First the Credit Crunch; now the Cruel Cuts. What are you going to do, or perhaps are already doing, in response? Spend less? Do less? Sit tight where you are and batten down the hatches? If you do that whilst everyone else goes on behaving as they used to, you will be fine. You will save and prosper. But what if everyone else around you does that as well? You will have no market for your services. If we all retrench at once we will embark on a nasty vicious circle into poverty.
Fortunately history says it is not that simple. That is not what happens. There are 60 million people in the UK and 7 billion people worldwide who, recession or no recession, must at least eat and clothe themselves. A fall in activity of 10% means that 90% of the business is still there for the taking. Moreover the market is uneven. Very large parts of it are worse off only from a position of wealth. Those parts will continue to want and continue to demand a very great deal more than to eat and be clothed.
For those who are enterprising and ready to make more for less, other peoples’ retraction from the market in a recession offers a remarkable opportunity because raw materials, resources and infrastructure become cheaper. This doesn’t happen equally or evenly of course, but sufficiently to create opportunities to make and sell more with less. Whoever does that is going to be the winner out of this economic cycle, just as they have been in previous episodes.
Sir Ronald Cohen said in a recent speech at Harvard Business School, “there is something in the air” about this recession which is different. One obvious novelty is that the internet, as Tim Ferriss points out in “The Four-Hour Working Week,” enables all the world to be your market, supplier, administrator and order-fulfiller. It breaks down old barriers to market entry so that unfunded and unestablished new enterprises more readily compete with well-capitalised and well-established suppliers. Sir Ronald suggested that the poorest 25% of the world population may now become successful entrepreneurs. The mobile phone suppliers reckon the next 1 billion of their customers will be from amongst this population. The mobile phone meets a remarkable proportion of the technological needs of entrepreneurial business.
We should therefore look out for this recession to be different from any which have gone before. What does that mean for those who, in the last 30 years, have been gainfully employed in programmes and projects?
Change, which is in reality the real objective of programmes and projects, is an early victim of cutbacks. It has been pointed out that you can gauge a recession by the number of cranes standing idle on construction sites. You can perhaps equally gauge a recession by the number of resources standing idle beside abandoned programmes. Yet to prosper out of a recession, an organisation (which of course includes Government organisations) cannot afford to stagnate like an idle construction site. It has to change more profoundly and faster than in times of prosperity in order to adapt to a different and more demanding market.
Fortunately programme resources are not cranes. They are not inanimate mechanisms, so have the potential to quickly change what they are and move into fresh roles. Moreover, they are often amongst the most skilled people in using information technology for themselves. The question is, are we enterprising enough?
Change does not come easily. It means giving up skills for which you have been highly valued. It means recognising that knowledge which gave you status is obsolete in the face of a market with new needs. It means sliding back down the ladder of achievement and starting over again. It often means changing values, relationships and location. Think of refugee doctors who have had to become, newspaper-sellers on the streets of new countries and cultures. Do not be glib; do not belittle it. Change, real change, is hard.
What does the new market for programmes require of you? Essentially, it needs you to be more effective for less investment. Crudely, it needs more bangs for its buck. Those “bangs” are not just objectives, they are real, tangible, “show me” outcomes. More than that, they have to be valuable outcomes, changes that must have real and immediate cash value to the client organisation. The programme-investing organisations need the payback of those valuable changes faster, sooner and with less process, procedure and fuss. And they need it now, as the cuts start. All that is not essential to the purpose must be jettisoned. Otherwise the organisation cannot afford to even start investing in us.
What are the candidates for what is not essential in modern programme practice? We can have a great debate about this. A good case might be made for the criticality of everything: visions; targets; objectives; mappings; governance; charters; planning; risk management; configuration management; cost control; all the functions we are familiar with and which seem to have matured and case-hardened from the furnace of failures and lessons learned.
An interesting exercise is to look at a programme from an exclusively client view. The client is quite simply buying a result, just as you or I would set out to buy an extension to our house or the payout of an insurance. It is apparent straight away that, unless the client is embarking on a construction project with a scale model and engineering blueprints of the outcome, they lack any easy way of specifying exactly what result it is they want. If they resort to numbers as they often do (they’re called targets) they run the risk of generating unintended consequences. This is a risk which has regularly materialised for the taxpaying victims of Government policy implementations – think waiting-time targets in hospitals’ A & E units, or school achievement targets.
Perhaps next in importance the client wants an honest assessment of the business case for making a start on a programme in the first place. This is acutely important in straitened times. No-one can afford to embark on an investment they are subsequently going to regret. Unfortunately they have no way of connecting the change outcomes in the operation of the business directly to specific cash flow benefits. The client has still less means of knowing how accurate the benefit value estimates are, because the programme initiators themselves have no means of estimating the monetary value of so-called “intangible” and “un-quantifiable” benefits. Given the lack of connection between change and benefit and benefit and cash, managing to keep the investment of money and time – the cost – focused on delivering the returns needed on the investment becomes well-nigh impossible.
It seems that from this point of view the two things most critical to the clients as investors in programmes are exactly the gaps in current programme methods. Yes, to be sure there is insistence that benefits should be identified, mapped, estimated, planned and tracked, but no-one is saying how in a way that helps the client. On the other front, business cases remain lamentably vague about the true cash value of benefits. Some would say, as Stephen Jenner references in “Realising Benefits from Government ICT Investment”, business cases are even sometimes dishonest.
How do these critical needs map to the aspects of programme management which have been most emphasised during the last 30 years? Not well, I think is the answer. Outcomes and benefit realisation, the result which is the whole point of the exercise for the client, have been virtually ignored. Though growing in prominence today, benefit realisation is still a Cinderella afterthought stuck in a kitchen added to the great grand household of programme management.
The business case, the honesty of which is of such critical importance to the client, has a lot of prominence in the initiation stages of programme management when budget is being sought for resources. But the business case together with its soft and shaky benefits most often becomes shelfware once the investment commitment has been gained. Shouldn’t it remain the focal point of the programme throughout, expressing as it does the objective of the programme and the contract of investment against returns?
So in doing more with less, what would you keep? Firstly, a focus on results, surely. An honest business case constantly monitored, of course. The monitoring implies that risk management is rather critical, as is tracking of benefits, even more so than the tracking of costs. After all, if it was an insurance policy you be at least as interested in the payouts and the risk of not getting them as in the cost of it. Secondly, if you were the client and already have the management structure of a business, and it is properly dedicated to doing its job of managing (not outsourcing) change as well supervising the operational status quo, how much programme governance is a necessary addition and how much is replication of management already employed? Thirdly, can you really plan effectively unless you know what the end result is to be in very explicit and tangible terms, and direct all of your plans to those ends? Would you keep all of a massive plan and let the cement go hard on it, or opt for a lighter, more agile plan that adapted constantly to the vicissitudes of real life in order to deliver non-negotiable results?
The person gainfully employed in programmes and projects has survived the Credit Crunch, let us assume, and now faces the Cruel Cuts. What do you do? I think the answer is: “change”. Be ready to give up skills for which you have been highly valued. Recognise that knowledge which gave you status is obsolete in the face of a market with new needs. Be prepared to slide back down the ladder of achievement and start over again. There is a new market there for the enterprising. Cut to the chase. If you know how to enable clients to get more bangs for their buck, and faster, you are going to be on their agenda. If you know how to enable them to make scale models of the outcomes they want and build honest, transparent business cases with substantiated benefits, you are going to be on their critical path.
A word of comfort, however, if you don’t want to give it all up and change. The market is not uniform. You’ll probably still do fine for a while yet in that wealthier part of the market which remains only relatively worse off only from a starting position of wealth.
Alan Fowler develops practical techniques for project managers based on research and the deep experience of the members of his company Isochron. He is the co-author of Accelerating Business and IT Change: Transforming Project Delivery.
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