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Change that will outlive you: Managing transformative projects, part 2

Get inspired by our experience with best practices and learn from people with many years of experience on change management
Jan Skrabanek

27. 8. 2022

In the first part, we talked about the difference between building a monument and leaving a legacy. We also mentioned that it isn't always good to be like Steve Jobs. We will continue to look in depth at visionaries and why and when to pull the emergency brake.

The Survivor Delusion

There is another problem with visionaries. When we look for inspiration, we forget about those who crashed along the way. I have one more famous story for you. On 9 June 1924, Edward Norton and Howard Somervell left the high-altitude camp at the foot of Mount Everest, determined to climb the world’s highest mountain for the first time in history. At an altitude of 8,534 meters, breathing problems forced Somervell to retreat, Norton continued alone. However, he had to give up his quest only 275 meters short of his goal, due to exhaustion. It’s not such a well-known story after all, is it? If you’re not a climbing enthusiast, you’ve probably never heard of him. But you’re sure to know that the first people atop Mount Everest were Edmund Hillary and Tenzing Norgay. When we look for inspiration for our own actions, we tend to overlook those who have not achieved their goal and focus only on the triumphant, i.e. those who survived the process. This cognitive error is what statisticians call survivorship bias.


climbing


The fact that statistician Abraham Wald did not succumb to this deception was a boon to the U.S. Air Force in World War II. Army researchers carefully analyzed how planes were damaged by the enemy’s strafing. Based on their research, they recommended reinforcing the fuselage of those parts of the aircraft that were hit most frequently. But Wald warned them that they had only considered the aircraft that returned from their mission. They did not take into account the planes lost in combat. Their sample thus showed that the damage to the aircraft from enemy fire they had seen had not prevented those planes from returning. He, therefore, recommended just the opposite approach, to improve the protection of those parts not seen to have been hit, based on the sample.

plane lost in combat


We should take note and strengthen our determination to be wary of taking action based on unproven assumptions, even when we see a successful project in another company right before us, or feel the Muse has given us a brilliant idea. Let’s not underestimate the contribution of a high-quality analytical phase in the project. Even so, we often find ourselves in a situation where we know something isn’t working, but we have only limited information about the contributing factors and circumstances. We are obligated and expected to come up with a good solution. Yet we can never be sure in advance that we will find it. 


Rudolf Slaba has two tips for us, on how to minimize the risk of a failed project:

1) sticking to the ITIL keep it simple motto

2) direct questioning of everyone involved before embarking on the project, to help avoid possibly biased hearsay information.

A fairy tale about a hen and a rooster

Doing things simply means not making greater changes than necessary. Focus on sub-segments, trying to narrow the scope of change to the most relevant parts of the process. For example, if you have a capacity issue, find the root cause of that capacity issue. Do you in fact have a speed issue? You can probably guess the answer... and the likelihood of success rises considerably.

The second thing is not to underestimate the personal fact-find among the people involved. Sometimes you have to replay the Czech fairy tale about the hen and the rooster [the hen trying to get water for the rooster who got a berry stuck in his throat, and was given the runaround], and follow a whole chain of people involved in the project to find out their expectations, says Rudolf Slaba.


hen and rooster


There is a whole cascade of activities and activities in the preparation of the process, and you need to get specific information from all the links in the chain. If you only ask at the tail-end you run a great risk of missing important factors. You’re setting future problems in store.


Don’t be afraid to pull the emergency brake

Despite the best analytical work, the project may fail. In such a case, emotions have to go by the wayside and you need to coolly evaluate the effort cost to complete the project. Having invested your sweat and blood in the project makes it very difficult for you to assess the situation objectively. Daniel Kahneman, in his seminal work Thinking Fast and Slow, warns us of the dangers of being deceived in planning. Once you are directly involved in the project and its planning, you will naturally tend to make overly optimistic predictions that are unrealistically close to the optimal scenario. In other words, you’ll have a hard time making allowances in your estimate for the various unknowns that can disrupt the project. These are unpredictable factors (divorces, illnesses, unexpected bureaucratic obstacles, ...) that can significantly delay the whole project.


Over-optimism is much more common than you would expect. Kahneman cites as a telling example the results of a survey of American homeowners who have had a new kitchen put in recently. They expected costs of $18,658 on average. In reality, the average they paid for their kitchen was $38,769.


STOP


How to deal with the planning fallacy? The most significant cause of the error is trusting one’s own estimates and ignoring reference information. Try to get as much information as possible about similar changes in other departments, in the past in your department, or in other businesses. How long did the projects take? How high did the total costs escalate, and most importantly, did the project bring the desired benefit? Did it meet a real business need? Adjust your forecast based on your findings. Knowing that you have invested a lot of money in a project that fails is not a pleasant feeling. But these are sunk costs and, as economic theory advises us, such costs should not interfere with your decision about future actions. Sometimes it is simply necessary to pull the emergency brake, stop the project, and move on. This is also part of the skillset of a leader wishing to leave a real and valuable legacy. Leave monument-building to historical societies.