Ways of working: how to stay ahead of the change curve
Building upon our realising the extraordinary series and findings focused on ways of working, we explore how businesses can become more adaptable to change, by proactively planning their future capability and project environments.
Infrastructure doesn’t have a track record of adapting to changes
Global interviews we undertook in 2020 told us that planning and adapting to changing workforce environments remains one of the greatest challenges that capital delivery businesses face. Lack of change planning and the ability to effectively adapt leaves organisations constantly working to catch up to achieve the capability they need to deliver.
The pressure to change and achieve new levels of performance continues to grow with the need to digitally transform and meet emerging initiatives gaining pace in the industry. The UK government’s Project Speed initiative is one example, with a drive to cut down the time it takes to plan and deliver high value infrastructure projects through various reforms, including the broader transformation of the construction sector.
Relying on a crisis to kick-start the process
Most leaders are familiar with the concept of creating a sense of urgency to enable change. Unfortunately, reality often allows a real crisis to emerge before organisations are ready to react. Worse still, often the response to a crisis is moving too quickly to undirected low-value action, lingering too long in the planning phase, or organisational paralysis, where no direction is taken.
Example: one transport operator took two years to mobilise a major change programme following an agreement of capability needs. Even when there is a clear need to change, organisations face paralysis in executing that change. Imagine the loss of benefits and likely change in context over the two years it took to mobilise.
Our experience shows that crisis leads to poor planning, as decisions are made to fix the immediate problem, rather than plan and transform. When driven entirely by urgency, change and decisions are usually a knee-jerk reaction and invariably moulded by the current crisis. Businesses often fail to address root causes, transfer the pressure into their supply chain, and create further siloed working and tension between functions.
Our research found that organisations failing to plan change, frequently experience:
- Change happening too late, or only in a crisis
- Over-focus on lots of short-term local initiatives
- No definition of internal capabilities and their maturity
- Separation of change from business-as-usual governance
- Little or no dedicated internal change capability
- Change is seen as an undesirable bolt on to the day job
- Staff are fixed in their teams, processes and expectations, with little involvement in shaping internal change
- Low energy levels and motivation across teams
- Little evidence of internally driven innovation or diversity in thinking
- Lack of coordination or structure around change
- Change plans or approaches that are not sponsored by leadership.
76% of respondents to our survey in 2018 identified adapting to change as the single greatest pressure by leaders. It remains one of the consistently lowest performing areas of our recent business reviews with programme leaders and infrastructure businesses.
Failing to set-up for success
Our interviews and experience show that change plans are also rarely properly governed or resourced. The governance applied to change is often light and with limited strategic decision-making ability relative to the potential impact of the change. With any sudden mobilisation, change is often resourced by adding it to the day job of already over-utilised people. Alternatively, people allocated to change are considered expendable in the delivery environment. Neither of these approaches results in success.
In major projects, change planning and linking capability requirements into the governance or gateway process is critical as programmes move through different lifecycle stages. Too often a lack of, or inadequate planning leaves teams without the capability required to achieve the right delivery outcomes at that stage. This puts pressure on supply chains and teams and can lead to more knee-jerk reactions to avoid losing time or budget.
It is not surprising that we so consistently encounter the same stories of resistance or change fatigue across the industry. Change however doesn’t have to be so difficult, or met with such resistance, but it does need to be prepared for.
Break the cycle with capability planning
Our industry interviews in 2020 found that preparedness and adaptability to change continue to remain a real challenge in capability and change planning. Most organisations interviewed had no target blueprint or map for future capability need. This was coupled with a consistent lack of process and governance to prioritise and plan business activities as their organisational context changed.
Organisations are also failing to capitalise on the capability of their supply chains to help jointly plan for future capability needs or prepare for distant programme phases. Joint scenario testing can identify future requirements and mitigate against impacts to the delivery environment, for example, through technological change, regulation or commodity prices. While we are seeing an increase in scenario testing, this step is still often missed with a short-term tactic of time saving, but at a potential long-term strategic cost.
It is possible to break this reactive cycle of change. While it is unrealistic to imagine that organisations can foresee all capability needs and that change plans will not be subject to unforeseen events, it should be possible to proactively plan. After all, the construction industry is familiar with planning years ahead to keep up with the changing needs of their markets, customers, and evolving characteristics of a nation – we need to adopt that same strategic planning to our delivery capability and ways of working.
To plan for future capability, an analogy can be found in the defence sector.
Defence sector in focus: Defence industry and military experts actively explore a potential world decades away and what threats might look like in the future. This is then translated into future capability needs and, subsequently, solution requirements and investment programmes. The lead time in technology development means nations cannot wait to reach a crisis before kickstarting a new defence programme; instead, there must be a structured approach, bringing different areas of expertise together around a common outcome to stay on the capability frontier. The same principles and rigour should be applied to planning organisational capability.
Organisational self-awareness and adaptability
To build capability for change, leaders need to increase organisational self-awareness and gain a greater understanding of how their business is built from different capabilities and whether those capabilities will meet future needs. As organisations embrace digital and its new insights, this understanding will enable them to put functional capabilities and performance under the spotlight.
Once this awareness has been built, organisations and major projects teams should define the future. This relies on exploring the unpredictable and better defining the predictable. Organisations should know the impact of their digital investments, anticipated changes in customer needs or capability requirements from the project lifecycle.
48% of respondents to our survey in 2018 felt that projects fail due to insufficient planning at the start. A further 40% identified short term thinking as a contributor to project failure.
Adaptability is also key to making the change journey. Organisations that enable change rather than resist it, tend to work more adaptively on a daily basis. Adaptability is driven through greater accountability and empowerment at a team level.
This typically involves consistent focus on outcomes, aligned across functions, and a clear understanding of how changes should be managed to effect new ways of working. Adaptable teams have the innate capability to understand strategic needs, translate these into actionable steps and effectively manage the impacts these cause within the business. This adaptability can be nurtured and will provide the capability to achieve new levels of performance and make the change journey a success.
Four areas to build change planning capability
To move from the back of the productivity pack to ‘extraordinary’ is going to require significant change. Organisations wanting to remain ahead of the curve need to build their change planning capability in four areas.
1. Build organisational self-awareness
Understand today’s capabilities, their levels of maturity and performance. For example:
- Define capabilities at business and function levels
- Use accurate and meaningful data, intelligence, trends and forecasts to understand the performance of different functions
- Understand relative maturity of functions and the organisation
- Reflect on how the organisation responds to change today – is it crisis driven or proactive?
2. Look beyond the usual horizon
Create dedicated time and focus to scenario plan the future with the following actions:
- Scenario test at organisational and individual levels, including supply chain partners and key stakeholders
- Benchmark yourself against other industries and ‘frontier’ organisations
- Identify the early warning signs of disruption or opportunities
- Translate future scenarios to a capability need
- Compare future needs for today’s capabilities.
3. Have a clear map and ‘architect’ change
You can’t build the future business without designing it first, so:
- Identify your architects (people who understand how functions and capabilities integrate into an operating model)
- Create single accountability for new capabilities, as well as the whole picture
- Integrate the changes needed to achieve new capabilities and those needed to mitigate risks into a single picture
- Establish the management process and governance commensurate to the scale of change
- Engage supply chain partners in capability planning and change delivery
4. Nurture adaptability and contribution
Embrace new ways of working by unlocking the organisation and nurturing everyone's contribution. You will need to:
- Resource change programmes with high performers
- Nurture the adaptability of individuals and teams to be part of forecasting, planning and enabling change
- Leverage this diversity of contributions to bring new thought
- Examine past responses to major changes – who were the real change leaders you will need in the future?
These steps are helping organisations in 2021 to break the cycle of reacting to change and helping them plan capability in their projects and teams. Ultimately, this will help them stay ahead of the change curve and embrace productivity.
Read more about our realising the extraordinary series and ways of working findings.