Modelling Change Management

For such a complex process, change management can be modeled mathematically using basic and remarkably simple assumptions, or rules.  The Nobel prize winner, Thomas Schelling as done so.

The sequence below shows segregation occurring where each red and blue dot is a “person” and they each want to live next to at least 2 neighboring dots of the same color out of their 4 total neighbors, the result of the simple and apparently moderate rule is total segregation after a period of time. What’s fascinating is that an apparently minor rule or constraint leads to this level of change.

Number of neighbors that need to be of the same color:

• 1 neighbor – no segregation
• 2 neighbors – complete segregation
• 3 neighbors – complete segregation
• 4 neighbor – complete segregation

Fine. So what does this mean for change management? The lesson is that very small changes in people’s behaviors and preferences can drive enormous differences in outcome.

You can see the animated sequence here (note: if it doesn’t work you need to have Quicktime installed.)

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See the full article from Atlantic Magazine here.

VIDEO – Inspiring Leadership

Simon Sinek on the importance of starting with “why?” to inspire people and achieve great results based on belief. People too often focus on the details but not the underlying motivation and this is less effective. The rationale for this comes partly from psychological insights on how the brain works.

Making Change Stick

Change management is a one of the most demanding aspects of project management, in part because it’s intertwined with human psychology which can prove even more daunting than mapping dependencies on a Gantt chart.

Previously, I highlighted a project that made change fun, such as changing stairs into piano keys to encourage people to use the healthier option rather than taking the escalator, and books such as Switch remind us that change has both an emotional and rational element to it.

Hear are two new examples of change management, one innovative and one that ultimately fizzled out.

Idea Submission At Technicolor

First the bad, as highlighted in the HBR blog at a Technicolor Plant in Michigan things started off great and got better, in asking for submissions from front line employees in 2003 then got 3,000 ideas in 2006 they got 20,000. Fantastic success, but it all happened because managers made it a priority, when the incentives for managers to focus on process improvement ended the ideas weren’t captured and it stopped. There’s never been any shortage of front line ideas, but when the management incentives changed, the submissions stopped.

Reusable Boxes At eBay

Second, in the Sloan Review an idea that has more promise (and incidentally was crowdsourced). eBay have redesigned their boxes to make reuse easier. There’s a clear alignment of incentives here, reuse is easier, helping the planet and customers, but the boxes are branded, reinforcing the eBay brand.

We shall see if it sticks, but it looks promising so far.

So, a good reminder on some of the helpful aspects of change management.

1. The incentives need to be in place, once these stopped at Technicolor, so did the change.

2. Make it fun, whether piano stairs or colorful boxes, fun is one of the best motivational tools.

 

A Major Trap In Gathering Requirements

Interesting post from Professor Tim Calkins on the Pepsi Refresh Project. The goal was to move dollars from advertising to supporting the community, in reality sales tanked…

“Be careful what people tell you. I suspect the team at PepsiCo did a lot of research on the Pepsi Refresh Project and heard from consumers that this was just a terrific idea. Indeed, I bet people said that more companies should do exactly this sort of thing, cutting self-serving advertising and instead investing in making the world a better place.

The problem is that there is a big difference between what people say they will do and what they actually do. Confusing these two things is a consumer research trap.”

Clearly, market research isn’t quite the same a gathering requirements, but there are parallels. Just because people tell you they’ll act one way, doesn’t necessarily mean they will.

Think about that the next time your stakeholders are asking for something so complex you worry it won’t be easy to use. Or delivery so fast with a budget so low, you worry it won’t meet the quality bar.

NASA and Terminating Contracts

I was surprised to learn that in 2010 NASA had 16,343 contracts in place for procurement of goods and services, of these only 28 were terminated. That’s less than 0.2% of their contracts.

Either NASA is very good at finding efficient vendors and accurately forecasting requirements and contingencies within the contract, or they aren’t being decisive enough in adapting to project changes or dealing with cases of extreme vendor underperformance.

The QWERTY Problem

Economics generally assumes people are rational. Given the information people have they’ll make the best decisions, in a Dr Spock like fashion. It’s an ok approach, but not a great one.

One of the more interesting challenges to this model is something called path dependence. This means that the world is shaped by not just what’s the right decision for people right now, but what has gone before. There are some of good examples of this:

The QWERTY keyboard is one example, originally designed to stop keys sticking on prototype typewriters it’s now being used on touchscreens on iPads where there aren’t even any actual keys. Other keyboard types are proven to be superior, such as Dvorak, but they are not broadly used – the move away from physical keyboards to on screen ones should make switching even easier, but nothing has changed yet.

photo: Jack Keene

There’s a good paper on path dependence here if you’re interested in learning more about it.

The question is this, on your projects, how many things are done because they’ve always been done that way?

Change Management and (gasp) Fun

In case you haven’t seen these viral videos from Volkswagen, they make an interesting point about change. This experiment attempts to show that people are more likely to change their behavior if it’s fun to do so. Hardly, scientific, but they are clever and inspiring. This video shows how people are more likely to take the stairs vs. an escalator if you make the stairs respond like walking on piano keys. Also a good reminder on balancing sticks and carrots, often the using a stick (punishment) as a form of motivation seems easiest, but offering carrots (incentives) can get better results.

Next, people are more likely to slow down if they can receive cash from those who speed via a lottery. Frankly, I think this one has less to do with fun and more to do with the power of financial incentives.

Finally, there are more ideas for improving recycling and bin/trash usage at http://www.thefuntheory.com/

Research on New Year’s Resolution Success

New Year’s Resolutions are hard to keep. Research from psychology professor John Norcross summarized here, shows that only 40% of resolutions are successful at the 6 month mark (incidentally, though this may sound bad, it is slightly better than typical rates of project success).

However, on the optimistic side, you are ten times more likely to do something if you have a resolution for it. I guess that’s obvious, but it’s a good reminder not to be too cynical about the concept of new year’s resolutions

Project Failure – Channel Tunnel

The Channel Tunnel Rail Link source: Akanekal (via Flickr)

The Channel Tunnel or Chunnel is a 31  mile tunnel running underneath the English Channel to carry Eurostar trains and freight trains between the UK and France.

Construction of the tunnel started in 1988, the project took approximately 20% longer than planned (at 6 years vs. 5 years) and came in 80% overbudget (at 4.6 billion pounds vs. a 2.6 billion pound forecast).

The tunnel wasn’t completely unprecedented. The Seikan Tunnel in Japan had similar length and depth. Nonetheless, like projects such as NASA’s missions and the Sydney Opera House, it seems part of the reason for cost overrun was the absence of many precedents and associated experience to base sound estimates off. In fact, subsequently, the Channel Tunnel has been listed as one of the engineering wonders of the world, which emphasizes its uniqueness.

The issues that caused delay resulted from three factors:

• Changed specifications for the tunnel, there was need for air conditioning systems to improve safety that were not included the initial design.
• The communication between the British and French teams who were essentially tunneling from the two different sides and meeting in the middle could have been improved. Theses sorts of communication issues are relatively common in delayed projects when tensions rise, Wembley Stadium is an interesting example, where poor communication meant that junior employees where often more informed about project status than senior managers.
• The contract was bid on by competing firms, this framework will necessarily encourage the ‘winner’s curse’ of the successful bidders having the lowest and most optimistic price estimates, again the Wembley Stadium project offers another example of the winner’s curse.

Another interesting aspect of the Channel Tunnel’s forecasts were that a lot of revenue was projected to come from driving the existing ferry operators out of business. Of course, these ferry operators were the main way to cross the English Channel before the Channel Tunnel existed. However, this analysis ignored the possibility that the ferries would react to the Channel Tunnel with improved pricing and service, leading to them retaining market share. In addition the creation of budget airlines providing cheap air travel between UK and France was not foreseen. It is a good reminder that in making strategic forecasts of benefits or results you should bear in mind how competitors will react to the project you are envisioning.

Whilst it is not a project management issue per se, it should be noted that a great deal of the financial problems with the Channel Tunnel were caused by overly optimistic revenue projections, on top of the construction cost overruns, and those projections failed to anticipate that the set of options for getting from Paris to London might change, both in reaction to the tunnel and because of innovation in other areas such as the development of the budget airline business model.

See more project management case studies at www.projectcasestudies.com or follow me on Twitter for blog updates.

Channel Tunnel Drilling Equipment (source: Tony Bradbury)

Book Review – Peopleware: Productive Projects and Teams

Similar to Rework, Peopleware focuses on the human side of project management, and specifically undoing many of the dysfunctions of organizations that make employees ineffective. Peopleware, as the name suggests is about how individuals can achieve flow and how team dynamics make projects successful and should be useful to most project managers given the provocative ideas that it contains.

The importance of efficient office design

Cost efficiency in office design favors crowding large numbers of people into ever smaller spaces, this increases noise and distractions making it harder for employees to be productive.  The costs of these interruptions then mean employees spend more time recovering from interruptions than getting meaningful work done offset the cost savings of spending less on office space. Because of the importance of this topic, the authors spend a lot of time discussing optimal workplace design.

Inefficient design of the telephone

The authors also point out that the telephone was poorly designed, rather than ringing once and then giving the receiver the choice to answer it rings incessantly until it is answered. The telephone, like the cramped office, promotes interruption. Interruption is the enemy of efficiency because it makes it hard for employees to be productive.

“Open kimono” management

In addition to office design, the book spends a lot of time on team dynamics, the importance of “open kimono” management, delegating and empowering employees and fostering communication and shared values within teams. “The managers’ function is not to make people work, but to make it possible for people to work.”

Overstaffing projects in the initial stages

Most directly relevant to project management, the authors argue that projects are often overstaffed during the planning phases for political reasons, planning and design requires small teams, whereas execution requires a much larger team. As the project requirements move from planning to execution, so the team size should increase. However, the authors seldom see this happen, arguing that most projects have excessively large teams during the design phase.

Despite the reference to projects and teams in the full title the book focuses more on management and team dynamics, and takes an adversarial tone against many norms of organizations. In this way, the book is very similar to Rework, and is more useful to the manager of people than of projects. The book is initially written to focus on the process of designing software, but most of the conclusions are broadly applicable.