Outcome Thinking for Projects
Most people in project management have been told about the classic triangle: time, cost, quality; sometimes called the scope triangle. Its overall focus is on stewardship of spend, on containment, on control. You know, the one that looks like this:
It encourages managers to consider how the impact of a suggested change might affect the scope of the project and to consider the knock-on effects between time, cost and quality.
Fair enough. It is a sound management framework, focusing on three of the key areas in a complex resource system.
But my concern is that this view comes from a control mindset, a mindset most managers consider normal. It is not really leadership, is it? It focuses on setting and defending project budgets in these three dimensions. Apart from maybe the focus on quality, this is pretty reactionary - it reacts, rather than initiates or creates. It is a controlling, defensive way of seeing a project through.
I submit that a better triangle is one that appears in my book, Practical People Engagement (Elbereth, 2013) and it is this:
Now, this triangle requires a shift to outcome thinking. Essentially, it is success oriented.
Let me explain by looking at each of these interactions in turn.
Different stakeholders will recognise different benefits; they will benefit from the same project in different ways. We see this using a benefits distribution matrix (see our Exploring People Engagement programme). For example, an replacement website might be justified by increased sales forecasted, something the Board really wants. However, line managers may also benefit from that website helping them brief new staff in a way that saves their time in induction using that new site. Also, by engagement, stakeholders such as the marketing team, can improve the benefit realisation of benefits already identified (sales growth).
Here we see the two-way connection between stakeholders and risks. Good engagement of one particular stakeholder (say the web developers) can reduce the threat of unforeseen cyber vulnerabilities, but can also open up new opportunities for a website that would otherwise be fairly hum-drum. By the same token, a good risk analysis - both opportunities and threats - can help us engage stakeholders with whom we would otherwise ignore.
Finally, risks (both opportunities and threats) will have an impact on both benefits we have identified in the project business case, and on benefits we have yet to recognised and claim for the project. Benefits themselves, may well reduce strategic and operational threats to the business, as well as opening up new opportunities beyond the project.
So, all in all, these three dimensions, stakeholders and their interests, risk and benefits all interact with each other.
Customers of projects don't buy budgets, they buy solutions.
This is a shift to outcome thinking. It is success oriented. Customers do not really buy a budget estimate, they buy solutions. They buy results. They look for the benefits of the new solution. And the three key areas of success are the individuals and groups involved or affected (the stakeholders), the threats and opportunities as they arise (the risks), and the benefits, both intended, emergent and unwanted (so called 'dis-benefits').
The success triangle is a shift to outcome thinking. #projectmanagement
The Project as Mere Scaffolding
Think about a project as the equivalent to scaffolding in a building construction. A project is really management scaffolding. Nobody intends to live in scaffolding, but rather they will use the scaffolding as a means to an end. Eventually, we hope to take the scaffolding away. In the same way, with a project. I've noticed that some in the project management profession has become so obsessed with the scaffolding of the project that they have made it an end in itself. It would be far better if they led towards the beneficial outcome. So an alternative focus is on the end benefits.
Some project managers make the project an end in itself. #projectmanagement
VUCA (the environment of volatility, complexity, uncertainty and ambiguity) means that the project journey will mostly be somewhat exploratory for the customer. They will be catching up with the possibilities of what current technology can do for them. Realisable benefits will change. So a better mindset becomes one of cultivation, not control; cultivation and nurturing of benefits, optimising them, and being alert to windfall benefits.
This makes the whole project less about a cost burden, to one which is an investment, where we look for a return on investment. It is a more entrepreneurial way of looking at a project. In this way, we may even find that our project business case improves as we go along.
Purely focusing on cost blinkers the project manager to the customer’s potential outcomes.
Now risk is an interesting dimension as it can be much more inclusive of time, cost, scope and quality. Thinking risk, particularly in how it relates to benefit realisation, begins to steward everything to head off, mitigate or minimise anything that might threaten our benefits.
Risk, as including both threats and opportunities, is a large enough mindset to allow that entrepreneurial approach, where risks are not merely threats, but also opportunities. We begin to think in terms of considered risk-taking rather moving from fear. Psychologically, for both customers and the project manager, this can be very powerful.
Risk, as including both threats and opportunities, is a large enough mindset to allow an entrepreneurial approach. #riskmanagement
And risks lead us to one of the most important sources of risk: people, our stakeholders.
We all know that people can be a nuisance, uncooperative or even openly resistant. They can become a drag on the project, unless we engage them well.
A rather clumsy term in use is dis-benefit. (I hate the term, but I can't think of a better one.) This is where we know that some stakeholders will be disadvantaged by the change the project brings. It's not the possibility of a loss (a risk) but is something we know the project will bring. We know that there is always loss with a change, there is always dis-benefit. Particular stakeholders will be disadvantaged in some way, will lose by what we do as a project.
With dis-benefits we must never assume that we are more aware of someone else’s dis-benefits than they are. The opposite is almost always true. If we don’t appear to recognise how they lose or cannot show empathy for their losses then that stakeholder could easily resent us and the project. As a general rule, it is far better to be open about dis-benefits. With this stance, we will find that our credibility grows.
So then, all three dimensions in this triangle can be positive or negative: risks as both threats and opportunities, and benefits as positive benefits and dis-benefits. And people can be a nuisance, uncooperative or even openly resistant, as well as being key enablers of the outcome we want.
Shaping Success v Managing to Cut Losses
Overall, though, the success triangle focuses us more on shaping success rather than operating merely to cut our losses.
So, how about the success triangle appearing on our project dashboards? Might it begin to shift mindsets for the better?
Leave me your comment on this below.