Galloping to Greatness in Strategy Implementation - PART 3 #dynamiccapabilities #heuristics / by John Schlichter

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Maturity recapitulates capability. That is a first principle of Organizational Project Management maturity. Let’s look at how we get there. In the first installment or Part 1 of this article, I noted the verb "to manage" was originally derived from the Italian word "maneggiare," meaning to handle and train horses, which is what sparked my idea that one can demystify the way that capabilities in strategy-implementation are created by talking about it in terms of horse-racing. Clearly I am actually interested in how to become capable of choosing good projects and delivering them well to implement one’s own organization’s strategies. But pretending that horse racing is our interest can be a useful thought experiment. In Part 2, I explained how standardization is followed by measurement. After standardization and after measurement, one can establish “control,” which is the pay-off. Standardization and measurement are pointless without control. Control is the goal because the control stage of maturity is when capabilities are created, i.e. the capabilities necessary to implement strategies through projects successfully, consistently, and predictably.

To establish the “Control” level of maturity in horse racing, we must do the following things:

  • Define capabilities. This means we must articulate operational definitions of process stability for the processes that were identified as important. If "speed" is important to us, then we must define what "speed" means, including what speed is too slow and what speed is too fast. If processes X, Y, and Z are essential for "speed," then we must articulate how they impact speed.

  • Document critical control points. We must identify the essential points in processes that must be controlled to produce speed in the manner that the organization requires speed to be produced.

  • Develop monitoring systems. We must develop a system for monitoring speed.

  • Develop process control plan. We must develop a plan for identifying when horse racing teams are not performing within the range of speed that is required. The plan must specify what will be done when this occurs and how performance will be reformed to expectations.

In addition to speed, I suggested “safety” as a possible metric. If the organization’s leaders decided that safety is an important metric, we would define what safety means, including minimum and maximum safety thresholds. For example, we might define safety as “avoiding serious injury,” where “serious injury means death, significant disfigurement, dismemberment, a fracture, a permanent loss of use of a body function, significant limitation of a body function, or a non-permanent injury preventing the person from performing his daily activities for not less than 90 days within the 180 days immediately following his accident.” This is called an operational definition, and its clarity makes evaluating safety easy. We would create operational definitions for each performance metric.

We would articulate how key processes impact the metric, in this case “safety,” e.g. warming up the horse, checking the saddle. We would identify essential points in the process that must be controlled, why, when, and how, e.g. checking the saddle to ensure it is secure before the horse leaves the paddock by reviewing the straps and buckles to ensure they are not loose, where "loose" is when straps shift more than 3 inches or buckles do not close fully. 

You should notice that capabilities were not distinguished until the third level of maturity (per figure 2). If we could define these things in terms of the outcomes the organization wants and not simply in terms of process KPI’s at the beginning of the first level of maturity (instead of waiting until after our second maturity assessment to define these things), then we could develop capabilities faster. We recommend establishing control limits for outcomes in level 1. The reason that this nuance is important is because it focuses practitioners on the performance outcomes and discourages bureaucracy.

 Figure 2: Maturity versus Capability

Figure 2: Maturity versus Capability

You should also notice that the organization's leaders can change their minds regarding the range of performance that is acceptable to them. If the maturity framework is in place, leaders may decide either to relax performance against a metric within the framework or to increase the rigor of performance that is required for a metric.

Leaders may change their minds about these things over time depending on developments in the organization's external environment. For example, if speed is important, and if competitors are getting faster, then leaders may decide that the speed of their own horses must increase to a level that addresses the new competitive environment. 

After “Control,” to establish the final level of maturity in horse racing, which is called "Continuous Improvement" or simply “Improvement,” we must do the following things:

  • Cultivate widespread and decentralized participation in process improvement activities. This means that everyone from the owners of the horse racing team to the riders to the people who clean the stables are continuously looking for opportunities to improve their performance. It also means that these persons self-organize to experiment with improvements.

  • However, it also means that these self-organized teams must demonstrate that their experiments do not result in a loss of control or a lower capability than what was established in the previous level of maturity.

Executives may experiment with giving the riders more decision-making authority, or the riders may experiment with new equipment or tools, or the stable hands may change their own schedules in ways they believe will improve performance. Continuous improvement is encouraged at all levels of the management hierarchy and across all functions if these efforts do not decrease capabilities. Participants are rewarded when capabilities increase. At the highest level of maturity, capabilities can continue to increase to any extent required by your organization. For this reason, an organization at the highest level of maturity may not be as capable as another organization at the same level of maturity. Stay tuned for the final installment of this article: Part 4.