The project management landscape has witnessed a significant shift in recent years. Instead of abiding by linear, predictable processes, professionals try to stay afloat in environments characterized by volatility, uncertainty, complexity, and ambiguity (VUCA). The concept of VUCA was first coined by the United States Army War College in 1987, describing the complex environment that emerged following the end of the Cold War. The framework has now spread to various industries, including project management.
“Project management is risk management. Project managers develop plans to identify and accommodate the risks in business processes and projects they are working on,” says Ramond Sheen president of Product and Process Innovation, Inc. (PPI).
Volatility refers to the unexpected or unstable nature of challenges. The challenge itself might not be difficult to understand, but its duration and impact can be uncertain. Even if one understands the potential cause and effect, there's uncertainty due to a lack of information.
One might ask, "What if there's information available?" Assuming that some information is available or predictable, its sheer volume or nature can still be overwhelming, making it complex. Ambiguity, the last aspect of VUCA, is arguably the most challenging because there are "unknown unknowns." In other words, there are no precedents to guide decision-making.
The notion of VUCA perfectly describes today's broader landscape. For instance, rapid technological advancements, despite bringing numerous advantages, also present potential disruptions that can negatively impact project timelines and outcomes. Global events such as the 2008 financial crisis, the COVID-19 pandemic, and geopolitical conflicts add to the uncertainty in project management.
These events have demonstrated how events that might seem unrelated at first can have ripple effects on projects across industries. Sheen asserts that traditional project management approaches often fall short, given such a complex environment.
Sheen, with nearly four decades of project management experience, recalls, "The foundation of project management used to be predictability. Project plans were based on educated guesses in a stable environment. Things became more and more unstable, and conventional project management approaches struggled to adapt." He adds that this resulted in a 90% failure rate for projects.
Sheen, who teaches Systems Engineering in the MBA program for Southern New Hampshire University, was first exposed to the concept of VUCA while consulting in the aerospace industry in the early 2000s. This concept now forms part of the curriculum he teaches. "I noticed that besides technology, VUCA is also applicable to geopolitical situations and economic markets," Sheen remarks. He then recognized the need for the project management sector to effectively address the challenges VUCA poses.
Sheen highlights the pain points he encountered in the field. Firstly, clients' needs are constantly shifting, which is inevitable, given that the environment is also changing. Rapid technological advancements also make things more complex. He notes that while agile project management is a decent response to this challenge, it still has limitations, particularly outside software development.
The seasoned professional encourages the project management professionals to embrace transparency and flexibility. According to Sheen, traditionally, the sector adheres to the iron triangle concept, where scope, schedule, and budget are fixed parameters. This rigid methodology unfortunately leads to project failure, with only 30% meeting all three criteria and 10% on digital transformation initiatives due to VUCA.
"We should adopt a more adaptive approach, where for each milestone, we set intentions for scope, schedule, and budget. One aspect should be regarded as absolute while the others can be more flexible," Sheen proposes. This unique approach of breaking down VUCA into its component parts allows project management professionals to develop targeted strategies to mitigate its effects and even leverage them to their advantage. Sheen adds, “Project plan includes pre-determined pivot points where the project manager and team resets the project based on the VUCA characteristics that have occurred. This allows projects to be robust, and flexible, simultaneously.”
Sheen believes that counteracting volatility begins with embracing change as a constant feature of the working environment. He asserts that one should create a robust vision to develop flexible goals and adapt to changing circumstances rather than resisting change. To solve uncertainty, one must prioritize listening and observing to understand their environment better. Meanwhile, in complex situations, professionals must prioritize communication and collaboration. Lastly, ambiguity is best addressed through agility and adaptability.
Ultimately, Ray Sheen introduces a groundbreaking approach that can redefine how organizations thrive in a volatile, uncertain, complex, and ambiguous environment. He provides a roadmap for success, advocating for breaking down the principles of VUCA into manageable components to succeed in the modern business landscape.
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