Organizational Transformation initiatives are big business for the consulting industry. Most companies discover shortly after implementing a transformation initiative that they need external consultants. These consultants offer expertise and perspective to help overcome internal barriers.
Article Contents
Perspectives championed by internal ‘change agents’ often reflect the assumptions and beliefs. They also mirror the espoused values of the current corporate culture. Although these need to be acknowledged in strategies to support organizational transformation, they are more likely to hinder change. They serve as a barrier rather than a catalyst to supporting change. Revealing these assumptions is essential. This is necessary to resolve legacy assets and constraints in enterprise service, technology, and product delivery efforts.
Transformation Foundations
“Transformation by definition involves taking stock of the organization’s current state, identifying the desired future state, and establishing best practices, norms, and strategies needed to close the gap.”
– Innovate Vancouver
Organizations that take on initiatives requiring a new way of thinking, doing, interacting, and perceiving require a transformational approach. Yet many organizations are likely to try and ‘skip’ the organizational retooling.
A thoughtful and methodical approach is needed that engages all stakeholders in the requirements validation process. Implementation that involves changes requires more than just buy-in, it requires stakeholder involvement throughout the delivery lifecycle. This allows for each team to provide ongoing feedback and input into the implementation approach. Pivoting is required as much as needed. This ensures stakeholders are ready. They need to be aware and confident to take on new services. This includes products and the changes involved.
Things to Consider:
- Is the organization open to change?
- Does the organization have a successful experience with past change initiatives?
- Is the organization comfortable with the experimentation needed to discover best practices for delivering its transformation?
- Will the organization’s culture and structure support the trust and transparency needed? Is there enough support for evaluating and monitoring current progress?
- Does the organization have the necessary feedback mechanisms needed to support the monitoring and evaluation of existing strategies & progress? Is the organization able to use feedback effectively?
- Can the project goals identified be implemented or achieved successfully without organizational change? Transformation?
- If the project goals require organizational change, and the organization is not prepared to change, should the project be cancelled?
Quiz Time
Transformation Competencies
The following competencies help set the foundation for a successful transformation effort. A readiness assessment compares the organization’s current state against its desired future state. It uses these competencies as a benchmark for evaluating project delivery throughout the lifecycle. This includes the operations stage (post project delivery).
Transformation Challenges
Failure to consider the above organizational readiness competencies prior to a transformational initiative can be costly.
- The next section discusses an example that helps explain why transformation initiatives can often fail to reach their goals.
- The last section in this article provides an explanation of additional criterion. It needs to be evaluated before launching a transformation project.
Composite Case Example: Building a Project Management Office (PMO)
Several organizations and industries are represented in the composite organization-x that is described below. An Organization-X felt threatened about its future. It anticipated that legislation recently passed south of the border would eventually be copied in the Organization’s location.
Organization-X had also recently rec-X eived a mandate from its stakeholders. The organization needed to switch from an ad-hoc (top-down) servicing model to a member-driven service model. Both transitions would require a transformation approach and framework to move the organization forward.
Legacy Framework
Organization-X was mindful of its history of failed projects. By their estimates, the failure rate for internal projects was potentially higher than the industry average.
Organization-X also lacked a formal and ongoing performance evaluation process. Without it, establishing an obvious business case, performance benchmarks, and evaluating progress became particularly challenging.
“Efforts to improve the organization’s project success rate would need a transformational approach. Without it, projects would continue to under-deliver. Additionally, the move towards a member-driven service model would choke under the organization’s bloated legacy framework.”
– PMO Consultant
Project Management Office (PMO)
To strengthen the Organization-X project delivery success rate, an influential executive advocated hiring an external consultant. This consultant would help build the Project Management Office (PMO). The office would be responsible for the development of the project management templates. It would also handle training and coaching staff. Additionally, the office would develop training materials and infographics. Finally, it would draft the organization’s first project management policy and procedure.
The vendor hiring process involved a panel of subordinates. They would own and hold responsibility for driving the PMO. Their task was to build an engagement process. A consultant was selected based on their healthcare, advocacy, lobbying, and service background. An ‘organizing-approach’ towards building and championing the project was identified at the start in order to match the organizational culture.
Organizational Culture as a Barrier to Transformation
Several stakeholders eventually identified success criteria for the PMO. They did this towards the end of the project. However, these criteria were never formally approved. Several stakeholders identified success criteria for the PMO towards the end of the project. However, these were never formally approved. These criteria were also never implemented. The following section describes why the Project Management Office (PMO) build, as a transformation project, was unlikely to be successful.
Compare the case example descriptions below to the Transformation Competencies discussed earlier.
Foundation Components Evalauted against PMO Builds Reported in the Literature
Delivering transformation projects are often disruptive. Therefore, they require a thoughtful and courageous review of the environment and current pain points. It is necessary to consider the requirements. These include processes, technology, people, and assets. They are needed to smoothly facilitate the transition from the present state to the future state. The following accordion provides a list of soft competencies needed to build a new enterprise project management office.
Additional innovation technology, architecture, and service assets should also be added to the company’s transformation readiness assessment. The literature reporting on transformation project barriers are included as notes in the dropdown menu under each competency section.
Champion
- A senior executive championed the PMO Transformation Project. They did not adequately consult the rest of the (subordinate) executive team. The senior executive was not present for any of the PMO Governance Meetings. The also only met with the PMO consultant once.
- They resented the lack of consultation and often made decisions in isolation in order to avoid & mitigate non-favoured decisions.
- In order to champion engagement and use of project management throughout the organization, other stakeholders were identified. They were involved in the PMO Working Group and identified for some of the Project Coordinator/Onsite Training roles. Several were effective in championing new standards and change. However, others were high maintenance and easily confused by discussions. They were a poor fit for supporting early adoption of project management.
- Despite their role as the project owner, they are responsible for championing the PMO build and implementation. The following were expressed: ‘I don’t think it will be successful.’ Another perspective was, ‘I think it’s too early.’ Finally, ‘we’re not ready yet’ was mentioned. Members of the working group also worried that project plans would be ignored even if approved by directors earlier.
Corporate Structure
- The organization-X culture included a Corporate Structure more resembling a for-profit company than a non-profit organization.
- The company recently started a transition from divisions to a model that acknowledged that constant overlap and need for integration. Unfortunately, there was no formal strategic plan, formal vision, or timeline to support the transition. Unfortunately, there was no strategic plan. There was no formal vision, assigned owners, or timeline to support a transparent and visible vision. One was requested by stakeholders.
- The early stage of the transition may be marked by a noted observation during one of the PMO Governance Meeting. A senior executive’s decision was discussed. A committee member responded “I hate it when he does stuff like that!”, during which their facial expression grew stern, red, and jittery.
Approach
- The ‘organizing-model’ that was ‘tried and tested’ for supporting external change initiatives was poorly suited for internal change efforts.
- This is partly due to the organization’s inability to tap organic leadership and enthusiasm. It also struggles to utilize readily available use cases and priorities. Additionally, it does not embrace organizational learning.
- Initial conversations and interviews at the onset of the project yielded 37 proposed projects and initiatives. Workshops were developed in advance of demand. A training SharePoint site was also developed to help scale engagement and training. None were approved.
Silos
- The Organization’s culture was heavily siloed. Departments were often unable to collaborate with other departments, or cross-organizationally, without the explicit permission of the assigned director. Line managers often replicated this protocol with their teams as well.
- Subordinates and line managers were not allowed to join the PMO Governance Committee. Participation was limited to four directors and one manager who oversaw the PMO.
- Line managers often replicated this barrier as well, limiting their team’s engagement of the Project Management Office.
Strategic Plan
- The organization-X was relatively clear on its vision and aspirations. However, it lacked a strategic plan. There was no formal framework to strengthen its delivery and realization. The absence of a strategic document to follow became a complaint at one of the Union Meetings.
- Organizational-X lore shares stories of peers asking about the strategic plan during very public workshops and large staff meetings.
- The response was always ‘we have one,’ with the responding executive providing a verbal response but no actual document existed.
- Exploration of this gap showed the team was unfamiliar with how to use data. Further championing of a ‘connect-the-dots-approach’ built upon the PMO Maturity Assessment & Stakeholder Interviews. They discovered they were not using feedback or vision to inform a connected strategy.
- Following the review of the findings, the governance committee indicated they didn’t understand the content. They no longer wanted to discuss ‘abstractions’ or ‘strategy.’ They also didn’t want to receive training independent of actual ‘doing.’ One stakeholder guessed the team did not adequately understand the concept of a strategy. Therefore, they were less worried about removing the topic from discussions.
- A project management policy was partially drafted prior to consulting engagement. The project definition included a criterion that a project costs at least $100,000. This resulted in most stakeholders thinking project management would not apply to their work area.
- The procedure drafted included a mixture of elements from two different project management models. It did not just focus on the dominant model for North America (PMBOK). The result was a lengthy document that was considered too ambitious for an organization first encountering project management.
- Further discovery indicated that internal-weaknesses limited the organization’s success and effectiveness on external-initiatives (and vice-versa). A transformation approach was needed but the team championed an operations approach that reinforced the status-quo instead.
Goals
- The governance committee had different criteria for the PMO’s success. One voice wanted a grassroots approach (that was not supported by the organization’s culture).
- A second voice was ambivalent & the third voice was resistant to having a PMO involved in ‘their space.’
- A fourth voice wanted the PMO to meet ‘all the best standards’. However, these standards were significantly out of reach for the organization at that time.
- None of these voices was talking with one another.
- This caused subtle sabotaging behaviours. One of the stakeholders began self-prophesying failure as early as the first month of engagement. This was maintained throughout the consultant’s commitment.
- One stakeholder began illuminating these hidden conflicts. This action triggered the HR role to ‘begin cleaning house’. It did not address the misalignment issues.
Knowledge
- The senior executive that sponsored the PMO was not part of the governance team that owned the build & implementation.
- The directors assigned to the governance committee had limited exposure to the subject of project management. They showed arguably even less interest in making the changes needed for a PMO to be successful.
- Assessments and interviews were conducted to inform the project approach.
- Unfortunately, the governance committee showed little interest in the feedback and suggestions. They were not proactive in learning about the models, tools, and processes. These improvements would help effectively leverage them. They instead preferred to make active decisions on immediate tasks and de-emphasize discussions and training on ‘strategy’.
- A flagship project used online project scheduling software set up by the consultant. A director insisted on updating and managing the system directly. However, the director resisted training and support around project scope management. The director also resisted integration management, schedule management, and managing the critical paths. 12 Months were later added to the project schedule.
Collaboration
- The organization-X silos, structure, and limited skillset hindered the governance team’s ability to make effective decisions. They also prevented leveraging the organic leadership and knowledge available from the rank-and-file employees.
- This internal weakness had cost the organization over a million dollars during a recent external campaign.
- Fear and self-fulling prophecies limited trust, experimentation, and the ability to use best practices.
- For example, a director with lawyer training refused to answer a question. They were asked which policy should be reviewed to understand the organization’s grievance procedure. This occurred despite them having responsibility for overseeing the grievance process.
- Another example, a regional lead assertively declined PMO help on a project. This contradicted multiple statements made by the team. The team had requested assistance and found the approach relevant.
Feedback Mechanisms
- The organization-X hierarchical reporting structure reinforced vertical silos. It was also plagued by horizontal divisions. These divisions minimized the sharing of information and collaboration. This structure also supported divergent priorities to surface.
- Rank-and-file staff often withheld information for fear of unfavorable responses.
- Meetings facilitated to investigate progress events often lacked significant information. This missing information was frequently in areas that would have exposed other roles and systemic issues.
- Vertical and hierarchical protocols/norms for communication and staff management also contributed to conflict avoidance, information sharing, collaboration, and effective problem-solving. Most problematic decisions were communicated indirectly to the consultant, making collaboration, risk management, and scope management difficult to maintain.
Transparency
- The senior executive was experienced with project management. However, directors assigned to the governance team did not want the spotlight on their projects. They also did not want to share the decision-making process on cross-organizational initiatives.
- The culture this created limited the PMO’s ability. It restricted their capacity to take on projects. These projects needed to meet the committee’s success criterion (complex, cross-organization, impact).
- Consultant efforts to promote & internally advertise the Project Management Office were rejected. These efforts included workshops and a SharePoint training site. An email tagline mentioned the PMO as a ‘shared service’.
Change
- This organization-X was resistant to changing existing practices. It preferred to use operation processes, tools, and strategies in a project setting.
- This lacked the precision and rigor needed to evaluate progress. It also lacked the tools, data, structure, roles & responsibilities needed to be effective.
- The closest Project Owner was also assigned to the Governance Committee. They did not want the PMO to operate or own projects in their department. Directors in adjacent verticals presented with similar resistance, not wanting someone from another department leading a project ‘in their space.’
- The line managers were considerably more interested in change, engagement, and training than the directors. This created a funnel where subordinate’s interest in engagement and training was blocked by levels above them.
Relationships
- Stakeholders often undermined one another, even when they should be collaborating together on a shared initiative.
- Many of the governance committee members are considered to be “explosive”, “blunt”, or “outspoken” when encountering group dynamics.
- Reported observations indicated many coworkers are intimidated by the directors, and hesitant to speak out about issues.
- During a formalized employee orientation, the presenting HR team discussed organizational branding, language, and political representation in the media. They explained the organization’s airtight policy on employee public communications. They also mentioned that the organization is suing a previous employee for violating the policy.
- When interacting with the primary PMO project owner, the assigned consultant saw the supervisor laughing. One of their contractors, onboard for 8 months, was not considered fit for their role. The contractor was going to be discontinued. Later contact with a staff representative indicated 6-month evaluations were often not completed.
Competitor Analysis & Best Practices
- Cultural sentiments within the organization were strongly anti-establishment and anti-industry.
- This was supplemented with robust advocacy and ‘organizing-language’. There was an almost inability to have a conversation about project management. Discussions about measurement or best practices were also difficult.
- This, in turn, was mirrored with inconsistent internal practices, misalignment, and this impacted success and quality metrics.
Espoused vs. Held Beliefs
- The organization-X considered itself democratic, open to feedback, equitable, courageous, and open to learning. Its expectations for external institutions varied from internal expectations.
- Rank-and-file employees often described the organization as a closed system. It had a lack of curiosity. There was promotion based on relationships and cultural fit. It showed resistance to change and innovation. There was a tendency to limit discovery and lessons learned to areas that could be controlled or easily explained.
- Previous flagship projects that failed were often not approved for a lessons learned workshop. What was learned ‘through other means’ was not shared effectively. It was also not implemented effectively.
- The directors initially state they ‘were interested in the idea of project management.’ Later, they update the statement to ‘we are very interested.’
- Later still, they said they did not like the approach. However, they were unable to describe what that approach was (organizing, pivoting based on director feedback).
- After the consultant’s engagement ended, the directors ‘put the PMO on hold.’ They cancelled the governance committee. The PMO working group was cancelled. The directors also cancelled the contested projects assigned to the PMO.
- The following year, a project manager was recruited for the organization. The role did not involve managing a PMO. It did not include training departments or the organization to use project management. The emphasis was on small projects within a single department. In the previous year, these projects were deemed not to meet the criterion of a project by the sponsor. The vision shifted from transformation to structured support within the same department. The initial manager, who didn’t want the PMO in their department in the first place, was assigned. They struggled with department performance.
Transformation as a Challenge to the Status-Quo
“The road to transformation is not easy travelled. There will always be resistance, so the goal is to discover how to turn concerns into opportunities.”
– Innovate Vancouver
Review the above list of barriers described in the literature with your team. Identify barriers that may also exist in your environment. Establish a plan of action. It should include a description of the present state and future state. Also, outline strategies to bridge the gap. Crossing the chasm requires courage, leadership, teamwork, and a systems thinking approach.
Quiz Time
Although an ‘organizing-methodology’ was used throughout the consultation engagement it proved ineffective. The consultant’s scheduled engagement came to a close with only a basic PMO model developed and implemented.
There was support for an organizing approach in espoused beliefs. There was also 90% support for a PMO. Additionally, there were 38 project suggestions for early proof of concept. The leadership team voted for a portfolio governance model. So why was the PMO transformation project considered unsuccessful?
The directors on the governance committee declared the approach they designed and implemented a failure. The consultant moved on to their next engagement. The PMO Governance Committee disbanded. The PMO Working Group was canceled. Many projects were assigned to the PMO. These projects were considered unpopular. They were put ‘on hold’ for an undisclosed period of time. A follow-up discussion with one of the stakeholders yielded no additional insights, reporting “I don’t know what they want.”
Identify Barriers Early
The first mistake the Organization made on its Transformation project was to assume that an ‘organizing-approach’ would help drive change. This occurred despite their proficiency with using the model externally. The second mistake involved poor internal consultation.
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The third mistake involved the belief. It was thought that the team was ready to champion an initiative. This initiative would impact the DNA of organization-X. The fourth mistake was to assume that the team had the skills to lead the initiative. This was assumed even if they showed interest.
Organizational DNA
Although a bulk of the organization-X primary services emphasize social competencies these were focused on influencing external change. The organization’s rigid corporate hierarchy created resistance when it came to internal change. The fear-based culture also contributed. Additionally, the anti-establishment skillset led to an abundance of resistance, beginning from the top.
Discussions about project management were often met with confusion and resistance.
Organizational language to support discussions on best practices, goals, evaluation, streamlining, and roadmaps were largely absent. Most departments considered none of their work relevant to project management. After a few minutes of discussion, the consultant concluded that 80% of the organization-X work could benefit. A project management informed approach would be advantageous.
Conducting a Readiness Assessment
The problems facing the organization represent its core DNA.
- Who it Is (its Identity)
- How it Works (Skills & Competencies)
- Relationships (Roles & Responsibilities)
- Assumptions (Beliefs & Knowledge)
- Values (Norms & Expectations)
These all contributed to reinforcing existing problems and limited the organization’s ability to take on a transformation project. Would a readiness assessment have strengthened the organization-X ability to take on a transformation initiative? Yes, and no.
Leadership
“A readiness assessment can help an organization to better understand its ability to take on an endeavour. However, it will not change its DNA or culture. This requires courage, leadership, and a thoughtful approach that acknowledges internal barriers to change.”
– Innovate Vancouver
The likely failure of the PMO Build & Implementation project started due to issues with leadership. The senior executive sponsor abdicated their responsibilities. They transferred ownership of the project to the unacknowledged and unconsulted line directors.
Leadership is the first piece of the puzzle. If a transformation project lacks an effective leadership sponsor the other pieces will not matter.
Interactive Elements Supporting Transformation
Assessing whether an organization is ready involves evaluating the interactions between all related components. This involves the synergistic dependencies among the following tools, processes, assets, and competencies.
The Information Technology Infrastructure Library (ITIL) lifecycle highlights the competencies, services, and functions needed to plan, design, and transition projects. It also covers operating and continuously improving project delivery. The emphasis is on the end user. Change management and release management are critical to ongoing management and adoption of new products and services.
The following stakeholder engagement, communication, and change management competencies are emphasized. This emphasis occurs alongside the ITIL lifecycle in the design, build, and implementation of a new project management office.
- Inspirational & Effective Leadership,
- Organizational Culture that Supports Collaboration & Innovation,
- Held Beliefs that are Consistent & Effective,
- Feedback Mechanisms that Support Learning and Adaptability,
- Effective Collaboration that Supports Stakeholder Feedback & Integration of Ideas,
- Comfort with Change and Adapting to Stakeholder Feedback,
- Investment in Continuous improvement,
- Comfortability with Learning from Others & Industries,
- Able to Identify and effectively Assess Goals/Performance,
- Able to Deconstruct Existing Barriers & Silos,
- Comfortable Discussing IDeas and Assumptions Openly,
- Able to Commit to a (Flexible) Approach,
- Able to Leverage Existing Assets, Processes, and Corporate Structures,
- and Able to Integrate Existing Priorities and Strategies into a Formal Framework or Plan
Quiz Time
Drag the word to the correct sentences below. The quiz will give instant feedback for each attempt.
The above skills and competencies are a journey and not a destination. They are never truly achieved but represent aspirations that are interdependent, setting the foundation for organizational transformation and achieving greatness.
Transformation Readiness Assessment
Most projects are disruptive and yet not designed as transformational projects. User, environment, and business requirements are often missed in early design discussions. If they are ever incorporated, they are often costly. They have an immediate impact on the project scope, budget, schedule, and quality specifications. Designing a transformation project begins with the following questions. Use this tool to strengthen the teams shared vision and roadmap for transformational efforts.
Innovate Vancouver is a Technology and Business Innovation Consulting Service (TBICS) located in Vancouver, BC. Contact us to help on your next project!
Travis Barker, MPA GCPM
Innovate Vancouver
https://www.projectsmart.co.uk/management-consultants-and-pmo-failures.php
https://www.enkillc.com/insights/2017/2/10/why-do-70-of-projects-fail-to-deliver