

Step 3: Communicate your strategy

It is close to impossible to execute your strategy when the strategy itself isn’t well understood, or performance relative to it is not communicated. Leaders must communicate their visualized strategy to the organization in a way that will help the organization understand not only what needs to be done, but why.

Transparent and clear communication creates the necessary understanding and engagement for the new/adapted strategy. 

For example, one big strategy event and a single strategy e-mail are not nearly enough. Use other meeting platforms, discussion groups, informal and formal encounters, performance management sessions, intranets, websites, screensavers, coffee corners, billboards, and other means to communicate the strategy.

Step 4: Review your progress 

In the same way that financials are reviewed monthly, your strategy should be reviewed regularly. The focus of these reviews should be to determine if the strategy is producing results, not to control performance.

Your business strategy is a hypothesis. It’s your best estimate of the route to success … but it’s still an estimation. That’s why it’s crucial to take some time at the end of a cycle to go back and check your hypothesis. To check your strategy against reality.

Step 5: Make decisions

Strategy execution is much like sailing a boat toward a planned destination. A defined course and a full complement of navigational charts will never eliminate the need to remain vigilant, to assess the environment, and to make corrections as conditions change. As part of regular strategy reviews you must make ongoing strategic decisions to keep the strategy current and on course.

Step 6: Identify and categorize all your projects

Organizations may have many, if not hundreds, of projects ongoing at any point, but they rarely have a firm grasp on the type and range of these projects. The first step in improving project-oriented strategy execution is to capture and categorize all projects that are underway in and planned throughout an organization.

Once strategic goals have been defined, which is itself a nontrivial process, linking them to project proposals and your existing projects is relatively straightforward. Each project can be examined to see the extent to which it supports each of the strategic goals.

Step 7: Evaluate and align your strategy projects 

Once projects are captured, they must then be aligned to the strategies or goals for the organization. This step entails comparing each project, either proposed or ongoing, to the strategic goals to determine if alignment exists.

This is the activity in which your dreams run up against reality, your business strategy meets operations, and your resources are added to the strategy formula. This is one of the most difficult steps in strategy execution—and it’s also where execution quite often goes wrong.

This step is all about selecting, prioritizing and executing the right projects. The goal is not to choose the 10 project proposals with the highest return on investment, but to ensure that the projects map to the strategic goals of the business.

Step 8: Deliver your projects

Organizations must develop a capability in project management and execution in order to execute strategy effectively. A project not delivered means benefits not delivered, and for strategic projects this means the strategy is not executed (or part of it, anyway).

An important goal of your strategy execution should be to have a high project throughput. Get projects delivered fast so you start reaping your benefits, and your organization is freed up for new projects to deliver additional benefits.

For a typical organization this means three things:

1) Doing fewer projects in parallel. On average, just half of what you are doing now.
2) Focus on doing the right projects.
3) Focus on improving your project delivery capability.

Step 9: Align individual roles

Employees want to know they are making a meaningful contribution to their organization’s success. It’s up to senior leaders to ensure that employees at all levels can articulate and evaluate their personal roles toward the achievement of specific strategic goals.

This is perhaps one of the most critical aspects of the execution process.

Step 10: Reward performance

In strategy execution, as in any other area of management, what gets measured gets done. Taking this one step further, what gets measured and rewarded gets done faster. After explaining the strategy and aligning your organization to it, senior managers institute the incentives that drive behaviors consistent with the strategy. Link individual objectives with the strategy at the organizational level.

No matter how well planned your strategy is, executing that strategy effectively is vital in order to achieve results. While this 10-step approach won’t guarantee strategy execution success, it will greatly improve your odds.

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Sunday, October 21, 2018

Strategy execution as a decision-making process

Strategy Execution
In my last article, I wrote about what strategy is, and what not. And although strategy is important, it is pretty much worthless without execution. So what is strategy execution?

Strategy execution as a process

The most notable book to date on strategy execution is “Execution: The Discipline of Getting Things Done”, by Larry Bossidy and Ram Charan. Bossidy, a retired CEO, and Charan, a renowned management consultant, make the case for execution as a discipline or “systematic way of exposing reality and acting on it.”  They explain that “the heart of execution lies in three core processes":

1)  People
2)  Strategy
3)  Operations

They explain the processes and descriptions managers use to successfully drive business results.

Strategy execution as a system

The information presented in the aforementioned book is certainly useful, but the authors don’t fully explain how an organization can implement their three core processes to achieve strategy success. There have been significant advancements in this area since Execution was published in 2002.  In 2008, Harvard Business School Professor Robert S. Kaplan and his Palladium Group colleague David P. Norton wrote "The Execution Premium: Linking Strategy to Operations for Competitive Advantage". In it they present their management system, which houses six sequential stages intended to help organizations capture what they call an “execution premium”—a measurable increase in value derived from successful strategy execution. They outline six stages in this system:

1) Develop the strategy
2) Plan the strategy
3) Align the organization
4) Plan operations
5) Monitor and learn
6) Test and adapt

Through detailed subactivities—26 in total— Kaplan and Norton explain how organizations have successfully executed strategy via application of their management system.

Strategy execution as a decision-making process 

Both of the models outlined above are important and anyone serious about the practice of strategy execution should be familiar with them. But both are not focusing what is the most important in my opinion. The one definition that sofar resonates most with me is the one of Jeroen de Flander. His explanation of strategy execution starts with a famous Mintzberg quote.

“Strategy is a pattern in a stream of decisions.” - Henry Mintzberg            

First, there’s the overall decision—the big choice—that guides all other decisions. To make a big choice, we need to decide who we focus on—our target client segment—and we need to decide how we offer unique value to the customers in our chosen segment. That’s basic business strategy stuff.

But by formulating it this way, it helps us to better understand the second part, the day-to-day decisions—the small choices—that get us closer to the finish line. When these small choices are in line with the big choice, you get a Mintzberg Pattern. So if strategy is a decision pattern, strategy execution is enabling people to create a decision pattern. In other words:

“Strategy execution is helping people make small choices in line with a big choice.” - Jeroen Flanders

This notion requires a big shift in the way we typically think about execution. Looking at strategy execution, we should imagine a decision tree rather than an action plan. Decisions patterns are at the core of successful strategy journeys, not to-do lists.

To improve the strategy implementation quality, we should shift our energy from asking people to make action plans to help them make better decisions.

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