Project Management

Planning for those project disasters that no one wants to think about

From the Easy in theory, difficult in practice Blog
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My musings on project management, project portfolio management and change management. I'm a firm believer that a pragmatic approach to organizational change that addresses process & technology, but primarily, people will maximize chances for success. This blog contains articles which I've previously written and published as well as new content.

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Harvard Business Review published an article this week about how boards can prepare for unexpected calamities such as pandemics, natural disasters or cyber-attacks. The authors provided a three-pronged approach for dealing with both true black swan events as well as the more common black elephants (a low probability significant threat which leaders are aware of but don't wish to address proactively). While the strategies provided apply to board members who are looking after the health of their companies, after reading the article I felt they could be adapted to apply to projects as well.

Boards play a key governance role in the successful running of companies. Steering committees play a similar role when it comes to projects. A common mandate for a steering committee is to help guide projects in the right direction by providing ongoing support to the sponsor and project manager. Some steering committees merely play an advisory function whereas others might be more directive. If the sponsor or key risk owners are ignoring looming threats, the steering committee could push them to do more and can encourage these stakeholders to take a more proactive stance. Steering committees can ask these stakeholders the tough questions which project managers or team members might be afraid to ask. To do this, committees need to be staffed with a diverse group of leaders.

Boards are often actively involved in the succession planning process for leadership positions, helping to cue up the best candidates for key leadership roles. Executive teams can play a similar role with projects by identifying who possesses the right risk appetite to be the best sponsor for a project. They can also plan for the future by creating leadership development programs incorporating effective risk management lessons. And, capacity permitting, they can act as mentors for senior stakeholders on critical projects, helping those leaders to plan for the threats they'd rather not think about.

The article also recommends that boards can design or adjust leadership compensation programs to compensate leaders for taking steps which will protect the company from unplanned disruptions. These programs can also be tuned to penalize leaders who prioritize personal short term gains over long term organizational resilience. The same ideas can be used when defining performance plans for sponsors and other key senior project stakeholders. Incorporating project success within the performance plans for these leaders is a good start, but ensuring that the measures also assess how the leaders are going about ensuring success and what they are actively doing to protect against threats is equally important.

The authors close the article by reminding us that building up organizational resilience is a long game. If senior leaders fail to plan for black swans and elephants they will plan to fail when those are realized.

Posted on: September 06, 2020 07:00 AM | Permalink

Comments (5)

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Thanks Kiron for this insightful article. Tailoring the Harvard report to the project management domain reflects an appreciable proficiency in "tailoring" of knowledge and processes in organizational project management. Well done for sharing your insight.

Thanks Adedeji, Kwiyuh & Eduin!

Kiron, this piece is very timely and directly applicable to what I'm thinking through. See the 2004 HBR article by David Nadler "Building Better Boards." Your piece definitely adds to that in thinking through this risk management space.

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