Category Archives: Complexity

Stakeholders in complexity

The new CPM is ‘Complex Project Management’ and whilst most of the current project management tools and practices including risk management, scheduling and EVM remain important, they are not sufficient to successfully manage a complex project according to Stephen Hayes, from the Canberra based International Centre for Complex Project Management ICCPM.

ICCPM Ltd was established by Australian, UK and US government bodies and major defence industry corporations, and is now a substantial network of global corporate, government, academic and professional organisations committed to the better management of complex projects across all industry and government sectors focused on improving the success of complex projects.

ICCPM

Whilst all projects have a degree of complexity (see: Project Size and Categorisation) CPM is focused on the major projects undertaken in response to ill-defined and often mutually-incompatible stakeholder requirements and are subject to uncontrollable external influences and almost continuous change.

Successfully managing this type of project needs outcome focused leadership that is capable of developing context specific innovative approaches to issues backed by the tenacity to deliver ‘no matter what’!

The latest report facilitated by ICCPM in conjunction with Global Access Partners and a range of leading public and private sector organisations is entitled “Complex Project Management: Global Perspectives and the Strategic Agenda to 2025” (available from https://iccpm.com/).

This report has developed a framework for on-going research into CPM under six broad themes:

  • Delivery leadership – the ability to navigate through uncertainty and ambiguity to achieve the desired outcome.
  • Collaboration – working as one team to a mutually agreed goal and equitable reward (including operating the entire supply chain as a single entity).
  • Benefits realisation – understanding and delivering through-life product value.
  • Risk, opportunity and resilience – taking good risk, seizing emergent opportunity, and successfully responding to the unexpected.
  • Culture communication and relationships – maximising the effectiveness of the human asset by understanding and responding to human behavioural need.
  • Sustainability and education – continuous learning, maintaining currency in leadership capability and knowledge transfer across generational boundaries in order to sustain through-life capability.

Against each of these a basic set of policies and actions have been developed to define the future work and research agenda of ICCPM, its partners and academia.  To this end ICCPM is working to develop a permanent, co-ordinated global specialist research agenda for CPM.

With support from the UK Cabinet Office, the Australian Government, universities including QUT and DAU, professional associations including IPMA and APM, and companies such as BAE Systems and Thales (to name but a few) this initiative may prove successful.  Two glaring omissions from the list of supporters though are the AIPM and PMI –maybe this blog will trigger some action.

Certainly the emergence of stakeholders at the centre of complexity means stakeholder management and engagement will be a topic of increasing importance which is only to be encouraged.

Note: The contents of this post are based on the executive summary of the ICCPM – GAP CPM Task Force report: www.iccpm.com

Poor Governance creates complexity

All projects and programs have four dimensions that in aggregate determine how difficult they will be to manage. The four basic dimensions are:

  • Its inherent size usually measured in terms of value;
  • The degree of technical difficulty in creating the output (complication);
  • The degree of uncertainty involved in the project; and
  • The complexity of the relationships (‘small p’ politics) both within the project team and surrounding the project.

These aspects are discussed in our White Paper: Project Size and Categorisation

Of the four, size and technical difficulty are innate characteristics of the project and are not affected by governance, they simply need to be properly understood and managed.

Uncertainty always exists to a degree and can affect what techniques and what processes should be used for the best effect (what to do) and how to achieve the objective (how to do it). The biggest challenge with uncertainty is making sure all of the key stakeholders are ‘on the same page’ and understand what the currently level of uncertain is, and how the project team are planning to resolve the uncertainties. In combination, these uncertainties create four basic project typologies requiring different management approaches (also discussed in WP 1072). Most residual uncertainties can be managed through risk management processes.

Uncertainty is not the same as ambiguity – at the start of the construction process for the London Olympics there was a very high level of uncertainty concerning the extent and types of contamination affecting the ground and waterways, the best techniques for removing the contaminates, and the total cost and time that would be required to complete the work. However, there was absolutely no ambiguity about the requirement to fully decontaminate and remediate the site and the waterways. As the work progressed, the uncertainties reduced, the extent of the problem was defined, the site was fully remediated and the requirement was achieved.

AmbiguityComplexity is similar to uncertainty; there is always a degree of complexity associated with the many and various stakeholder relationships in and around the project. Internal ‘politics’ can be managed, controlled and used in a positive way provided the organisations governance and internal management disciplines are effective. External stakeholder relationships are more difficult to control and tie into the organisation’s overall corporate social responsibilities (CSR) and public relations (PR) activities.

But this is not the way many practitioners are experiencing complexity. The Project Management Institute (PMI) has recently published its latest Pulse of the Profession® In-Depth Report: Navigating Complexity

The worrying finding is that among the organisations surveyed whose portfolios were filled with what they defined as ‘highly complex projects’, 64 percent cited ambiguity as a defining characteristic of complexity in their projects while 57 percent cited the issue of managing multiple stakeholders. I would suggest neither of these characteristics is a true measure of complexity; but that allowing either to exist to the detriment of a project is a clear indication of weak or non-existent governance.

Ambiguity generally means the people working on the project do not know what they are supposed to achieve or there are different interpretations of what is to be achieved. Given unresolved ambiguity is a guaranteed way to ensure project failure, the open governance question is why are so many organisation allowing their managers to waste money working on a ‘project’ when there is no clearly defined objective? Good governance would require the waste to be stopped until the objective of the project is defined and the associated uncertainties understood. This does not require masses of detail, but does require clarity of vision.

When JFK stated in 1961 that “the United States should set as a goal the landing a man on the moon and returning him safely to the earth by the end of the decade”; no one knew how to achieve this in any detail but there was absolutely no ambiguity associated with what had to be accomplished and when it had to be achieved. What Kennedy did was not ‘rocket science’ (that came later); what he did was to create an unambiguous objective against which all future management decisions could be judged and empower everyone to keep asking “is this decision supporting the achievement of the objective (or not)?” Being a ‘good governor’ Kennedy had sought and received assurances that the goal was achievable before issuing the challenge, but he did not try to tell his engineers and scientists how to do their work. And as the saying goes, ‘the rest is history’.

The second area of complexity, identified in the PMI report, involving diverse politics and views will in part be resolved by creating a clear vision. However, the frequently occurring ‘turf wars’ between executives are very much a symptom of poor governance and control. A well governed and disciplined management team should vigorously debate concepts at the initiation stage, but once an investment decision has been made, recognise that working against the success of the initiative is counterproductive and damages the organisation. A key aspect of governance is creating a management culture that supports the organisation in the achievement of its objectives, turf wars and destructive politics are a symptom of weak executive management and poor governance.

Within the PMI findings, the one area where genuine complexity exists is where a project (or program) has multiple external stakeholders with divergent views and expectations that are frequently ‘unreasonable’ from the project’s perspective. A typical example is the motorists who will appreciate the reduced congestion and travel times after a freeway is widened but complain about the delays caused by the road works and the environmentalists who are opposed to the whole project ‘on principle’, knowing the money would be better spent on ‘clean’ public transport upgrades. Thousands of stakeholders, hundreds of different positions, wants and needs and everyone ringing their local papers and politicians…… this is real complexity.

In these situations there are no easy options, the only way to minimise the damage is carefully planned and implemented stakeholder engagement strategies that combine traditional communication options with more sophisticated corporate social responsibility (CR) and public relations (PR) initiatives. This is hard work and never 100% successful but essential to minimising the effect of complexity and to contribute to achieving a successful project outcome. The Stakeholder Circle® has been designed to provide the data management and analysis needed for this type of heavy duty stakeholder engagement.

The limitations of root cause analysis

Learning lessons from projects is not as simple as you may think! Projects are complex adaptive systems linking people, processes and technology – in this environment, useful answers are rarely simple.

Certainly when things go wrong stakeholders, almost by default, want a simple explanation of the problem which tends to lead to a search for the ‘root cause’. There are numerous techniques to assist in the process including Ishikawa (fishbone) diagrams that look at cause and effect; and Toyota’s ‘Five Whys’ technique which asserts that by asking ‘Why?’ five times, successively, can you delve into a problem deeply enough to understand the ultimate root cause. The chart below outlines a ‘Five Whys’ analysis of the most common paint defect (‘orange peel’ is an uneven finish that looks like the surface of an orange):

These are valuable techniques for understanding the root cause of a problem in simple systems (for more on the processes see WP1085, Root Cause Analysis); however,  in complex systems a different paradigm exists.

Failures in complex socio-technical systems such as a project teams do not have a single root cause. And the assumption that for each specific failure (or success), there is a single unifying event that triggers a chain of other events that leads to the outcome is a myth that deserves to be busted! For more on complexity and complex systems see: A Simple View of ‘Complexity’ in Project Management.

Complex system failures typically emerge from a confluence of conditions and occurrences (elements) that are usually associated with the pursuit of success, but in a particular combination, are able to trigger failure instead. Each element is necessary but they are only jointly sufficient to cause the failure when combined in a specific sequence. Therefore in order to learn from the failure (or success), an approach is needed that considers that:

  • …complex systems involve not only technology but organisational (social, cultural) influences, and those deserve equal (if not more) attention in investigation.
  • …fundamentally surprising results come from behaviours that are emergent. This means they can and do come from components interacting in ways that cannot be predicted.
  • …nonlinear behaviours should be expected. A small change in starting conditions can result in catastrophically large and cascading failures.
  • …human performance and variability are not intrinsically coupled with causes. Terms like ‘situational awareness’ or ‘lack of training’ are blunt concepts that can mask the reasons why it made sense for someone to act in a way that they did with regards to a contributing cause of a failure.
  • …diversity of components and complexity in a system can augment the resilience of a system, not simply bring about vulnerabilities.

This is a far more difficult undertaking that recognises complex systems have emergent behaviours, not resultant ones. There are several systemic accident models available including Hollnagel’s FRAM, Leveson’s STAMP that can help build a practical approach for learning lessons effectively (you can Google these if you are interested…..)

In the meantime, the next time you read or hear a report with a singular root cause, alarms should go off, particularly if the root cause is ‘human error’. If there is only a single root cause, someone has not dug deep enough! But beware; the desire for a simple wrong answer is deeply rooted. The tendency to look for singular root causes comes from the tenets of reductionism that are the basis of Newton physics, scientific management and project management (for more on this see: The Origins of Modern Project Management).

Certainly starting with the outcome and working backwards towards an originally triggering event along a linear chain feels intuitive and the process derives a simple answer that validates our innate hindsight and outcome bias (see WP1069 – The innate effect of Bias). However the requirement for a single answer tends to ignore surrounding circumstances in favour of a cherry-picked list of events and it tends to focus too much on individual components and not enough on the interconnectedness of components Emergent behaviours are driven by the interconnections and most complex system failures are emergent.

This assumption that each presenting symptom has only one cause that can be defined as an answer to the ‘why?’ is the fundamental weakness within a reductionist approach used in the ‘Five Whys’ chart above. The simple answer to each ‘why’ question may not reveal the several jointly sufficient causes that in combination explain the symptom. More sophisticated approached are needed such as the example below dealing with a business problem:

The complexity of the fifth ‘why’ in the table above can be crafted into a lesson that can be learned and implemented to minimise problems in the future but it is not a simple!

The process of gathering ‘lessons learned’ has just got a lot more complex.

Defining Complex Projects

There has been a lot written about ‘complex project management’ over the last few years much of which as confused projects with programs, complexity with big and complexity with complicated technology. For an overview of complexity theory see: A Simple View of ‘Complexity’ in Project Management.

A sentence in the paper ‘Translation and Convergence in Projects: An Organisational Perspective on Project Success’ (Project Management Journal, Sept.2011) triggered this post and sums up project complexity nicely: “The key difficulty with complex projects is that those managing them will often be ‘feeling their way’ towards a solution rather then following a reliable blueprint or project plan”.

Our view has consistently been that complexity is a function of complexity theory and it is a dimension of every project and program. This means every project has a degree of complexity in the same way that it has a defined size, a degree of technical difficulty and a degree of uncertainty, and all 4 dimensions interact and affect each other. These four dimensions are discussed in the Mosaic White Paper at: http://www.mosaicprojects.com.au/WhitePapers/WP1072_Project_Size.pdf.

What the thought from the paper above highlighted is the very close linkage between complexity which we see as being primarily a function of the project’s stakeholder community and the degree of uncertainty associated with the project outcome. Our blog post, Projects aren’t projects – Typology outlines one way of measuring uncertainty based on a model by Eddie Obeng.

I’m not sure how to measure this empirically yet, but I do have a feeling there is a need to define a measurement system that incorporates the type of uncertainty within the overall matrix of stakeholder engagement and supportiveness already embedded in the Stakeholder Circle® methodology – any thoughts will be appreciated.

See our earlier posts on Complexity.

If it can go wrong……

One derivative of Murphy’s Law is: If it can go wrong it will go wrong, usually at the most inconvenient moment!

Planning the assault

This post may be old news to many European’s but in November 2009, the 27-kilometer (16.8 mile) Large Hadron Collider (LHC), buried under fields on the French/Swiss border, suffered serious overheating in several sections after a small piece of baguette landed in a piece of equipment above the accelerator ring. Dr Mike Lamont, the LHC’s Machine Coordinator, said that “a bit of baguette”, believed to have been dropped by a passing bird (other sources suggest a malicious pigeon), caused the superconducting magnets to heat up from 1.9 Kelvin (-271.1C) to around 8 Kelvin (-265C), close to the level where they stop superconducting.

In theory, had the LHC been fully operational, this could cause a catastrophic breakdown similar to the one that occurred shortly after it was first switched on. Fortunately, the machine has several fail-safes which would have shut it down before the temperature rose too high.

Part of the LHC

Given the total cost of the project to build and commission the accelerator is of the order of 4.6 billion Swiss francs (approx. $4400M, €3100M, or £2800M as of Jan 2010) with an overall budget of 9 billion US dollars (approx. €6300M or £5600M as of Jan 2010), making the LHC is the most expensive scientific experiment in human history. Politicians are probably asking how a bungling bird could target a critical part of the machine with a small piece of bread and shut the whole system down?

A more realistic question for project practitioners is how could design engineers and risk managers be expected to foresee this type of problem? Failure Mode Analysis (FMA) may help but I can just see the reaction to someone in a risk workshop hypothesising that a bird would fly over the machine and drop its dinner precisely on target to cause the maximum damage. Theoretically possible, but hardly plausible would be a polite reaction……until after it happened.

One of the messages from books like ‘The Black Swan’ and from complexity theory  is the future is inherently unpredictable. This is probably as good an example of a ‘Black Swan’ as any I’ve heard of.

For more on the LHC see: http://en.wikipedia.org/wiki/Large_Hadron_Collider

Complex Decision Making Explained

Complex decision making is a vital project management skill; required not only by the project manager but also by the project’s sponsor and client / customer among others.

Some of the key areas involving complex decisions include risk management, many aspects of planning (particularly optimising choices) and dealing effectively with issues and problems in a range of areas from scope and quality to cost and performance.

There is an underlaying assumption in project management (derived from traditional scientific management) that decisions will be based on a rational assessment of the situation to optimise outcomes. Unfortunately this is not true! As complexity increases assuming a ‘rational decision making paradigm’ becomes increasingly unrealistic. Human decision makers become ‘predictably irrational’.

Understanding the built in biases and ‘predictable irrational’ decision making processes used by people confronted with complex decisions can help managers requiring optimised decisions to craft strategies to minimise suboptimal outcomes. But where can busy project managers access this information?

I have just finished reading the most amazing paper on the subject that canvases the whole spectrum from risk aversion to behavioural economics in a practical, easy to read format; and it is free!

Behavioural economics and complex decision making: implications for the Australian tax and transfer system has been written by Andrew Reeson and Simon Dunsttall of the Australian national science agency, CSIRO. The report was commissioned by the ‘Henry Review’ into the Australian taxation system and is published on their web site. Whilst you can safely skip the last section which focuses on applying the knowledge to our tax system. The preceding 7 sections are focused on how people make complex decisions in any sphere and are just as relevant to complex project decisions as to complex investment and taxation decisions.

You can download this free resource from the review panel’s website: download the paper (a copy is also on the Mosaic web site on the assumption the Government site is temporary and will close once the Henry Review has reported: download from Mosaic).

If you find the report useful and you don’t live in Australia, you can buy the next Australian you meet a beer; it was his or her taxes that paid for this amazingly useful report. I know I will be keeping my copy handy for a very long time to come.

PMI COS Seminar

This week, I will be presenting live from Australia the final session of the Fall PMI College Of Scheduling (COS) Wednesday Webinar Series: Scheduling in the Age of Complexity. This hour-long event will provide key insights for better scheduling from a personal level: What is the role of the scheduler and what is our future?

The PMI-COS Fall series is designed to bring highlights from the 6th Annual Scheduling Conference held in Boston, MA earlier this year.  Archived presentations are available at http://www.pmicos.org/ondemandlearning.asp if you find them of interest, why not sign up for the College?

The Featured Presentation:   Scheduling in the Age of Complexity

Scheduling was developed as a computer based modelling process at a time when ‘command and control’ was the dominant management paradigm. The mathematical precision of the early scheduling calculations were somehow translated into certain project outcomes. Today, the certainties are no longer so apparent. Most projects run late and uncertainty and complexity are starting to take center stage.

This paper identifies the key elements in Complexity Theory to suggest the real role of a schedule in ‘the age of complexity’. It concludes by recommending a way to re-establish the role of the scheduler in the successful delivery of projects in the 21st Century.

DATE:  Wednesday, December 2, 2009
TIME:   5:00pm EST (US Eastern Daylight Savings Time); Doors open at 4:45pm

LOCATION: http://pmi.acrobat.com/r31077016/

There is no dial-in telephone option for the presentation. All voice will be through the classroom platform.

Mathematical Modelling of Project Estimates

I have just finished reading a very interesting paper by Dr. Pavel Barseghyan; Problem of the Mathematical Theory of Human work the paper is available from the PM World Today web site.

Dr. Barseghyan’s key message is the unreliability of historical data to predict future project outcomes using simple regression analysis. This is similar to the core argument I raised in my paper Scheduling in the Age of Complexity presented to the PMI College of Scheduling conference in Boston earlier this year. Historical data is all we have but cannot be relied on due to the complexity of the relationships between the various project ‘actors’. As a practitioner, I was looking at the problem from an ‘observed’ perspective it’s fascinating to see rigorous statistical analysis obtaining similar outcomes.

A counterpoint to Dr. Barseghyan’s second argument that improved analysis will yield more correct results is the work of N.N. Taleb particularly in his book ‘The Black Swan’. Taleb’s arguments go a long way towards explaining much of the GFC – models based on historical data cannot predict unknown futures. For more on this argument see: http://www.edge.org/3rd_culture/taleb08/taleb08_index.html 

Personally I feel both of these lines of reasoning need to be joined in the practice of modern project management. We need the best possible predictors of likely future outcomes based on effective modelling (as argued by Dr. Barseghyan). But we also need to be aware that the best predictions cannot control the future and adopt prudent, effective and simple risk management processes that recognise each project is a unique journey into the unknown.

I would certainly recommend reading Dr. Barseghyan’s paper.

A Long Tail

One of the key books that started my interest in risk, uncertainty and ultimately complexity theory was Against the gods: The remarkable story of risk written by Peter L Bernstein, and published in 1996 when Peter was aged 77! This book explained much of the history behind the development of risk management in a way that I could understand and is a recommended read for anyone involved in managing projects. Despite his success, Peter Bernstein never retired, and at the time of his death last month, aged 90, he was working on another book on risk. As authors go, a very long and distinguished career.

Long_Tail

The limitations of the risk framework built in the 18th century and so clearly described in Bernstein’s book have been defined and expanded in recent times in The Black Swan by N.N. Taleb (another recommended read). Taleb’s ideas are discussed in my post Risky Business.

The major failing of traditional risk models is the issue of ‘boundaries’. Rules of probability such as The law of large numbers work if the population is bounded. The problem with project data is that there are no limits to many aspects of project risk. Consider the following:

  • You plot the distribution and average the weight of 1000 adult males. Adding another person, even if he is the heaviest person in the world only makes a small difference to the average. No one weighs a ton! The results are normal (Gaussian-Poisson) and theories such as the Law of Large Numbers and Least Squares (Standard Deviation) apply.
  • You plot the distribution and average the net wealth of 1000 people. Adding Bill Gates to the group causes a quantum change in the values. Unlike weight, wealth can be unlimited. Gaussian-Poisson theories do not apply!

Most texts and discussion on risk assume reasonable/predictable limits. Managing variables with no known range of results is rarely discussed and many project variables are in this category. For more on this see Scheduling in the Age of complexity.

Fortunately our colleague, David Hillson’s latest book Managing risk in projects will be published by Gower on 11 August 2009. This book is part of the Gower Foundations in Project Management series, and will provide a concise description of current best practice in project risk management while also introducing the latest developments, to enable project managers, project sponsors and others responsible for managing risk in projects to do so effectively. I would suggest another ‘must read’ if you are interested in project management.

More later….

Complexity

As readers of this blog and our published papers would know I have a passing interest in complexity theory and its application to project management. This seems to be an expanding area of interest world wide.

Last night I was at the PMI Canberra Chapter presenting a summary of my paper ‘Scheduling in the Age of Complexity’ [download the paper] – another good reception for the ideas but more importantly several people in the audience were involved in parallel lines of enquiry. Possibly of most interest is the ideas of Graham Durant-Law see his blog at http://www.durantlaw.info.

Another interesting development is a new publication from PMI, Exploring the Complexity of Projects written by Svetlana Cicmil, Terry Cooke-Davies, Lynn Crawford and Kurt Richardson [see: http://www.pmi.org/Marketplace/Pages/Default.aspx] A quick skim suggests this is a comprehensive round up of the current state of complexity theory in project management. More on this once I have had a chance to read it.

What is gratifying is seeing the confusion created by the so called ‘College of Complex Project Managers’ and Prof. David Dombkins receding rapidly into obscurity. Rather than the confusion caused by the ‘college’ treating large complicated programs of work as a synonym for complexity theory (as Dombkins did in the original College manifesto); thought leaders world wide seem to be:

The work on understanding complexity in project management has a long way to go and will undoubtedly be the subject of future blogs. Your contribution to the discussion will be welcome.