Managing Innovation and Change
E-Book, Englisch, 244 Seiten
ISBN: 978-3-347-09724-7
Verlag: tredition
Format: EPUB
Kopierschutz: Wasserzeichen (»Systemvoraussetzungen)
The management of digital projects requires professional and state-of-the-art methods, tools, and techniques. In this book, the authors pass on practical approaches from their experiences in the field.
The authors also critically acclaim existing methods and discuss their limitations. In particular, the book covers the following topics:
- Methods and Best Practices;
- Tools and Techniques;
- Soft Skills, Team Dynamics, and Human Resources.
Thirteen international subject matter experts contributed to this book. The objective is two-fold. First, the authors aim to further the discussion on business practices and methods. Second, the authors aim to stimulate the professional community. Senior professionals can benchmark their activities, while junior professionals can apply proven methods from this book.
Weitere Infos & Material
Why Projects Fail How to decide whether a project is a failure Dr. Stephan Meyer StephanMeyer.com Abstract This chapter takes a closer look at change projects and discusses whether the rumours are true that so many of them are complete failures. In a nutshell, whether a change initiative is considered a ‘success,’ or a ‘failure,’ is mostly dependent on classical project baselines, but also the observer’s perspective and the observer’s expectation. However, these differentiations are often ignored when making blunt statements about change projects. Beware of Numbers often Quoted but Badly Documented Recently I discussed with a professor who told me that from her point of view, change projects are almost futile since it is a wellknown fact that 70% of all change projects fail. Is that so? I decided to play detective to find out where that mysterious percentage originated from. I did some research on the scientific papers she referred to, and this is what I found out. The literature is full of blunt statements about a supposed high failure rate of change initiatives, often without much evidence to back up these statements. Someone makes up an arbitrary percentage of change failures, someone else refers to it, and suddenly the rumour of a supposed high failure rate leads a life of its own. For example, Beer and Nohria claimed “the brutal fact is that about 70% of all change initiatives fail”,1 without referring to any evidence. How the authors came up with that number remains mysterious. Other authors2 then presented this 70% failure rate as a number etched in stone and backed up their claims with reference to Beer and Nohria3. Another author4 referred to a second group of authors5, who made a reference to both Beer and Nohria6 and to a third group of authors7 who once again referred to Beer and Nohria8. In other words, while there is hardly any doubt that some projects do fail, in this case, the oftquoted statement that almost all projects fail seems to be rather based on rumours than on facts. How to Judge Project “Success” and “Failure” A project can be understood as a temporary initiative to establish a change in an organisation. The most fundamental question about the outcome of a change initiative is whether it is a ‘success’ or a ‘failure.’ While at first sight, this may seem to be an easy question to answer; upon closer inspection, it is just as complex as questions such as “what is radical change” or “how should change be managed.” Categorising a change initiative as either a ‘success’ or ‘failure’ depends on a set of parameters, of which the most relevant seem to be: • Classical project baselines • Perspective • Expectation Here is a suggestion on how these project parameters can be used to judge the success of a project. Project Figure 1: Key Factors for Project Success The classical project baselines as they are represented in the PMBOK Guide consist of scope, time, and cost.9 ‘Scope’ refers to the question of what kind of change initiative is being evaluated. As there is a broad range of possible ‘changes,’ it may be challenging to put all of them in one basket: Small versus big ones, short-term versus long-term ones, changes performed half-heartedly by overworked line managers versus changes performed fulltime by experienced change agents, and so forth. ‘Time’ refers to the question of which time is evaluated when deciding about success or failure. In other words, this is a question of sustainability. ‘Cost’ refers to the amount of money spent and generally follows the rule, the less, the better. ‘Perspective’ refers to the question of who is to evaluate the change’s success, as different observers may come to differing conclusions. For example, the financial stakeholders of an organisation may apply entirely different success criteria from those applied by the organisation’s employees. ‘Expectation’ refers to the question of what the person judging about the change expects to achieve from it. A financial stakeholder may be happy because his expectation is fulfilled when a change initiative saved his investee organisation from bankruptcy. At the same time, a relocated employee may not find his expectation fulfilled because his local plant had to be closed down to enable the organisation’s survival. From his perspective, the change initiative may not be considered a success. Figure 2: Judgement Depends on a Persons Perspective and Expectation Different Perspectives cause Conflicting Success Criteria Here is an anecdotal example of a different perspective and, thus, different expectations about a successful project. I had my own experiences with internal line managers with short-term contracts. I would like to compare for a moment the perspective of such a line manager to the perspective of the owner of a family business. The line manager: I once had a consulting mandate at a client who hired their top management externally and gave each manager a short-term contract with a duration of two years each. In other words, every two years, the financial stakeholders decided whether the contract should be extended or not. If the stakeholders were satisfied, the contract could be extended almost indefinitely until the manager’s retirement, at least in theory. However, this procedure meant that 18 months into the contract, the negotiation between the stakeholders and the manager would start about whether the contract should be extended. The consequence of this was that every manager was geared toward short-term wins that could be presented during the negotiations. Those short-term wins were often detrimental to the organisation’s long-term success or even its long-term survival. The manager calculated that he would not be part of the organisation on a long term anyway. Such a line manager with a short-term contract had a completely different perspective from the owner of a family business. The owner of a family business: The owner of a family business may think even in periods of several generations. He may plan, for example, to lead the company for another ten years, give or take a few. After that, the company will either be sold or be transferred to a member of the next generation in the owner’s family. In either case, the company owner will do everything to ensure that the company’s value will be as high as possible ten years from now. In contrast to the line manager with a short-term contract, the company owner will not sacrifice the company’s future for a quick win in the next 18 months. The success of a change initiative may be judged entirely differently, depending on whether you look at it from a short-term or long-term perspective. The question of the time scale chosen is related to the concept of an organisational life-co-founder-optimal. Generally speaking, categorising a change initiative as either ‘success’ or ‘failure’ is rather preposterous without considering all of the parameters mentioned above. Figure 3: Perspectives of Line Manager and Business Owner Example for specific expectations: The financial stakeholder Generally speaking, how the outcome of change is evaluated is a stakeholder perspective issue. While the average employee may have a somewhat subjective expectation about the outcome of organisational change, such as an improvement of the organisational culture, the financial stakeholder will always focus on the hard facts concerning the profitability of the organisation. He is the one to initiate the change project and thus has high expectations about the improvement of profitability. More specifically, Crone et al. suggest the following kinds of key performance indicators (KPIs) for organisational change: KPIs for rentability analysis, KPIs for working capital analysis, KPIs for liquidity analysis, KPIs for financial analysis, KPIs for crisis investors.10 Here are a few examples of these KPIs: • KPIs for rentability analysis, e.g., return on equity, return on assets, return on capital employed • KPIs for working capital analysis, e.g., working capital, networking capital efficiency, duration of liabilities, duration of assets • KPIs for liquidity analysis, e.g., liquidity 1st grade to 3rd grade, cashflow I to III • KPIs for financial analysis, e.g., equity ratio, borrowing ratio, gearing ratio • KPIs for crisis investors, e.g., EBITDA, total net leverage, interest coverage, revenue growth It hopefully becomes obvious that these criteria for a successful project, and thus, the expectations about the project outcome are not equally shared by everyone involved. This is why you always have to consider that different stakeholders may have different expectations. Figure 4: Different Expectations of Project Stakeholders Causes of Project Failure So, after having considered the three project...
