Project Management

Voices on Project Management

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Voices on Project Management offers insights, tips, advice and personal stories from project managers in different regions and industries. The goal is to get you thinking, and spark a discussion. So, if you read something that you agree with--or even disagree with--leave a comment.

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Recent Posts

3 Agile Disconnects We Need to Address

What to Expect: Anticipating and Adapting to Dynamic Economic Trends

Governance Models: The Secret to Successful Agile Projects

3 Valuable PM Lessons I Learned in 2023

The 4 P’s of Successful Modern PMs

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What to Expect: Anticipating and Adapting to Dynamic Economic Trends

By Peter Tarhanidis, Ph.D.

In the ever-evolving landscape of corporate strategic planning, organizations face the perpetual dilemma of choosing between capital spending for growth—and optimizing operations for efficiency. Striking the right balance amidst economic trends and leveraging organizational strengths becomes paramount when navigating through strategic projects. Meeting shareholder and stakeholder needs, while aligning with the organization's mission, presents a constant challenge.

To anticipate potential initiatives, project managers must consider global macroeconomic conditions and CEO outlooks. A preliminary assessment based on the United Nations World Economic Situation and Prospects and OECD Economic Outlook reports for 2024 reveals a projected global economic growth slowdown from 2.7% to 2.4%. This trend suggests a delicate balance between slow growth and regional divergences. Key considerations include:

  • Global inflation showing signs of easing from 5.7% to a projected 3.9%
  • Slowed global investment trends due to uncertainties, debt burdens and interest rates
  • Fading global trade growth attributed to shifting consumer expenditure, geopolitical tensions, supply chain troubles, pandemic effects and protectionist policies
  • Notable regional examples include the United States expecting a GDP drop from 2.5% to 1.4%, China experiencing a modest slowdown from 5.3% to 4.7%, Europe and Japan projecting growth rates of 1.2%, and Africa's growth expected to slightly increase from 3.3% to 3.5%

Examining the corporate landscape, a survey of 167 CEOs in December 2023 indicated a confidence index of 6.3 out of 10 for the 2024 economy—the highest of the year. The CEO upsurge assumes inflation is under control, the Fed may not raise interest rates and instead reverse rates, setting up a new cycle of growth. Furthering the CEO agenda, McKinsey & Co. identified eight CEO 2024 priorities:

  • Innovating with GEN AI to dominate the future
  • Outcompeting with technology to drive value
  • Driving energy transition for net zero, decarbonization, and scaling green businesses
  • Cultivating institutional capability for competitive advantage
  • Building out middle managers
  • Positioning for success amidst geopolitical risks
  • Developing growth strategies for continued outperformance
  • Considering the broader macroeconomic wealth picture for identifying growth

As project managers, navigating the uncertainty of economic shifts necessitates staying vigilant. The year may bring variables and predictions that impact the execution probability of strategic projects. Shifting between growth plans and efficiency drivers demands different preparation. To stay prepared, consider the following:

  • Regularly monitor global economic indicators and CEO outlooks
  • Foster agility within the team to adapt to changing priorities
  • Develop scenario plans that account for potential economic shifts
  • Collaborate with key stakeholders to gather real-time insights
  • Continuously reassess project priorities based on evolving economic conditions

In an environment of perpetual change, proactive monitoring, adaptability and strategic collaboration will be key to successfully steering projects through the dynamic economic landscape.

How else can you stay prepared as the demands shift on you and your team?

References

  1. JP Morgan: Economic Trends
  2. Economic outlook: A mild slowdown in 2024 and slightly improved growth in 2025
  3. UN: World Economic Situation and Prospects 2024
  4. McKinsey: What matters most? Eight CEO priorities for 2024
  5. CEOs Gain Confidence About 2024 On Hopes Of Lower Rates
Posted by Peter Tarhanidis on: January 26, 2024 12:19 PM | Permalink | Comments (4)

The Problem With Paradox

Categories: Decision Making

by Lynda Bourne

The dictionary defines a paradox as a statement or group of statements that, despite sound reasoning from acceptable premises, leads to a conclusion that seems to defy logic or intuition. An example of a paradox is: “This statement is false”—if it is, it is not; and if it isn’t, it is.  

A well-known project management example is Cobb’s Paradox: “We know why projects fail; we know how to prevent their failure—so why do they still fail?” The apparently true statement is that we know how to prevent project failure, but do we really know how to make projects successful?  And if we do, the illogical element is, why do we let them fail?

This concept extends into the realm of project management. Virtually every management system generates a range of contradictions that can be removed by better design. It also creates a series of paradoxes that can’t be removed because both factors that create the paradox are important, but at the same time contradict each other.

This type of management paradox is defined as “a persistent contradiction between interdependent elements that resist a simple binary choice between the elements.”

Some of the more common paradoxes found in most organizations include:

  • The need to manage the tension between consistency (following the rules) versus flexibility (creativity to enhance outcomes)
  • The need to mitigate risk to provide certainty versus the need to take risks to seize opportunities
  • The need for planning and control versus the need for agility to respond to issues
  • The need for standard operating procedures to maximize quality versus the need for continuous improvement to enhance quality

The persistent nature of every paradox means the decision maker has to get used to living with contradictions. Dealing with the paradox requires intuitive judgment to decide on the best balance to strike between the competing elements in the current situation.

Group decision making, diversity, and consensus can help achieve the best judgment call. But there will always be viable alternatives—and any change in the situation will usually require the judgment to be adjusted. The problem with any intuitive judgment is that different people will arrive at different conclusions because they apply a different frame of reference to the problem.

The final element that makes paradox hard to live with is hindsight.  Regardless of the decision made, balancing the competing elements in a paradox involves a compromise and different people will have differing opinions of the optimum balance point.

When circumstances at a later date show there was a better balance point, criticizing the original decision (and the decision maker) is very easy. The 20/20 vision afforded by hindsight rarely matches the uncertain fog that surrounded the possible futures confronting the decision maker. 

Math does not help either; binary decisions have a 50/50 chance of being correct and these odds can be improved by the application of good decision-making processes. A paradox presents a continuum of choice. That means there is an almost unlimited array of possible options and the one chosen is highly unlikely to be the best in hindsight—the best outcome one can hope for is one that is reasonably close to the optimum.

This type of decision presents a real challenge to trained engineers and technical managers who expect to find the right solution for every problem.

Generally, at the technical level, there are correct solutions. But, if not, in most cases you know a decision is needed and can choose the lesser of two evils.

Good managers decide—lucky ones get it right (and you can usually correct wrong decisions).

The further up the organizational ladder you move, the more you will be exposed to paradox. Every decision you make to balance the competing elements in a paradox will be open to criticism.

It’s a tough place to be. How would you deal with a paradox in your environment?

Posted by Lynda Bourne on: June 26, 2017 09:24 PM | Permalink | Comments (8)
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