Eight questions to ask before you start a business-critical program – and one good answer to each
Few things stir up executive emotions quite as much as how a company should organise to run a business-critical program.
Mostly because senior executives don’t have previous experience of what it takes to get a true business-critical program across the line.
No matter how gifted they are in other disciplines, many executives have bad mental models for simulating how a business-critical program is going to unfold.
Even if they are aware of some of the hazards they tend to believe these only happen to other people – and couldn’t possibly happen to them.
There’s little doubt senior managers are seduced by quick structural solutions – because they look so deceptively easy.
Information systems, management styles and informal communication networks can’t be messed around with on the back-of-an-envelope.
But structure can, sadly.
Huge shakeups are engineered on the back-of-envelopes by replacing solid lines with dotted ones.
Superficially it’s attractive but ultimately it’s disastrous.
There is no single right way to organise for a business-critical program.
But this doesn’t mean that anything goes. Some approaches are much more likely to succeed than others – and there are eight crucial areas to cover.
Organisation models for business-critical programs must cover these eight areas and if your approach doesn’t deal really effectively with them, watch out.
Do you have?
1. Full Alignment
Full alignment – at the team level – covering what work is involved, timescales, expected financial results – and so on.
The important phrase here is “at the team level.” It’s not enough to have senior management agreeing with each other and dishing out targets to the unsuspecting execution team. People who actually do the work must understand what they have to do – and how they will do it.
This can only be achieved through widespread staff involvement in the Program Definition process – which receives scant attention in most companies.
2. Credible plans
Credible plans must have an excellent foundation. They should be realistic, convincing – and based on reasonable – not valiant – assumptions.
Credible plans are not targets, forecasts or “plans for a plan.”
They describe the work in detail, dependencies, key assumptions, resource levels, financial considerations – and the expected business results.
Mismanagement of interdependencies between individual projects can kill programs stone dead. They should be “unmistakably” identified, negotiated, agreed, resourced and funded with the supplying function.
No caveats – no ifs, no buts, no maybes.
Failure to manage dependencies is rampant – in particular with 3rd party suppliers. Program commitments based on “provided- that-someone-else-does-this-by-then” statements are not worth a candle.
Unseen and informal dependency “agreements” always cause serious problems.
4. Contingency Plans
Most plans are put together assuming everything will go perfectly; nothing can go wrong. They also imagine the program is top priority; there’s a never-ending supply of skilled resource available; and, the business has no other work to do. Complete nonsense, of course.
This is “optimism bias” in action.
Understanding the nature of risks; how likely they are to appear; and, specifically what can be done to lessen the brunt, gives program teams confidence that potential disasters can be prevented, or worked around.
Many battered executives have learned that having “zero contingency” in program plans is a ridiculous. Sudden calamities do occur.
5. Change Control
One small change “here or there” is unlikely to dramatically affect a program. It’s the combined effect of hundreds, perhaps thousands, of minor changes passed through “on the nod” that throttle business-critical programs, triggering soaring costs and runaway timescales.
Robust, disciplined Change Control is essential.
No plan should change without a full management evaluation of resources, costs and timescales of the proposed modification.
6. Resource Management
Nothing interferes more with progress than the non-appearance of vital capabilities, skills and resource levels – at the right time.
Time-slicing people’s effort is the major crime. Plans are built on resource expectations. When resources aren’t available as planned – or when they’re still working on the last delayed program, severe problems crop up.
The flow of people has to be managed dynamically.
People required 100% of the time should be clearly identified and “hard-wired” to the program; people required 100% of the time – but only for several months should be “ring-fenced” for that period of time – and shared resource requires accurate management.
7. Program Control
Pragmatism is at the heart of execution – the performance management system is pivotal to control. It strives for crisp, evidence-based answers to four basic questions: what’s happened, why, is it going to continue- and what are we going to do about it?
The reluctance to face facts is widespread – a major cause of poor execution. Weak control and reporting can mask detailed implementation difficulties for months.
Reviews should be intense and focus on the truly significant drivers of progress. Measurement is much more than judging progress – it’s also to find ways of performing better.
8. Finance Management
The ultimate success of any program is whether it delivered its financial benefits.
A program is not successful if scope and benefits are delivered “miles over” the original forecast.
Poor financial management has huge consequences.
A program business case is not a one-off – it’s a living document – the baseline for future reporting through to program completion.
The main focus should always be on the true cost of delivery. Rigorous forecasting increases accuracy and safeguards against ineffective Change Control.
The role of the Program Financial Controller is critical and should not be seen as “support” but at the heart of the program leadership team.
If you’d like to read a more detailed commentary on the options companies tend to use for business-critical programs, download our eBook “Are you Jumping the Gun?”.