Case: Quantum Telecom

Both project managers were still advocating the cancellation of the projects, and the situation was getting worse. Yet, in order to “save face” within the corporation, both sponsors allowed the projects to continue to completion.

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In June of 1998, the executive committee of Quantum Telecom reluctantly approved two R&D projects that required technical breakthroughs. To make matters worse, the two products had to be developed by the summer of 1999 and introduced into the marketplace quickly. The life expectancy of both products was estimated to be less than one year because of the rate of change in technology. Yet, despite these risks, the two projects were fully funded. Two senior executives were assigned as the project sponsors, one for each project. Quantum Telecom had a world-class project management methodology with five life cycle phases and five gate review meetings. The gate review meetings were go/no-go decision points based upon present performance and future risks. Each sponsor was authorized and empowered to make any and all decisions relative to projects, including termination. Company politics always played an active role in decisions to terminate a project. Termination of a project often impacted the executive sponsor’s advancement opportunities because the projects were promoted by the sponsors and funded through the sponsor’s organization. During the first two gate review meetings, virtually everyone recommended the termination of both projects. Technical breakthroughs seemed unlikely, and the schedule appeared unduly optimistic. But terminating the projects this early would certainly not reflect favorably upon the sponsors. Reluctantly, both sponsors agreed to continue the projects to the third gate in hopes of a “miracle.”

During the third gate review, the projects were still in peril. Although the technical breakthrough opportunity now seemed plausible, the launch date would have to be slipped, thus giving Quantum Telecom a window of only six months to sell the products before obsolescence would occur. By the fourth gate review, the technical breakthrough had not yet occurred but did still seem plausible. Both project managers were still advocating the cancellation of the projects, and the situation was getting worse. Yet, in order to “save face” within the corporation, both sponsors allowed the projects to continue to completion. They asserted that, “If the new products could not be sold in sufficient quantity to recover the R&D costs, then the fault lies with marketing and sales, not with us.” The sponsors were now off the hook, so to speak. Both projects were completed six months late. The salesforce could not sell as much as one unit, and obsolescence occurred quickly. Marketing and sales were blamed for the failures, not the project sponsors.

How do we eliminate politics from gate review meetings?

To mitigate the influence of politics in gate review meetings, it’s crucial to establish clear and objective criteria for each decision-making gate. This ensures that assessments are based on concrete outcomes rather than subjective opinions. Enhancing the objectivity of evaluations can be achieved by involving third-party consultants or auditors to offer an unbiased perspective on a project’s viability. Moreover, rotating reviewers periodically can prevent the onset of group-think and deter alliances that may introduce biases.

To create an atmosphere where individuals feel secure in expressing their genuine opinions, implement a system for anonymous feedback regarding project concerns. This method permits honest feedback without fear of repercussions. Furthermore, segregating the roles of project sponsors from the evaluation process is essential. This ensures sponsors don’t have a direct influence on reviews of projects they’re invested in, reducing personal biases.

A culture of transparency is pivotal. By keeping meticulous and transparent records of all meeting discussions and decisions, participants are more inclined to prioritize the company’s interests, knowing that their inputs are documented. This transparent approach should be complemented with an educational initiative that underscores the risks of allowing politics to steer decisions. Real-world examples, such as the Quantum Telecom case, can emphasize the consequences of such actions.

It’s also wise to have an established escalation mechanism. This ensures that if there are concerns about any decisions, they can be elevated to senior organizational levels or an ethics committee. A foundational shift in company culture is required to view failures as learning opportunities rather than finger-pointing events. By fostering a no-blame culture, decision-makers are liberated from the fear of retribution, making them more inclined to act in the company’s best interests.

Accountability cannot be overlooked. When decisions deviate from expert recommendations, the underlying reasons should be comprehensively documented, promoting a transparent decision-making culture. Promoting differing opinions can help ensure that a variety of viewpoints are taken into account, thus reducing uniformity. Integrity, often a casualty of political maneuvering, should be recognized and rewarded. Those who base their decisions on data and prioritize the company’s welfare over personal or political gains must be celebrated.

Lastly, to ensure the continued efficacy of the review process, periodic evaluations are necessary. These can identify potential vulnerabilities to political influence, allowing for timely corrective actions. Strong leadership that emphasizes integrity, transparency, and objectivity can pave the way for a culture where company interests always remain paramount.

How can we develop a methodology where termination of a project is not viewed as a failure?

Changing how organizations perceive project termination demands a strategic shift in both mindset and operational processes. Instead of associating project termination with failure, it’s essential to reframe the narrative. Adopt terms that convey strategic foresight, like “strategic realignment,” “resource optimization,” or “portfolio adjustment” rather than words like “shut down” or “failure.” It’s equally important to place an emphasis on the lessons and insights extracted from every project journey, regardless of the outcome. Celebrating what’s learned fosters a culture of growth and adaptability. To further streamline decision-making, it’s beneficial to incorporate a robust stage-gate process, allowing for periodic evaluation of projects. This not only ensures timely and well-informed decisions but also facilitates early detection of potential issues, enabling teams to adjust efficiently. By establishing clear criteria for both the continuation and termination of projects, decisions become more transparent and objective, reducing the potential for personal biases. Importantly, fostering a culture that steers clear of blame when projects are terminated emphasizes collective responsibility and acknowledges the multitude of external factors that can influence such outcomes.

Positioning project termination as a chance for improved resource distribution can be key. By underscoring that ending one project can release crucial resources for more significant endeavors, the emphasis moves to the broader health and productivity of the organization. Open and transparent communication regarding termination decisions ensures alignment and understanding across teams, emphasizing the strategic considerations behind each decision. Integrating regular project portfolio reviews can further reinforce the idea that projects are fluid and subject to change based on broader organizational objectives. Recognizing and rewarding teams for tough but necessary decisions, including the halting of projects, sends a clear message that strategic decision-making is a valued competency. This positive reinforcement becomes more potent when all stakeholders, from team members to senior leadership, are educated about the methodology behind terminations. Lastly, a feedback loop is essential after any termination. By gathering feedback, analyzing reasons, and ensuring learnings are applied to future initiatives, organizations can evolve and refine their approach, ensuring project termination is recognized as a strategic choice, not a failure.

Were the wrong people assigned as sponsors?

From the information provided about Quantum Telecom’s situation, there are indications that the project sponsors may not have been the best fit for the role. Here are some reasons why:

Their decision-making, especially the reluctance to terminate projects despite collective feedback on technical challenges and time constraints, raises concerns. It’s implied that the sponsors possibly placed a higher emphasis on their personal advancement within the company rather than prioritizing the broader organizational interests. This perspective is further underscored when they proactively shifted potential blame onto the marketing and sales teams, rather than fostering a collaborative cross-departmental approach. Furthermore, their disregard for the technical recommendations from project managers adds to the concern about their suitability. The sponsors’ inclination to allow projects to proceed primarily to “save face” suggests that personal biases influenced their decisions more than objective evaluations.

Yet, while their decisions appear questionable, it’s critical to consider the broader context. The sponsors were operating within the confines and perhaps pressures of Quantum Telecom’s organizational culture, which might emphasize personal reputation and advancement. To thoroughly determine if they were indeed ill-suited as sponsors, a deeper analysis of their historical performance, decision-making patterns, team relationships, and expertise in the projects they managed would be necessary.

What options are available to a project manager when there exists a disagreement between the sponsor and the project manager?

When a project manager faces disagreements with a sponsor, the first step should always be initiating an open dialogue to understand the sponsor’s perspective. Often, such conflicts arise from misunderstandings or miscommunication, and a direct, respectful conversation can clarify the root issues. To ensure the discussion remains objective, it’s crucial to back up concerns or opinions with data and evidence. If a direct conversation doesn’t bridge the gap, it might be beneficial to involve a neutral third party to mediate the discussion, ensuring all perspectives are considered. Additionally, integrating other key stakeholders into the dialogue can offer valuable insights, potentially leading to a consensus or middle ground. In situations where the project’s success might be at risk due to the disagreement, the project manager should document their concerns as a reference point for future decisions. There might also be occasions where a compromise serves the best interest of the project, addressing both the manager’s and sponsor’s viewpoints. If all else fails and the disagreement poses a significant threat to the project’s outcomes, escalation to senior management or a governance board may become necessary, though this should be a last resort. Regular feedback loops between the project manager and the sponsor can anticipate future conflicts by ensuring consistent alignment. External consultants or experts can also offer impartial perspectives that can help in conflict resolution. Project managers should periodically self-reflect, ensuring that their stance is truly in the project’s best interest and not influenced by personal biases. Joint workshops or training sessions with the sponsor can further strengthen the collaborative relationship, and having clear communication channels in place can proactively mitigate many disagreements. Approaching such conflicts with an open mind and a focus on collaboration often leads to constructive resolutions.

Can your answer to the above question be outlined as part of the project management methodology?

Incorporating steps for resolving conflicts into a project management approach ensures that a systematic process is available when disagreements emerge. Here’s how a project management methodology can detail the approach to disputes between project managers and sponsors:

Resolving disputes between Project Managers and Sponsors.

Communication protocol:

  • Objective: Ensure transparent, regular, and consistent communication from the beginning of the project.
  • Action: Organize consistent meetings and updates between the project manager and the sponsor to maintain alignment and avert potential disagreements.

Evidence-based decision making:

  • Objective: Make sure decisions and concerns are based on concrete data and evidence.
  • Action: Always support your viewpoint with data, project metrics, or solid evidence to keep discussions fact-based and impartial.

Mediation process:

  • Objective: Handle disputes that aren’t settled through straightforward dialogue.
  • Action: Involve an impartial third party to mediate the conversation, making sure both parties are listened to.

Stakeholder engagement:

  • Objective: Utilize wider perspectives to address disagreements.
  • Action: Engage key stakeholders in dialogue when agreement between the project manager and sponsor proves challenging.

Documentation protocol:

  • Objective: Maintain a record of concerns and decisions.
  • Action: Document key conflicts, issues, and the reasoning for decisions to offer a reference point for future discussions or assessments.

Compromise framework:

  • Objective: Find middle-ground solutions.
  • Action: Create a structured process to evaluate potential compromises that can serve both the project’s and sponsor’s interests.

Escalation pathway:

  • Objective: Address severe conflicts that could harm the project.
  • Action: Establish a systematic approach to assess possible compromises that align with both the project’s and the sponsor’s objectives.

Continuous feedback loop:

  • Objective: Ensure alignment and understanding.
  • Action: Introduce a systematic feedback mechanism where both parties can consistently exchange perspectives and comments.

External consultation mechanism:

  • Objective: Gain impartial insights.
  • Action: Seek advice from external consultants or industry specialists for an outside viewpoint when finding in-house solutions becomes difficult.

Reflective practices:

  • Objective: Make certain that decisions prioritize the project’s optimal outcomes.
  • Action: Encourage for self-assessment sessions for project managers to examine their perspectives and inherent biases.

Collaborative training sessions:

  • Objective: Strengthen the collaborative bond between project managers and sponsors.
  • Action: Arrange collaborative workshops or training sessions that emphasize cooperation, understanding, and proficient communication.

Through the incorporation of these conflict resolution measures into the project management methodology, organizations can encourage a proactive stance toward conflicts, cultivating a culture of teamwork and understanding.

This case, and questions, is take from the book “Project Management Case Studies – Sixth Edition” – 2022, by Harold Kerzner.

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