Category Archives: Project Management

10 guiding questions to help restructuring initiatives

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Turbulent economic times are making many organisations consider restructuring. Theoretically, a company that has been restructured effectively will be more efficient, better organised, and better focused on its core business. However, in practice, many restructuring initiatives fail as a result of overlooking “insignificant” issues or taking an unrealistic approach of the reality of restructuring across multiple countries and markets.

Here are some key points you should consider before and during a restructuring initiative that may help you thrive in challenging times:

Adding value to your company

1) What are the business drivers behind your restructuring requirements?
2) What should your redesigned organisation look like?
3) Are you obtaining function efficiency and true value for money for your spend?

Engaging effectively with your employees

4) Is your approach to your restructuring consistent with your declared values?
5) Have you got effective communications plans in place?
6) Are you engaging with employee representatives in an appropriate manner in each of your markets?

Balancing your short and longterm risks

7) How do you manage your employment brand in such challenging times?
8) Is there a risk of any proposed measures damaging your future business strategy?
9) How do you retain key talent now and in years to come?
10) How do you continue the development of tomorrow’s people whilst restructuring?

You may also want to read:
Restructuring checklist #1
Restructuring checklist #2
Restructuring checklist #3

Virtual teams: opportunity during crisis. Tips & tricks on effectively managing virtual project teams.

Market Watch recently published one of my articles regarding virtual teams’ management seen as an opportunity of cost-cutting and performance improvement. However, significant issues could arise in managing virtual team communication; overcoming them is one of the most challenging tasks of any project manager.

Article headlines:
– Available technologies;
– Tips & tricks on effectively managing virtual teams;
– Virtual communication problems: how can we overcome them?

You may find a PDF copy (Romanian version only) at:
“Echipele virtuale: oportunitate in timp de criza”, Market Watch Nr. 116, Iunie 2009, 12-13

or you may read it online at:
http://www.marketwatch.ro/articol/4991/Echipele_virtuale_oportunitate_pe_timp_de_criza/

R&D opportunities in a downturn: creating new products to take advantage of competitors’ weaknesses

The McKinsey Quarterly surveyed 494 senior executives around the world in February and March 2009. Results show that research and development remains a strategic priority for executives, even in turbulent times: 40% of the respondents say their companies are actively seeking to reduce R&D costs – far fewer than are cutting operational costs overall (according to other McKinsey research). Some 34% of the executives report that R&D budgets are lower in 2009 than they were in 2008. Further, a large majority indicate that their companies are taking a new approach to R&D in the current economic circumstances; many are turning to shorter-term, lower-risk projects or focusing on minor changes to existing products.

While this tendency toward caution is understandable, other findings indicate that many companies may be overlooking longer-term opportunities to innovate. Notably, the companies that get the greatest benefit from innovation appear to be taking a different approach. The respondents from them not only indicate that, during the past 5 years, they have had high rates of organic growth as compared with competitors but also attribute more than 30% of that growth to new products developed in house. In the areas just described, these high performers are taking a very different approach – one that seems intended to fortify their existing competitive advantages.

Respondents at high-performing innovators are nearly twice as likely as the others to regard the current economic situation as an opportunity to upgrade R&D (24%, compared to 14%) and are more likely to say their companies are expanding some R&D activities (30% versus 21%). Indeed, they are more than twice as likely as other respondents to report that their companies’ R&D budgets are either “higher” or “much higher” this year than last (35% versus 17%). As for setting R&D goals, executives at these companies are more likely than others to say they are focused on creating new products to meet changing consumer needs and new products or services to take advantage of competitors’ weaknesses. Most notably, these companies are more than twice as likely as the others to seek projects that combine higher risks with higher returns.

R&D trends based on survey results:

  • Although the urge to reduce R&D costs is understandable, not all cuts are created equal. Top companies save money by optimizing and upgrading R&D processes and making them leaner – a path that improves the bottom line while raising productivity and speed to market.
  • A rigorous portfolio approach to managing R&D projects helps senior executives focus on strategically promising efforts while uncovering moribund projects that may otherwise go undermanaged – or even unnoticed.
  • Widespread layoffs and industry restructuring, though painful, offer opportunities too. An unprecedented pool of specialist engineering talent – for example, in the automotive industry – is available for companies looking to steal a march on competitors.

For more details:
http://www.mckinseyquarterly.com/Operations/Product_Development/RD_in_the_downturn_McKinsey_Global_Survey_Results_2342

Crisis and stakeholder management

Whenever we talk about crisis, liquidity problems, news media reactions and contingency planning, we tend to overlook an essential consideration: the severity of the crisis is not only determined by the problem itself but also by the affected stakeholders and their reactions to what is happening.

When organisations are facing a crisis, such as cash flow problems, you need to deliver quick and effective results. Ideally, such issues should be managed by an experienced person or team (depending on the level of crisis) with a strong track record in managing stakeholder relationships and significant expertise in crisis situations with financial, resource and time constraints.

In the short term, you should focus on stabilising the financial position of the business and obtain both management and stakeholder buy-in. In the longer term, you should rebuild confidence and relationships whilst regaining control, keeping all parties informed every step of the way.

Here are some potential issues you could encounter during crisis:

  • You experience increasing tension with stakeholders;
  • You have or anticipate cash flow problems;
  • You are experiencing increasing working capital levels;
  • You are experiencing share price falls;
  • You are experiencing unexpected business surprises.

As solutions for the problems above, you could consider:

  • Identifying your key stakeholders as some may be more important than others;
  • Involving your key stakeholders in the process;
  • Quickly stabilising the business;
  • Exploring quick win cash generation opportunities;
  • Rebuilding stakeholder confidence in the business;
  • Improving sustainable working capital;
  • Drive robust financial information.

Once your business is back and running there are two groups of people who need to be kept informed of progress: your own employees and your key stakeholders. The most effective way of communicating progress is via regular progress reports. The reports, e-mailed to all relevant parties, should help you rebuild confidence.

Social Private Partnerships: innovation in public service delivery

PwC Public Sector Research Centre published these days a study on “Social Private Partnerships”. Using profit to deliver social benefits is a concept that the private sector has already embraced through its considerable investment in corporate social responsibility programmes. Maximising profit should enable social enterprise to deliver a higher level of ‘mission benefits’. Therefore, PwC considers that the time is ripe to recognise the coming together of the two related sectors, and to adopt a more assertive approach to partnerships between social enterprises and private firms in the provision of public services.

Working together, and sharing experience and resources, may indeed become a necessary means of achieving the traditional aims of both sectors whilst better harnessing public spending for the wider public good. However, it is important not to exaggerate or confuse the role of the third sector and social enterprise. Much of the third sector will remain dependant on giving. Only 2% of total public spending is on third sector delivery and a high proportion of social enterprises are micro-businesses. Even so, the sector receives widespread support and is popular with Government and service users. Moreover, if the goal is to create a mixed economy of providers then there will need to be more social enterprise involvement, especially in areas where private providers or public providers are dominant.

The economic downturn will act as a brake on the rate of growth and constrict access to conventional funding, but may also open up new opportunities as the government seeks to fast-track spending in key areas like health, education, housing and transport while also delivering on social outcomes, such as limiting inequality.

Advancement in outcome-based commissioning (whereby social or local added-value, like volunteering or mentoring are factored into the procurement process) and the introduction of full cost recovery should be real plusses.

You may download the full PwC study at:
“Social Private Partnerships: innovation in public service delivery,” PwC Public Sector Research Centre, 2009