Stakeholder Circle Upgrade Launched

The Stakeholder Circle® is the premier methodology and tool set for analyzing the stakeholder community around a business activity, or a project. The primary tool for implementing the Stakeholder Circle® methodology, is the Stakeholder Work Sheet (SWS). The latest upgrade now includes:

1. The Stakeholder Circle® report as an integrated, fully automatic, capability
2. Greater control over the prioritization calculations, you can balance power, proximity, and urgency to suit your environment
3. Enhanced engagement assessment
4. The stakeholder engagement index to track changes in the average stakeholder attitudes over time
5. An integrated on-line help capability linked from each tab of the spreadsheet

Two version of the tool, a 100-stakeholder version and a 1000-stakeholder version.

You are invited to download the enhanced sample version of the spreadsheet from https://mosaicprojects.com.au/shop-stakeholder-worksheet.php  (there is no longer a requirement to register before downloading). The sample version allows the first 5 stakeholders to be edited and all of the macros to run.

For more information see: https://mosaicprojects.com.au/PMKI-SHM-030.php

Effective Stakeholder Engagement is Multifaceted

An organisation’s success, reputation and long term sustainability depends on its stakeholders and how they perceive the organisation.  The way the organisation interacts (or is perceived to interact) with its stakeholders builds its reputation and its customer base.  But customers belong to communities and it’s the broader community that grants the ‘social licence’ needed for the organisation to operate long-term. And, because no one and nothing is ever perfect, things will go wrong from time to time requiring action to protect the organisation’s reputation and its social licence.

The objective of this post is to:

• Put all (or most) of the different mechanisms used by organisations to engage with stakeholders into perspective; and
• Emphasise the message that authentic and effective stakeholder/community engagement needs an organisation-wide coordinated approach that is governed from the very top levels of management.

The Stakeholder Engagement Spectrum

The Organisational Core

The characteristics of the organisation are always at the centre of every stakeholder relationship[1]. The way your organisation is structured, its ethics, characteristics, systems, and services, underpin how its stakeholder community will ultimately perceive the business. The key to successful stakeholder engagement is in part the way the organisation is structured and operated, and in part being authentic and realistic in the way various aspects of stakeholder communication and engagement are used. If your business is a low-cost, low service, bulk supplier don’t pretend to be an upmarket high service organisation. Many people are more than happy to shop at retail outlets such as Walmart and Aldi, attracted by price and simplicity; others prefer the higher levels of service and higher prices from more upmarket department stores. The art of stakeholder engagement is to maximise the appeal and perceptions of the organisation as it is – not to mask reality with a pretence of being something else.

However, poorly governed unethical organisations will always ultimately fail regardless of their stakeholder engagement effort; you can’t build an effective long-term relationship on unsound foundations.

 

The 8 Aspects of the Stakeholder Engagement Spectrum

The eight aspects of stakeholder engagement highlighted above are all well defined in various publications; the way they are used in this post is briefly set out below:

PR: Public Relations – The actions taken by an organisation to develop and maintain a favourable public image. PR is a strategic communication process that builds mutually beneficial relationships between the organisation and its stakeholders. The core element of PR is push communication; it is a proactive process controlled by the organisation, broadcasting information to a wide community to influence attitudes.

Advertising – The activity production and placing of advertisements for products or services. The purpose of each advertisement is to announce or praise a product (goods, service, concept, etc.) in some public medium of communication in order to induce people to buy, use it, or take some other action desired by the advertiser. The difference between PR and Advertising is that PR largely focuses on creating or influencing attitudes and perceptions whereas advertising focuses on some form of ‘call to action’.

CRM: Customer Relationship Management – Refers to the practices, strategies, and technologies that organisations use to manage and analyse customer interactions and customer data throughout the customer lifecycle. The goal of CSR is to improve the organisation’s relationship with each customer, assisting in customer retention, and driving sales growth. Good CRM systems make it easy for people to do business with you.

Issues Management[2] – The process of identifying and resolving issues. Effective issues management needs a pre-planned process for dealing with unexpected occurrences that will negatively impact the organisation if they are not resolved. The scope of this concept ranges from ‘crisis management’ where the magnitude of the issue could destroy the organisation (and the most senior management take an active role) through to empowering staff to deal with relatively minor customer complaints. The key to effective issue management is resolving the issue to the satisfaction of the affected stakeholders. This requires effective systems and preplanning – you don’t know what the next issue will be, but you can be sure there will be one.

Stakeholder Management Initiatives[3] – this is the area where most of my work is focused; managing the expectations of, and relationships with, the stakeholder community surrounding an organisational activity, initiative, or project. Most business initiatives and projects have a high potential to affect a range of stakeholders both positively and negatively (and frequently both at different times). How these relationships are managed affects not only the ability of the organisation to deliver its initiative or project successfully, but also the overall perception of the organisation in the minds of the wider stakeholder community.

Business Intelligence & Environment Scanning – BI and other forms of environmental scanning looking at attitudes, trends, behaviours, and other factors in the wider stakeholder community. They are a key emerging element in the overall approach to stakeholder engagement used by proactive organisations. This is very much the space of ‘big data’ and data mining. Much of the collection of data can be automated and ‘hidden’ from view. The challenge is making sure the information collected is legal (privacy legislation is an important consideration), accurate, relevant, and complete; then asking the ‘right questions’ using various data mining tools. As with any intelligence gathering process, obtaining the data is the easy part of the equation; the real skill lies in developing, validating and interpreting the data to create information that can be used to produce valuable insights.

Social Networks – The ubiquitous, widespread, and diverse nature of social networks ranging from Facebook to personal interaction down the pub can easily outweigh all of the organisation’s efforts to create a positive image using PR, advertising and the other ‘controlled’ functions discussed above.  The organisation’s staff and its immediate stakeholders literally have millions of connections and interconnections to other stakeholders. Most of these connections are unseen, and the environment cannot be controlled. The best any organisation can hope to achieve in this relatively new communication environment is to plant seeds and seek to have some influence. Seeding ideas and concepts into the ‘Twittersphere’ may result in a concept being taken up and ‘going viral’, more commonly the seed simply fails to germinate. Conversely identifying negative trends and issues early, particularly if they are false, is critically important and where possible these negative influences should be countered but given the nature of the environment this is a very difficult feat to achieve.  Smart organisations recognise that their staff, customers, contractors, and suppliers all engage in this space and through other effective communication channels can influence how these people respond to opportunities and issues affecting the organisation.

CSR: Corporate Social Responsibility[4] – CSR completes the circle and brings it back towards the concept of PR.  CSR contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders. ISO 26000  Guidance Standard on Social Responsibility, defines social responsibility (ie, CSR) as follows:

Social responsibility is the responsibility of an organisation for the impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that:
–  Contributes to sustainable development, including the health and the welfare of society
–  Takes into account the expectations of stakeholders
–  Is in compliance with applicable law and consistent with international norms of behaviour, and
–  Is integrated throughout the organization and practised in its relationships.

The key difference between CSR and PR is that CSR actually involves doing things both within the organisation and within the wider community, whereas PR focuses on telling people things.

 

Applying the Stakeholder Engagement Spectrum

The various aspects of stakeholder engagement spectrum combined together to create the organisation’s reputation, engage communities, build customers, and when necessary protect the organisation’s reputation. The key combinations are set out below:

Reputation Creation: The key components needed to create and maintain a desirable reputation start with CSR and work clockwise through the spectrum to CRM.

Community Engagement: The key components needed to effectively engage the wider community are focused on CSR but includes the elements moving anti-clockwise from CSR through to Issues Management.

Building Customers: The elements needed to build and retain customers start with PR and work clockwise through the spectrum to Issues Management.

Protecting Your Reputation: Finally protecting the organisation’s reputation is focused around Issues Management, but includes elements of CRM and continues clockwise through to Environment Scanning. In addition, many of the ‘push’ elements in the spectrum may be used as tools to help manage issues and protect the reputation of the organisation including PR and advertising.

 

Conclusion

The ‘stakeholder engagement spectrum’ above is deliberately drawn in a circle surrounding the organisational core, because all of the different aspects interrelate, many overlap, and they all build on each other.  The governance challenge facing many organisations is breaking down the traditional barriers between functional areas such as advertising, PR and CRM/sales, so that the entire organisation’s approach to its stakeholders is coordinated, authentic and effective.

________________

[1] See more on Ed Freeman’ stakeholder theory at: https://mosaicprojects.wordpress.com/2014/07/11/understanding-stakeholder-theory/

[2] For more on issues management see: https://mosaicprojects.com.au/WhitePapers/WP1089_Issues_Management.pdf

[3] For more on stakeholder management see: https://mosaicprojects.com.au/Stakeholder_Circle.html

[4] For more on CSR see: https://mosaicprojects.wordpress.com/tag/corporate-social-responsibility/

Seeking a definition of a project.

Good definitions are short and unambiguous and are essential for almost every aspect of life. Even something as simple as ordering a snack requires a clear understanding of what’ required – this understanding is the basis of a definition. For example, doughnuts and bagels have a lot in common, they are both round and have a hole (a torus), and are made from dough but they are ‘definitely’ very different commodities! If you need a bagel for breakfast or a doughnut for you coffee everyone involved in the transaction needs to understand your requirements if your expectations are to be fulfilled.

 

 

 

 

 

 

 

 

Definitions serve two interlinked purposes, they describe the subject of the definition in sufficient detail to allow the concept to be recognised and understood and they exclude similar ‘concepts’ that do not fit the definition. Definitions do not explain the subject, merely define it.The simple fact is if you cannot define something precisely, you have real problems explaining what it is, what it does and the value it offers, and this lack of definition/understanding seems to be a key challenge facing the project management community (by the way, the bagel is on the left…… the other picture is a Krispy Kreme donut).

Way back in 2002 we suggested the definition of ‘a project’ was flawed. Almost any temporary work organised to achieve an objective could fit into almost all of the definitions currently in use – unfortunately not much has changed since. PMI’s definition of a ‘project’ is a: temporary endeavour undertaken to create a unique product, service or result. This definition is imprecise, for example, a football team engaged in a match is involved in:

• A temporary endeavour – the match lasts a defined time.
• Undertaken to create a unique result – the papers are full of results on the weekend and each match is unique.
• Undertaken to create a unique product or service – the value is in the entertainment provided to fans, either as a ‘product’ (using a marketing perspective) or as a service to the team’s fans.

Add in elements from other definitions of a project such as a ‘defined start and end’, ‘planned sequence of activities’, etcetera and you still fail to clearly differentiate a team engaged in a project from a football team engaged in a match; but no-one considers a game of football a project. Football captains may be team leaders, but they are not ‘project managers’.

The definition we proposed in 2002 looked at the social and stakeholder aspects of a project and arrived at an augmented description: A project is a temporary endeavour undertaken to create a unique product, service or result which the relevant stakeholders agree shall be managed as a project. This definition would clearly exclude the football team engaged in a match unless everyone of significance decided to treat the match as a project but still suffers from a number of weaknesses. To see how this definition works download the 2002 paper from, www.mosaicprojects.com.au/PDF_Papers/P007_Project_Fact.pdf

 

Updating the definition

Since 2002 there has been a significant amount of academic work undertaken that looks at how projects really function which may provide the basis for a better definition of a project.  The key area of research has been focused on describing projects as temporary organisations that need governing and managing; either as a standalone organisation involving actors from many different ‘permanent organisations’ such as the group of people assembled on a construction site, or as a temporary organisation within a larger organisation such a an internal project team (particularly cross-functional project teams). The research suggests that all projects are undertaken by temporary teams that are assembled to undertake the work and then dissipate at the end of the project.

My feeling is recognising the concept of a project as a particular type of temporary organisation provides the basis for a precise and unambiguous definition of ‘a project’. But on its own this is insufficient – whilst every project involves a temporary organisation, many temporary organisations are not involved in projects.

Another fundamental problem with the basic PMBOK definition is the concept of an ‘endeavour’.  The definition of endeavour used as a noun is: an attempt to achieve a goal; as a verb it is: try hard to do or achieve something.  But, ‘making an effort to do something’ is completely intangible; projects involve people! Hitting a nail with a hammer is an endeavour to drive it into a piece of wood but this information is not a lot of use on its own; you need to know who is endeavouring to drive the nail and for what purpose?

Another issue is the focus on outputs – a product service or result; the output is not the project, the project is the work needed to create the output. Once the output is finished, the project ceases to exist!  A building project is the work involved in creating the building, once the building is finished it is a building, not a project. But confronted with the need to create a new building different people will create different projects to achieve similar results:

• One organisation may choose to create two projects, one to design the building, another to construct it;
• A different organisation may choose to create a single ‘design and construct’ project;
• Another organisation may simply treat the work as ‘business as usual’.

The scope of the work involved in any particular project is determined by its stakeholders – projects are a construct created by people for their mutual convenience, not by some immutable fact of nature.

 

A concise definition of a project

Unpacking the elements involved in a project we find:

• A temporary organisation is always involved, but not all temporary organisations are project teams.
• The requirements and scope of work included in a project have to be defined and agreed by the relevant stakeholders – there are no pre-set parameters.
• The stakeholders have to agree that the work to accomplish the scope will be managed as ‘a project’ for the project to exist; the alternative is ‘business as usual’ or some other form of activity.

Modifying our 2002 definition to incorporate these factors suggests a definition along these lines:

A project is a temporary organisation established to deliver a defined set of requirements and scope of work, which the relevant stakeholders agree shall be managed as a project.

This definition overcomes many of the fundamental problems with the existing options:

• It recognises projects are done by people for people, they are not amorphous expenditures of ‘energy’.
• It allows for the fact that projects do not exist in nature, they are ‘artificial constructs’ created by people for their mutual convenience, and different people confronting similar objectives can create very different arrangements to accomplish the work.
• It recognises that projects are only projects if the people doing the work and the people overseeing the work decide to treat the work as a project.

What do you think a good project definition may be that is concise and unambiguous?

The challenge is to craft a technically correct definition, and then apply the Socratic method of thinking outlined in our 2002 paper at:  hwww.mosaicprojects.com.au/PDF_Papers/P007_Project_Fact.pdf.

I look forward to your thoughts!

Defining Stakeholder Engagement

Two earlier posts have discussed the concepts of stakeholder engagement.

• The Elements of Stakeholder Engagement discussed the three foundations of stakeholder engagement and the paradigm shift in thinking needed to shift from management to engagement: https://stakeholdermanagement.wordpress.com/2015/07/20/the-elements-of-stakeholder-engagement/
• Beyond Crisis Management looks at the journey from responsive to proactive engagement with stakeholders in your community http://www.projectmanagement.com/blog/Voices-on-Project-Management/13868/

This post builds on these foundations to look at the tools and techniques of proactive stakeholder engagement. Effective stakeholder engagement is a mutually beneficial process designed to enable better planned and more informed policies, projects, programs and services.

For stakeholders, the benefits of engagement include the opportunity to contribute as experts in their field or ‘users’ of the deliverable, have their issues heard and participate in the decision-making process. This should lead to:

• Greater opportunities to contribute directly to the development of the outputs from the work;
• More open and transparent lines of communication, increasing accountability and driving innovation;
• Improved access to decision-making processes, resulting in the delivery of better outcomes;
• Early identification of synergies between the stakeholders and the work, encouraging integrated and comprehensive solutions to complex issues.

For the ‘organisation’, the benefits of stakeholder engagement include improved information flows, access to local knowledge and having the opportunity to try out ideas or proposals with stakeholders before they are formalised. This should lead to:

• Higher quality decision-making;
• Increased efficiency in and effectiveness of delivery;
• Improved risk management practices – allowing risks to be identified and considered earlier, thereby reducing future costs;
• Streamlined development processes;
• Greater alignment with stakeholder interests – ensuring outputs are delivered in collaboration with stakeholders and provide outcomes which meet their needs;
• Enhanced stakeholder community confidence in the work being undertaken;
• Enhanced capacity to innovate.

As with any stakeholder management process, ‘not all stakeholders are equal’ some stakeholders should be engaged because they are important to the work being undertaken, others simply need to be kept informed by appropriate levels of communication (for more on this see The three types of stakeholder communication).

The various levels of stakeholder communication, management and engagement are:

• Inform: You provide the stakeholder with an appropriate level of communication, generally either PR or reporting.
• Manage: You direct your communication to achieve a desired change in the attitude of the stakeholder or to manage an emerging situation.
• Consult: You invite the stakeholder to provide feedback, analysis, and/or suggest alternatives to help develop a better outcome.
• Involve: You work directly with stakeholders to ensure that their concerns and needs are consistently understood and considered; eg, the business representative involved in an Agile sprint).
• Collaborate: You partner with the stakeholder to develop mutually agreed alternatives, make joint decisions and identify preferred solutions; eg, typical ‘alliance’ and ‘partnering’ forms of contract.
• Empower: You place final decision-making in the hands of the stakeholder. Stakeholders are enabled (but also need to be capable) to actively contribute to the achievement of ‘their’ outcomes.

The first three bullets above are Stakeholder Management activities, the last three various levels of Stakeholder Engagement. Deciding which level of interaction is appropriate is a key driver of success, in any project, program or other work, some stakeholders will be best managed by simply keeping them informed, whereas the higher levels of engagement such as collaboration and empowerment require stakeholders with sufficient skills and knowledge to be able to actively participate in the endeavour, and importantly the desire to be involved!

The Stakeholder Circle® methodology provides the foundations needed to understand your stakeholder community and decide on the appropriate level of engagement for the ‘high priority’ stakeholders affected by the work. When you get to ‘Step 4 – Engagement’ the additional questions that need answering include:

• What is the purpose and desired outcomes of the engagement activity?
• What level of engagement is required to achieve this outcome – consult, collaborate, empower?
• What method of engagement will you use?
• What are the timing issues or requirements?
• What resources will you need to conduct the engagement?
• Who is responsible for engagement?
• What are the risks associated with the engagement?

 

Finally, as with any stakeholder management process, the success or otherwise of the overall process needs to be reviewed regularly and appropriate adaptation made to optimise outcomes (step 5 in the Stakeholder Circle® methodology)

Summary:

Stakeholder engagement is not a ‘one-size-fits-all’ solution to managing stakeholders and needs to be planned into the overall development of the work:

• Some of the questions outlined above need asking at the very earliest stages of a project or program during the ‘strategic planning phase’ and will affect the way the whole of the work is planned and undertaken.
• The culture of the organisation undertaking the work will determine how open it is to inviting stakeholder collaboration or engagement, a degree of ‘culture change’ may need to be planned into the work.
• Stakeholder engagement is always a two-way process, the skills, capability and culture of the key stakeholders will also be a constraint on what is feasible or desirable. You may need a strategy to ‘get the stakeholders on-side’.

Overall time and effort spent on stakeholder engagement will pay dividends (see: Valuing Stakeholder Management), stakeholder engagement is simply the most proactive way of helping your stakeholders to help you deliver their requirements successfully.

The Elements of Stakeholder Engagement

Effective stakeholder engagement is a two-way interactive relationship that encourages stakeholder involvement in the organisation for the benefit of both the stakeholders and the organisation.  The trend is increasingly clear; organisations that effectively serve the needs of their stakeholders outperform those that do not.

However, what is also apparent is confusion on the part of many managers as to precisely what stakeholder engagement is, and what systems facilitate effective stakeholder engagement.  This post suggests there are three basic systems that together form the foundation for effective stakeholder engagement in most organisations, but the foundations are just that, necessary underpinnings, stakeholder engagement itself rises above the foundations to create an entirely new way of engaging with stakeholders. Let’s start with a look at the three basic components:

PR = Public Relations

PR is probably the oldest of the three foundations (particularly if you include advertising within the overall ambit of PR).  For thousands of years people and organisations with something to sell to ‘the public’ have recognised the need to tell potential customers about their offering and suggest there is a good reason for the potential customer to become an actual customer or client.

Smart merchants realised they needed to give potential customers a reason for doing business with them (rather than someone else) and that competing on price alone was not a good move in a crowded market place.

The role of advertising is in part to make potential customers aware of your offering and in part to create a desire for the type of goods or services you are providing. Effective advertising creates a ‘call to action’ which the customer heeds.

Public Relations (PR) has a different focus.  Good PR is built around creating a positive image of the organisation in the minds of its wider stakeholder community. PR is not directly aligned to sales in the way advertising is, but does seek to make the organisation appear to be one that most stakeholders in its target audience will want to be associated with.  This may be because of exclusivity, or status, because the organisation is seen to be ‘good’, or for any one of a dozen other reasons.  Effective PR has many purposes including:

• Underpinning its advertising by creating a ‘good first impression’ of the organisation, thereby allowing the stakeholder to take note of its advertising.
• Explaining the value of the organisation to a wider community minimising resistance to the functioning of the organisation and facilitating its operations.
• Making the organisation appear to be a desirable ‘citizen’ within its community; etc.

Good PR is of course authentic and reflective of the true nature of the organisation, in the modern age ‘spin’ is easily uncovered and can be very damaging.

The fundamental nature of both PR and advertising is ‘push’ communication – the organisation pushes its message out to the wider community, hopes someone listens, and then measures its impact after the event with a view to improving the ‘message’ and the effect.

 

CRM = Customer Relationship Management

CRM is focused on providing a great experience to every customer.  The commercial driver for CRM is in part the generally accepted fact that it is far cheaper to retain an existing customer then to attract a new one and in part from a win-win view that the ability to quickly and efficiently service the unique needs of each customer reduces the transaction costs for the organisation.

Customers or clients are clearly stakeholders with a significant interest in the organisation, so focusing effort on providing them with the best possible level of service, delivered quickly and efficiently is a win-win outcome. Happy customers are more likely to recommend an organisation to their friends and colleagues as well as becoming regular clients of the organisation.

Unfortunately the concept of CRM seems to have been hijacked by software systems, overseas call centres and ‘big data’; bought with a view to ‘reducing costs’.  There’s nothing wrong with any of these concepts provided the outcome is improved customer service. Where the outcome is a reduction in service, any cost savings are likely to be offset by reduced business and the cost of attracting new customers to replace the ones lost by poor service.

Whilst CRM at its best is interactive and focused on a win-win outcome for both the organisation and its stakeholders, the stakeholders directly affected by CRM are limited to the organisations customers and clients.

 

Stakeholder Management

Stakeholder management is process focused; it involves planned interaction with a wider stakeholder community, both to manage the consequences of any crisis as well as providing information and facilitating two-way communication with key stakeholders.

Good stakeholder management is a proactive process, focused on facilitating regular communication and anticipating needs, issues and problems that are likely to arise within the stakeholder community. Tools and methodologies such as the Stakeholder Circle® are designed to facilitate efficient stakeholder management. Stakeholders are identified, there needs assesses and their relative importance determined. Based on this assessment, communication and other interactions are initiated to gather the support and assistance needed by the organisation and to head off or minimise any threats or problems.

The focus of stakeholder management tends to be ‘defensive’, and is aimed at creating the best possible stakeholder environment to allow the organisation to do its work efficiently   The process is interactive, seeking to engage constructively with the organisations stakeholders and looking for win-win outcomes that benefit the organisation and the stakeholder, but is driven by the organisation, from the perspective of the organisation.

 

Stakeholder Engagement

Stakeholder engagement builds on these three foundations (particularly ‘stakeholder management’) to create a different paradigm.  Stakeholders are encouraged to actively engage with the organisation and contribute to its growth and development whilst at the same time the organisation and its staff engage with their community through Corporate Social Responsibility (CSR) initiatives and the like. These engagement processes build a strong, two-way relationship in which the stakeholders and the organisation work together to build a common future that is both mutually desirable and beneficial.  I will be writing about stakeholder engagement in a future post.

 

Conclusion

The three foundations of Stakeholder Engagement: ‘Stakeholder Management’, CRM and PR are quite different processes focused on achieving different outcomes.  In a well managed organisation all three functions work together to crate a supportive stakeholder environment and a successful organisation. However, whilst the systems need to be aligned and compatible they are very different and should not be confused.

In particular CRM and Stakeholder Management systems have very different objectives, focus on quite different stakeholder groupings, need significantly different information sets, and have very different measures of success:

• CRM focuses on customers (or clients). Whilst customers as a ‘class’ of stakeholder are important, generally an individual customer is not. The focus of a CRM system is managing large amounts of data to provide ‘all customers’ with a generically ‘good’, potentially ‘tailored’ experience.
• Stakeholder Management focuses on indentifying the key stakeholders ‘at this point in time’ that require specific management focus as well as the wider group of stakeholders that need to be engaged (or at least watched). In most situations very few individual clients or customers would be sufficiently important to feature in this list, but there will be lots of stakeholders who are highly unlikely to ever become ‘customers’, for example suppliers and competitors.

The shift to ‘stakeholder engagement’ does not add new systems but does require a paradigm shift in thinking. The key element of stakeholder engagement is opening up to the ‘right stakeholders’ and either inviting them into the organisation, or reaching out to them, to help create a mutually beneficial future – more on this later.

 

 

 

What’s in a Name?

When it comes to effective communication, a clear, concise and easily defined name for something is essential if you want people who are not directly involved in your special disciple to understand your message.  Jargon and ambiguity destroy understanding and damage credibility.

Potentially one of the major reasons senior executives still fail to understand ‘project management’ within their organisations is the fact that the project management profession uses its special terms in a multitude of different ways……

There are four generally recognised focuses within the overall domain of ‘project management’ Portfolio management, Program management, Project management and the overarching capabilities needed by an organisation to use project, program and portfolio (PPP) management effectively.

The starting problem is implicit in the above paragraph, ‘project management’ can be used as a ‘collective noun’ and mean all four areas of management or specifically to mean the management of a project.

The next problem is if project management means the management of a project, exactly what is a project?  The current definitions for a project are very imprecise and can apply to virtually anything. A more precise definition is discussed in Project Fact or Fiction.

Program management is fairly consistently defined in the literature and involves both the management of multiple projects and the realisation of benefits for the organisation. There are still legacy problems though; the ‘Manhattan Project’ to create the first atomic bombs during WW2 was a massive program of work involving dozens of separate projects.

Similarly, Portfolio management is fairly consistently defined. The core element of portfolio management is deciding on the best investment strategy for the organisation to meet its strategic objective through investing in new selected projects and programs and reviewing current ‘investments’ to ensure the project or program is continuing to deliver value (and closing those that are not to redirect the resources to a better ‘investment option’.

Both Program management and Portfolio management are relatively new concepts and have the advantage of being developed at a time where wide reaching communication was relatively easy allowing a consistency of though and definition. Where the real problems emerge is in the realm of the overall organisational capabilities to use PPP concepts effectively.

The management space around the core PPP management functions includes:

• Governance
• Multi-Project management
• Organisational enablers such as PMOs, etc
• The ‘management of projects’ (Prof. Peter Morris)
• Benefits realisation
• Organisational change management
• Value creation

In general terms this area of management responsibilities can be picked up if ‘project management’ is used as an overarching term. Some times, some aspects get absorbed into people’s definition of portfolio management and program management. But this ‘absorption’ does not really help develop clarity; for example,  whilst benefits realisation is generally seen as part of program management, this does not help deal with the realisation of benefits for the 1000s of project that are not part of a program, etc.

Apart from project, program and portfolio management as defined I believe the global project management community, including academia and the major associations need to make a focused effort to develop a ‘standard’ naming convention for these various aspects of ‘project management’ – if we cannot be consistent in our use of terms our stakeholders will be permanently confused and confused stakeholders are unlikely to be supportive!

I feel there are three distinct aspects to this ‘fuzzy space’:

• The first is governance. The role and function of governance in the PPP domain was outlined in Patrick Weaver’s recent presentation to the Project Governance and Controls Symposium in Canberra: Stepping up to Governance – the development of ISO 21503.

• The second is the ability of an organisation to effectively select and support its project, program and portfolio management efforts. This includes the ‘management of projects’, organisation enablers and multi-project management: The Strategic Management of Projects.
• The third area is the link between PPP, operations, strategy and value, encompassing benefits realisation, value creation and integration with organisational change management (which is an already established management discipline). I don’t have a good name for this critical area of our professions contribution to organisations but it is probably the most important from the perspective of executive management.

The overall architecture of the discipline of PPP management looks something like this:

 

The challenge is to start moving towards a consensus on a naming convention for these aspects of ‘project management’ so we can start communicating clearly and concisely with all of our stakeholders.  Hopefully this post will start some discussions.

Making Projects Work: Effective Stakeholder and Communication Management

My third book, Making Projects Work is now generally available in hardback and Kindle editions.

Making Projects Work: Effective Stakeholder and Communication Management focuses on the skills needed by project management teams to gather and maintain the support needed from stakeholders to make their project successful.

The underlying premise in the book is that projects are performed by people for people. The key determinants of success are the relationships between people in the project team and between the team and its wider community of stakeholders. This web of relationships will either enable or obstruct the flow of information between people and, as a consequence, will largely determine project success or failure.

Making Projects Work provides a framework for understanding and managing the factors required for achieving successful project and program outcomes. It presents guidelines to help readers develop an understanding of governance and its connection to strategy as the starting point for deciding what work needs to be done. It describes how to craft appropriate communication strategies for developing and maintaining successful relationships with stakeholders. It highlights the strengths and weaknesses of existing project controls and outlines effective communication techniques for managing expectations and acquiring the support required to deliver successful projects on time and under budget.

Features – the book:

• Provides a framework for understanding and managing factors essential for achieving successful project and program outcomes.
• Facilitates an understanding of governance and its connection to strategy as the starting point for decisions on what work needs to be done.
• Describes how to craft appropriate communication strategies to develop and maintain successful relationships with stakeholders.
• Supplies an understanding of the strengths and weaknesses of existing project controls.
• Outlines effective communication techniques for managing perceptions and expectations and to acquire the support necessary for successful delivery.

For links to more information on this, and my other two books, start at: http://www.stakeholdermapping.com/stakeholder-management-resources/#Books

Are Sponsors over worked and under effective?

The Institute of Project Management (Ireland)  has published a  survey is based on self-reported information from their course based on nine major position descriptions/levels in reporting the data comparing the expected number of hours to be worked based on their terms of employment and the actual number of hours typically worked. The averaged data from senior management positions is worrying:

• Director of PMO; expected: 39.0 Hrs, actual: 60.0 Hrs
• Portfolio Manager; expected: 37.0 Hrs, actual: 50.0 Hrs
• Project Manager (Senior); expected: 37.9 Hrs, actual: 50.3 Hrs.

Combine these findings with data from PMI on the hours worked by Sponsors (download the PMI report on ‘Executive Sponsor Engagement’) with many reporting working weeks of 50 to 60 hours on their ‘day job’ before taking on the additional responsibilities of sponsoring a project or a program; and, that effective sponsors report that typically they are working on three projects at a time, spending an average of 13 hours per week on each, the problem of over extension of key executives becomes obvious.

Combine these findings with the demonstrated correlation between effective sponsorship and achieving project success, the over extension of senior managers has serious consequences:

• Sponsors have inadequate time to understand the project’s requirements and support the project manager leading to an increased probability of failure;
• Tired managers make poor decisions, and tiredness affects ethical standards (see: Tired workers lose their ethics);
• There is frequently not enough time to train the sponsor in his/her role further reducing their effectiveness; and
• These pressures often lead to a lack of continuity in the sponsorship role, which is another identified source of project failure.

The evidence is clear, organisations that fail to effectively sponsor their projects and programs are making an overt commitment to wasting the organisation’s time, money and resources – there is an 80% greater probability of failure and no amount of effort at the ‘project management’ level can overcome executive management failures.

One simple way to stop the waste is for an organisation to defer any project where it is unable to find a committed, trained sponsor, with adequate time, energy and skills to properly fulfil their role. No sponsor – no project! (See more on the role of a sponsor)  This may sound extreme, but if the executive management team do not see the project as being sufficiently important to the organisation they manage, to reorganise the disposition of executive resources to properly support the work, then the project is probably not that important anyway. The organisation will be better off not spending the money and wasting its resources.

The governance challenge is creating a management culture that on one hand, actively encourages the deferment of projects that are inadequately supported (eg, don’t have a sponsor); and on the other actively encourages the development of the organisation’s capability to excel at the ‘the management of projects’ (see more on the strategic management of projects).

Creating this culture is a critical governance issue (see more on the governance of project management).  If an organisation cannot implement projects and programs efficiently, it cannot adapt and change to meet the challenges of a rapidly changing world which will inevitably lead to the organisation becoming obsolete. However, achieving the necessary changes won’t happen if the executive team are already overextended – the situation highlighted in both of the reports referenced in this post! Building the organisational capability to efficiently its projects and programs is itself a major change initiative that needs resourcing and sponsoring at the highest levels.

Opportunity Lost

The first edition of the RICS / APM guidance note on Stakeholder Engagement is a missed opportunity. Hopefully the second edition will plug many of the glaring gaps.

The guide is built around ten principles:

• Principle 1: Communicate
• Principle 2: Consult early and often
• Principle 3: Remember they’re only human
• Principle 4: Plan it
• Principle 5: Relationships are key
• Principle 6: Simple, but not easy
• Principle 7: Just part of managing risk
• Principle 8: Compromise
• Principle 9: Understand what success is
• Principle 10: Take responsibility

All sound principles but in a strange order

Any complex endeavour needs a clear understanding of its objectives and then a plan to achieve the objectives before starting work, but ‘Understand what success is’, is at #9 and ‘Plan it’ at #4.  Surly the whole point of engaging stakeholder is to enhance the probability of success. Which means #1 understand what success is, #2 plan how to achieve success and then move into implementation.

But implementation needs focus, completely missing from the guide is any practical guidance on ways to understand the stakeholder community, prioritising the stakeholders so the communication effort is focused where needed and then managing the overall engagement effort for maximum effect. The best the guide can offer is a simplistic 2×2 matrix. My methodology, the Stakeholder Circle® is one of several that recognise the multiplicity of dimensions needed to understand a stakeholder, the outline is available free of charge from http://www.stakeholdermapping.com/stakeholder-circle-methodology/

The last omission is considering the path to stakeholder management maturity. The path to maturity is mapped at: http://www.stakeholdermapping.com/srmm-maturity-model/

I had hoped stakeholder engagement was moving beyond the soft ‘fluffy’ platitudes of the past into a pragmatic management process, allied to risk management, focused on maximising the aggregate benefit from a project to all of its stakeholders.  These ideas are in the RICS Stakeholder Engagement guide but unfortunately the guide lacks any guidance on how to achieve these objectives, with the exception of the CASE model in Appendix 3.

Hopefully the 2^nd Edition will not be too far away.

The 1^st Edition is available from http://www.rics.org/shop

Mind your language

Communicating ideas effectively to another person needs a common language, and a common understanding of the meaning of the symbols used in the language. While this sounds simple, language can take many forms including images, sounds and writing. This post is going to focus on the design and use of images as the language for communication.

The use of images as a language stretches back to the Ancient Egyptians. They developed a written language based on stylised pictures whereas the civilisations in the ‘fertile crescent’ developed cuneiform text.

Whist we may not be able to read the Egyptian script, many of these hieroglyphs are easily understandable.

Whereas the cuneiform script is completely indecipherable. However, just because we can identify a goose at the top of the third column of the hieroglyphs, it does not mean we understand its meaning!

A simplified graphical language can provide a really useful way of communicating complex information but when you use the language, you need to be sure the people you are communicating with have the same level of understanding you do and ‘see’ the same message.

One of the first attempts to stylise complex information and to make it accessible and easy to understand was the development of the London Underground map.

The London Underground Map

The London Underground is one of the most complicated systems in the world.  By the middle of the 20^th century the map was becoming too complicated for easy use.

1930 Underground Map.

The concept of the topological map we all know and use was developed by Henry Charles Beck. ‘Harry’ Beck was an English engineering draftsman at the London Underground Signals Office. He developed the first ‘topological map’ in his spare time, based on an electrical wiring diagram.

London Underground was initially sceptical of Beck’s radical proposal and tentatively introduced to the public in a small pamphlet in 1933. It immediately became popular, and the Underground has used topological maps to illustrate the network ever since. There is even a book on the map: Ken Garland’s, Mr Beck’s Underground Map (Capital Transport Publishing 1994). The book describes the enormous care, craft, thought, and hard work of Harry Beck that went on for decades (exactly what it takes to do great information design).

Beck’s version of the 1930 Map.

This style of communication has carried through to modern times but is not without its problems – you can easily get to the station you want, but there is no indication of how close or how far apart different stations are ‘on the surface’ – particularly if the stations are on different lines.

The current London Underground Map.

Success is contagious; most transport maps world-wide follow Henry Beck’s lead and a new universal language has been created.

Part of the new Melbourne Tram Map, using a version of Beck’s language.

The Melbourne map uses the same style as the underground map – lines are vertical horizontal or at 45 degrees, but unlike the underground stations, tram stops are not shown; the designers believe the street names and route numbers are more important.

Part of the Stuttgart Metro map

Based on your knowledge of the London or Melbourne maps, you do not need to be able to read German to have a good idea how to navigate the Stuttgart metro from the Hauptbahnhof to the Zoo. The language of transport maps has become fairly standard world-wide.

However, design of the communication is still important; the designers of each map need to decide what is important (eg, the route numbers on the tram map), what is emphasised, what is suppressed, and what is left out – bad design can reduce the elegance of the communication and block understanding. Whereas innovation can enhance it – the Tokyo train system has its trains painted the same colour as the line used on the transport map – the orange trains follow the orange route and you ret to the right platform by following the orange signs!

A similar convergence of communication style has occurred with in-car road maps. Most books and electronic sat-nav systems use a stylised language similar to the map of North Sydney (below) – another language designed for a specific purpose.

North Sydney

For the purpose of navigating a car to the ‘Aiki Kunren Dojo’, this ‘simplified road map’ is far more useful than the 100% accurate photograph of the same location!

North Sydney

The style of the road map above has been taken ‘virtual’ and global by several organisations including Tomtom. You do not need to be able to read the street names or understand the spoken advice ‘turn left in ……’ to follow the map – the pictures say it all and are just as effective in Shanghai and Munich as Sydney or Melbourne.

When designing a graphical communication language, useful, accurate and fully detailed are not synonymous! Both of the mapping languages discussed so far are really simple to use provided you have learned to ‘read the language’ and interpret them correctly. But as we all know North Sydney looks like the Google Earth photograph (not the map) and Melbourne’s geography only has a passing resemblance to the tram map – but we have learned how to read the ‘language’ and can then use that knowledge of the language to understand similar maps in different cities.

Project Maps

The same challenge applies to project dashboards, reports, and artefacts such as bar charts and CPM diagrams. Creating an appropriate level of understanding in a person’s mind about the true situation of the project and your intended work plans requires appropriate information to be communicated in a language that is understandable to the stakeholder. In this context, ‘appropriate’ does not mean complete or fully detailed; selecting the right level of detail is in itself an art form.  The bar chart below may be fully detailed and precise but it is not a good communication tool!

And while preferred by many project controls professionals, the CPM logic diagram below is even less likely to work as a communication tool for stakeholders.

These specialist languages are useful to trained project controls professionals and some experienced project management professionals but are too complex for most communication needs.

As suggested above, effective communication does not need fully detailed or accurate representation. What is needed is ‘useful’ information that can be used!  You do not need to be an expert in directional boring to understand the plan for this project (all that is missing is the timing for each stage):

Simple is good, simplistic is dangerous! One of the popular options for reporting project status is using simplistic ‘red-amber-green’ (RAG) traffic lights such as these:

We know there is a scope problem but there is no real indication of the seriousness of the situation or how far into the ‘red zone’ the project actually is.  Rather than the simplistic 3 point RAG scale, the same information can be displayed using more insightful tools:

Any of the ‘gauges’ will tell you where within each band the project is situated, add in a simple ‘change’ report and the trend becomes apparent as well. The art is knowing how much information is enough.

Conclusion

From the hieroglyphs of the Ancient Egyptians to the Tomtom road map, the art of using pictures for effective communication is creating a set of symbols that communicate your ideas and information simply and accurately, and then taking the time to teach your stakeholders how to read the language.

Effective communication, focused on obtaining the understanding and buy-in from a stakeholder needed to deliver a successful project requires:

• Understanding who are the key stakeholders at ‘this point in time’ that you need to influence;
• Understanding their needs and the best way to communicate with them (the Stakeholder Circle®  methodology is designed for this purpose);
• Communicating the appropriate amount of information in a way that can be understood by the stakeholder; and then,
• Taking the time to help the person reach a proper understanding.

The communication challenge is recognising that some concepts will be easy to communicate in some communities of stakeholders, others will be more difficult; and people are frightened of things they don’t understand.

Designing an effective communication strategy requires the project team and project leaders to firstly derive a common understanding between themselves, then determine what the key stakeholders actually understand, then determine how to communicate effectively with the key stakeholders to build their understanding to the level needed to get the ‘buy-in’ required to make the project successful.

Effective communication is the tool that builds understanding, reduces opposition based in ‘fear of the unknown’ and generates a framework for success – for more on effective communication see: http://www.mosaicprojects.com.au/PM-Knowledge_Index.html#PPM07