Business Politics, Organisational Politics, Workplace Politics, irrespective of what noun you place in front of the word “Politics”, an association can be drawn that there will be some decisions taken within organisations that are based on robust debates that are based on biased agenda’s and contrasting behaviours and personalities. Belsky G and Gilovich T in their book, “Why Smart People Make Big Money Mistakes”, infers that it is human nature to make decisions based on our personalities, self-motivated objectives, ego’s, peer pressure, fear and regret irrespective of the irrationality of the outcome. The inference can be generalised against any decisions we as individuals need to make and is supported by Belsky G and Gilovich T when they succeeded statements made in their book with, “financial and or otherwise”.
During my tenure, within a large financial institution, being accountable for the delivery of fairly large Business Process Reengineering (BPR) projects, I found myself within the context of a matrix type management structure where successful BPR projects where considered to be a myth. So, the question I posed to myself was; “Why is that so?.” Before moving towards an answer to this question a brief understanding of business politics is required, furthered by a case study example as to the prevalence and impact in a matrix management organisation structure.
A definition of business politics can be found in various resources having minor variances’ however all these definitions propound a central theme based upon the people within the organisation putting forward their own convictions, agenda’s and ego’s irrespective of whether it has a negative impact towards the organisation’s performance or not.
Now why would this type of behaviour impact projects negatively in a matrix type management structure? In my experience I would affirm that it simply comes down to the reason that in a matrix management structure you have people reporting to various managers to deliver and or achieve the same product/outcome.
The context in where the aforementioned statements prove themselves true is at an executive level where strategy is defined and executed and where decisions have a direct impact on the BPR projects conducted within an organisation. Let us look at a real world example which will provide a deeper context as to why I affirm the aforementioned statements.
The example revolves around a major BPR project which was carried out within a Global Corporate and Investment Bank. The project’s aim was to realign the organisation’s strategy from having disparate Customer/Contact Centres towards implementing a consolidated Customer/Contact Centre. As you can imagine this was quite a huge initiative requiring huge investment which would incorporate a swarm of stakeholders across numerous geographies. The key driving point was the swarm of stakeholders which created numerous decision points, wherein no single individual was accountable for a decision but rather creating collaborative accountability for decision making.
There were ultimately four executives accountable for approving any decision inclusive of funding, scoping and execution approach. The executive group were as follows:
- Line Executive: Accountable for the project resources, inclusive of human capital, BPR tools and Continuous Improvement Methodologies (for example: Six Sigma and Lean)
- Executive Sponsor: Accountable for the funding and scope of the project
- Business Operations Executive: Accountable for the funding and scope of the project
- Business Strategy Executive: Accountable for the funding and scope of the project
Reading the above, it is clear that there would be conflict when it came to funding and scope; however any decision that needed to be made required all five approvals. A single conflict point was easier to manage as you only had to influence one outcome over another; however multiple conflict points were next to impossible to manage as there were too many viewpoints in play. Over and above the conflicting viewpoints that were in play, the project management had to also contend with constantly changing viewpoints expounded by the corridor conversations held by the executives – be it in isolation to the other executives or in persuasive collusions.
One of the key success factors in executing a BPR project is to have strong Executive Management support. This key success factor was one of the major failure points on the project, and was mainly attributed to business politics. The Business Operations Executive had a very strong technical background and did not support BPR projects. Instead the executive believed that software development was the silver bullet to fix all the business unit’s financial woes. This led to much collusion happening between the executives that eventually resulted – after 6 months – in only the Line and Strategy Executive supporting the project. There were many other similar examples around funding and scope agreement.
To summarise: the outcome of the Executives behaviour resulted in 9 months’ worth of work being stopped which included many pilots that were aimed at proving BPR concepts, and the development of numerous Project Charters and Business Cases which were presented at various Investment Committees for funding and scope approvals. Needless to say the staff attrition in the BPR Business Unit, particularly the senior management, was close to 90%, citing business politics as a main reason for leaving the environment. The completion rate of BPR projects executed within the organisation’s business unit was in a ratio of 1:4 – namely only 20% of projects executed could have been considered completed.
In conclusion business politics has a major implication to the success of executing BPR projects and should always be considered when planning for stakeholder management. Organisations should also strive to create an environment that is conducive to project management structures thereby limiting multiple stakeholders accountable for approving projects once initially approved to go ahead. The ideal would be to have a single accountable stakeholder for decision-making that would drive the interest of the organisation after the investment committees have initially prioritised projects, allocated funding and determined scope at an organisation level.
