STRATEGY
Succeeding in the project economy The way we work has been transformed. Executing on strategy means learning from project management
WRITING
Christoffer Ellehuus ILLUSTRATION
Adam Quest
We need to rethink our approach to talent, and recognize the skills needed to succeed
We work in a world being transformed by powerful trends. Globalized business models, the proliferation of information and the emergence of new technology are driving complexity in the markets we operate in, whether we work for incumbent firms or for fast-growing challengers and disruptors. The nature of work is shifting too, driven by digitization, in ways that profoundly change what managers and professionals do, and the tools they need to succeed. In this context, how should leaders and organizations act? Twenty or thirty years ago, the answer to that question was to improve efficiency. The thinking was that we could hone our processes and models, making operations leaner and more efficient, using tools like Six Sigma. But today, those processes are either being digitized, outsourced, or automated. Instead, the focus for leaders has to be on the changing environment and increasing the ability of their organizations to adapt to change. That means that organizations need to understand and respond to two major dynamics. First, work has changed from being based on operations, to projects. Second, because of that change, we need to rethink our approach to talent, and recognize the new skills and behaviours needed to succeed in a world that is oriented around projects.
A changing balance
The balance of how we work is changing. Research cited by project guru Antonio NietoRodriguez suggests that executives’ time used
to be split in a 90:10 ratio between the relatively routine work of ‘running the business’ and ‘changing the business’. That formula has been overturned. Today, we estimate it to be a 70:30 ratio in the other direction, with the bulk of leaders’ time spent on changing their business. Change can, of course, take any number of forms. It includes developing new products and services, moving into new territories, or responding to competitors and regulatory changes. Whatever the change, it tends to be delivered through discrete, defined initiatives: in other words, projects. In all sectors, across business, government and not-for-profits, organizations are increasingly working with a project-driven workflow. It might not be called ‘project management’ – it’s just ‘work’ – but the shift is unmistakable. The change is global in scale: it’s forecast that project-oriented economic activity could grow 68% over a 14-year period, from US$12trn in 2013 to $20.2trn in 2027 (Project Management Job Growth and Talent Gap 2017-2027, Project Management Institute, 2017). Yet organizations rarely acknowledge this shift. The costs could be substantial. One McKinsey study of over 5,000 business projects found that 56% delivered less value than expected, and 45% had cost overruns. Some 17% went so badly that they threatened the company’s very survival. If they cannot improve those odds, organizations are playing Russian roulette in their approach to managing projects. This failure rate also betrays a lack of thinking about the implications of the project-based Q4 2019 Dialogue
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