Geoff Charters looks why projects should be consistent with the organisation's strategy, common reasons why they fail, and how to ensure they don't fail.
New projects are essential to the success of a business. The right projects create new markets, assets, processes and attitudes that mutually sustain and enhance the business. Without new projects, a business will lose value.
A project has to fit the business. It needs to be consistent with the organisations strategy. Business Review Weekly (21 October 2004, page 66) reported that one in ten projects undertaken by Australias Top 200 companies made no worthwhile contribution to a companys business objectives.
Arguably, the most critical stage is at the beginning: defining what is to be achieved and creating options that might be used to accomplish the task.
For the many small projects needed to keep the company running at an operational level, the answers may be self-evident. But for the big ticket strategic projects critical to the future of an organisation, undue haste in getting on with the job can result in underperforming or lame outcomes.
Some of the common reasons projects dont deliver include:
Failing to clearly define the strategic outcome required. It may instead take the form of a narrow, short term view, or be expressed with a strong operational spin rather than a strategic focus.
Preoccupation with a technology or particular form of asset at the expense of focus on strategic business.
Accepting a poor range of weak options promoted by assertive interest groups within the organisation, when bold choices that may challenge conventional wisdoms are needed.
A good starting point for defining a strategic outcome is the clientele or the area of the business that has to be built or changed. Consider what, where, who, how much and when. Continue to review the strategic definition until it is clear and robust. If it requires a specific technology or asset, be clear about the strategic reason.
In creating options, involve stakeholders. Ensure that support staff are consulted as well those in the line of business; their views can be critical to success. Request the views of astute individuals not involved who may bring fresh perspectives to the opportunity. Continue to ask how else the initiative could be realised.
When it comes time to filter the options:
dont dump an option too quickly
consider combining options
examine relationships or overlaps with other projects
consider risk - a high risk option or conflicts with other projects can flag an opportunity to improve an option at an early stage.
look for speed to market and future flexibility if things change
be alert to vested interests
watch for off-the-cuff assertions, hidden assumptions and generalisations
use instinct
It is common that up to twenty or so options will be progressed for more detailed consideration. At this stage, it is still early days and nothing is yet committed.
Filtering will often reveal a strategic definition needs further work. Keep all notes and jottings because new information may bring a discarded option back into play or provide the inspiration for a new super option.
Finally, in making reviews of completed projects, it is frequently realised that where the project definition was inadequate or the range of options considered small, the best option was overlooked altogether with the wisdom of hindsight.
Geoff Charters has a depth of experience in the government, private and not-for-profit sectors. He has held senior management and CEO roles in transport, banking and finance, information technology, business services and health industries. Geoff developed and implemented capital expenditure processes globally for ANZ Banking Group and managed the ANZ capital investment program. He has conducted appraisals for major projects in rail, road and air transport, government infrastructure, manufacturing, building and construction and IT. He can be contacted by telephone: +61 3 9882 6336 or email: geoff.charters@gmail.com
