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ISSUE 20: MARCH 2016

CONNECT BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

2016 INTERNATIONAL ROUNDTABLE SERIES Education: ICCPM Becomes an RTO Certificate IV in Responding to Organisational Complexity - Available in Australia Articles: Effective Change Management Capability Building Why Waste a Good Crisis? Building High-Performance Project Talent for Complex Environments Vacancy: ICCPM Director of Educaton and Research


|||||| CONTACT US STAFF Deborah Hein Managing Director & CEO Diane Hope Business Manager Cathy Baljak Learning & Development Manager

ICCPM BOARD Harry Bradford, Chair Chris Jenkins Simon Henley Julie Dunlap Mary McKinlay Deborah Hein Alicia Aitken Tim Cummins International Centre for Complex Project Management Ltd (ICCPM) PO Box 327 Deakin West ACT 2600 AUSTRALIA Level 2, Equinox 3 70 Kent Street Deakin ACT 2600 AUSTRALIA +61 2 6120 5110 admin@iccpm.com iccpm.com Twitter: @iccpm LinkedIn: ICCPM Complex Project Management Discussion Group The views expressed by contributors to this magazine are solely their own and ICCPM accepts no responsibility or liability for these views.

Š ICCPM 2016

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CEO MESSAGE We started back in January with the welcome news that we had successfully navigated the governments process and have been approved to be a Registered Training Organisation (RTO) under the National Vocational Education and Training Regulator Act 2011. We were then advised a couple of weeks later that our application to have our Complexity Awareness Program approved as an accredited course under the Australian Qualifications Framework (AQF) had also been approved, albeit with a name change; the new name - Certificate IV in Responding to Organisational Complexity (101095NAT). So what does all of that mean? Well apart from the recognition of the significant amount of work and effort skilfully lead by Cathy Baljak to achieve both results. It means that we have been assessed and recognised as providing high quality education products and delivery, with the appropriate processes, policies and systems in place to meet the needs of clients, students and the regulators standards for education delivery in Australia. It also means that we now have the only course on the Australian National Training Register that provides education focussed on responding to organisational complexity at the certificate IV level which is designed to meet workplace needs. It also now means that there is a recognised development pathway for those interested in working in complex environments, on complex projects and programmes into the future.

required in Australia. I will also be looking to develop delivery partners in countries that can demonstrate commitment to deliver the product to the highest possible standards at some point into the future. This year we will be conducting a series of international roundtables as part of our commitment to Thought Leadership in the complexity and managing complex projects space, the details are contained in this edition of Connect, I hope to see many contributions from the community either at the roundtables or via submission, the theme is Contracting for Success in Complex Projects. We welcomed two new partners over the Christmas period General Dynamics Land Systems – Australia and Telstra, I am looking forward to working with both partners over the coming year and beyond.

Finally it has come to pass that with the successes of ICCPM over the last couple of years we need more resources to deliver the best outcomes. We are now seeking a new Director of Education and Research. Details are included in this edition of Connect and are available on our website. It is a What does it mean from an wonderful opportunity for the right international perspective? It person to work in a small dynamic means that when we deliver the team on some of the best content program internationally it will in the world, so if you are interested BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS be delivered to the same high in making a real difference please quality standards as would be consider applying.


CONTENTS FEATURES

ARTICLES Effective Change Management

2016 International Roundtable Series 4-5

NEWS GDLS Becomes a Corporate Partner 6 TELSTRA Joins ICCPM

7

ICCPM Sponsors UTS Student Prize

8

Capability Building

14 - 19

Book Review - Performance Coaching for Complex Projects

20 - 21

Why Waste a Good Crisis

22 - 24

Building High-Performance Project Talent for Complex Environments

26 - 27

14 - 27

ICCPM Appoints Tim Cummins to its Board

9

6-9

ICCPM NETWORK Board Profile

30

Fellows Profile

31

Traci-Ann Byrnes

32

Hayden Kozlow

33

10

Certificate IV in Responding to Complexity available in Australia

11

Systems Thinking Course

12

10 - 13

What are Project Management Academics Reading About? 28 - 29

LINKS & EVENTS 34

Food For Thought

ICCPM Becomes an RTO

ACADEMIC-IN-RESIDENCE

30 - 33

Calendar

EDUCATION

34 - 35

28 - 29

34 - 35 BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

ICCPM CONNECT | 3


2016 INTERNATIONAL ROUNDTABLE SERIES

2016 INTERNATIONAL Contracting for Succes

The International Centre for Complex Project Management (ICCPM), in collaboration with the International Association for Contract and Commercial Management (IACCM) will run an International Roundtable Series in 2016 to consider the topic Contracting for Success in Complex Projects. Successful project outcomes depend on the right forms of contract and supportive contract management. Too often those in project management and those in contract/ commercial management experience similar challenges, yet do not combine their efforts or resources to drive improvement. This initiative seeks to bring together senior leaders to share perspectives and to use the collective wisdom of the participants to confirm the issues that currently prevent contract and project alignment, and to create specific and practical steps that will drive major improvement, with the principal outcome being a clear definition of further action required.

Read the Discussion Paper at page 38. 4 | ICCPM CONNECT

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS


2016 INTERNATIONAL ROUNDTABLE SERIES

L ROUNDTABLE SERIES ss in Complex Projects

LOCATIONS

Roundtable events will be held between April and September in a number of locations gloablly. One-day facilitated roundtable workshops are being planned for Washington, Ottawa, London, Europe, New Zealand and Australia.

DELEGATES

Delegates will include Fellows and members of IACCM and ICCPM and executive level practitioners working in complex project, program and contract and commercial environments in the private and public sector. Attendance will be by invitation only and numbers at each event will be restricted to 30-50.

SPONSORSHIP

We invite you to partner with us and showcase your organisation to commercial and programme managers working in complex environments. Opportunities exist to sponsor the entire series or an individual event.

CONTACT US

To find out more or to register your interest please visit www.roundtables2016.com admin@iccpm.com or +61 2 6120 5110

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NEWS

General Dynamics Land Systems - Australia

Becomes an ICCPM Corporate Partner

It is with great pleasure that we welcome General Dynamics Land Systems - Australia (GDLS-A) as a corporate partner of ICCPM. This partnership is not only a commitment from leading edge companies such as GDLS-A to the understanding and management of complexity, it also clearly establishes the terms and conditions under which ICCPM and GDLS-A can support and work together for mutual benefit to optimise the delivery of complex projects. ICCPM MD/CEO Deborah Hein said, “GDLS-A becomes our third Adelaide based corporate partner, joining BAE Systems and ASC Pty Ltd. This may say something about the degree of complexity that these Defence Industry companies are clearly dealing with on a day-to-day basis.

I am looking forward to assisting GDLS-A in maintaining a project management capability that is aligned to the increasing complexities of defence programs and most importantly having GDLS-A staff share their knowledge, experience and wisdom through participation in our thought leadership and networking activities.” Ian Cook - Managing Director of General Dynamics Land Systems - Australia said, “Not only will ICCPM provide us with ready access to world class resources in this vital field, it will also help us to identify and implement best practice in managing complexity as Defence moves to a more strategic relationship with Industry under the First Principles Review.”

General Dynamics Land Systems provides a full spectrum of land and amphibious combat systems, subsystems and components worldwide. Combat vehicle systems are our core business which results in continuous internal investment in research and development, and continuous production at our manufacturing plants and global suppliers. Our strengths are world-class design and systems integration, best in class reliability and durability and innovative life cycle support. General Dynamics Land Systems–Australia was established in 2000 to support the growing fleets of GDLS products in the region. In Australia, the Army operates a fleet of 257 LAV II 8x8 ASLAV Armoured Fighting Vehicles and a fleet of 57 M1A1 Main Battle Tanks. In New Zealand, the Army operates a fleet of 105 LAV III 8X8 NZLAV Light Armoured Vehicles. http://www.gdlsaustralia.com

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NEWS

TELSTRA Joins ICCPM Corporate Partnership Program Complexity Diagnostic fffggg

The recent appointment of Telstra CEO Andy Penn as an Honorary Fellow of Australian Institute of Project Management, Chief Project Officer Alicia Aitken’s appointment to the ICCPM Board, and now this partnership, demonstrate Telstra’s thought leadership in project management and in particular, complex projects.” Telstra Executive Director, David Boyes said the partnership between Telstra and ICCPM showed Telstra’s commitment to delivering complex projects for its customers, using contemporary project management practices. On 1 January 2016, the International Centre for Complex Project Management (ICCPM) joined with telecommunications provider, Telstra in a partnership that will see them work together to optimise the delivery of complex projects and increase capabilities and knowledge sharing across the profession.

“We look forward to be deepening our relationship with the Australian Defence Industry and forging new ties with other organisations working on complex projects.”

ICCPM Managing Director and CEO Deborah Hein said Telstra joining ICCPM reflects the increasing diversity across the corporate network.

Telstra is Australia’s leading telecommunications company, with an international presence spanning 20 countries, including a growing footprint in Asia.

“It is exciting to welcome Telstra to our growing network, although not the first non-defence organisation to be part of ICCPM, Telstra is the first telco and technology based company to join.

https://www.telstra.com.au

ICCPM is a professional organisation (network) that welcomes partners and members who have an interest in working toward better outcomes for society in the delivery of complex projects and programs. These outcomes can be linked to increased productivity, reduced failure (personally, professionally and organisationally), better budget outcomes, and most importantly increased levels of capability. Individuals and companies belong to ICCPM in order to access the nnnngglatest education and academic advancements, networking across organisations to share ggg lessons and knowledge, and building a cohort that together can address some of the most complex projects in history. Belonging to the ICCPM network encourages individual members and corporations to engage in continuing professional development to increase their capability to manage complex projects. For further information, please contact ICCPM on admin@iccpm.com or 02 6120 5110.

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ICCPM CONNECT | 7


NEWS

ICCPM Sponsors UTS Project Management Student Prize ICCPM is pleased to join with the University of Technology Sydney in awarding a prize that will recognise academic excellence in project management. The prize will be presented annually to the student of the Master of Project Management course who achieves the highest grade in the Managing Project Complexity subject. This is a five year agreement and demonstrates a long term commitment to the relationship between UTS and ICCPM and to further education in the project management space. ICCPM MD/CEO Deborah Hein said, “Academic excellence in Managing Project Complexity is the most appropriate subject for ICCPM to sponsor in any program, we have been a very long term supporter of all education in the complex project space. I am hopeful that by encouraging and recognising graduates with such a prize we might inspire the graduates to work to become some of the best practitioners in the world. I am hopeful that one day we may see one of these graduates managing something like the Joint Strike Fighter, Future Submarines, High Speed Rail or other projects of national significance, and potentially become a Fellow of ICCPM”.

Dr Chivonne Algeo, Course Director of the Master of Project Management program at UTS said, “A robust relationship between industry and the courses student’s study is invaluable for achieving mutually beneficial outcomes. The ICCPM have recognised the value of rewarding exceptional performance in the area of project complexity by supporting a student who has mastered this area of study. The opportunity for students to connect with professional associations like the ICCPM is beneficial to all responsible for delivering project outcomes in an increasingly complex and dynamic world”. The post-graduate project management degrees offered at the University of Technology Sydney (UTS) are internationally recognised and certified degrees providing a pathway into specialised project management roles, or advancement to project and program director positions. Students have the unique opportunity to develop a specialised skill set by choosing a sub-major in business, construction, engineering, IT, local government management, or health. This approach provides students with the opportunity to combine project management disciplines with sector-focused knowledge. The course incorporates UTS’s block teaching approach, which creates an immersive environment where students work with their peers in a team-based, simulated project environment.

For further information, http://www.uts.edu.au/future-students/finda-course/courses/c04006

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NEWS

ICCPM Appoints Tim Cummins to its Board Complexity Diagnostic

The ICCPM Board of Directors has appointed CEO of the International Association for Contract and Commercial Management (IACCM) Mr Tim Cummins to a non-executive Director position for an initial period. Tim will hold office until the next Annual General meeting where he will be eligible for re-election. ICCPM MD/CEO Deborah Hein said, “It is fantastic that Tim has agreed to become a member of our board. Tim brings an increased level of diversity to our board that not only shows our board’s commitment to continual growth and improvement, Tim also fills a gap in expertise in the legal/commercial/contracting knowledge area. ICCPM and IACCM have been building a strong and supportive relationship for quite number of years”. Tim Cummins said, “I have great respect for the work undertaken by ICCPM and believe that increased cooperation and knowledge-sharing between the project management profession and commercial staff is critical to their mutual success. The costs associated with a failure to work effectively together are simply too high – for business and for society.” The ICCPM Board of Directors is made up of a Chair, Deputy Chair, MD/CEO and up to six Non-Executive Directors and is ultimately responsible for the strategic direction of the organisation.

Tim Cummins is Chief Executive Officer of the International Association for Contract and Commercial Management (IACCM), where he works with leading corporations, public and academic bodies, supporting executive awareness and understanding of the role that procurement, contracting and relationship management increasingly play in 21st century business performance and public policy. Prior to IACCM, Tim’s business career included executive roles at IBM and a period on the Chairman’s staff, leading studies on the impacts of globalization and the re-engineering of IBM’s global contracting processes. His earlier career involved the banking, automotive and aerospace industries, initially in Corporate Finance and later in commercial and business development. He led negotiations up to $1.5 billion in value and his work has taken him to over 40 countries.

For further information contact ICCPM on admin@iccpm.com or +61 2 6120 5110

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

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EDUCATION

ICCPM Becomes a Registered Training Organisation (RTO No. 41394) ICCPM has received a seven year national registration from the Australian Skills Quality Authority (ASQA) as an NVR Registered Training Organisation (RTO) in accordance with the provisions of the National Vocational Education and Training Regulator Act 2011. Mrs Deborah Hein, ICCPM CEO said, “The successful result from the comprehensive initial registration audit was welcome news and comes at a time when the sector is experiencing unprecedented demand for quality training programs and skilled employees. Achieving and maintaining an RTO status needs a significant and ongoing commitment and it is a team effort to ensure ongoing compliance with the VET Quality Framework and other stringent conditions of registration. Being granted the seven year registration timeframe is not only a vote of confidence from the national regulator of Australia’s vocational education and training sector, but reflects the ongoing hard-work of staff. All of our trainers are highly qualified industry experts and educators in complexity, teach industry best practice and build capacity, capability and sustainability across organisations that are required to deliver complex projects and programmes.”

ICCPM’s scope of registration is listed on the National Register at training.gov.au For further information, please contact ICCPM on admin@iccpm.com or +2 6120 5110

RTO NO: 41394

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BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS


EDUCATION

BREAKING NEWS -

Certificate IV in Responding to Organisational Complexity course available in Australia ICCPM are very proud to announce that we are the course owner of: 10195NAT - Certificate IV in Responding to Organisational Complexity. Using the latest in scientific research and practitioner application our course shows students how an understanding of complexity can enable them to work more effectively, especially in situations of increasing uncertainty and instability. We have applied to ASQA to have the Certificate IV course placed on our scope of registration and anticipate that we will be delivering this course by the end of this financial year. Contact us if you would like to know more or wish to be placed on the waiting list for the first public course delivery.

10195NAT Certificate IV in Responding to Organisatinal Complexity is endorsed by the Australian Skills Quality Authority (ASQA) and is a nationally recognised qualification

Learning outcomes: • work with managers and team members as appropriate to deal with situations where complexity is present across a range of organisational contexts • provide guidance to managers and teams as to the tools, methods and approaches that may be used to deal with complex situations present in organisations • take responsibility for own role as appropriate in applying complexity theories, approaches and systems concepts to allocated tasks • manage self and supervise others in the efficient use of complexity management techniques at an organisational or operational level • facilitate effective problem-solving techniques for effective risk management and decision making in complex environments • demonstrate effective leadership required in environments where complexity is present • facilitate an environment orientated to high performance in the workplace

registered under the Australian Qualifications Framework (AQF).

Course graduates will demonstrate autonomy and judgement (within the limitations of their job role), underpinned by sound theoretical knowledge of complexity theories, frameworks and tools. They will demonstrate a broad range of skills in applying their specialist knowledge in environments that are complex and dynamic.

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EDUCATION

Systems Thinking and Complex Project Managment Course Brisbane 17 - 19 May 2016 ICCPM, in conjunction with the Queensland University of Technology, offers an Executive Education course in Systems Thinking and Complex Project Management.

By the end of the course, participants will be able to:

Who is the course for?

• challenge project/problem boundaries and ‘taken for granted’ assumptions using critical systems heuristics

Participants will be introduced to the concepts of systems thinking to manage complex projects. The course will benefit senior and aspiring project managers, key project management staff, commercial managers, supply chain managers, portfolio managers and key advisors independent of sector or program type.

What does the course cover? This course provides a conceptual bridge, extending traditional analytical tools of senior members into the field of managing complex projects. The course uses real-world examples of applying organisational and holistic systems approaches, so that viable project systems can be designed and managed, and emerging problems can be solved. The course also considers working with diverse and competing shareholder views and needs as well as stakeholder needs, and project delivery architecture.

• make sense of complex problems using soft systems methodology

• use the ‘Viable System Model’ • apply new approaches to working on complex projects and programs.

Essential Information Duration:

3 days

Cost:

$2,722.50 includes GST per person if you register and pay by 3 May

(Discounts are available for group bookings and ICCPM members)

Date:

17 - 19 May 2016

Venue: QUT Gardens Point Campus, Brisbane

How participants will benefit. Participants have significant opportunities to consider the transfer of their new knowledge to their own projects and feedback received shows that the transfer of learning to the workplace is immediate and powerful.

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REGISTER ONLINE or further information, please contact ICCPM on admin@iccpm.com or +61 2 6120 5110

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS


EDUCATION

Business Connect

Leadership Development Canberra Series

The QUT Graduate School of Business specialises in real-world education programs designed to transform individuals and ignite organisational performance in complex business environments. This is achieved through a focus on the development of enhanced leadership and multidisciplinary decision-making skills. QUT Business Connect is your gateway to QUT’s thoughtleadership in education and research in the real worlds of business and government. BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

ICCPM CONNECT | 13

https://www.qut.edu.au/study/short-courses-and-professional-development/short-courses/ business-connect-leadership-development-canberra

CRICOS No. 00213J


ARTICLES

Effective Change Management Capability Building By David Miller and Audra Proctor David Miller is the CEO and Founder of Changefirst. David has helped organisations successfully implement major change for over 30 years, as a senior executive in a global company and subsequently through his work with Changefirst. David’s first book Successful Change is a culmination of working with major clients and includes practical anecdotes and examples that illustrate how you can successfully implement change. Audra Proctor is a Board Member and Director of Research & Development at Changefirst. For the last 20 years Audra has been helping global organisations to develop capabilities and improve their productivity to execute business critical change initiatives. It’s her strong belief that change is far more sustainable when critical skills, processes and tools are transferred inside an organisation, to people who then control and deliver their own changes. The volume and complexity of change that organizations are facing continues to increase, and they cannot risk the negative impacts of not executing their business critical changes. Whether focused on cost reduction, process redesign, mergers, restructuring or a large IT implementation, it can be difficult for organizations to capture the full value from their change activities. A 2008 IBM survey “Making Change Work” identified an average 22% gap between the amount of substantial change an organization expected and an organization’s success at actually changing. There may be a number of causes of this gap; it could be that these organizations are pursuing inappropriate strategies, or it could be that they are in rapid decline and unable to muster sufficient resources. It could even be that they simply lack the process efficiencies which can drive real business change. However, we would conclude that the core reason for organizations failing to execute, and realise benefits from, their strategies is the difficulty getting employees to embrace the change each new initiative. This is the realm of change management – helping people adopt new behaviours, accept and take ownership of change, instead of resisting it.

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Successful project implementations rarely come from purely technical project plans that do not take into account these human dynamics of change. The qualitative impacts of poorly managed change can be seen and felt by many and effective change management is known to increase the likelihood of achieving project objectives and return on investment (ROI). The issue is how best to make change management happen in your organization.

“This is the realm of change management – helping people adopt new behaviours, accept and take ownership of change, instead of resisting it. ” BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS


ARTICLES

Key Questions 1. Should you rely on external consultants and interim managers, or should you seek to build internal capability? 2. Should you build capability focused on supporting a specific project delivery, or the specific needs of different roles in change? 3. How does an organization remain agile to survive and thrive in today’s competitive climate? In this chapter we explore how organizations can “make change their business “, with a change capability up, down and across the organization, which is commensurate with the volume, magnitude and pace of change the organization faces. We introduce our Change Maturity Model (C3M) as a way to measure the size of the gap between current capability levels and what is required for success. We consider how quickly that gap can be closed to support successful change delivery, and the best ways to ensure that this investment yields sustainable results.

Agility is critical in today’s environment Nearly 90% of UK executives surveyed by the Economist Intelligence Unit, in the 2009 report Organizational agility: How business can survive and thrive in turbulent times, ranked organizational agility as vital for business success. The same report also highlights the research conducted at the Massachusetts Institute of Technology, which suggested that agile firms grow revenue 37% faster and generate 30% higher profits than non-agile companies. Organizations that lack agility and can’t adapt to change, can suffer more than ever before from: • more adaptable competitors dominating the market • business performance deteriorating rapidly – and when deterioration occurs recovery is tougher than ever before • the engagement of employees becoming more difficult

Organizational life - cycles

So, how can organizations become agile, able to deliver change at the volume, speed and accuracy required? In a recent survey of over 50 organizations, we asked more than 2,000 change leaders what they believed was the most effective way to help their organization implement change in the current environment. The vast majority – 86% - said that internal teams were the best way to implement change. Earlier supporting data published in a McKinsey Quarterly article [Helping employees embrace change, LaClair and Rao, November 2002] demonstrated a direct linear relationship between an organization’s change management capabilities and the value it captures from projects. They found that the organizations with high levels of available internal change management capabilities had collected, on average, 143% of the value they originally expected from their projects. It is against this backdrop that Changefirst believe that organizations should be re-assessing their reliance on external consultancies and interims to drive major business change. Further, we believe that if an organization is to become agile; able to transform effectively through the Organizational Life-Cycles (see Figure 2.1) rather than go into decline, and able to deliver change at the volume, speed and accuracy required; it needs more than a small number of project or OD specialists trained in change management.

• the term ‘change fatigue’ becoming part of regular conversations inside the organization BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

ICCPM CONNECT | 15


ARTICLES

Rather it takes the building of change management capabilities across the entire organization, ensuring that key processes are effectively applies on all projects and business critical changes. It is this enterprise-wide perspective of capability building that is the bedrock of organizational agility and is called Enterprise Change Management (or ECM for short).

Enterprise Change Management (ECM) ECM is the term used to describe the discipline and process of deploying change management up, down and across an organization; ensuring it can be applied to each project, and individuals have access to requisite skills to build their own personal change competency. It comprises: • A common change language that is used throughout the organization • A shared set of change processes and tools that can be applied to different projects and in different parts of the organization • Strong change leadership competency at all levels of the organization

Key Benefits In our experience, taking an ECM approach to change management ensures: • time is not wasted “re-inventing the wheel” for each new project • continuous improvement of the approach, as well as the tools and training that support the approach • consistent application on all major projects • senior leaders are managing the overall change capability

The Change Management Maturity Model (C3M) The successful introduction of ECM requires a level of change management maturity, which required a significant investment of time and effort for many organizations. Changefirst developed a Change Management Maturity Model, with four levels as shown Table 2.2, to help an organization: -

assess their current maturity level

• Role-based training and coaching to build and embed new skills and techniques.

- determine the gap towards being able to support ECM

• An organizational mind-set that supports the effective implementation of strategic change*

- build a development roadmap for a more agile organization

* Note: this would include, but is not limited to change capacity being assessed before projects are initiated, executives proactively managing the portfolio of change and a change management scorecard being established and reviewed.

Each of the Change Management Maturity levels has its own standards which must be achieved to master that stage of maturity.

Level

Stage

Description

4

Enterprise

Executive sponsors manage the overall change capacity of the organization.

3

Organisational

Change management has been tailored to align to other organizational processes. It is applied consistently on all major projects.

2

Tactical

Change management is applied inconsistently across projects.

1

Rudimentary

Project implementation contains little change management beyond basic communications and training support.

0

Technical

Change is seen as a technical process where people will comply with the requirements of the change.

Table: Change Managment Maturity Levels

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ARTICLES

Rudimentary Level At this level, there is a strong focus on the technical aspects of projects. Project implementation contains little or no change management beyond basic communications and training. Resistance is the normal outcome at this level and usually is seen as ‘anti-organization’. Employee engagement is seen as putting forward a rational case for change, and compliance is viewed as successful implementation of a change. The bottom line is that workplace productivity drops more than it should during change. The key leadership mind-sets observed at this level are: • ‘People are rational and will do the right thing. If they don’t, they have to comply anyway’ • ‘All this change stuff is a bit soft and unnecessary’ • Appropriateness to business situation This level of maturity only functions if change is slow and incremental in scope. We would say that there are no actually no maturity standards worth noting at this level

Tactical Level At this level, we observe change management being applied inconsistently across projects. Usage is typically a reaction to problems experienced during projects delivery, such as employee resistance, rather than built into the original project plan. Senior sponsors are usually active in supporting change management as an idea, but are more inclined to rely on external change management consultants for more strategic advice than the tactical support required to drive and sustain change in local areas. At best, change management is driven by a “coalition of the willing” – a small group of enthusiastic early adopters working on projects. Key leadership mind-sets at this level are: • Let’s try to get people’s buy-in, but if not then we’ll move to compliance’ • ‘Change management is good stuff, but not as important as a detailed technical plan’ • ‘We’ll do change management if we have the time and money.’

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

This level of maturity may be a strong fit if there are a number of significant change initiatives focused on improving ways of operating – i.e. there will be notable consequences if the business case in not achieved. There are some standards at this level, namely; different change models are available and there is often a generic change management education process in place that people can access. However, this is seldom a ‘needs-based’ or ‘just-intime’ approach.

Organizational Level This maturity level is characterised by change management being tailored to align to other organizational processes, and being applied consistently on all major projects. The organization agrees on the need for a single change management methodology on major projects, and project delivery communities such as IT, Six Sigma and HR feel a strong sense of ownership of the change management methodology. There is an increase in the number of change management roles, and just-in-time workshop, rather than generic training are seen as a way to help people learn and apply change management skills and processes to projects. At this level we’ve observed that external consultants are less used for change management assignments. Instead there is likely to be a core group of skilled change agents in place, plus appropriate training for local managers, and even employees, to allow them to play their active part in change.

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ARTICLES

“Change management is built into the culture - it becomes ‘the way we do things around here’...”

Key leadership mind-sets at this level are: • ‘We will be successful if we have project plans with a strong people component.’ • ‘Securing people’s commitment and helping them to shift their behaviour in support of the change are essential to success. This level of maturity is essential for environments where there is an agenda of change with a strong vision, sufficient capacity and resources. The level of complexity is high but not unmanageable using project planning and change management methodologies. There are definite maturity standards at this level with change management being integrated into other organizational processes and change management checkpoints being measured in the same way as other project checkpoints. At this level executive sponsorship and review processes are established, supported by a change management community of practice with a clear mandate.

It’s not just about ‘doing change right first time’, but also about ‘doing the right change’. Executives spend time assessing the demand for change as a whole and the level of capacity the organization possesses. Change management is built into the culture – it becomes ‘the way we do things around here’ and change agents build continuous improvements into change management. The leadership mind-sets observed at this level are: • ‘Managing change effectively is a core competency in the organization’ • ‘Assessing people’s capacity and limits to change is a core part of strategic decision-making.’

This level of maturity is essential for organizations with a transformational agenda. There are a large number of changes and difficult prioritisation decisions may have to be made. Maturity standards at this level include change capacity being assessed before initiating projects, plus a change manageEnterprise level ment scorecard is established and reviewed at all project review meetings. Change management is This maturity level is not just characterised by included in project and programme charter manchange management being adopted through the dates and associated skills are seen as an integral organization, but also be executive sponsors manpart of management development programmes. aging the overall change capacity of the organization.

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ARTICLES

Summary The volume and complexity of change that organizations are facing continues to increase, and they cannot risk the negative impacts of not executing their business critical changes. The qualitative impacts of poorly managed change can be seen and felt by many and effective change management is known to increase the change success and benefits realization. The issue is how best to make change management happen in your organization, helping you to remain agile to survive and thrive in today’s competitive climate. In this article we explored how organizational agility to effectively transform our organizations needs more than a small number of project or OD specialists trained in change management.

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

Rather it requires enterprise-wide change capability building ensuring that key processes can be effectively applies on all projects and business critical changes, and it is this that we call Enterprise Change Management.

Excerpted with permission from Enterprise Change Management: How to Prepare Your Organization for Continuous Change, by David Miller and Audra Proctor (Kogan Page, April 2016)

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ARTICLES

Book Review:

Performance Coaching for Complex Projects Influencing behaviour and enabling change By Mr Tony Llewellyn Published By Gower Publishing Review by Mrs Deborah Hein, Managing Director and CEO ICCPM This book is a must have in any project practitioners resource library regardless of whether they are managing or someday aspire to manage complex projects. It is equally applicable to complicated projects (in my humble opinion we don’t have simple projects anymore) where you will find outcomes will be optimised as a result. In Chapter 1 Tony mounts a very logical and compelling case for change in the way we approach the project management challenges in complex projects, he does this very well throughout the whole chapter. He takes the time to provide the reader with an articulate explanation regarding what complexity is and how it appears in projects. Given he is accurately reflecting the world that I have always intuitively been aware of; it is refreshing to see that he has not tried to include anything that is so far removed from reality it is hard to believe about the world and our projects becoming more complex. He has not tried to shock the reader into believing that complexity is something scary or difficult to understand, he very simply reinforces the view that complexity requires a different way of thinking and behaving and that it can be understood and must be managed. I particularly agree with the assertion that a paradigm shift from a transactional to a transformational mindset is absolutely imperative and human ingenuity is part of the necessary response, all wrapped up in the concept of a ‘coaching mindset’ to get you there.

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“This is a great book to help move practioners toward becoming great delivery leaders ”

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ARTICLES

The explanatory chapter that digs deep into the philosophy of Project Coaching is very well written and easily understood. Tony makes every effort to try to use terminology that is tangible (not ethereal) and is able to be translated into real world experience. His short case study stories are well placed, relevant and once again focussed to connecting the reader to the application of theory.

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

Practitioners will be pleased that Tony has not just written an academic piece, he has provided a wellresearched handbook for the practitioner to try with good detail around the tools and methods that with practice, perseverance and support will help professional project managers move toward successfully managing complex projects. This is a great book to help move practitioners toward becoming great delivery leaders.

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Why Waste a Good Crisis? By Karen Cherrill Kingsfield Consulting, UK Karen has over 25 years’ experience in the international engineering & construction industry. After graduating in chemical engineering and obtaining solid grounding in process design with Foster Wheeler, she gravitated towards project commercial and risk management. Karen worked with large Owner, PMC and EPC contractor organisations, directly managing teams delivering complex international projects in the oil and gas, petrochemical, power, industrial and utilities sectors. She is now a Director of Kingsfield Consulting, contributing technical leadership across the project life cycle, ranging from pre-contract risk strategies, delivery phase commercial management and avoiding contract disputes. She has gained a deep understanding of why projects fail to meet their objectives and proactively helps her clients avoid these pitfalls. Karen’s current interests are immersing herself in the fascinating world of complexity science, and finding ways to apply this pragmatically in the delivery of complex construction projects around the world. I’ve just returned from a week’s business trip to the Middle East, listening to our clients who are contractors designing and building large industrial plants in the region and beyond. They were very different conversations from the ones I was having even two years ago. Then the market was still booming, the oil price was over $100 per barrel, commodity prices were holding their own and the region’s capital spend was enormous. Contractors had huge backlogs of work, there were enough projects to go round and everyone was hiring. Today’s oil price is less than $40 per barrel and it would be a brave forecaster who would be prepared to state with any confidence that this will rise to $100 levels in the medium term. The spend on capital projects, especially to support the region’s growing infrastructure and power needs, is still massive by European standards; in Qatar alone there are $282bn worth of projects underway or planned in 2016. But that ebullience has disappeared, contractors are cutting back in overheads and staff, owners are trying to work with budgets set at a time when their expected revenues were much higher, many projects are in distress or dispute as the parties get entrenched in trying to deliver results to their stakeholders – a very different picture. 22 | ICCPM CONNECT

At a recent conference, Thierry Pilenko, CEO of the global contractor Technip, stated that this was the worst crisis that the industry has faced for a generation and that everyone knew what they must do – drive down the costs, and not by 5 or 10% but by 30 or 40%! His suggestions were about creating a climate of creativity and innovation, letting go of old ways and standards, engaging in early collaboration from the supply chain, limiting the number of interfaces, but mostly importantly changing the behaviours of the people from the top to the coal face, likening this to the step change that Technip has made in safety. The sceptics amongst us, and those who have been around this loop many times before, may smile at the rhetoric but he is not the only voice calling the industry to action. A report by Morgan Stanley and BCG (1) last year concluded that “Big Oil still lacks a truly cost-conscious culture”, referring to the need of the world’s largest oil companies to change their business model. A change of mindset was a recurring theme amongst senior executives during my trip last week who cannot sustain getting squeezed for that extra few percent, as that is all that is left without radical change.

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ARTICLES

Qatargas - the world’s largest liquefied natural gas (LNG) company

“Never let a good crisis go to waste.” Winston Churchill

At Kingsfield, we’re in the project business and full of admiration for the amazing and innovative industrial plants that our contractor clients build all over the world. We help these contractors think about, plan, deliver and make a profit on complex projects often in places where they haven’t worked before, maybe using first of a kind technology, often in multi-cultural joint ventures and from many execution centres in different time zones. These are private rather than public projects; they don’t have the luxurious timescales or seemingly elastic budgets which can pervade the public sector. BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

They are driven by the needs of stakeholders who expect rapid returns on their investment – and are often expected to be delivered at break-neck speed once the funds are sanctioned. In a fast track megaproject, there’s no time to allow for patterns to emerge, no time for ‘sense and respond’ type strategies, and no time to step out to reflect and adapt. In fact they seem specifically designed to ignore the characteristics of complex systems. But for me the real challenge is that any project team is only ever temporary; although its sole purpose is to deliver only one project, a supply chain of 1000s of vendors and subcontractors is not uncommon. After that everyone disbands and moves onto the next one. And the ‘team’ is usually made up of individuals from different companies, countries, and environments; who have different motivations and drivers. The excellent research done by ICCPM in their Research Paper RP3 (2) shows that the success factors for complex projects are tied to relationship management and collaboration. ICCPM CONNECT | 23


ARTICLES

“So where are we? The industry is in crisis. Significant cost savings need to be found by changing behaviours and a more equitable distribution of risks. Even now 65% of all megaprojects are failing.”

KC-PHO-008 Distillation Tower When we try to draw a relational map with our project managers of all the parties involved and their relationships, a massive network of interconnectedness slaps you in the face – how am I supposed to ‘manage’ all of this?! So where are we? The industry is in crisis. Significant cost savings need to be found by changing behaviours and a more equitable distribution of risks. Even now 65% of all megaprojects are failing (3). The supply chain cannot continue to be squeezed; parties need to make a reasonable profit and stay in business. The industry is calling for this step change; but it can only be achieved by acting on the growing research and experience about why complex projects fail and what we need to do differently. Whilst readers of this journal may be familiar with complex adaptive systems and the significant body of research that surrounds them, as a practitioner I would have to say that the application of ideas of self-organisation, interrelatedness, adaptiveness and emergence seem a long way from the frantic and stressful environment of a typical megaproject. But I strongly believe that the pragmatic extrapolation of these concepts into reality will provide part of the solution to the radical change in behaviours that are being called for.

mass engagement, using trending techniques and early warning flags to help respond with agility, facilitating scenario or ‘what if’ planning, and creating workshops for reflection – to name a few. I can hear contractors shouting at me – it’s the owners that need to lead this charge, not us! We’re not at the top of the food chain! Yes, we can wait for and welcome enlightened owners and operators to be brave and invite us into their world. But if this doesn’t happen any time soon, and we’d like to keep our businesses profitable, we can also lead by example and enact some smart practices that may help us all to make this step change.

References 1. “Big Oil: Toughen It Out, or Business Model Reboot” Morgan Stanley Research and Boston Consulting Group, 2015 2. ICCPM Research Project 3 Outcomes Paper: Contracting for Success in Complex Projects, December 2015 3. Industrial Megaprojects: Concepts, Strategies and Practices for Success, E W Merrow, 2011

At Kingsfield, we are challenging the conventional notions of ‘command and control’ style leadership, using techniques like Future Search to create

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ARTICLES

Do you have something to say about complexity, projects, programs, people, or research? If you would like to be included in future editions of CONNECT, contact us with your suggestions and abstracts. CONNECT is published quarterly in March, June, September and December. Deadline for submissions is the 1st of each publishing month. admin@iccpm.com

If you would like to sign up to receive future editions of CONNECT, please visit iccpm.com

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ARTICLES

Building High-Performance Project Talent for Complex Environments Through a focus on talent, culture and process, the Canadian Department of National Defence’s Project Manager competency Development Framework helps drive successful outcomes. The following article is an excerpt from a PMI whitepaper, Building High-Perforamance Project Talenet - A Transforamtional Initiative In an effort to develop strong, effective project managers working in an increasingly complex environmement, the Canadian Department of National Defence (DND) has implemented a comprehensive and robust program that aims to effectively develop and formally qualify all project managers to position the organization for ongoing project management success.

Ian Mack, Director General, Major Project Delivery, The team drew from a number of global experts Sea (Chief of Staff of the Materiel Group) laid the including the Australian Defence Force for ground work for the PCMD said that he was inspired guidance and support. after hearing a lecture by an Australian official discussing his organisation’s project management The DND’s Project Manager Competency competency standard. Development (PMCD) framework was developed by a small, forward-thinking group of individuals “I realized that the Australians were light years within the department. They recognized the need ahead of us in terms of establishing a competency to develop DND’s project management talent as set of profiles to be used to develop and qualify well as more effectively match project managers’ project managers against a project complexity competencies with the level of project complexity. assessment system,” said Director General Mack. By pursuing a similar path, DND could train and The process was given heightened impetus when assign more experienced project managers to more the Treasury Board Secretariat introduced a complex projects and newer project managers to Project Complexity and Risk Assessment (PCRA) smaller, less complex projects so they could gain model. This new management policy described a more experience. comprehensive new system for rating government projects. The basic idea of the PCRA was that Building high performance, competent project projects would be evaluated throughout their life talent requires a process that ensures employees cycle and assigned a score based on the type have the technical skills they need for effective of project; its complexity and cost; technology project management, as well as leadership, and required; number of people involved; procurement strategic and business acumen required to get the issues; and a series of other critical factors. job done.

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ARTICLES

In grooming the next generation of project managers, DND recognized the imperative of equipping its people to excel within a shifting paradigm. While the original project management triple constraint is marked by time, cost and scope, DND’s framework focuses on a talent triangle of skills that include: • Technical (project management) • Leadership (behavioral) • Contextual (government/DND knowledge) The world has ceased to be linear from a project management point of view,” said Mr. Mack. Tangible technical skills – as well as intangible leadership skills – are now equally important in ensuring project success. This is due in part to the explosion in unforeseeable risks that characterize the interconnectedness of the global marketplace, combined with the critical horizontal integration needed within the government of Canada to manage complex endeavors.’

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

Through its efforts, the DND has made an investment to ensure that project management becomes a core competency that drives successful project outcomes. The PMCD framework’s ability to align project manager competencies with project complexities will continue to play a critical role in meeting the strategic objectives of the Federal Government’s major equipment recapitalization program for the Canadian Armed Forces and perhaps become a model of excellence for successful project management throughout the entire government.

To read the full PMI white paper, Building High-Performance Project Talent – A Transformational Initiative go to: http://www.pmi.org/Business-Solutions/ White-Papers.aspx

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ACADEMIC IN RESIDENCE

ICCPM ACADEMIC-IN-RESIDENCE What are project management academics ICCPM is currently planning its 2016 International Roundtable Series during which there will be opportunities to hear and gauge the concerns of CPM practitioners. This is a valuable activity, which informs practice, education, and research. In order to further the necessary dialogue between practitioners and researchers, it is timely to ask what are the topics of interest to academic researchers. Short of a comprehensive survey, there is no direct way to address this question. However, the most recent list of the 25 most read papers by academics interested in project management offers an indication . I readily acknowledge that the list is concerned with project management in general, not just complex projects, but it still provides a valuable overview. The most popular theme –unsurprisingly- is project success, how to define it, and what are the factors that influence success (16 of the top 25 articles). The list reveals a healthy approach towards defining success beyond the traditional ‘iron triangle’ of cost, schedule and quality and the articles cover a broader horizon, including benefits realization and stakeholder engagement.

The second most popular theme is concerned with project management tools and methods (12 articles) . Here, the approach is more traditional and articles present the benefits of using a range of tools, methods and practices that are argued to be beneficial to practitioners. The presence of papers arguing for the need to transition practices to reflect current concerns (e.g. change management and the ability to evolve projects over the lifecycle) demonstrates an awareness of the challenges experienced by practitioners. Leadership and risk management (5 articles each) are in a tie for the third most popular theme. The majority of the articles here explore how leadership style or risk management assist project success, usually by identifying how to adjust to project type. However, some recent articles offer more innovative ideas on transformational leadership, and the management of risk and uncertainty.

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ACADEMIC IN RESIDENCE Complexity Diagnostic

reading about? And why does it matter? The two other themes in the top 25 are governance and stakeholders (3 articles each). Project governance is emerging as a major topic for practitioners and academics and this is a welcome development. Although complexity or complex project management are not explicitly mentioned in the top 25, some of the issues of concern to CPM practitioners are reflected in the articles: measuring success beyond the ‘iron triangle’, insights about project leadership and change management, risk and uncertainty, and governance. At the same time, the analysis of the list also reveals some gaps: contracting and supply chain collaboration are absent, issues of culture, communication, gender, diversity and sustainability are also not directly addressed. In conclusion, this highlights the opportunity for a better dialogue between CPM practitioners and academics in order to create an even more informed research agenda: this is critical to shape and innovate our inquiries, standards and practices.

The list comprises the most popular articles from the International Journal of Project Management (the top ranking project management research journal) from October 2015 to December 2015. It is available at: http:// top25.sciencedirect.com/subject/business-managementand-accounting/4/journal/international-journal-ofproject-management/02637863/archive/67/

The role of ICCPM Academic-in-Residence is to act as the single point of contact for academics worldwide wishing to engage with ICCPM on research. Prof Tywoniak will have a significant role in fostering collaborative relationships with the academic community, and provide updates on progress and issues to ICCPM Partners and members on a regular basis.

1

The count exceeds 25 as some articles address more than one theme 2

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

The ICCPM Academic-in-Residence can be contacted via email at academic@iccpm.com nnnnggggg

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ICCPM NETWORK

ICCPM BOARD PROFILE Julie Dunlap - Director Julie Dunlap is Co-founder and Managing Director of CPMC Corporation, a business dedicated to advancing the practice of complex program management. Her passion for program management is a direct result of being responsible for numerous Mission Critical programs. Her goal is to develop an organization that combines experience with education, resulting in not only the successful delivery of the defined program, but also the increased understanding on both the client and delivery side of the key elements needed for a successful project. Ms. Dunlap’s interest in program management was cultivated during her 30-year career with Lockheed Martin Information Systems and Global solutions (LM IS&GS). She led several large programs that had a direct impact on how critical information was gathered and used by the US, UK, Canadian and Australian government agencies. While all of the programs were delivered successfully, they all faced challenges. Solving those challenges helped shape and refine her key philosophy for how to make a program successful: Develop a strong partnership within your team and with your client. There will always be challenges, but a collective approach to solving them will ensure the best outcome. Combined with a strong commitment to PM fundamentals, this philosophy has enabled not only the successful delivery of programs, but the establishment of ongoing partnerships. Previous to starting CPMC, Ms. Dunlap was the Vice President for LM IS&GS South East Asia, Ms. Dunlap developed a strategy for growth and execution that resulted in significant growth in the LM resource base as well as established partnerships with key government agency’s. This role, combined with previous leadership roles in the US, UK and Canada, have provided her with an international view of program delivery and an appreciation for the program complexities that exist regardless of location. ICCPM provides the perfect forum for advancing a global focus on program management that will increase the skill level and knowledge base required for successful program delivery.

The ICCPM Fellows Program recognises individual excellence in managing complex projects. ICCPM Fellows are recognised as highly credible and successful Program Managers with a proven track record in the field of Complexity in Project Management. They are opinion leaders in the field of managing complex projects across all sectors and have extensive networks of influential thinkers. Fellows are identified by their peers as a professional program manager who is held in the highest regard in the project management community. Their personal involvement in some of the most complex projects and programs in the world provides demonstrable evidence of meeting all the criteria to be invited to become a Fellow of ICCPM. Fellows can only be nominated by existing Fellows or ICCPM Directors and are assessed by the ICCPM Board as being suitable or otherwise. More information is available on the ICCPM website and we will profile individual Fellows in future editions of the CONNECT Magazine.

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ICCPM NETWORK

ICCPM FELLOW PROFILE Raydon Gates AO, CSM (Australia) Raydon Gates is Chief Executive for Lockheed Martin Australia & New Zealand. Mr. Gates was appointed to his current position in March 2011. In this capacity, he is responsible for leading and growing Lockheed Martin’s business in Australia and New Zealand. Previously, Mr. Gates was the CEO of the Kokoda Foundation and a private consultant working in the Defence Industry and National Security areas. He also had mentoring/coaching roles in Leadership and Strategic studies at the Australian Defence College. Prior to this he served in the Royal Australian Navy for 37 years retiring in 2008 as a Rear Admiral. A seaman officer, his sea service culminated with the command of two guided missile frigates. His flag officer (2 star) appointments include the inaugural Commander of the Australian Defence College, Maritime Commander Australia, and Defence Attaché and Head Australian Defence Staff (Washington DC). His honours and awards include his appointment as an Officer in the Order of Australia, the Conspicuous Service Medal, the United States’ Legion of Merit and the French Order of Maritime Merit. Mr. Gates has been awarded a Masters Degree in Business Administration, a Graduate Diploma in Strategic Studies, and a Diploma of Company Directorship. He is a graduate of a number of strategic leadership management programs from Mt Eliza (Victoria) Management College, Australian Graduate School of Management, Oxford University and Harvard University. Mr. Gates holds a number of pro-bono Director positions: New South Wales Centenary of ANZAC Advisory Council, University of NSW Canberra Advisory Council and University of South Australia’s Defence and Systems Institute. (Source Lockheed Martin) “I am honoured to be an ICCPM Fellow. While I consider myself experienced in the higher echelons of the workings of government I am still very much learning the ‘art’ of business. To be recognised as a Fellow by my peers is very humbling to me; I look forward to contributing to the advancement of ICCPM to the best of my ability. To me the sharing of knowledge has always been paramount. This was demonstrated most ably to me on many a warship bridge as Commanding Officers shared their sea experience with me and imparted knowledge. That I was able to do something similar when I myself was a Commanding Officer was simultaneously empowering and an awesome responsibility. I would like to think that as a Fellow I can again share knowledge and experience to those eager and keen to learn. Knowledge not of the sea but of leading in complex environments, leading in ambiguity, appreciating the finer points of policy and strategy, and navigating the nuances of Government and government departments. All in their own way shoals and hazards that can undo the most competent of mariners.”

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ICCPM NETWORK

AROUND THE NETWORK Traci-Ann Byrnes is responsible for the Australian Military Sales Office within the Department of Defence in Australia, leading the disposal of major platforms and facilitating industry exports. Traci-Ann has had over 20 years experience in Defence in varying roles, dealing with complex issues and wide ranging stakeholders. Traci-Ann believes that flexible work practices and continuous personal development are essential to any career and holds a Master of Business (Complex Project Management) along with post graduate qualifications in Public Policy, Management and Strategic Procurement. Since joining the Department of Defence in 1994 as a graduate, Traci-Ann has held business finance management positions in Major Capital Equipment projects procuring night vision equipment, major ships, and aircraft upgrades. Traci-Ann had the opportunity to spend 18 months on exchange with the USA Department of Defense, focusing on project performance management and subsequently lead the reform of policy and practice associated with earned value management in Australia. Traci has been involved in a number of reform projects including the introduction of the Financial Controls Framework, the Accelerated Disposals Program and Smart Sustainment. She led the remediation of audit findings against $44billion of military assets on the Defence balance sheet and implemented a shared services model for materiel finance including the implementation of a service culture and professionalisation programme. Traci-Ann is driven to improve inclusion in the workplace. She has worked to create a diverse workforce, mentoring staff and high school girls from vulnerable communities, as well as helping to further Defence’s women’s network and supporting diversity and inclusion initiatives. This work supported her nomination by Defence for the Westpac 100 Women of Influence Awards in 2015.

BENEFITS OF MEMBERSHIP • Member events

• Monthly Member Bulletin

• Access to the Digital Gateway

• Early notification of ICCPM events

• Networking opportunities

• Discounts on ICCPM courses and events

• Access to the online Member Forum to interact with other members • Gower 25% discount on specialist business and managment books and resources

• Access to research, communications and information reserved for ICCPM members • Opportunity to contribute to the ICCPM eBook series • Access to free books (in exchange for a book review)

• Opportunity to contribute to ICCPM sponsored research

We will be profiling members of the ICCPM network in this space; if you would like to appear or suggest someone for a profile in a future edition please get in touch.

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ICCPM NETWORK

AROUND THE NETWORK Hayden Kozlow is an experienced urban planner and project manager with a career spanning 16 years in planning, property and the infrastructure industry beginning with local government in Melbourne, Regional/State Government in the ACT and now Commonwealth Government with the Department of Defence. Initially starting his career in freight forwarding, warehousing and logistics on the Melbourne Waterfront, Hayden decided to change careers, went back to University in his mid-20’s and started working for Frankston City Council in Statutory Planning at the age of 28. Although primarily working in urban planning roles, he has found that his skills can be related to property management and infrastructure construction projects. Hayden worked in Statutory and Strategic Planning roles with ACT Government as well as Property Policy and Tenancy Management of Government Owned buildings during a tough period when the ACT Government announced their school closures. Hayden was a part of ACT Government Recovery Taskforce for the 2003 Canberra Firestorm as part of the demolition team. It was challenging but ultimately rewarding to see that you can actually make a difference in your job. Currently, Hayden is Project Director of the facilities component of Project AIR5428 – Pilot Training System that involves replacement of the Pilatus PC-9 Aircraft and related training and working facilities over 5 sites and 4 states in Australia. He has only been in his current role for 7 months and every day he’s learning something new. Hayden was in a previous role in Estate Planning Branch with Defence for over 5 years. His Deputy Secretary came to speak as part of a leadership course Hayden attended and stated that ‘life begins on the edge of your comfort zone’. This prompted Hayden to change roles and begin a new challenge with CFI Branch. In addition to his Bachelor’s degree in Arts (Urban and Regional Planning), Hayden has a Diploma in Government Management, Master’s subject qualifications from the University of Melbourne in Contract Management of Public Private Partnerships and Certificate IV in Government Procurement. Hayden has enrolled in a Diploma of Project Management to be completed this year and recently completed the Introduction of Complexity Course as part of ICCPM’s Complexity Awareness Program.

MEMBERSHIP

Welcome to our new members: Ricardo Ledo Lopes Telstra, Australia

Claudius Kleynhans CK Project Services Pty Ltd, Australia

Tom Fordyce Boeing Defence Australia

Michelle Bennetts Airservices Australia

Peter Terwee Department of Defence, Australia

Adrian Wellspring Australia

Robert McNeil BAE Systems, Australia

Michael Washer Ajeeva Inc, Canada

Matt Florence Thales, Australia

Toni-Anne Munn Telstra, Australia

Paul Jeffery General Dynamics Land Systems, Australia

Tim Cummins IACCM, USA

Ganesh Muthu Boeing Defence Australia

Daniel Milford Defence, Australia

Salman Shabbir Telstra, Australia

How to join ICCPM Visit iccpm.com/register and follow the links to register as either an Individual Member (open to everyone) or a Partner Employee (open to employees of our partners). If you are a Partner Employee and need your Corporate Code please contact us. BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

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LINKS & EVENTS

CALENDAR 13 - 14 April 2016 Global Project Management Competence Detroit, USA

30 - 31 May 2016 PMI Australia Conference Adelaide, Australia

21 April 2016 APM Project Management Conference 2016 London, UK

25 - 26 July 2016 IACCM Auatralasia Conference Sydney, Australia

9 - 11 May 2016 IACCM EMEA Conference Rome, Italy

16 - 19 October 2016 AIPM National Conference Sydney, Australia

9 - 11 May 2016 PMI Global Congress 2016 - EMEA Barcelona, Spain

24 - 26 October 2016 IACCM Americas Conference San Diego, Canada

11 - 12 May 2016 Project Governance and Controls Symposium Canberra, Australia

FOOD FOR THOUGHT The Rowing Competition The boards of two fiercely competitive companies decided to organise a rowing match to challenge each other’s organisational abilities. The first company was strongly ‘theory X’: ruthless, autocratic, zero staff empowerment, etc. The second company was more ‘theory y’: a culture of developing people, devolved responsibility and decision-making. Race day arrived. The Y company’s boat appeared from the boat-house first, with its crew: eight rowers and a helmsman. Next followed the X company boat and its crew - eight helmsmen and a single rower. Not surprisingly the Y company’s boat won an easy victory. The next day the X company board of directors held an inquest with the crew, to review what had been learned from the embarrassing defeat, which might be of benefit to the organisation as a whole, and any future re-match. After a long and wearing meeting the X company board finally came to their decision. They concluded that the rower should be replaced immediately because clearly he had not listened well enough to the instructions he’d been given. (Ack J.J. Lasseur)

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LINKS & EVENTS

The Stepladder Technique Making Better Group Decisions Mind Tools Mindful Listening - Developing Awareness to Listen Fully Mind Tools Well-being Fractals Positive Psychology News Daily

Denise Quinlan

Diving into vulnerability Positive Psychology News Daily Homaira Kabir

Building Good Work Relationships - Making Work Enjoyable and Productive Mind Tools

The Johari Window - using selfDiscovery and Communciation to Build Trust Mind Tools Managing Mutual Acceptance in Your Team Do You welcome the Difference of Others? Mind Tools

The Modified Borda Count -

Achieving Consensus About Which Options to Persue Mind Tools Avoiding Groupthink Avoiding Fatal FLaws in Group Decision Making Mind Tools

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

ICCPM CONNECT | 35


Vacancy

VACANCY:

ICCPM Director of Education and Research

Are you looking for something new? Are you altruistic? Do you want to make a difference? ICCPM is looking for an executive-level practitioner with 10+ years industry experience and a good understanding of systems thinking and complexity to join the ICCPM team. We offer the opportunity to deliver high quality training and to work with industry to contribute to improving the management of complex projects and programs globally. You will report to the CEO and your responsibilities will include: • Leading the development and delivery of nationally recognised accredited courses, non-accredited courses and workshops; • Ensuring that ICCPM’s education products and services link to and are influenced by ICCPM’s research strategy and outcomes; • Ensuring ICCPM meets all obligations and remains compliant with the requirements of being a Registered Training Organisation (RTO); and • Delivering the Research Strategy as agreed by the ICCPM Board. To be a strong contender, you will be a collaborative leader and facilitator and an exceptional communicator who is innovative, consultative, resilient and personally accountable for the quality of delivery of results. You will need to demonstrate extensive industry experience in a relevant field and a background and/or deep interest in complexity and managing complex projects. You will be based in Canberra (or willing to relocate), have a Certificate IV in Training and Assessment and be able to travel. We offer flexible working arrangements and the option of full-time or part-time hours. This position may suit someone who wishes to undertake part-time post-graduate study.

The position description and application form are available on the iccpm website Applications close 9am (AEDT) on Thursday 31 March 2016

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PARTNERS

ICCPM also recognises the support of the following organisations: AIPM APM APM Group ARPI CSIRO DAU Gower Publishing University of Hull

Hudson IACCM IPMA MinterEllison The PM Channel SEGroup SKEMA

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS

In the June edition... • International Roundtable Series • Academic-in-Residence • Book Reviews • Fellows Profile • Member Profiles and much more!

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Vacancy

VACANCY:

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ICCPM Director of Education and Research

BUILDING CAPABILITY IN COMPLEX ENVIRONMENTS


Acknowledgements Dr John Davies – Principal Parallax Project Management - ICCPM Associate Partner - Australia Mrs Deborah Hein – MD/CEO ICCPM - Australia Mr Tim Cummins – CEO IACCM – United States Ms Genevieve O’Sullivan – ICCPM Fellow - Canada Mr Tony Graham – ICCPM Fellow – United Kingdom Mrs Maree Weir – Capability Acquisition and Sustainment Group (Dept of Defence) - Australia

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ICCPM/IACCM 2016 Roundtable Discussion Paper Topic Contracting for Success in Complex Projects

Introduction Successful project outcomes depend on the right forms of contract and supportive contract management. Too often, those in Project Management and those in Contract / Commercial Management experience similar challenges yet do not combine their efforts or resources to drive improvement. The purpose of the roundtable discussion is to bring the collective wisdom of the participants together, to focus on the topic, with the principal outcome being a clear definition of further action required. The purpose of this discussion paper is to provide a perspective on Contracting for Success in Complex Projects and to identify key questions that will guide the roundtable discussion. Research evidence points to the importance of the contract and underlying commercial judgment in the successful delivery of major projects. The evidence further points to a lack of attention and investment by many organisations in their embedded contract and commercial capabilities. This initiative seeks to confirm the issues that currently prevent contract and project alignment, and to create specific and practical steps that will drive major improvement. It is well understood that without commercial and contracting functions it is very difficult for a Project Manager to understand the commercial realities of their projects in totality and that the two functions have distinctly different accountabilities and responsibilities. Table 1 below provides an overview of responsibility and accountability. Project Management

Commercial Management

Jointly Owned

Responsible for

Delivery

Deal making and commercial risk

Success

Responsible for

Specification

Contract

Integrated Package

Commercial Responsible for

Technical Compliance Compliance

Negotiations and Relationships

Accountable to

Operations

Function

Organisation

Approach is

P3M methodology

Policy, Rules and Legal

Good Business

Approach is

Leadership

Corporate

Teamwork

Approach must be

Communicate

Communicate

Communicate

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There is a general problem that contract models tend to be based on classical legal theory and a standard template mentality. The UK's NAO (Sept 2014) concluded that this is 'because senior management has not taken contract management seriously enough'. In consequence, contracts have tended to be seen as instruments of administration, control and core asset protection - not really designed to be of practical use to operational staff or 'users'. In many organisations, there has been limited thought given to an overall 'contracting process'. The contract simply emerges during a sales or acquisition lifecycle. Given this lack of attention, there has been little focus on 'fitness for purpose', or indeed even discussion over what purpose a contract and contracting process should serve. 'Good contracting' is often undermined by the incentives created by current management and measurement systems (e.g. profit centres, negotiated savings, revenue-based commissions). Cooperation, collaboration and strong communication between those preparing and negotiating the contract and those charged with implementation and delivery is in many cases the exception rather than the norm, especially within customer / client organisations. There is very little data capture regarding what goes wrong in the post-award phase and therefore little root cause analysis of real risks or practical steps to avoid or provide mitigation in future contracts. Contracts rarely offer 'a framework for business operations', yet this is what is needed. Their core role in project support should be to provide appropriate guidance and flexibility in performance management and governance, yet mostly they do not do that, or they do not do it in an intelligible way; as a result, most project managers see limited purpose in the contract; they see limited purpose in raising their own contract awareness and skills; and they see the contract as a possible weapon (theirs and the other side's) to be consigned to a drawer unless or until something goes badly wrong. Overall, contracts are viewed as a necessary but unfortunate imposition, with limited relevance to ultimate project success. A major problem is that there is no real 'owner' of contracts; this is because contracts and projects are individual and transactional, and it isn't obvious who will actually champion change at a strategic level. Big projects sometimes succeed due to force of personality and the ability of a powerful sponsor to cut through organisational norms. This initiative will produce a practical roadmap of the journey needed to make project success the norm.

Background In the ICCPM compendium of working papers that supported the development and release in 2011 of the ICCPM Task Force Report – Complex Project Management – Global Perspectives and the Strategic Agenda to 2025, we said in relation to Commercial Management – Striving for a Win/Win Commercial Outcome: “The typical corporate response to a crisis frequently drives trading partners apart, rather than uniting them in seeking mutually beneficial solutions. Many contracts can ‘be governed efficiently only if the parties adopt a consciously cooperative attitude’. The nature of a contract – and the time invested in its creation and management – depends on the nature and economic potential of the relationship but too many contracting and legal professionals

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do not alter their negotiation priorities to reflect this potential value or the extent to which its realization depends on cooperation. As a result, contracts and the professionals charged with their creation are frequently seen as obstacles to value creation and are viewed by many as an unfortunate pre-requisite to doing business, rather than as a fundamental asset to successful relationships. Management in these organizations appreciates the importance of developing ‘commercial competence’, and ensures appropriate systems and personnel are in place. The Public Sector challenge is somewhat different from that of the private sector, not least because of the burden imposed by Public Procurement Rules and in particular the need for open competition. This tends to create a rules-driven approach that eliminates opportunities for competitive difference or added-value. Price, rather than quality, becomes the governing factor; and the approach to risk allocation ensures an adversarial and blame-avoiding relationship culture. Much negotiation appears driven by classical legal theory based on transactions rather than relationships. Classical law assumes self-interest and that economic interest is best served by looking after one’s own interests. This assumption encourages an attitude that approaches negotiation deal by deal, rather than seeking or observing patterns or examining the potential management of risk across relationship portfolios. Therefore, legal provisions lag behind current thinking and still assume the best way to manage risk is to allocate it to someone else and mistake dire punishments for failure for incentives to perform. The tendency for the law to dominate contractual obligations is not the only factor to undermine the effectiveness of negotiations. Many procurement organizations still believe all relationships can be reduced to individual commodity transactions and so ignore their dependency on relationship quality and governance. The lack of truth in tendering is a significant contributor to poor contractual outcomes. Research has shown that the poor performance of major projects can be linked in part to issues that were knowable, in that information existed, but was not disclosed, at the time of tendering and contract formation. The root causes of what Flyvbjerg termed the “conspiracy of optimism” are not the sole responsibility of one party alone, nor are they simple to address” The following recommendations were made in the Task Force Report:    

Rec 37 - Develop and adopt frameworks that promote contracting solidarity with strategic partners. Rec 38 - Establish systems for capturing and disseminating data derived from the operation of contracts to inform the development of policy and practice. Rec 39 – Expand and continue to support CPM Communities of Practice. Rec 40 – Institute an approach to contract creation/formation with a view to achieving the long term outcomes sought from the agreement rather than ‘game playing’ to achieve short term goals. Rec 41 – Develop and institute relational contracting and risk management methodologies that recognise the iterative and collaborative nature of risk management.

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 

Rec 42 – Institute arrangements that support the earlier engagement of suppliers in buyers’ project planning. Rec 43 – Institute the concept of benefits realisation into organisational management practices.

Further, in 2012 our second roundtable series produced the report - Hitting a Moving Target - Complex Project and Programme Delivery in an Uncertain World. We made the following observations (including recommendations) in relation to commercial and contract management: Industrial Age socio-politically-derived procurement systems are inappropriate for a data-driven, ‘information’ age and beyond. The difficulty is that those who have the power to change those systems are insufficiently informed – while those who are informed have little power. This is beyond the scope of this report to address, however, we see a strong indication of the need to seek every opportunity for conversation and research into new public/private sector procurement ‘operating systems’ that can facilitate improved project execution and delivery. One important aspect of this, which demands immediate attention, is the introduction of ‘evolutionary’ contracting models, reliant upon mutual trust and providing a framework for success in the face of inevitable uncertainties rather than emphasising punitive conditions for non-performance. A useful starting point, based on discussion between ICCPM and the International Association for Contract & Commercial Management (IACCM) defines the understanding of a contract as in essence a system to define communication channels and ensure a mutual understanding between all parties in order to support the relationships on which successful trade depends. It must therefore: • Establish consensus and consent between the trading parties • Ensure clarity and reduce ambiguity regarding their intent • Allocate roles and responsibilities related to performance • Agree mechanisms to underpin trust and confidence in working together • Document processes and principles related to the management of success or failure the greatest of these is ‘trust’, a principle that is increasingly eroded in a litigious society. The phrase ‘Good fences make good neighbours’, from the poem ‘Mending Wall’ by Robert Frost, is often cited as the principle on which rigorous contractual conditions, regulation and process compliance are justified. In fact the poem is satire, and contract conditions are no substitute for trust, regulation no substitute for ethics, and process no substitute for common sense. The ‘good fence’ in question in the poem has to be rebuilt every year because it doesn’t stand up to the reality of events, rather like the abovementioned contracts, regulations and processes!

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Attention must be paid to the negative effects of massive potential bidding costs in large projects, where the race may very well be won by the one with the deepest risk pocket rather than the supplier with the best solution. It may be that some form of funded bid process, particularly at the Concept and Assessment stages should be applied, and again, this may be a suitable topic for further collaborative research. Although it appears that as a collective we have been aware of and have had discussions and debates around these issues, it is difficult to find where much progress has been made - perhaps it is because neither the project management nor commercial management professionals see the problem as theirs individually. Certainly neither has complete visibility and/or carriage of the problem regardless of who has contributed to it. However when failure is imminent, or has occurred, collectively we all become responsible and accountable to rectify the situation.

What is Success? The attached ICCPM Research Project Outcomes Paper found the following: Whilst there are many success factors associated with complex projects, the following recurring themes were identified as crucial to project success: a) b) c) d) e) f)

Clearly defined and shared project goals and vision, Suitable Relationship/behavioural management, Prudent risk management and equitable risk allocation, An acquisition and sustainment strategy suited to the project at hand, A robust project management and systems engineering framework, and Leadership and competencies of the team.

Though not exhaustive, these characteristics are most prolific in the complex project literature as key success factors. The paper concludes with the statement: The complex project success factors are tied to relationship management, collaboration, and the principles of fairness and equity. There is nothing new in these observations. What we have seen though, it the realisation of these principles in novel contract approaches that eschew the traditional arm’s length approach of risk transfer contracting. Pursuit of relational contracting approaches though does not mean that project ‘hygiene’ factors should be ignored. Successful projects still require sound project management principles.

What Goes Wrong from a Contracting Perspective? IAACM (2015) have determined 10 key factors to explain why contracts are not fit for purpose: 1. 2. 3. 4. 5. 6. 7. 8.

Lack of Clarity on scope and goals Legal/contact team not involved early enough Failure to engage stakeholders Protracted negotiations Negotiations focus on the wrong terms and risks Contacts lack flexibility, insufficient focus on governance Contracts difficult to use or understand Poor handover from deal team to implementation team

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9. Limited us of contract technology 10. Poor post award processes and governance These factors have relevance for both the project and commercial management functions and cannot be attributed to one or the other, thus to address these factors both project and commercial managers must work hand in hand.

Next Steps Roundtable participants might be asked to consider the following:   

   

Explore barriers to collaboration (governance, competition law, corporation’s law, organisational momentum etc.) Explore opportunities to develop strategies to mitigate or address the barriers to collaboration Explore the value proposition of collaborative/relational approaches (how do we sell the message, how to we craft a business case) – how do we make taking alternative approaches more acceptable and lower risk How can we tell if we are mature enough to embark on a relational journey (ISO11000 processes or similar)? A key consideration here is that not all contracts should be relational contracts. What would the conditions under which relational contracts would be favourable? How do we measure PM and CM maturity to enable relational or new novel contracting mechanism? Current tools are not sufficient. How do we craft acquisition and sustainment strategies to drive positive relationships between customer and supplier? How do we ensure strong and productive relationships between PM and CM? How do we address institutional issues that are critical, for example - If the organization for which the PM works is does not embrace new approaches, success is difficult to achieve? What kind of institutional educational piece needs to be developed to embed new thinking as a result of this work? Can we develop a PM/CM tool that might help us to identify key event milestones with both project management and commercial management activities – with joint key event milestones with success criteria for project/commercial staff to mutually achieve at each these key event milestones? Will ICCPMs Complexity Diagnostic Tool help?

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ICCPM Connect Issue 20 March 2016  
ICCPM Connect Issue 20 March 2016  
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