Is there clarity & alignment regarding the fundamentals of your strategic initiative or critical project? You may be thinking: ‘Sure, we have a detailed project plan, including a work plan and timeline with the key dates and deliverables shown in a colorful Gantt Chart’. Great! That is the project side taken care of. …but what about the other important stuff? In particular, what about the business fundamentals?
At the project level everything may look good, but even the most meticulously planned project can have unresolved business issues at its foundation. For example:
- Project outputs or results may be clear, yet there may be ambiguity regarding the business impact.
- Project scope may be defined, yet some issues remain regarding business need or even strategic ambition.
- The timeline may be set out, yet question marks remain about the level of urgency surrounding the initiative.
Factors such as the above can put a project on a shaky foundation and could ultimately jeopardize its success in the eyes of key business stakeholders.
A lack of clarity or alignment regarding the business fundamentals of a project goes a long way to explain the challenges faced by project teams in engaging C-suite executives. More importantly, it explains why losing sight of business needs (called Project Myopia) emerges as a serious (but often unseen) project risk.
What are the Business Fundamentals?
There are 9 key business fundamentals for any project – whether it is an IT project, HR project or anything else. These fundamentals link the project to the issues and concerns of the C-suite – to the key opportunities and challenges facing the business.
The Business Fundamentals are about ensuring that the rubber meets the road and strategy gets executed (through those projects and initiatives that must bring it to life). That explains why they engage C-suite executives more than any project plan can.
The Project Chassis
We use the metaphor of projects and initiatives as vehicles of your strategy. Relatedly, of ensuring that ‘the rubber meets the road’ in terms of execution. In this context, we talk about the 9 business fundamentals as the chassis of a project – as shown in the diagram below.
The 9 labels in the diagram are the business fundamentals of a project as follows:
- Business Need
- Market Reality
- Strategic Ambition
- Project Confidence
- Business Impact
- Business unusual
Why these 9 factors?
The 9 business fundamentals are not just pieces of information, but powerful talking points to engage senior executive sponsors and stakeholders. The result is no ordinary project conversation, but rather a strategic conversation. That is the type of conversation that, although important (even essential), tends not to happen in the everyday busyness of a project.
These are HBR topics – terms that would likely feature strongly in the latest business strategy book. Moreover, these are sticky topics, or at least they should be. The have the power to engage and energize senior executives and busy stakeholders.
Q: Which one of these 9 factors (for your project) requires a conversation?
In times gone by it may have been that these topics were reserved for the C suite. After all, it is their job to devise the strategy and the project team’s job to faithfully execute on it. But such a top-down traditional view is challenged by the requirements for greater speed and agility, as well as collaboration and innovation. The success of complex ambitious projects requires that project teams keep one eye on business needs / strategy and the other on the activities and steps of the project plan or Gantt Chart. This is key to leading, rather than just managing projects. It is also central to success.
Beyond the Labels
When you look at the labels on the chassis you will see:
- The obvious elements such as project timeline and budget, as well as the fundamental factors such as business need and project confidence.
- Factors that are commonly overlooked – for example the level of project complexity (labelled ‘Business Unusual’) or misunderstood (such as Business Impact).
- Matters of objective fact (e.g. budget), others are surprisingly subjective and will reveal a variety of perspectives (e.g. project confidence).
- Variables that are quantitative data (e.g. project headcount) while others are qualitative (e.g. market reality, or strategic ambition).
Combined they provide an insightful profile of a critical project or initiative. However, when you go looking for the 9 pieces of information, don’t be surprised if you find that 2 or 3 of them are missing or unclear. The question is: How many of the 9 factors are clear for your project / initiative? Are there areas where greater clarity and alignment is required?
Exploring the 9 Business Fundamentals
Let’s start with the most important fundamental, that is the business need being served by the project.
What underlying business need does the project address?
- What problem /opportunity does it address?
- How does it connect to the strategy/vision?
What fundamental market reality shapes the project?
- Key market insights
- Key market opportunities Key market constraints
- Key market trends
- Key market assumptions
The focus on what we call ‘market reality’ is important because it challenges leaders to look not just from the inside out but from the outside in. Organizations can become so wrapped up in their own internal workings and internal challenges, that they can lose sight of what is happening with customers and competitors.
The needs and expectations of stakeholders, both internal and external, are at the heart of the project chassis, including:
- What unmet stakeholder needs / expectations are to be addressed?
- How well are needs understood?
- Are any stakeholders feeling neglected?
- How engaged are stakeholders?
Confidence & Ambition
Of all the metrics on a project these can be the most revealing! Indeed, if the CEO could only ask 2 questions these would be them. Project teams have a powerful 6th sense about these factors. They predict success. But can be as much about mindset as reality. Let’s explore ambition and confidence in turn:
How ambitious is the initiative?*
- Does it dare to dream big?
- Does it aim for modest or massive gains?
- Will it stand-out or leave a lasting mark?
- What is the ambition behind the project (in 3 lines)?
- Where is ambition coming from?
*Please rate on a scale of 1-10, where 1 is not ambitious at all and 10 is ‘moonshot’ level of ambition.
What is the level of confidence in the success of the project (today)*? To probe further:
- What factors are shaping the level of confidence?
- What are the main sources of risk / uncertainty?
*Please rate on scale from 1-10, where 1 = Not Confident at All and 10 is Absolutely Confident.
The next two factors relate to ‘the numbers’ or the financial ‘stakes’ of the project. It’s what your CFO wants to know. The first is Business Impact and the second is Budget or Investment. The second is the expected payback or return on investment for the project. Let’s examine these in turn:
What quantifiable impact is the project likely to have on the business? (Please describe in scenarios with #s) Specifically:
- The performance of the business
- The future of the business
- the future of its market or industry?
For example, while it may be an IT or HR project, it is the impact on the business that matters (e.g. will it generate savings or efficiencies, improve customer service, reduce business risk, etc.). Being able to distinguish project activities and outputs from business outcomes and impact is important. A key question is: Is there a business case and how robust is it?
What is the approx. total budget for the project?
- Is it sufficiently resourced?
- Is it on track budget wise?
- What % of budget is left?
- How many people are working on the project and working fulltime on it?
Urgency & Timeline
What is the level of urgency around the initiative? Probing further:
- Is there too much or too little urgency?
- Is it on track timewise?
- What is project lifespan (mths)?
- How many months are left?
To what extent is the project ‘business as usual’ or ‘business unusual’? For example:
- How much change or disruption is likely?
- How much innovation is required?
- Will the old ways of working be sufficient?
We use ‘Business Unusual’ as a proxy for project complexity. It also a measure of how strategic a project truly is. For example, is it about shaping the future of the organization or just short to medium term performance? It is an important question, although it rarely gets asked1 Note there is a scale used here, as projects are rarely 100% ‘business as usual’ or 100% ‘business unusual’ but are to be found on all points in between.
- Whether a project is ‘business as usual’ or ‘business unusual’ is a question that rarely gets asked. Yet, the answer shapes so many aspects of a project or initiative, including risk, innovation, ways of working (such as the need for agility and collaboration). Not only does it shape the methods and tools used (e.g. agile versus waterfall), but also the mindset required (curiosity and fast learning, versus rigid planning and control). Managing ‘business unusual’ projects as if they were ‘business as usual’ is a recipe for disappointment, even disaster.