Monthly Archives: December 2010

Business lessons from “Cablegate”

I don’t know if the word has been coined yet – so I may get the kudos of being the first to use it!

Without going into the political issues in this week’s media led furore, the behaviour of our Business Secretary certainly has some lessons for business.

Here are my three top lessons:

Be careful what you say – even in private

What you say in unguarded moments not only betrays your real thoughts but there is always a danger that it will get out into the public arena.

So what do you say in private about your:

  • Customers
  • Colleagues
  • Team
  • Suppliers
  • …?

Would you be concerned if they heard?

What does this say about what you think?

Should you be saying such things even in private?

How would they react if they knew what you thought?

Be true to your values

Your values will always come out – so be true to them. It is very stressful to act in ways which are not congruent with ones beliefs.

I’ve had personal experience of working in organisations where their values didn’t match mine; it affected my mood and performance. I felt so much better when I got out.

Be aware of your prejudices

We all have prejudices – its human nature. The critical issue is whether you are aware of them and try not to be driven by them. This has strong parallels to the first step in Emotional Intelligence – self-awareness.

So

What do you think?

Have you got any lessons from this?

Have you any useful observations / lessons from others in the public eye?

You can have too much of a good thing – apparently!

If you’ve ever tried to change attitudes and behaviours, you will know that it is crucial to be consistent with your message. Whatever you do, make sure that all of your words and actions reinforce the change you want and never, ever do or say anything which undermines it.

I know it seems like walking a tightrope at times – hard to do and easy to fall.

Remember that actions speak louder than words! Especially if the actions don’t match the words – people are very sensitive to that.

This is even more critical for senior people because their position amplifies their every word and action.

If it comes across as:

“do as I say… not do as I do!” – you’ve lost.

You have to lead by example

You would think it was obvious but it seems not.

One of the biggest behavioural change processes at the moment is the ongoing attempt to encourage the British people to recycle more – the UK government and local authorities all claim it is a high priority. And so it ought to be – we lag well behind most of  our european neighbours.

But I worry about the mixed messages they send.

What do you think of this?

Where I live, we have a complicated but comprehensive recycling system – it uses colour coded wheely bins [we have 4]  and different combinations  are collected weekly on a cycle which is difficult to fathom! Sometimes it seems like a large scale version of the 1980s “Mastermind” code breaking game.

Last week we had to put out our Green [compostible], brown [paper and card] and blue [bottles and cans] bins at the kerbside, not before 19:00 the night before but by 07:00 at the latest on the day of collection. They were collected at three separate times during the day by what seemed to be the same team in the same vehicles!

One of my neighbours had so much card and paper to recycle that the lid on his wheely bin wouldn’t quite close. His reward for being such a good recycler was that his bin wasn’t emptied! So now what does he do?

So the message seems to be:

“please recycle but don’t recycle too much.”

  • Do you think this approach will encourage the desired behaviour?
  • Do you think they are making it easy for people to change their habits?
  • Have you ever done anything which undermined the change you wanted?
  • Or know of anyone who has?

I’d like to hear your examples – perhaps we can all learn from them!

Project Planning – the 4th Dimension

Project plans are often thought of has having three key parameters:

  • Scope – what you plan to do and the standard you intend to meet
  • Cost / Budget – How much you intend to spend [taking all resources into account] and
  • Time/ schedule – How long you expect the project to take.

Different project types / styles and levels complexity require different levels of sophistication but the basic principles remain the same.

What I’ve noticed in many major projects that the proposed method of implementing the project is less well defined than the other aspects at sanction. This is a major error – not only to do the three elements mentioned above depend on the assumed approach but it is crucial that they are all mutually compatible and consistent. The four elements are in tension with each other, so altering one will affect all the others.

Tensions between elements of the project plan

There is a severe risk that the budget will be based on one implementation approach whilst the schedule is based on another. Simple examples of this can often be seen in TV property development programmes where, for example, – the budget is based on the developer doing the work whilst the schedule [and anticipated quality] is based on employing professionals. These assumptions are incompatible and problems are likely to surface as the work proceeds.

In professional circles, the risk of major discrepancies of this type is lower but can still exist, particularly if the development stages have not been based on effective dialogue [see an earlier post in this series – Make sure everyone is doing the same project.] This risk is heightened if the various elements of the plan are put together by separate teams with inadequate attention to communication. Similarly, there is a danger that the implementation approach will be changed late in the definition phase with assumptions being made on the likely impact on other aspects of the project. The nuances of assumed changes of approach can easily be missed and the implications of, for example, undertaking design work in-house rather than contracting it out can be underestimated.

Difficulties of this type can surface on seemingly minor sub-projects which become more important as work proceeds. There is a natural tendency to focus on major and critical items. This can lead to the team being blindsided when a significant minor but sub-critical element, which may have received only scant attention in the development phase, is delayed or cannot be sourced.

It is critical that the:

  • Budget
  • Scope / Standard
  • Schedule and
  • Implementation approach

Are all congruent with each other and prepared to an equivalent level of detail / sophistication. Saying “we’ll cross that bridge when we come to it” is unlikely to be good enough and is often a reliable predictor of problems ahead!

To Bid or not to bid?

Whatever you think of the process used to decide on the hosts for the 2018 and 2022 FIFA World Cups, there are lessons for everyone involved in bids.

Bidders

It is easy to be blinded by the prospect of the work covered by the bid and there is a risk that you will be drawn into the process without a thorough review. This can be dangerous: bidding is often expensive [reputedly the World Cup bid cost the FA £15 million and councils around £3 million] and not always successful. So it is useful to consider the decision to bid carefully. Think about the costs involved and compare the degree of scrutiny you put on this decision with the attention you would focus on a purchase with a similar cost.

To decide whether to bid, you need:

  1. An understanding of the potential competitors and how you compare
  2. An objective assessment of your ability to meet the customer’s requirements
  3. A clear understanding of the selection criteria and your ability to meet them
  4. A realistic assessment of the costs of bidding, the potential profit and the likelihood of winning.

You can then make an effective evaluation of the value of bidding. The less information you have, then the more circumspect you should be. Don’t forget about the opportunity cost – would you be better off focusing your efforts elsewhere?

Don’t forget that even if you are invited to bid, you are under no obligation to do so. If you don’t intend to bid, you should inform the customer as soon as possible so that they can find alternative bidders.

Customers

You should decide on the criteria you will use for evaluation and selection before you invite bids [ideally before prequalification]. This will cut down the work you need to do in evaluation and eliminate inappropriate bidders sooner. It is not fair to involve suppliers in significant effort when they have no realistic prospects of winning.

You should make the selection criteria and any weighting clear to bidders so that they can make an informed decision on whether to get involved. Would the same countries have bid for the World Cups had they known that taking football to new markets was to be considered much more important than the technical merits of the bid? FIFA might also consider whether the cost and effort of evaluating the technical aspects of the bids were worthwhile when the results were not taken into account.

Don’t make bidders jumping through unnecessary hoops. This drives up costs by increasing the overhead allowances bidders need to build into their fee structures.

Increasingly, customers ask bidders to undertake tasks associated with the execution of the contract as part of the selection process. I’ve been involved in bids where the customer has asked bidders to demonstrate their creativity and expertise by suggesting improvements to the scope or proposed methods.   These approaches can provide useful insights into the capabilities of bidders but should be used carefully. One might also question the ethics of using ideas supplied by unsuccessful bidders.

Some tips for customers:

  1. Don’t invite companies to bid if they will stand no chance of winning.
  2. Ensure that your prequalification process rejects companies that don’t meet your criteria
  3. Communicate these criteria effectively from the outset
  4. Use selection criteria which are appropriate to the proposed contract
  5. Don’t involve bidders in unnecessary work
  6. Treat bidders’ information with respect and confidentiality [consider rewarding unsuccessful bidders who provide useful ideas] – you may need their services in the future.

Professional Advisors

You have a responsibility to ensure that bidding processes are properly conducted and to ensure that those you are advising behave professionally and ethically. You should discourage those inviting bids from requesting unnecessary information and avoid inflating the complexity of the bidding process.

Example

As the Business Development Director of a project management company, I was involved in a bid for a framework agreement with a manufacturing company. Having submitted a prequalification package, I attended a review meeting. I noticed that the client’s representative had neatly arranged all 14 prequalification packages in his office.

I noticed that these were all from known competitors and ranged from start-up companies to one of the biggest companies in the field, we were in the middle. I asked the client how the prequalification process had gone and he responded: “Really well, everyone looks as though they could do the work, so we’ll be inviting everyone to bid”.

I recommended that it was not worth bidding – the customer had clearly not thought through what type of company they wanted to work with and had inadequate selection criteria. I wasn’t prepared to put a significant amount of effort into the bid with so many competitors and no clear view of what would make our bid stand out.

The client was doing himself no favours either as choosing between bids from such dissimilar organisations would be very difficult. He ought to have used a process which narrowed the potential bidders down to a manageable number of companies which could be compared on a rational basis. One might question the value of any professional advice they had had.