This story begins with a subsidiary of a public company that provided project and technical services for the financial services industry.
An aim of the Executive was not unusual. They wanted better control of their business with better reporting.
A software provider introduced a consultant to implement a performance management solution.
The engagement was to establish an overarching financial reporting base to report hard numbers against what was expected for three areas namely; Sales and Gross Profit forecasting, Project based WIP and Delivery Reporting and Financial control. The aim was to make transparent performance issues as they occurred.
To do this as the reporting solution had to match the business process it meant inconsistencies may need to be fixed. This of course relied on the understanding of the unwritten law that in most projects, as workflow conflicts are exposed or they become obvious, they get sorted out quickly by the business owners. The boundary issue for the consultants is not to get hooked in into activity solving these issues.
Hence for design, taking a top down approach does carry risks if roadblocks cannot be fixed. But the upside is it also empowers Executives and Key Users to then set priorities for change.
Then hidden items get fixed, especially if the spirit of co-operation is in place up front.
As they get resolved it happens in cost neutral way so companies get much more than their money back with the improvements even before their projects goes live.
In the normal course of projects too as boundary issues become roadblocks they then get handled by this executive processes with all the stakeholders involved.
To ensure this, a steering committee and sponsored project management team is mandatory.
In this case study a new CEO in his first 100 day was impressive. He articulated his three year growth vision that made a lot of sense, even though he did not provide any detail plan of any substance as side from putting in place a reporting system for control and see what was going on.
Other executives also talked eloquently about exploiting their business capability with grand plans to move to higher end markets with higher quality services, with faster cash flows and better profits.
At the kick-off the CEO stated the company needed a new reporting system. He stated to all assembled that the present financial reporting was poorly integrated with key operational reporting basically all manual and disconnected.
He stated that improving the process to get up-to-date Sales forecasts status and Delivery control of major projects was also vital.
Additionally Profitability forecasting for revenue, cash and related ratios were mission critical items missing and needed to get their highly geared Balance Sheet under control.
Another dynamic was if this project could be a showcase a potential alliance with the Software Company for growth to re-sell reporting solutions to their client base. This would to their value add services mix.
All the signs were there that it could not fail.
As it got started, the appointed team set about understanding the business processes. It became very clear very early that bottom up change was needed to fix the fundamentals in core system. Interim solutions were also needed to organize the large chunks of core systems data missing. That in turn meant change for those who prepared spread sheets reports in surrogate processes.
What became obvious from this was making the project the driver for change was actually flawed as the knock on cost to fix things was way more than neutral in terms of cost and time.
In this case the project could not actually deliver anything useful at all until the core was fixed. So a scope change was agreed and changes to the bottom up feeder processes were commissioned to another party.
In the meantime about 6 weeks into the project floods threatened the lives of whole city and the economic base of the whole country. As may recall in 2010 Thailand was paralysed by this.
This serious business interruption for two months took hold of with personal survival understandably a forefront for many.
In the project team key technical and business managers, lost their homes to the flooding and in some way everyone was affected. This meant when the project kicked off again it was behind schedule.
Being all in the same boat meant no-one could claim it as an excuse, but when Executive then reviewed progress they accused the project of being late which intimidated and disenfranchised people. It also meant they also failed to go back and restart properly given the changed circumstances and timing.
So a project having been born out of good intent was not only road blocked by events but sadly put under pressure and orphaned to survive as best it could. So with a political purpose already it set about making the best of it as it struggled to re-empower people.
By now the un-cohesive project sponsorship, had also distracted other process owners from being involved in change leadership as they were now focused on business recovery.
Without key operational involvement, as the cockroach’s nests showed up under the rocks lifted, instead of being eradicated they continued to multiply. Gaps were also left to be closed later when the executive returned to support the changes needed.
Basically what had happened was the client’s ability had been diminished by the events and the approach albeit ambitious at the outset was by then wrong.
In hindsight the project should have been stopped. That makes sense so why proceed with unrealistic business demands and the risk to manage squarely on the project and sponsor’s attention abdicated.
In commercial terms with the project being milestone driven this meant the implementers were quite deeply committed and over a barrel. It was not hostile and seemed those engaged were still committed so despite the roadblocks they decided to keep going and trusted they could find leverage for a break thru for a win-win.
But things never came back to normal and the business inertia for change deepened. Now mostly as outsiders the team’s ability to influence and motivate people was also impacted. One big folly was the project cash flow was geared to the solution delivery and took no account of catastrophe events. That in turn restricted commercial leverage to deal with the issues.
The flood distraction was one thing but once it abated business priority became intense to make sales and deliver customer services. As the control tools project become orphaned with no time or resources spare to do that work. The lack of executive access too also meant operations spent most of their time fire fighting and unable or unwilling to get involved in the change issues.
With management and operations disfranchised, the idea that the project should just delver a panacea solution took root and began to control of the agenda. Hence instead of being able to rely on key users to resolve gaps, the team was left with that responsibility. To make matters worse the as-is financial reporting, was managed by a disinterested shared service.
Hence operational business process gaps in need of changes were ignored as was the critical point where the project should have been reassessed.
The mistake was assuming the sponsorship and processes themselves were reasonably founded. Instead when the project identified gaps, nothing was done.
At the more fundamental level there also seemed to be executive disaccord which always made the project team wonder. Toward the end after 8 months of broken and inconclusive effort, even then the team struggled to close off the work they had done.
A revelation came when the team overhead the Toyota model being talked about again but this time like a new concept. They realized then the connection to the 3 year plan approach that had been promoted by the CEO as the project premise at the kick off. In fact it had not been converted to any sort of plan at all and was just a theory and rhetoric.
Toyota of course has a mature six sigma based performance model capability for organic step change which is realistic. This company on the other hand with no basic systems in place had a very long way to go to get even to get to first base. “I have a dream” would be a good metaphor”
The question is, after attempting to add value to an unstable base and failed "Do you throw our work and bury your head in the sand in the hope that it all goes away.”
The lesson was to close the gaps in commercial arrangements and project methods to include ongoing capability due diligence.
Only then you better ensure your work has value and benefits everyone?