Part One:
Your Change
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Chapter 1:
Ask the Right Questions
The Essence of a Valuable Project
OK, letâs get straight to the heart of the matter. What makes a change valuable?
In short â A Valuable Change is one that solves a key organisational need or desire. Itâs truly as simple as that.
The trick is ensuring that your change actually solves that need or desire, and this is where the art of asking the right questions becomes your key tool. A concise and considered answer to all three Valuable Questions is crucial for creating a great return on your project investment.
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Donât Fall into The Money Trap
But first⊠I want you to close your eyes with me for a moment and imagine yourself sitting outside the board room of one of the largest retail chains in Australia. Maybe youâre nervous, sitting there fidgeting with your pen. Or perhaps youâre a slick operator, sitting in a calm silence. Either way, you know this is not going to be a fun meeting. You are about to break some devastating news to the CEO and Owner. To make it worse, this is a man not known for his patience or good nature.
You are about to inform him that the half a billion-dollar portfolio of projects that youâve been asked to audit is on track to deliver only 50% of its expected financial returnâŠ
Finally, the door opens, and your name is called. You walk in and greet the room.
As a seasoned professional, you warm the room up with some good humour and your positive findings.
âThe projects are delivering well. Systems and processes are, on the whole, on track.â
âŠThen you break the news.
âThe expected financial benefits across the portfolio were over estimated. By a factor of 2 to 1.â
There is silence⊠An awkward stillness fills the room. Then your intuition detects something. Your brain switches to slow-motion as you hear a noise... a âwhooshingâ noise, that seems to be getting louder. Then you start to see it out of the corner of your eye⊠a shiny object comes hurtling at your head.
What do you do?
Tell me, would your first reaction be to duck? Because if so, then you may well have been as lucky as a friend of mine was in this exact situation. He too managed to dodge the glass jug that was thrown at him by this short-tempered CEO. My friendâs quick reactions saved him from a potentially large hospital stay, reducing the damage to just a broken water jug and a cracked window.
This is a story of a CEO who deeply understands that every change initiative is an investment. The feeling was particularly acute for this man as it was his personal wealth that was invested with the organisation. Where this CEO missed the mark, well aside from the physical violence, was that he got so caught up in the financial return.
And this is how we arrive at the first common misconception we challenge in this book: As each change initiative is an investment, many leaders get caught in the trap of always expecting a money-based return.
The reality is that value doesnât always come in the form of tangible cost savings or increased revenue. Sometimes an organisation wants to shift its culture, or stop using an IT system that people donât like, or improve its customer experience, or make some other shift to set itself up for the future. There are also times when an organisation isnât focused internally â perhaps itâs investing for the betterment of a vulnerable community or other philanthropic goal. The key to all these elements is that a project needs to be solving an organisational need or desire. The art here is in figuring out what itâs going to do to solve it, and how itâs going to prove it has done so.
A Common Trap
A common trap that Government and Not-For-Profit (NFP) organisations fall into is requiring their projects to have a financial return. These organisations often get caught up in purely mathematical exercises to demonstrate the millions of different ways that the Government or NFP will be more efficient after the project delivers its work.
Interestingly, the polar opposite of this trap is also equally found through Government and NFP organisations â the dangerous thinking that âWe arenât profit-driven, so we donât need to prove we invested the money wellâ.
Neither of these are useful positions.
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Learning from Failure
My key aim in this chapter is to illustrate the power of asking and then answering the right questions. What better way to do that than to look at what happens when the right questions are ignored? There are a multitude of examples we could draw on for that, but to really illustrate it, Iâve found us an elephant of a project.
In 2006 the Australian New South Wales (NSW) State Government Department of Education started one of its largest undertakings ever â the Learning Management and Business Reform project (known more widely as LMBR). The LMBR project was inherently ambitious in nature. It aimed to replace a 15-year old cluster of expensive and no longer suitable backend and learning management systems across the Department itself, 2230 public schools and its vocational TAFE3 sites. The expected total cost for the project was $483 Million. Expected total time: 8 years.
The project progressed well for its first few years, delivering some early wins all within expectations. All seemed OK from the outside looking in.
It wasnât until late 2014, as the project was nearing its expected end date, that a bombshell dropped. It was revealed that the project was overspent and not even close to done. In fact, delving deeper, after the preceding years and circa $530 Million, the Department had only partially delivered its solution to 229 of the 2230 schools. Just 10% of its target result at an already notable cost overrun. Unfortunately, even luck was not on the projectâs side, with public outcries by the Public Service Association (the workersâ union) to halt the rollout â citing major system flaws and huge additional workloads for the staff at those 229 schools that had received the new system.
If we ratchet forward a further four years to 2018, with continued time and cost slippage, and more public embarrassment on the way (including misplacing $525M in TAFE revenue in 2016); we arrive at the end of the LMBR journey. The final result: a 12-year project (50% longer than the original time estimate), and $755 Million in spend (+56% more than originally planned).
While there isnât direct audit data available for 2018, the key findings in the 2014 audit were that: âThe Department [had] yet to demonstrate that it [would] achieve [any] expected benefitsâ4.
If we temporarily put aside the fact that this project likely made some consulting partners very wealthy5, LMBR is a great example of what happens when a project doesnât answer and link the three key Questions that underpin a Valuable Change. So, like a forensic analyst, letâs delve deeper. Letâs conduct a procedural autopsy of their failures to give us useful insight into why each of the Valuable Questions truly create Valuable Change.
Valuable Question One: Why Are We Doing It?
âVery few people or companies can clearly articulate WHY they do what they do. âŠPeople donât buy WHAT you do, they buy WHY you do it.â
- Simon Sinek
In the quote above, Simon clicks into why the first Valuable Question is âWhy Are We Doing It?â. In short â there are two reasons itâs absolutely crucial to answer this question clearly as early as we possibly can.
1) First is that, unless youâre on the bleeding edge of âcool techâ, no one is motivated by what youâre doing. And, even if you are on the bleeding edge, not everyone is motivated by future tech. Itâs the WHY youâre doing it that drives engagement. Get this right and you will find that winning stakeholder buy-in becomes dramatically easier. Seriously, we are talking a night and day level of difference here. Whether this is in trying to convince investment boards to allocate you funding, or explaining why your new restructure is a good idea for the 650 staff affected â a clear WHY makes your life easier.
2) The second amazing thing that happens when you answer this Valuable Question is that you automatically start to build in regular checks on the projectâs viability. By this I mean, you start asking the logical follow-up question â âDoes this project still make sense?â. Itâs this one-two punch combination of questions that will have one of the largest impacts on driving up your project return on investment while simultaneously cutting down your project lengths.
Getting to Your Projectâs WHY
Unfortunately, our elephant â the LMBR Project - failed to capitalise on either of the awesome advantages of answering the project âWHYâ. Letâs explore.
Letâs first look at the LMBRâs formal stated project âWHYâ.
The department stated that âthe reasons for proceeding with the LMBR program were that the existing finance, human resources, payroll and student administration systems were over 15 years old, technically obsolete, complex, costly to maintain, and did not meet the Departmentâs business requirements.â
Anyone excited yet? No? Hmm... Maybe if we go on itâll get a little better:
âThere were over 100 applications being used by schools and TAFEs to [supplement the existing systemsâ deficiencies]. This meant there was duplication of effort and inefficient and inconsistent manual processes across the Department. The LMBR program was designed to address these issues.â
Can you hear a strong enough call for a $750 Million spend and 12 years of effort in any of the above? Because I canât. It seems that LMBR had a clarity of âWHYâ problem. Simply put â having an old system is not a good...