Surprise: leveraging the unexpected in strategy implementation

This article is based on research carried out at the engineering systems division of the Technical University of Denmark - DTU and supported by Brightline Initiative.

By Verena Stingl and Josef Oehmen

The favourite saying of one of the executives we work with is: “The opposite of well done is well planned.” While we do not fully agree, he has a point: We love to emphasise the importance of details in strategy planning. This leads to a false confidence that all we need to do is “push the button” and lean back to watch our strategy implementation unfold.

A more conciliatory viewpoint is: “The plan is nothing, but planning is everything.” The saying emphasises that during planning, we develop an understanding of the intricacies of the problem, that then allows us to adapt and think on our feet during the implementation process. In order to succeed, we need to bring together two fundamentally different mindsets: ‘Predict and Plan’ with ‘Monitor and React’.

Taking to the extreme, we can look at strategy work from a perspective of crisis management. And indeed, organisations that are leading performers in strategy implementation share characteristics of organisations that excel in the management of crises. Comparing recent studies carried out by the Brightline Initiative (that also supports our work) together with Quartz and HBR, these organisations exhibit high goal alignment, effective communication, high flexibility, decisive and empowered employees across the (crisis) organisation and trusted leader figures. These traits are for example also used to describe agile, resilient, or anti-fragile organisations.

We wondered how an organisation can develop these characteristics and capabilities, without the need of being in a constant crisis. In searching for an answer to this question, we turned to a mode of organising that successfully deals with the unexpected on a day-to-day basis: projects.

Projects are designed to venture into new and unknown territories and thus often form the basis of exploratory, experimental, or transformative strategic initiatives. Through interviews and the literature, we explored how project practitioners prepare for dealing with the unexpected and thus develop characteristics of a shared vision, effective communication, flexibility, empowerment, and effective leadership.

In well-managed projects, the team reacts to surprises in a calm and decisive manner that allows them to contain critical deviations or even to exploit an unexpected situation to their benefit. This does not just happen by chance, but is the result of careful mental, cultural and organisational preparation within the organisation. We identified three simple mantras that guided preparation and action in the face of surprises.

“Houston, we have a problem!” – Noticing the surprise

Before organisations can start dealing with a surprise, they need to notice and acknowledge that their activities have gone off track. To improve their attention, project organisations take active steps that help them to notice, interpret and acknowledge deviations early.

Know where you want to head to know when you go astray

To identify a deviation, the team needs to have a clear understanding of the goals and preferences. Using tangible rather than abstract descriptions of goals and values reduces ambiguities that may lead to misunderstandings or non-spotted deviations. For example, a practitioner from the construction industry described that instead of providing their contractors with a specification of health and safety regulations, they asked the contractors to show them a site that they considered best practice. Based on this familiar and tangible setting, the client and the contractor can then discuss the safety requirements and develop a very clear, shared understanding of their goals and acceptable behaviour.

Have everybody on the lookout, all the time

In successful projects there are (almost) no silos, everybody’s work is connected through schedule, content, information, and so forth. In projects, the understanding of these connections are fostered through visualisations of the project flow, information presentation in analogue or digital dashboards, and most of all: formal and informal conversations. Project organisations foster such conversations deliberately through co-locating key team-members and raising the visibility of project information in dedicated central areas of the project management office. They acknowledge and steer that vital out-of-the box conversations are much more likely to happen with a coffee in hand, rather than in a formal meeting.

See something, say something

Having people on the lookout only helps if they speak up. However, a trusted and open communication quickly meets barriers if spotted errors result in punishment and control, rather than solutions; or steep power imbalances separate the spotter and the information receiver. Successful managers therefore see themselves often as “brokers of relationships” between people in and around the team, and foster trusted relationships.

Adaptation and improvisation are trained skills

A surprise would not be a surprise if we had a plan ready to cope with it. While emergency organisations – firefighters, ambulances, police – demonstrate the possibilities of generalised procedures and rigorous training, most organisational processes fail when facing the unexpected. Conversely, a recurring theme in the self-perception of experienced managers is their ability for improvisation and intuition. Yet, just like being able to recognise a deviation, quality improvisation requires thorough preparation. We found four typical preparative approaches in projects that help practitioners to enhance their improvisational abilities:

Talk about futures in the plural

As the old military saying goes: No plan survives first contact with the enemy. Following that notion, managers use the planning stage to creatively explore different futures, instead of identifying singular risks to a specific plan. For example, event organisers of a Nordic Ski World Cup engage in role-plays or scenario discussions of potential accidents, and teams in the infrastructure sector discuss plausible and comprehensive stories why their project may fail (using the “pre-mortem” technique). These relaxed discussions build up a repertoire of potential action patterns (rather than concrete actions) that teams can creatively activate under time pressure.

Clarify boundary goals and values to enable quick decision-making

Under time pressure during a surprise situation, managers have to rely on smart and fast decision approaches – there rarely is time for a detailed analysis. This includes ‘satisficing’ approaches, the search for a good enough, not perfect, solution. Such smart strategies require a robust understanding of the boundaries between what is desired, and what is not. As for noticing the surprise in the first place, the clear definition of goals and values in tangible stories – rather than as abstract goals – facilitate the understanding of such boundaries. For example, if the team agrees that avoiding delays and avoiding physical harm are the most important values in the project, this will help them narrow down the solution space quickly to cope with a surprising technical malfunction.

Maintain room for improvisation through slack and real options planning

Improvisation requires space to move, which projects typically provide through slack or buffers. However, a buffer is not always material. Managers often consider future options resulting from their current (re)actions, thus future-proofing their plan and behaviour. For example, in calm times managers reportedly often accept a manageable change request of the customer at no cost, to create goodwill and leverage that can be used in a future stressful situation. Similarly, teams may scrutinise a technical design or logistics plan on its ability to incorporate or accommodate substantial environmental changes and, if it appears too rigid, change it. This latter idea lies at the core of the agile software development approach.

Create knowledge sharing routines

Surprises in projects often require specialist knowledge and expertise that may be beyond the core competencies of the decision-maker and core team. Project practitioners therefore implicitly or explicitly map out areas of expertise in their ecosystem and develop relationships and communities of practice with those experts. This identification of expertise can be part of the rapport building through the manager. Or it is institutionalised in competence centres in your organisations, offering support as an internal service.

Time for action

Finally, when the surprise is there, it is time for action. In those high paced and pressured situations, we found that some successful managers consciously relied on simple rules to respond to the surprise quickly and effectively.

Search for solutions, instead of culprits

Once the project team has acknowledged and understood the problem, they need to move forward to find a solution. However, many projects and organisations block their way because of preoccupations with the causes – and guilty parties – of the surprise. This has two negative implications: It occupies mental and emotional resources direly needed for finding a solution, and, more importantly, it discourages future proactive reporting of errors while incentivising a blame culture. There is a time for an honest root cause analysis – but not in the immediate search for a fix. Thus, some managers actively guide the discussion away from the question of how they got there, to the question of how to move forward. For instance, in a case of a damaged delivery of a time critical component, a project manager might first take action and reorder the critical component, postponing the analysis of who she may hold accountable and liable for the damage.

Step back and defer to expertise, rather than hierarchy

While project managers usually need to exert strong leadership, we regularly encounter examples where they acknowledged that, in solving problems, hierarchy is nothing and expertise is everything. As one of our interviewees stated: “I’m the project director, but at the same time, I’m the student of our student assistant. [..] when she knows what’s going on I’m like, ‘What do you want me to do?” This ability, which is typical for resilient organisations and projects, has regularly been reported for organisations in crises, where leadership flowed to individuals with particular expertise. Yet, deference to expertise requires the ability to spot, access and acknowledge expertise – and the willingness to “check our badges at the entrance”.

Based on our findings, we believe that successful practices of managing surprises in projects are directly applicable to improving strategy implementation – strategies are typically implemented through projects, and there is a lot to learn from them for our way of preparing for our next strategic effort.

Notes:

• The research reported here was carried out at the Technical University of Denmark (DTU), Engineering Systems Group and supported by the Brightline Initiative.
• This post gives the views of its authors, not the position of LSE Business Review or the London School of Economics.
• Featured image by rubylia, under a Pixabay licence

Originally published at The London School of Economics and Political Science (LSE) on April 26, 2019.

Verena Stingl is a postdoctoral researcher at the Technical University of Denmark (DTU), Engineering Systems Group. Her research interests concern human cognition and behaviour in highly uncertain business environments, such as projects and strategy initiatives.

Josef Oehmen is an associate professor at the Technical University of Denmark (DTU), Engineering Systems Group. His research interests focus on managing large-scale (systems) engineering programs, particularly on the application of risk management, lean management and the associated organisational strategy processes. He is the founder and coordinator of the DTU RiskLab.