Managing risk in global projects

I was recently asked what are the most relevant, pressing risks that affect global project management. Many come to mind but one stands out immediately: One of the most significant risks we identify is a globally disparate (geographically separated) team. Teams working in separate regions face tremendous challenges that a co-located team doesn’t have to think about. This is exacerbated when outsourcing, where conflicts in language, time, culture, and business environment all affect the organization.

Organizations facing these environmental issues need to put a considerable investment into mitigating the associated risks. This is essentially why the “promise of outsourcing” has been toned down over the past decade: Gone is the illusion that you can get solid work for 25 cents on the dollar. “Real” outsourcing costs tend to range anywhere from 70 cents on the dollar to $1.20 on the dollar (yes, outsourcing can often lead to higher costs — but sometimes it’s not just about cost, but geographic presence, distribution, foreign market penetration, etc.)

Language barriers pose some of the most difficult issues to work around. Being unable to easily communicate means poor communication becomes a barrier to the entire team. This can lead to misunderstood requirements, misinterpretation of directions, even a complete disconnect on whether a team is in trouble or doing fine. Ideally, open communication, information radiators, and visibility are central to successful projects. Any barriers increase risk, and that means increasing efforts to compensate. Closely related to language barriers are cultural barriers. A pretty obvious example is the straightforward U.S. business culture in regard to the respectful and tradition-rich Japanese culture. Even seemingly similar cultures pose barriers; for example, East Indian cultures and U.S. cultures don’t easily connect until interpersonal barriers have time to break down.

Business environment and common bias also contributes to the risk of disparate teams, especially those separated by business culture. For example, consider a client developing a legal work product solution in the U.S. market while using East Indian resources. The lack of a common business foundation can easily lead to a complete disconnect regarding assumed business objectives (in other words, the legal system is very different in the U.S. versus India, which means a lack of common understanding regarding some pretty basic business goals).

All of these issues can be mitigated with appropriate practices. The necessary measures will vary from one project or organization to another — there are a lot of variables at work, and that means every project has to be treated uniquely. The common thread is communication. Breaking down these barriers by using process, technology and culture is critical. The disparate team needs to become one team, working as a unit — and that usually means a significant investment in tools, strong processes and team-building exercises. I strongly advocate rotating team members across the organization or project as one example. This helps across the board: It breaks down communication and culture barriers, helps team members get to know one another, lets distant teams experience local culture, and helps to build a collaborative “whole team.”

Boomers at the exit gates

Organizations across the globe are trying to come to grips with a new corporate  challenge; one created by millions of employees who make up the boomer generation, who are poised to leave the working world, for golf, sailing, gardening or playing with the grandkids.

In some cases the departure of these senior employees will allow younger managers to step up to the plate to fill the void, but not everyone is ready, or even wants the next rung on the corporate ladder. So the question becomes:  After all you’ve gone through during this recession, can your organization survive the holes these departures will create? Do you have a well developed Succession Plan with Knowledge Transfer processes in place?

Many managers faced with a looming shortage of employees have reconsidered their business model; to find alternative ways to serve the client, build their products, distribute the materials, but a reinvention of their strategy simply brings new challenges to the fore.

Take the case of one of our clients who decided to outsource some aspects of their work to deal with looming labour shortages. They were in for a nasty surprise. A few months ago we conducted a risk assessment and  they found to their horror that not only were their boomers poised to flee, so were some of their specialists — the “go to” people others rely upon to do their work.  The newly outsourced work was what these ‘specialists’ enjoyed, so instead of taking on new responsibilities, which were less appealing, they were seriously considering offers of work at the outsourcing company! Clearly a game plan was required to stall a potentially disastrous situation.

Traditional succession planning identifies high potential employees and implements long range plans to develop those people so they are well equipped to lead in the future. The focus is on core competencies, business knowledge, technical skills and sound judgement that will lead to solid business decisions. Mentors are enlisted from the senior ranks to pass on savvy business knowledge to new incumbents. Short term overlaps are permitted so a veteran of the job can coach a neophyte.

But what can a company do when the mentor has retired or the specialist now works elsewhere?

How can crucial knowledge be retained for organizational health and continuity?

Knowledge Transfer has become the latest ‘buzz’ as leaders, faced with the loss of people and corporate knowledge, struggle to retain information that is vital and which has contributed to their present success.

New people to the company don’t know what they don’t know, so important questions are not asked. The soon-to-retire employees who have been operating smoothly for years; often don’t know what is vital — what to keep or toss — and the clock is ticking ever closer to their departure. Some, on the other hand, know exactly what to hang on to for that lucrative consulting job they envisage after their retirement and guard it jealously from their colleagues for fear of losing their distinct advantage.

So, getting vital knowledge from individuals and passing it to the right people, in a way that can be understood and assimilated quickly and accurately, is the challenge that will be facing most business leaders for the next two to three years.

We suggest you implement a few simple things to protect your company from a major risk.

  1. Pinpoint how many people will be leaving within the next three years and develop a strategy to capture their knowledge now before it’s too late.
  2. Identify who your Subject Matter Experts (SME’s) are and determine their unique advantage — what makes them so valuable to your organization?
  3. Consider doing some serious cross training to reduce your vulnerability, build capacity and engage employees in building a better workplace.
  4. Develop a data base with SME’s, lesson’s learned and past practices so people can source information as and when they need it.
  5. Start a community of practice so people are encouraged and supported to share information freely with colleagues.
  6. Reward people for building your internal capacity when they mentor, coach or lead information sessions.

If you pondered for a minute when you might get around to this — stop thinking — start taking action now, the days, months and years are slipping past very, very quickly. Is your organization going to be a risk?

Heather Hughes, CMC is a Certified Management Consultant with a 30 year international track record. She specializes in building vibrant organizations through Leadership Coaching, Succession Planning, Knowledge Transfer and Employee Engagement.