Having crucial conversations to tackle five key problem areas will help business initiatives succeed
When any company announces unexpectedly that the chief executive or a senior manager is moving on to seek fresh challenges or pursue other interests, most people assume something has gone badly wrong.
Once the dust settles, it usually emerges that a key initiative or prized project has hit a brick wall. It might relate to a delayed product release, cost savings failing to materialise after a merger or acquisition, or a new IT system going way over budget. Whatever the case, there will be repercussions for expenditure, revenue, the short-term health of the organisation and people's careers.
Of course there is no guarantee that a corporate project will succeed. However, according to a recent study conducted by two United States-based firms, VitalSmarts and The Concours Group, failure can generally be traced to five common business problems and the quality of communication around them.
The study, entitled 'Silence Fails: The Five Crucial Conversations for Flawless Execution', found that getting things wrong in these areas ultimately contributed to an astonishing 85 per cent failure rate across various high-stakes business initiatives.
The findings were based on data collected since late 2005 from more than 1,000 executives and project management professionals in 40 US-based multinationals in different industries. The analysis covered more than 2,200 projects ranging from IT implementations valued at around US$10,000 to billion-dollar restructuring programmes.
In summary, five main problem areas were identified: fact-free planning, sponsors who are AWOL (absent without official leave), skirting, the so-called project 'chicken' and team failures. The report also found that an increased focus on these areas and more open discussion about them led to better effectiveness and a 50 to 70 per cent improvement in performance.
James Chan, regional head and principal consultant for True North Leadership Asia, which is the exclusive authorised partner for VitalSmarts in Asia, said companies often got off on the wrong foot. They set unrealistic deadlines and resource limits and overlooked obvious facts about the market or the general business climate. The managers nominated to run the project and act as internal sponsors often had other priorities. This meant they provided inadequate leadership. Alternatively, they might have little political clout in the organisation, without which it was difficult to get broader co-operation and support.
Mr Chan said that 'skirting' referred to the all-too-common practice of not setting and sticking to priorities. He went on to note that the project chicken was a leader or team member who was reluctant to admit problems or always waited for someone else to speak up first. This obviously contributed to team failures, where individuals held back and were unwilling or unable to support the project wholeheartedly.
Concentrating on the five key problems, the study found that 90 per cent of project leaders surveyed regularly experienced one or more of these.
The positive news, though, was that they could all be overcome, provided companies tackled them in the right manner.
Essentially, this came down to holding the right 'crucial conversations'.
Mr Chan compared the effect of these to creating the right 'flow' within the organisation. It ensured that people understood the project's parameters, knew their own roles and had the information necessary to keep things moving forward at the required speed.
He noted that people often got into difficulties simply through not speaking up soon enough.
'They either bury those problems or talk among themselves, but don't raise things with the right people,' he said. 'So, as the project gets closer to the deadline, there are more frustrations, morale gets worse and, eventually, the project will be set for failure.'
However, he stressed that merely speaking up was not enough. It was also vital to speak articulately and persuasively, in order to win over supporters and avoid potential conflict.
'The stakes are high, there are opposing opinions, and you can get emotional,' Mr Chan said.
He said the study revealed that only 13 per cent of project leaders felt that they presented their ideas and opinions well enough.
Some admitted to not expressing the full extent of their concerns and to not encouraging their teams to air all the issues. Others conceded that their way of talking probably put colleagues on the defensive.
Mr Chan said that this could lead to another common problem - appearing 'violent' during conversations, which was equally harmful. It could cause individuals to do or say things that were counterproductive, or create a situation where people preferred not to be involved.
'Silence and violence are both wrong,' Mr Chan said.
The study also highlighted the need for senior leaders to create a culture where employees were willing and able to discuss things openly. Doing this reduced the chances of a project failing to meet budget by almost half.
Mr Chan said if project leaders effectively conducted these crucial conversations, overall quality improved almost 60 per cent, and the likelihood of having strong morale and good stakeholder relationships was almost 70 per cent greater.
He said this could literally save companies billions of dollars by preventing major delays, cost overruns or cancellations. This, in turn, helped top executives hold on to their jobs.
For most companies, the first practical step was to develop a 'crucial conversations' culture. The recommended starting point was to face up to existing problems and make them visible. An obvious way was by tracking and publicising data about projects, and identifying which were successes or failures. This approach could serve to generate discussion among staff about the causes of underperformance.
It was also useful to engage senior leaders in a 'listening campaign', where they would lead focus groups to examine where and how the five crucial problems had adversely affected the outcome of projects and, by extension, corporate results.
The report also made several recommendations. These included training project leaders on how to hold crucial conversations, and commending or rewarding team members who were prepared to take the initiative.
Particularly in a public forum, the important thing was to praise individuals who were bold enough to raise sensitive issues or even challenge their leaders.
Our lives begin to end the day we become silent about things that matter
Martin Luther King Jnr
American civil rights activist