Kategorie: 1. Transformation

If I had a crystal ball to foresee the future, I’d sit on a beach and sip a cocktail. Well – I don’t.

In fact, very likely at the time I can lay my hand on the proverbial crystal ball, everybody else would have one, too. So, in a way, I am glad there are no crystal balls helping me or anyone else to predict what is going to happen: It would destroy my business model as a consultant and project manager, as I manage my clients‘ exposure to risk.

Project Management = Risk Management

Mostly I lead transformation, carve-out and/or post-merger integration projects. Such projects are very complex, and high complexity generally translates into high risk. Many a thing can happen in the course of such programs: System failures, resource issues, a pandemic breaks lose, loss of key people, roadblocks with the works council, unforeseen regulatory hurdles…. You name it, I’ve been there.

Unfortunately, ambiguity lies in the nature my daily business, and dealing with it is one of my core challenges. Hence, I manage my client’s exposure to unwanted outcomes by predicting what might happen, and find ways to either prevent it, or at least prepare for it. The classic risk register is a simple, but proven tool to collect risk information, and hold a catalog of mitigation strategies.

Risks to the Project Timeline

Usually, I am working to a set timeline in my assignments. (If there was no timeline set by the client, I will set one: Swift implementation is a key success factor in PMI scenarios in particular. Procrastination never adds value – compare my article on the subject.) Since anything is connected to everything in transformation projects, understanding and management of functional dependencies is critical to project success: There are no ivory towers in my line of work, and if there were, they needed breaking down.

Since sequential task completion does not work in complex environments, many activities run in parallel; they are interconnected, and yet I have to give the project direction based upon incomplete information and projections. In the interest of time, I make assumptions of projected outcomes and schedule accordingly. Failing to do so, waiting for hard facts instead of applying probabilities to potential alternative events and outcomes will most likely lead to missing the overall timeline.

Conveying the concept of dealing with ambiguity, of being at the ready for a desired outcome, but at the same time prepare for the unwanted, is a project manager’s key competence. It takes conviction, persuasive power and a very good understanding of the project, functional interfaces and dependencies to succeed.

A regular, open and healthy exchange of information on progress, risks and new dependencies across functional workstreams will facilitate cross-fertilization, risk-flagging and early alignment. The good old stand-up meeting presents a great stage for key team members to report on their tasks ahead and challenge others. Be sure to make this a firm part of your team’s schedule.

Covid-19 is impacting on many businesses – directly or indirectly: The economy takes a nose-dive, and the future is more uncertain than ever. How should Management react?

Steering a ship in calm waters is difficult already, but holding the helm in rough seas takes perseverance, a clear vision, and trust into own and the team’s capabilities. It is any CEO’s first responsibility to improve (and grow) a business, even in rough times.

1. Strategy
   The business strategy describes the path to success, in particular considering markets, technology, and competition. Strategic goals and objectives are long term – usually with a minimum horizon of 5-7 years (may be shorter in New Economy business models). Having a strategy at all is a good starting point, but sticking to it is imperative since the determinants of the market environment usually do not change over night – not even in a pandemic.
   
2. Tactics
   A successful strategy is supported by a series of well-defined, concrete postulations, targeting specific goals and objectives. They define the stepping stones towards full implementation – and largely translate into those strategic projects without which the strategic process comes to a grinding halt.
   
3. Drive or Stall?
   Exceptional situations require exceptional measures – but panic is a bad advisor. Even in a shrinking economy, the general business direction will remain the same. Instead of stopping all strategic initiatives, each of them should be reviewed carefully for its effectiveness, cash-impact and risk/reward ratio in an objective process.
   
4. Risk Management
   Obviously, especially in uncertain environments managing risk becomes paramount. Implementing KPI systems, routine milestone reviews, and a stage gate process to control critical waypoints are essential elements of a continuous monitoring process.
   
5. Courage
   „Killing your puppies is the hardest part!“, is a quote by an R&D Director I used to work with. It takes courage to stop a process one has invested in…. Nevertheless, pulling the plug on a project may very well be the right decision if the project is derailed, and objectives cannot be reached at all or at least not with acceptable efforts.

Summary

“The Chinese use two brush strokes to write the word ‚crisis.‘ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger–but recognize the opportunity.” (Quote by John F. Kennedy)

Unfortunately, there is no one-size-fits-all approach to strategic decision making. However, driving the strategy by implementing strategic projects in a controlled manner will position the business for the future. Heeding this principle will allow you to hit the ground running past the pandemic.

The author: Diethard Engel is an interim manager and consultant, focused on Business Transformation, Post-merger Integration / Carve-out and Executive Finance in the manufacturing industry.

Stellen Sie sich folgendes Szenario vor: Ein Unternehmen tätigt eine Akquisition. Im neuen gemeinsamen Unternehmen soll geändert werden: Nichts. Ist das wirklich ein wahrscheinliches Szenario?

In meiner Erfahrung ist jedes Post-merger Integration Projekt mit erheblichen Veränderungen für beide Unternehmensteile verbunden: Das akquirierende Unternehmen will strategische Ziele erreichen, und strategische Ziele erlangt man nur durch die Umsetzung spezifischer Maßnahmen, zum Beispiel durch Änderung des Footprint und Angebots, Vereinheitlichung der Prozesse und Systeme, und oft auch durch Verschlankung der Personalstruktur – alles Schritte einer echten Business Transformation. Neben der Fehleinschätzung der erreichbaren Synergien liegt das größte Risiko für eine erfolgreiche Integration in der Unterschätzung des Veränderungsbedarfs.

Als Interim Manager habe ich internationale PMI-Projekte durchgeführt, die sich vordergründig durch den Zusammenschluss zweier oder mehr Unternehmen definierten, tatsächlich aber im Gesamtblick viel eher einer gemeinsamen Neuaufstellung (manchmal sogar: Restrukturierung) glichen. Die Geschäftsführung muss sich darüber im Klaren sein, dass jede Integration eine Neudefinition der Strukturen bedeutet, und dass die Umsetzung mit den üblichen Risiken einer Restrukturierung einhergeht: Verunsicherung und Motivationsrückgang, ungewollter Personal- und damit Know-how-Verlust, Produktivitätseinbuße, Unterbrechung der Supply Chain….

Die Entwicklung des Integrationsplans unter Berücksichtigung dieser Aspekte kann den Unterschied zwischen erfolgreicher Integration und Vernichtung von Kapital bedeuten. Leadership, Transparenz und Kommunikation sind erwiesene Treiber erfolgreicher Integrationsvorhaben. Daneben ist die Umsetzungsgeschwindigkeit nachweislich ein weiterer Erfolgsfaktor: Langwierige Integrationsvorhaben haben sich in der Praxis als nicht effektiv erwiesen.  

Da oft keine geeignete interne Ressource für die operative Post-merger Integration zur Verfügung steht, kann die Verpflichtung eines externen PMI-Managers die Wahrscheinlichkeit einer erfolgreichen Integration und damit einer erfolgreichen Akquisition erhöhen.

Weitere Tipps von PMI-Profis und Beratungshäusern zum Thema Integration Management finden sich als Beiträge hier auf meiner Website.
 

Zum Autor: Diethard Engel ist als Interim Manager auf die Bereiche Business Transformation, Post-merger Integration / Carve-out und Executive Finance für produzierende Unternehmen spezialisiert.