How Bureaucracies Stifle Projects

Some years ago all employees at Nissan were required to drive Nissan cars. It’s probably a stretch to try and figure out what was on management’s mind.  Perhaps they concluded that it would hurt the company’s image if their employees were seen driving a Honda.  Perhaps they thought that employees would feel more committed to the company if they all drove the same car.  Perhaps they thought this was the best way to create team spirit.  Or, perhaps it was just the bureaucracy protecting itself from outside influences.
 
Well, it turns out that Nissan eventually saw the light. They abandoned this policy and then, in an about face, encouraged their employees to visit their competitors’ showrooms, drive their cars, and if they liked what they saw …  buy one.
 
Nissan was finally able to step out of its own box.  They determined that by encouraging employees to take a customer’s view of the competitive marketplace their workforce would become more committed to the competitive goals of the organization.  From this shopping experience they would learn what Nissan was doing right, what they were doing wrong, and what needed to change. And through this process they would become more productive employees.

By encouraging employees to shop the competition, they were setting into motion a subtle change in organizational and project culture, a change that had the potential to challenge the bureaucratic, institutional, and groupthink pressures that inevitably envelop mature organizations and lead to projects that may be efficiently executed but fail to produce the right market results.

There are many examples of bureaucracies that stifle projects.  Several months ago I made a presentation overseas.  I was told that I was the first outsider allowed inside the company. This was a large multi-billion dollar company that was suffering from lackluster growth and an inability to expand its overseas markets!  More Nissans!

What about GM and Ford taking comfort in their market dominance for SUVs and light trucks while Toyota and Honda were developing expertise in hybrid vehicles?  Until recently they had no project teams that focused directly on fuel efficient cars.  More Nissans!

Let me share with you a recent project I managed at my university.

MBA programs are very competitive, and understandably so. Students take one or two years out of their lives and spend as much or more than $100,000 for the degree.  Every year Business Week, the Financial Times, and US News and World Report rank the accredited business schools.

Now, wouldn’t you think that MBA granting institutions would keep an eye out for what their competitor’s were doing and then use these data to realign their programs with the changing marketplace for graduate business education?  How else could they compete and advance in the rankings if they didn’t step-out-of-the door?

Four years ago I undertook a comparative study of sixty-five graduate schools of business to determine how they competed and how they delivered program content.  I studied how they recruited students, structured their programs, designed courses, assigned faculty, and supported the student job search process.

Here is what I discovered.  Every school with whom I spoke told me that they had never undertaken a competitive study and that they would be very grateful if I shared my data with them.  None of them apparently found it necessary to step out-of-the-door! They all wanted their “employees” to drive Nissans!

After collecting and analyzing the data, I presented the results to my colleagues. The results were very clear and led them to conclude that sweeping changes were necessary. Within four months we had completed the biggest changes to our programs in over 20 years.

Organizations do change.

 For the last ten years I have been involved with the world’s largest scientific project, ITER.  It is a $15 billion effort involving the US, EU, Russia, China, Japan and South Korea.  Its goal is to design, develop and build the world’s first nuclear fusion facility. With the design and engineering phases already completed, the first demonstration plant is now under construction in Caradache, France.  In addition to this mega-science project there are several more throughout the world including CERN and soon ILC. Recently, scientists from CERN and ITER have met to share common science issues, yet there has yet to be a meeting to share common project management issues. Fortunately, effort is now underway to help managers of these projects step-out-of-the door and develop a common body of project management knowledge that addresses these large-scale international science projects.

Success in an increasing number of projects requires that we step-out-the-door and see what others are doing.  The inclination of established bureaucratic structures to protect their insular view of projects needs to be continually challenged.

Lessons Learned
Call a competitor, get their catalogs, go to trade shows. If you are implementing a new module in an ERP system, visit installations at other companies.  If the project focuses on CRM, talk with customers not just software vendors.  If the project deals with vendor selection don’t stop with the vendors, visit their customers.  If the project deals with outsourcing, don’t limit yourself to China. Collect information and even visit South Vietnam, Mexico and Korea. How about a call center in South Africa?

Projects that truly align business goals with project objectives must encourage project managers to step-out-the-door. Sell your Nissan!

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