Leadership: Mobilizing Resources

Comment: This is the sixth post of the Leadership Process series. I began this series because I saw a lack of rigor and discipline to leadership. The purpose of these posts is to look at a process model used by leaders. 

The term "mobilizing resources" originated from governmental language when seeking reforms or conducting international aide operations. Nonetheless, mobilizing resources is classic project management. This phase of the leadership process model is where project managers, PMs, make their mark. PMs may be involved in the previous steps to a lesser extent if involved at all. Mobilizing resources is the fundamental activitiy of being a PM.

Mobilizing Resources Background

The problem of effecting a vision, design, or a general effort has been a challenge historically. Visions, designs, and efforts of various sorts when implemented become projects. The discipline for effecting projects originates from operations management and to some extent engineering specifically industrial engineering.  Within these disciplines project management has emerged with the methodologies for mobilizing resources; manpower, money, machinery, and methods. Projects come in many types and styles having associated tooling, tactics, techniques, and practices.

Projects fall into two general categories; continuous and discrete. Continuous projects come in two forms; continuous improvement or Agile. Conitnuous improvements often utilize a Spiral Waterall model. These projects may have discrete points along the way but the project is ongoing and does not fully complete. Instead, there are versions that demark major waypoints. Discrete projects are typically linear having a start and end date upon which the project fully terminates. A special case of projects stems from complexity which can be nonlinear but always has a high degree of uncertainty and dynamic relationships between participants. Often complex projects occur as progressive elaboration events.

Project Managers must assess and know the character of the project type before beginning to organize the project details. For many project managers, the practice of program management is not a foreign concept. Programs lay down the framework for the projects to operate within giving structure, form, and policies for conducting the project(s).

Many organizations offer methodologies for managing projects. The Project Management Institute, PMI, is one such organization which issues its Project Management Body of Knowledge, the PMBOK.

Mobilizing Resources

Once leadership has created the vision, built a constituency, and established the capabilities and capacities necessary to move the project forward, the PM begins by initiating the project.  There are many activities and two of the key activities is developing the Work Breakdown Structure, WBS, and the Organizational Breakdown Structure, OBS. The WBS work packages maps to the OBS or who will execute the work packages. Typically, the PM will look for shortfalls in capacity and capabilities. If leadership was on spot desiging the organization then there should be no shortfalls. Nonentheless, the PM occassionally must seek special skills or augement capacity from time-to-time. For example, crashing a project requires additional resources. Resourcing capability for specific work packages is not uncommon. The capabilities resourced are often journeymen or tradecraft skills such as plumbers, electricians, and IT support of various sorts. Professional services (Engineering, Legal, Accounting, etc...) are often contracted as well.

However, resources are not uniquely labor. Money, methods, and machinery are also resources that demand the PM's attention. Money often gets the most attention and tracked in many cases through Earb Value Management, EVM. Methods and machinery are also part of the equation as capabilities and capacity to perfortm work. Methods are most often skills, techniques, and practices. For example, a method could be a means of interstitially coating something. There are numerous methods from electro-plating to Ionic bonding to electro-static paint to perform such outcomes.  Machinery or tooling is another resource. If a process calls for a specific method then the proper tooling or machinery needs to be on hand to perform the work. Sometimes in a project, job shops or shop floors are leased to bring capabilities into the project.

Mobilizing resources often means overcoming political, organizational, and human obstacles. This is often called personality management which is an art more than a science. The science is simple in which humans generally fall into behavioral groups that have collective personalities. The art is knowing how to apply the science and gain productive outcomes from fickle people.

Conclusion

Mobilizing resources is project management. PMs are concerned with manpower, money, machinery, and methods in additional to the project objectives; scope, cost, quality, and schedules. Mobilizing resources is where the leaders vision and strategy are put to task. A key performance indicator is to ask the question, "Did what was worked serve the organization and strategy?"  The concept of measurable organizational value, MOV, serves to answer this question. MOV will be part of the posts on "Assessing Results" and "Plan for Updates".

Leadership: Organizational Design

Comment: This is the fifth post of the Leadership Process series. I began this series because I saw a lack of rigor and discipline to leadership. The purpose of these posts is to look at a process model used by leaders. 

This is an overview of organizational design.

Background

With the down economy and globalization events, leaders have tended to focus narrowly on product lines and specific competitors rather than the big picture. This has resulted in piecemeal  organizational design when a broader picture should have been assessed.

The problem is a narrow focused staff rushes in and architects a new information technology system, software application, or they purchase some new machine to solve a specific need. They rally resources to the new cause and train on it.  Terrific plans are put together to implement these systems. Most often the organization adapts to the technology rather than leveraging the technology in support of the operational objectives and strategy. In short, these organizations fail miserably at designing the organizational structures that support the vision from a leadership perspective.

The root cause of the problem, unfortunately, is that professionals historically either ignore the organizational constructs and processes or refuse to adapt to them. Changes to culture, business processes, and/or relationships often create conflicts and become disruptive to the organization and operations. For many professionals, placing the blame for these outcomes on innocuous things such as technology becomes more bearable. Staff often finds work arounds to the new architectures and ways to maintain empires, stove pipes, and cliques previously built. This is not leadership. Leadership involves putting strategy-to-task utilizing effective organizational design.

The challenge for the leader is overcoming politics, over-regulation or too many policies, cultural clashes, and the unworkable positions. 

Leaders must link the vision and its objectives to actionable activities that contribute meaningful work towards the vision. This requires organizational resources. In doing this, the two most essential organizational qualities are capacity and capability. Without adequate capacity and capability within the organization either something poorly or nothing will get accomplished. Thus, there must be some sort of reconciliation between the requirements of the vision and the capacity and capabilities of the organization in order to effect the vision.  There is a need to take corrective action on the shortfalls and measure the results of the effort.  Meanwhile, the shortfalls should be monitored in order to utilize in strategic planning of the organization later.

"We believe that the centerpiece of corporate strategy for most large companies should become the redesign of their organizations. We believe this for a very simple reason: It's where the money is (Bryan and Joyce, 2007, p. 1.)." Bryan and Joyce argue that organizational design is central to 21^st century business and that older designs are arcane and costly. Bryan and Joyce believe that thinking intensive staff possess the potential for enormous revenues and cost savings. This may lend well to autonomous self-directed cells of a living system discussed below.

Organizational Design

Poor organizational design and structure results in a bewildering collage of contradicting and conflicting activities. For example, role confusion, poor collaboration, high latencies and slow decision-making leading to unnecessary complexity, stress, and conflict. The principles of organizational design involve:

•  Complementary to Objectives: The design must support the desired objectives of not only the project but the organization's as a whole.

• Minimal Critical Specification: The design involves dialogue among those affected. Most teams struggle with over specifications. Thus, a minimal design can allow for teams to learn and adapt more readily. General Guidance is better than specific details.

•  Lowest level problem resolution: Problems need to be resolved at the point of origin. Teams to need find where things go wrong and deal with the variances at that point. People know what good work looks like and if empowered can resolve issues at their level.

•  Clear goals and flexible strategies: Define early on clear and concise performance goals. Do not over specify. Organizational design are living systems rather than robotic machines. There are many ways to get to the same ends. This principle encourages adaptability.

• Boundary Location and Control: Design for desirable sharing of information, knowledge, and experience in order to strengthen learning. Traditional companies typically build structures that limit sharing and problem solving through organizational barriers. The idea is to breakdown boundaries and reduce control.  

• Information Flow: Information must flow uninhibited and self-directed at all level of the organizational design. Control must be subordinate to achievement and learning. In short, it is better to share information and encourage conversations than control information access and limit dialogue.

• Supportive of congruence: Any rewards and support systems must be congruent with objectives and strategies for team-based work structures across boundaries.

•  Human values and design: Any designs must be supportive of relationships, meaningful work, as well as supportive of learning, decision-making, and help. There must be interactive and participatory planning processes involving those affected.

• Learning systems:  Design is an ongoing and reiterative experience. It is critical to build into any organizational design the ability to change and learn. Professionals and staff must have the ability to re-fashion their organizational arrangements as required.

There are scores of organizational design styles and types. The leader must assess the style and types the organization is operating within as this will determine how they leverage the capabilities and capacities. Once gaps and shortfalls are determined in capacity and capability, then procurement of the shortfall must occur. This often involves a make-buy analysis or some sort of organizational strategy to augment capacity and capabilities.  If capabilities are not present at all then the organization must resource them at the adequate capacity.

One of the stronger approaches is to view the organization as a living system or as a nodal network of cells that perform work and communicate among each other. The idea is not to over specify organizational design. Instead, provide guidance and room for the teams and organization to adapt as necessary. Living systems are organizations that have autonomous cells, self-organize, and are in a managed dynamic state of flux. These systems adapt to changing conditions by identifying necessary elements or cells then communicate with these other elements to solve problems and perform pertinent work.

In this living systems paradigm, the leader must assess or look for complimentary fits for capability and capacity augmenting the organizational structures where necessary. Decisions must be made if the augmentations are long term or short term which goes back to make-buy analysis and organizational strategies regarding augmentations.

Once the organizational design is in place then the leader is ready to mobilize resources. This is typically when the project manager is selected and a classic project initiates. This is the next blog posting on the Leadership process.

Reference:

Bryan, L., Joyce, C. (2007). Mobilizing Minds. McGraw-Hill. NY. 

Project Complexity Perplexes Procurements

Comment: This is a paper I wrote for a course on procurements and included in my series Supply Chain Basics. If you have followed my blog posts you may have realized that I am a proponent of complex adaptive systems (CAS). I have found that CAS reflects natural relationships such that organizational latency is reduced, collaboration and information sharing increase, and problem-solving occurs at the point of origin. The business or operation must be properly structured in order to take advantage of CAS. Once again, I have applied this concept to complex projects and procurements.  

Introduction

One of the greatest challenges in project management is complexity which is common to mega-projects but also common to smaller highly integrated projects. Complexity occurs in many dynamic forms such as in scalability, relationships, the tempo of the project, and due to self-organization. Complexity affects project procurement costs due to uncertainty in quantity and timing. In some cases, the actual procurements required remains in question until conditions emerge such that a determination can be made as in progressive elaboration events. The greater challenge is not the actual procurements but instead the management of or adaptability to emergent conditions while maintaining optimal procurements otherwise known as innovative procurements or simply innovation. In complex projects, the project procurement practices of the plan, conduct, administer, and closeout fall short of providing the requisite level of management. How does a project manager design and implement procurement systems or programs that assure optimal procurement processes in the face of uncertainty driven by complexity?

Clarifying Project Complexity

A formal definition of mega-projects does not exist among scholars but the United States government defines mega-projects as major infrastructure projects exceeding $500US million or projects that attract a high level of public or political attention due to impacts on the community, environment, or budgets (Li, Yanfei, and Chaosheng, 2009). Regardless of the definition or whether a highly integrated or mega-project, complexity is present and best described as projects that have a high degree of uncertainty and dynamic relationships among the participants. A closer look at complexity reveals the nature of the project culture. Scalability relates to sizing or the scale of the effort indicating the type of management and controls. Relationships among the participants such as serial, parallel, or nonlinear indicates the participant’s collaborative interest and willingness to cooperate. Self-organization traits of the project participants relate to the ability to adapt to emergent conditions in order to learn and solve problems. The project tempo relates to the rapidity with which decisions must be made and the effort progresses. Projects operating under a compressed timeline must make reliable decisions sooner than projects under normal time constraints. Optimal procurement processes are adaptive to the emergent conditions, minimize overall legal claims, promote quality, and correctly specify materials and services. The project manager must bring these objectives into succinct focus while managing complex projects.

Procurement Planning

Many managers are realizing that the control of overall complexity is a strategic issue for the company (Isk, 2010, pp. 3681-3682). The process begins before the scoping and work breakdown structure is considered by surveying the ground conditions such as the form of complexity, anticipated project tempo, and the nature of the expected procurements in order to begin formulation of the management method.

Project managers reel over uncertainty and the lack of structure. Complexity is typically wrought with uncertainty causing project managers an uneasy sensibility. Somehow, project managers must apply structure to complex projects in order to stabilize the core focus areas and, in particular, the project procurements. Complex environments rely on several key activities; information sharing, transparency, communications, and autonomy. These activities are necessary for the project participants operating under complex circumstances to adapt to emergent conditions otherwise known as the ability to innovate. Complex adaptive systems are the structure of complex environments that can facilitate key activities. Complex adaptive systems, Figure 1, are composed of autonomous nodes and communication pipes between the nodes reflecting a molecular lattice. In this case, the autonomous nodes represent suppliers, work centers, stakeholders, and other project participants. The communication pipes between the nodes pass Information Exchange Requirements, IERs, over the pipes and possess the self-organizing capability of dynamically connecting and disconnecting from nodes as necessary. With this architecture in mind, project managers can begin to overlay policies and practices to manage the complex environment. "Owing to the inherent complexity, it is a challenge to coordinate the actions of entities across organizational boundaries so that they perform in a coherent manner (Surana, A., Kumara, S., Greaves, M., & Raghavan, U. 2005, p. 4241)."

Figure 1: Complex Adaptive Systems exchange information and self-organize

Supply Networks

Supply networks can be ‘dyadic’ to multi-firm groupings (Brady, 2011). The variety and uncertainty of a supply chain might be extremely high and cause complexity. A typical supply chain can often be complex as a large mesh having members with competing objectives in other supply chains that dynamically reform (Isik, 2010, p.3685). At the most basic level, supply networks vary in structure based on the predictability of demand and complexity of the finished goods. Regardless of the supply network’s detail, the complex adaptive construct can be mapped to it. The greatest concern for a project manager is the supply network’s ability to be responsive and solve problems autonomously or to be innovative. Supplier competitive and self-interest factors detract from the desirable traits of collaboration and innovation. The project manager must put all the traits into balance in order to keep cost low and innovation high.

The more complex, high technology, and high cost the product becomes the more significant systems integration becomes the productive activity of the organization (Brady, 2011, p. 471). Complex adaptive constructs combined with program management provide such integration through teaming.

Procurement Management Program

Cost overruns of 50% are common; overruns of 100% are not uncommon. Project management is of enormous value to the success of mega-projects (Li, Yanfei, and Chaosheng, 2009, p. 100). The source of the cost overruns is uncertainty or risk. There are five main sources of risk; (1) Lack of buyer understanding of the requirements, (2) Language shortcomings, (3) Behavior of the parties, (4) Haste, and (5) Deception (Garrett, 2010, p. 50).

A procurement management program frames and provides guidance in order to address risk factors and strengthen the project procurement process such that cost overruns are reduced to acceptable levels. The underpinnings of a procurement program can be addressed in a structured manner the complex adaptive systems as the underpinnings. As indicated prior, optimal procurement processes are innovative and adaptive to the emergent conditions, minimize litigations or claims in the end, promote quality, and correctly specify materials and services. The objective of managing procurements in this manner is to derive value for the project.

The British Airport Authority was confronted with supplier conflict, poor information sharing, unwillingness to accept risk, and the lack of a consistent process among other issues. The solution embodied two main principles; the client always bears the risk and the work was to be carried out by integrated project teams. The British Airport Authority took on the role replacing the lead firm as systems integrator creating a framework of agreements that led to a value-creating supplier network (Brady, 2011, pp. 475-479).

The centerpiece of a program is the type of contracts and agreements made between the contractors or suppliers that leverage the complex adaptive systems traits. These agreements may be viewed as a teaming arrangement which is an agreement between two or more firms to form an alliance for their mutual benefit in a project (Fleming, 2003, pp. 36-37).

A system of agreements should be developed as part of the procurement management program that frame the level of collaboration and empowerment in a way to reduce destructive competition or conflict, properly assign risk, and solve procurement problems as they emerge. This was a success in the Heathrow terminal project where the approach consisted of four main components in the agreement; a single model environment, the use of preassembly, prefabrication, off-site testing, and just-in-time logistics (Brady, 2011, p. 477). One agreement should frame the project procurement structure as did the Heathrow project. Another agreement should frame guidance for cross-functional teams that strengthen collaboration, information sharing, and problem-solving. This approach was a success in the SHRBC construction project where long term strategic cooperative partnerships yielded a high satisfaction with collaboration and looked forward to future cooperation projects (Li, Yanfei, and Chaosheng, 2009, p. 107). Other agreements with the procurement participants can be developed on an as-needed basis. Once the framework for the procurement program is in place then the project procurement practices of the plan, conduct, administer, and closeout, can be integrated into the overall management effort.

The project procurement practices will follow the Project Management Institutes model as closely as possible. This involves the Request for Information, Request for Quotes, and Request for Proposals as well as contract type selections. The procurement management program could have agreements that provide guidance to the participants in the procurement process regarding the project procurement practices in these areas. For example, several contract types could be utilized during the project in a strategic manner. Cost-plus and fixed fees could be used to reduce cost and manage high uncertainty as the risk management on the buyer and not a lead vendor who may pass the risk around. Firm fixed-price contracts are ideal when uncertainty is low and places the risk on the contractor. Time and material contracts should be sparingly used but serve well in augment labor situations where the buyer has direct control and oversight of hours.

In the end, the agreements provide the necessary structure promoting a successful procurement management program.

Conclusion

Leveraging complex adaptive systems as the structural underpinning of complexity creates a framework for innovation that solves problems and increases value to the project. Layered on top of the complex adaptive systems framework is a system of agreements that frame the communications, information sharing, and collaboration as well as any other structures necessary for the management of the procurements in complex projects. Actors in the procurement process need adequate guidance to collaborate, share information, and communicate. In the Heathrow Terminal project, the British Airport Authority took on the role of systems integrator rather than allowing the prime contractor or lead supplier to perform this task. In doing so, a strategic supply network was created where the level of innovation had been considered low (Brady, 2011, p. 470). The system of complex adaptive framework, agreements, and the Project Management Institutes project procurement practices can provide the program management levels necessary to reduce cost overruns in complex projects.

References:

Brady, T. (2011). Creating and sustaining a supply network to deliver routine and complex one-off airport infrastructure projects. International Journal of Innovation & Technology Management, 8(3), 469-481.

Defense Systems Management College. (2008). Comparison of major contract types. [PowerPoint slides]. Retrieved from http://www.dau.mil/sites/locations/dsmc/default.aspx.

Flemming, Q. (2003). Project procurement management: contracting, subcontracting, teaming. (1st e.d.). FMC Press. California.

Garret, G. (2010). World-class contracting (5th ed.). CCH, inc. USA. Isik, F. (2010). An entropy-based approach for measuring complexity in supply chains. International Journal Of Production Research, 48(12), 3681-3696.

Li, Z., Yanfei, X., & Chaosheng, C. (2009). Understanding the value of project management from a stakeholder's perspective: Case study of mega-project management. Project Management Journal, 40(1), 99-109. doi:10.1002/pmj.20099

Lind, D. (2012). Integrated project delivery for building new airport facilities. Journal Of Airport Management, 6(3), 207-216.

Project Management Institute. (2008). A Guide to the project management body of knowledge (PMBOK Guide). (4th ed.). Newtown Square, PA: PMI.

Surana, A., Kumara, S., Greaves, M., & Raghavan, U. (2005). Supply-chain networks: a complex adaptive systems perspective. International Journal Of Production Research, 43(20), 4235-4265. doi:10.1080/00207540500142274

Yeow, J., & Edler, J. (2012). Innovation procurement as projects. Journal Of Public Procurement, 12(4), 472-504.