by Lynda Bourne
One thing we learned from 2020 is that it's difficult to make predictions, especially about the future. (Danish physicist Niels Bohr’s words from 1971 still ring true.) Still, the world doesn’t stand still, and project managers need to keep looking ahead. That’s the whole purpose of a project controls function: to produce information that helps us make decisions about the future.
In many respects, project plans (schedules, budgets, etc.) are similar to economic forecasts. For decades, both have been used to make predictions more academically rigorous through mathematical techniques. The problem is these models are suited to the stationary physical world, where everything that happens is governed by the unchanging laws of physics—or to games of chance, in which the probability of something happening can be calculated fairly easily and accurately. They do not neatly apply to the intricacies of a dynamic project or economy.
Two leading British economists, professor John Kay of Oxford University and professor Mervyn King, a former governor of the Bank of England, recently launched a critique of the unrealistic assumptions their peers have added to conventional economics in the book, Radical Uncertainty: Decision-Making for an Unknowable Future.
Their view is that making predictive models more mathematical does not improve the accuracy of the predictions. The models assume the decision-maker and all of the other actors will follow the logic underpinning the model. But we all know the people being modeled do not behave rationally and rarely, if ever, actually work to the plan.
Kay and King call this type of modeling “small world,” as the right and wrong answers can be clearly identified. Projects (and economies) operate in a “large world” occupied by consumers, businesses and government policymakers, and characterized by what they call “radical uncertainty.” People in the large world have to make decisions based on a small part of the information actually needed about both the present and the future. Most of the time we can never really know if we made the best decision, even after the event.
Fortunately, like Alice in Wonderland facing the appearing and disappearing Cheshire cat, people are very good at coping with uncertain situations. And it’s amazing how often we get it right. Kay and King conclude: “Our knowledge of context and our ability to interpret it has been acquired over thousands of years. These capabilities are encoded in our genes, taught to us by our parents and teachers, enshrined in the social norms of our culture.” Human intelligence is effective at understanding complex problems within an imperfectly defined context, and at finding courses of action that are good enough to get us through the remains of the day and the rest of our lives. They are not necessarily the best solutions, but they’re ones that are good enough.
So where does that leave project controls? We have predictable tools such as earned value, critical path and the like built on the basis of predictable calculations. Unfortunately, these calculations are rather bad at accurately predicting actual future outcomes. But is the imprecise information useful?
My thinking is that control tools can provide useful insights, but only if you accept there will always be a difference between the prediction and reality as the future unfolds.
How do you use project controls to chart paths forward into the unknown?
by Cyndee Miller
We’ve pretty much seen it all in 2020: accelerated transformations, momentous pivots and, well, spectacular flameouts. But even before COVID came along, plenty of project teams have stared down adversity and delivered. One prime example: the PMI Project of the Year winner.
The Trans Anatolian Natural Gas Pipeline (TANAP) is on track to disrupt Europe’s natural gas sector. The US$6.5 billion pipeline stretches 1,835 kilometers (1,140 miles) across northern Turkey, traversing over mountains and under bodies of water, including 19 kilometers (12 miles) below the Dardanelles.
Led by TANAP Dogalgaz Iletim A.S., the pipeline is the longest stretch of the Southern Gas Corridor, a game-changing program of over 250 energy projects across seven countries that will transmit natural gas from the Caspian region to Europe for the first time.
A massive impact? Check. A massive investment? Check. But things didn’t go off without a hitch. As the team built out the pipeline, project leaders had to work around sensitive archeological sites—uncovering roughly 1,000 artifacts during the project. Whenever the team faced potential delays stemming from cultural or environmental concerns, work didn’t stop. Instead, the team leap-frogged down the line and returned to work on the previous site when conditions allowed. Project leaders also provided incentives for contractors to safely reach key milestones early.
Their efforts worked: The team closed the project on time and US$5 billion under budget “to the highest quantity and safety, social and environmental standards,” says Mustafa Ayan, former project CTO and now COO of TANAP Natural Gas Transmission Co., Ankara, Turkey.
And project leaders are also ensuring their lessons learned don’t just stay in their heads. Team members are pooling their experiential insights to create a book that will not only help TANAP sponsors and stakeholders, but will be shared with the industry.
TANAP was in good company for this year’s Project of the Year award. Consider the other two finalists:
Check out a recap of the three projects in the PM Network digital exclusive. And then dig into full case studies in the December issue of PM Network. If you can’t wait until then, grab some popcorn and head to the 2020 Project of the Year playlist on PMI’s YouTube channel.
by Conrado Morlan
The term VUCA (volatile, uncertain, complex, and ambiguous) world has been around for a while. But 2020 will be remembered as the year that forced every organization to deal with the VUCA world. And the most successful ones will be those that find ways to improve the capability of their leaders by acquiring new ways of thinking.
Yet even before COVID, PwC’s annual CEO survey found a majority of executives reporting they didn’t have the talent needed to grow their organizations and respond to increasing complexities.
Today’s VUCA world demands vertical development. What exactly does that mean? The acquisition of skills, certifications, and experience is essentially learning or horizontal development. Vertical development helps the individual change to become more sophisticated, mature, and capable.
Put simply: Horizontal development transforms what you know; vertical development transforms how you think.
Typically, vertical development involves the following:
Vertical development isn’t exclusive to leaders at the top of the organizational hierarchy. It’s for anybody in the organization, including project professionals.
If project managers and/or organizational leaders respond to the VUCA world simply through learning a few more skills, it’s not going to produce any significant benefit. They must develop their capabilities, adapt, and expand their ability to respond to the challenges. Vertical development involves a transformation of their consciousness.
To understand the difference between horizontal and vertical development, think of a cup of water. Individuals developing horizontally are pouring water into their cups. Individuals developing vertically need a bigger cup.
As project managers grow into their leadership roles, it becomes less about their mastery of frameworks, methodologies, tools, and techniques, and more about their container. The level of consciousness to navigate the complexity of the VUCA world requires a bigger cup.
One of the greatest benefits of vertical development is how it fosters increased mental complexity, innovation, emotional intelligence, and the ability to resolve conflicts constructively. This translates to an improved ability to interpret situations and make effective decisions—two essential skills needed to tackle problems in the VUCA world.
How are you and your team using vertical development to deal with today’s VUCA world?
By Conrado Morlan
In a previous post, “The Impact of Unforeseen Risks,” I described how two major events have impacted projects I’ve lead in the past: the eruptions of Eyjafjallajökull in Iceland in 2010 and Fidel Castro’s death in 2016.
Many project professionals don’t include unforeseeable circumstances in their risk log, unless their projects are being executed in an area where natural and unavoidable catastrophes are known to occur. Due to the dynamics of geopolitical events, they may not be included during the initial risk identification process. As the project progresses, however, the risk log should be updated to identify the impact of these risks on project progress and the enterprise as a whole.
Risk management strategies help project management practitioners forecast and evaluate risk, while also identifying ways to avoid or minimize their impact on desired project outcomes.
Conducting SWOT on COVID-19
Late last year, news of a novel illness affecting a city in China failed to capture the attention of most people and businesses around the world; many thought the impact would be similar to SARS or swine flu—a blip on the breaking news radar and no real threat to the global economy. They were wrong.
Many organizations failed to consider the COVID-19 outbreak an enterprise risk and continued their business-as-usual operations. Around mid-February, I met with colleagues and friends who work in the telecommunications industry, and they expressed their concerns about how their projects would be impacted if the factories in China that produce the electronics needed for their work shut down. They wondered if that would break an important link in their supply chain and if it would jeopardize the final delivery of their projects.
Those in the telecommunications industry were not alone. Supply chains in multiple industries have strong ties to China. By the time they were primed to react, the risk was already an issue and without the procedures to avoid or minimize the impact, industries and countries were facing a pandemic with no plan in place.
Sharing enterprise risks identified during the planning and strategic phases of a project isn’t always a common practice within organizations. But not being aware of such risks has a direct impact on project success, and important assumptions may not be considered for the projects and programs that lie ahead.
People in charge of developing the multi-year strategy at an enterprise can use SWOT (Strengths, Weaknesses, Opportunities and Threats) Analysis to identify potential risks. This analysis uses a matrix, in which the strengths, weaknesses, opportunities and threats are listed and prioritized.
The SWOT matrix can be evaluated and updated as the enterprise strategy is reviewed or on an ad hoc basis. Moreover, threats identified during the SWOT analysis may have an associated opportunity. For example, in the event that the plant producing vital electronics in China shuts down, it will impact the supply chain. An opportunity to avoid that threat would be identifying another country where the vital electronics could be produced in order to reduce supply chain disruptions.
As we’ve learned, the importance of communicating the risk identified by the enterprise risk management process needs to be shared with business units to achieve strategic alignment and empower teams to achieve strategic objectives.
As a project professional, how do you interact with the strategic team within your organization to learn about enterprise risk?
by Cyndee Miller
The rogue monkey gets the banana. Researchers first made the discovery in the late 1970s, but the lesson remains for project leaders looking to keep pace with disruption.
Let’s peel this one back: In Jamil Qureshi’s opening keynote at PMI EMEA Congress in Dublin, Ireland, he told the tale of one monkey that chose not to believe the evidence put forth by its monkey colleagues that came before. It questioned the bias of its environment, adjusted its mindset—and was rewarded for its defiance. Seeing any parallels?
“I cannot tell you the value of a rogue monkey in your organization,” said Mr. Qureshi, a psychologist and performance coach. “Every single thing worth having on this earth has come from rogue monkey thinking.”
The greatest inhibitor to human performance, Mr. Qureshi said, is a steadfast adherence to our belief systems. (We all have them. Trust me, you’re no magical exception.) “We prove ourselves right even when we’re wrong, and that’s the problem.”
We must be willing to change the way we think. It’s the foundation of our decision-making process. “We think, we feel and then we act,” he said.
Hold off on the grand gestures, though.
“Proving ourselves as leaders is not about doing something dramatic. It’s about doing something a little bit more, more consistently,” said Mr. Qureshi. True leaders look inward, find what they already do well—and do more of it.
None of this will go very far without proper motivation, however. We’re drawn toward our most dominant thoughts, he says. And if those thoughts sound like “don’t fail” …? Um, we’re in trouble—our subconscious will only hear “fail.”
“People who are truly disruptive are motivated by what they seek to achieve, not by what they seek to avoid,” he said.
That’s how you move teams “from transactional to transformational.” The really bold ideas come from making the connection between two previously unconnected things. Look at PayPal, Spotify or Skype. “It took someone outside the sectors to give us what we wanted,” said Mr. Qureshi. Too often, companies and project teams are bad at being different—but the future demands it. “The only way to stay future relevant and future literate is to think about what the customer is valuing all the time, not what we wish to sell.”
So, are you ready to go rogue?