Category Archives: Michael Menard

A Fool with a Tool is Still a Fool

By Michael MenardMichael Menard

Any software you implement in your organization should enable or enhance a business process. Unfortunately, many people mistakenly believe that the software or technology itself is the solution, when in reality, technology is at best 10 percent of the value equation—the other 90 percent is based on the human factor.

Knowing this, it’s no wonder 70 percent of technology implementations fail. In other words, seven out of ten applications that are installed and that companies spend millions of dollars for the implementation aren’t being used one year later. Talk about wasted resources!

How does this happen? All too often, company or department leaders hear about new software and view it as the “next shiny thing.” They call the software provider and say, “We heard you have a great tool and we’d like a demonstration.” The software is certainly seductive with its bells and whistles, but its effectiveness and usefulness depend upon the validity of the information going in and how the people actually work with it. Having a tool is great, but remember that a fool with a tool is still a fool (and sometimes a dangerous fool).

So if technology is not the answer, what is? The answer that will really solve organizational challenges and enable business processes consists of three parts that, when done correctly in conjunction, will lead to long lasting results.

Get the business process design right before you implement any software: The first step to a smart technology implementation is to get clear on what information goes in and what analysis comes out, which has nothing to do with software itself. This is called business process design. Unfortunately, many companies fail to align technology with their processes. That’s because some companies have no processes, while others have a stated process (the one they talk about) and an emergent process (the one they actually do). So what is a business process and how do you design one?

A process is like a recipe. If you have a great recipe for New York-style cheesecake that calls for folding in three eggs one at a time, yet you decide to blend in all three eggs at once, you’ll get a completely different (and probably not very good) end product than if you had followed the directions. Make the recipe again and follow the instructions in the proper order, and your cheesecake will be edible.

If you do anything more than twice in your organization, you should define a process for it. Once you have done so, you should continue to improve upon it. In the absence of a defined and documented process, subsequent actions become experimental. Process design is an investment that’s easy to understand. But while the idea of it usually gets an enthusiastic response, actually doing it gets shelved.

So prior to any software implementation, map out your business processes and define such things as:

  • What do we want from the software?
  • How will this software be used on a daily basis in our organization?
  • Which business processes will the software affect?
  • Who will be using the software?
  • Who has the authority to make decisions about the software and the information it produces?
  • Who will be responsible for inputting the needed data and making sure it’s accurate?
  • Who will be receiving the data and acting upon it?
  • How will the data inform our future business decisions?

The clearer you get on business process design and how the software ties in, the better your results will be.

Choose the right technology: No company can do the things it’s called upon to do without technology, so some sort of technology is a must. We all need tools. If you’ve done step one, you’ll have a clear picture of your business and how the new software must play a role. Now it’s time to analyze your software options and choose the one that complements your business processes and will deliver the results you’ve outlined.

Implement the tool into the organization so it has rapid uptake and the shortest time to value: This third step is the most important because it’s about the human factor and how it impacts any organizational change—and implementing new technology is a big change. Unfortunately, too many companies today are simply doing installations. But “installation,” which means “to put something in place” is very different than “implementation,” which means “to put something into effect or action.” Having a new car in the driveway is nice, but if you can’t drive that car, it doesn’t offer much value.

Implementations often fail because companies forget the human factor. In fact, in most changes, human factors pose the greatest risks to long-term profitability. New knowledge and behavior-adoption drive ROI.

Why is change so difficult? Because most of us like comfort. We may complain about routine, but the majority of folks secretly like it. And almost any organizational change threatens our existing comfort zone. Change requires movement from what we know to what we don’t yet know. Like people, organizational cultures prefer to remain the same. That’s why even changes directed at entire departments or organizations, rather than specific individuals, often meet resistance.

So why bother with change when the odds of success stacked against it? The answer is simple. All businesses must continually change or they will die. The markets demand change; customers demand change. Therefore, you either instigate change or it will happen to you. David Nielson, a leading authority on organizational change says to better prepare your team for change and have a successful implementation, be sure you do the following six things:

  1. Communicate the business case for the change
  2. Identify internal change agents (allies) and engage with them
  3. Educate and support the change agents
  4. Assess adoption readiness
  5. Define and support effective behavior
  6. Execute a communication plan about the change

Remember, implementation will fail unless sufficient time and resources are allocated to the process of learning. These six steps form the foundation of successful implementation. Miss one and you’re asking for trouble.

Make Your Technology Implementations Work: The message is clear: Technology is not the answer. Yes, it’s an important piece of the puzzle, but it’s not the all-encompassing solution so many people believe it to be. If you just focus on the tool, you may end up the fool; but if you focus on the business, the tool, and the people within the organization who will be using the tool, you’ll be the leader who not only uses technology effectively, but who also sees great gains in productivity and profits.

Michael Menard is the author of “A Fish in Your Ear: The New Discipline of Project Portfolio Management,” and cofounder and president of The GenSight Group, which provides enterprise portfolio management solutions for strategic planning, project portfolio management and business performance optimization. A holder of 14 US patents, Menard has utilized his expertise to advise senior executives at organizations such as Coca-Cola, Cisco and the US Department of Energy. To learn more about Mike Menard please visit http://www.afishinyourear.com.

The Top 5 Pitfalls that Derail Corporate Decision Making

By Michael MenardMichael Menard

Despite the wealth of information available to us these days, many of today’s best and brightest business leaders still make poor decisions. This is unfortunate, because sound decision making is at the heart of every company’s success.

Even if you have the best education and years of experience, it’s still possible—and common—to make poor decisions. Why? Today’s decision makers are up against a long list of pitfalls and obstacles that prevent them from making sound decisions. Fortunately, once you know what you’re up against, you can take the proper steps to correct it. Here are the top five decision-making pitfalls that get in the way of organizational success.

1. “We need to change, only not today.” (Avoiding the decision) Saint Augustine (b. 354 – d. 430) prayed, “Lord, make me chaste, but not yet.” It’s one thing to know about change and imagine future benefits, but we often avoid deciding to take action right now because change means some level of immediate discomfort. Realize, though, that no business or individual grows without change and risk. However, risk aversion is basic human nature. The paradox is that we want something different without having to change. This is like the teenager who wants her parents out of her life but first wants to be dropped off at the mall.

With the recent economic downturn, many companies are employing a bunker mentality. They’re staying put and not taking action. Instead of playing to win, they are playing not to lose. Without a realistic vision of what’s both possible and probable, organizations will continue to play it safe and delay making decisions. But this so-called safety is an illusion. Organizations must keep moving, employ their assets, and create value. That value comes from the decisions they make and the projects they implement.

Remember, any decision is a choice. Choosing not to choose is a choice.

2. “It’s such a simple decision.” (Oversimplification of the challenge) Telephone numbers are seven digits long because most of us can only keep this much information in our short-term memory. We naturally chunk information into intelligible bites. Likewise, difficult and complex situations can overwhelm us, so we unconsciously and erroneously make them simpler. However, this natural tendency to simplify information can hinder decision making.

Of course, let’s not confuse oversimplification with the highly valuable ability to reduce a problem to its essentials. After all, decision making needs to be both effective and efficient. But we must distinguish between these two words. We can be efficient without being effective by doing the wrong task well.

No matter how well-intentioned we are, under pressure our desire for simple answers to complex questions increases dramatically. The red flags go up. When we imagine we don’t have time or resources to address a problem adequately, we start to look for a single explainable cause that fits into our existing framework. Paying too much attention to what we directly see in front of us is called the present bias. Oversimplification discounts contributing factors and exaggerates what already stands out for us. Oversimplify and we set ourselves up for poor decision making.

3. “Everything is great!” (Happy talk) Project advocates would never get the ear of senior management without predicting optimistic outcomes. Politicians would never be elected if they didn’t promise a sunny future. Optimism is ingrained in American culture. Attempts to confront it with reality are consistently dismissed with the discussion-ending judgment of negativity.

But who wouldn’t rather think they are going to enjoy a positive future rather than pain, suffering, and gnashing of teeth? However, due to unrealistic optimism, who hasn’t miscalculated how long it will take to get to a destination? Who hasn’t underestimated the real cost of time and effort to reach a particular goal? The optimism bias shows up every time a company has to restate its earnings. Project-cost overruns, delays, and benefit shortfalls result from this combination of wishful thinking and the inability to recognize complexity.

Of course optimism is not a bad thing. It can stem from genuine responsible confidence, and confidence may lead to bold, necessary, and effective action. But optimism without a foundation sunk into the ground of reality is unstable and self-delusional. The optimism bias underestimates necessary contingent factors—as any insurance salesman would be happy to point out to you.

4. “I can’t wait that long.” (The time factor) Given the choice, would you prefer to have $100 today or $300 tomorrow? Most of us can defer immediate gratification and wait an extra day for a significant monetary increase. However, studies show if we have to wait one year for $300 or we can take $100 today, most of us demonstrate what’s called present bias and go for the $100 right now.

The perceived length of time to realize a benefit has a significant impact on our selection, so let’s change the time factor. Imagine you are given the choice between gaining $100 one year from today or $300 in one year and one day. Most people given such a choice can wait the extra day. Studies show that under similar conditions, as the time to realize the benefit is increased, the majority of us would reverse our decisions. Without short-term reinforcement of long-term goals, our objectives remain mirages and greatly affect our decision making ability.

5. “According to my Magic 8-Ball…” (Magical thinking) “Mirror, mirror on the wall, who’s the fairest of them all?” The evil queen in Snow White wanted to know about the future, and so do we. She had a magic mirror. We have educated guesses. While any prediction about the future or how a decision will turn out is a guess, educated guesses are more likely than magical thinking to deliver results we want. However, we should be aware of our tendencies to oversimplify, as we discussed, by focusing only on what we think is relevant.

Cognitive scientists call this bias anchoring. Once this anchor has securely fixed itself in a crevice in the seabed of your mind, it’s not easy to shift. Then you interpret information based on this what-you-think-is-relevant anchor. It gets worse. You ignore other possible relevant factors. Not only are you focusing on wrong information, but you’re ignoring information that could be vital to long-term success. Falling prey to magical thinking and not testing your assumptions—not anchoring—can capsize the whole enterprise.

It’s Never Too Late: If you’ve ever realized that a decision you made was less than stellar, don’t feel bad. It happens to us all. But by understanding the top five things that get in the way of most decision-makers, you can analyze your decision with a new perspective and make the best choice for you, your organization, and your future.

Michael Menard is the author of “A Fish in Your Ear: The New Discipline of Project Portfolio Management,” and cofounder and president of The GenSight Group, which provides enterprise portfolio management solutions for strategic planning, project portfolio management and business performance optimization. A holder of 14 US patents, Menard has utilized his expertise to advise senior executives at organizations such as Coca-Cola, Cisco and the US Department of Energy. To learn more about Mike Menard please visit http://www.afishinyourear.com.

Four Things You Have to Get Right in Business

By Michael MenardMichael Menard

Most organizations know that in order to grow and be an industry leader, they have to continually innovate and undertake key projects that lead to growth. Unfortunately, many companies do so in a haphazard or non-strategic way.

Here’s what typically happens: Leaders keep saying yes as various projects and ideas are presented to them for investment. They say yes until they run out of resources. The projects and ideas first on the list get funded in contrast to the best of all ideas across the organization. The sad truth is the early bird does get the worm. As a result, they waste money and resources, lose momentum, and then wonder why they never achieve their strategic goals.

But it doesn’t have to be that way. There’s a proven approach that enables leaders and decision makers to make a greater contribution to the business, activate the strategic plan, achieve the desired balance, and optimize allocation of limited resources. Here are the four things you need to get right in order to make better decisions so you can maximize your company’s Capital Efficient Profitable Growth (CEPG).

1) Define your strategy: Before your company can undertake any new initiative, you first have to identify your strategy. In other words, who are you and what do you want to do? Unless you know this information, it’s difficult if not impossible to move forward in a productive way.

While most companies have a general idea of their strategy based on their vision or mission statement, often it’s not focused enough to translate into specific strategic goals. For example, suppose you’re a beverage company who offers a variety of soft drinks. How do you grow? You could introduce one new beverage after another and expand into new markets at random, but that will quickly drain your resources. A better approach is to define a specific strategy for growth. For instance, you may decide that you want to be the North American leader in bottled water. Now you have a focused strategy to guide your efforts.

2) Generate ideas: Armed with your strategy, you can now generate ideas that support the strategy. Some people call this step innovation or creative brainstorming. Whatever you call it, the goal is to come up with possible options for advancing the strategy.

Going back to our beverage company example, if the strategy is to be the North American leader in bottled water, your team needs to generate ideas that fit the strategy. Some ideas could include adding nutrients to the water, adding protein to the water, adding exotic flavors to the water, offering different bottle shapes or sizes, etc.

3) Prioritize and select the best ideas: Next is to select the portfolio of ideas that are the best for the company to pursue and that will advance the strategy. As you do the prioritization and portfolio selection process, you need to ask two key questions. The first is, “Will this portfolio of ideas and projects deliver our strategic goal?” If the answer is no, then you have to do something different. Either you alter your strategic expectation or you increase the number of ideas. Keep going through these iterations until you can say, “Yes, our portfolio has the potential to deliver our strategy.” And remember, at this point you’re simply assessing whether the portfolio will meet your strategic goals. You’re not assessing whether it’s something you actually could do.

Once you agree that the portfolio of ideas and projects will help you meet your strategic goals, the second question to ask is, “Do we have the resources (time, money, people, equipment, etc.) to fund the portfolio?” If the answer is yes, then celebrate and move on to step four. But if the answer is no, then you need to circle back and solve the equation. Can you lower your strategic goals? Can you generate bigger, better ideas? Can you add resources? Change the timing? Scale back the idea? Once you have a portfolio that allows you to say yes to both questions, you’ve completed the prioritization and selection process.

4) Execute on the ideas: Finally, it’s time to take action and actually execute the portfolio of ideas. This is where project management comes into play. As you execute each step to support the strategy, outline the detailed activities needed to complete the project on time and on budget. Assign key people to be responsible for each role, and establish checkpoints so you know if the project goes off track. The more thoroughly you manage the execution of the portfolio, the more success you’ll have.

Get it Right…Now! No matter what industry you’re in, long-term business growth depends on these four things: Strategy, Idea Generation, Project Selection, and Execution. When you take the time to implement this process in your company, not only will you make better strategy decisions, but you’ll also achieve the breakthrough results that achieve the ultimate goal: Increased CEPG.

Michael Menard is the author of “A Fish in Your Ear: The New Discipline of Project Portfolio Management,” and cofounder and president of The GenSight Group, which provides enterprise portfolio management solutions for strategic planning, project portfolio management and business performance optimization. A holder of 14 US patents, Menard has utilized his expertise to advise senior executives at organizations such as Coca-Cola, Cisco and the US Department of Energy. To learn more about Mike Menard please visit http://www.afishinyourear.com.