Communication revolution and globalization have turned the world into one large village where individuals and organizations are now connected in unimaginable ways. The result is a highly dynamic world beaming with opportunities for organizations, ranging from micro businesses to enterprise entities.
While most social pundits provide a positive outlook of the effects of globalization, organizations face serious existential challenges in keeping up with the pace of changes and in responding to the issues arising out of diverse workforces. In order to survive and effectively compete in such dynamic conditions, organizations need to transform the existing frameworks used to align their strategic goals. They would need to embrace agility in order to achieve higher degrees of responsiveness in dealing with demands dictated by different regions and cultures.
As evident from many studies, people and communication remain among the most important factors leading to success or failure of projects and change initiatives. Communication of strategic goals and getting people to work towards achieving them is becoming more and more challenging.
In this paper, we will explore key elements of a decision-making framework which can help organizations in preparing “agile” strategies which can potentially better align to needs of stakeholders representing different cultures. Means to communicate the benefits and tools to achieve better realization of those benefits will also be shared.
change agility, cultural diversity, organizational agility, globalization, dynamic organization
Change leaders who have the experience and skills to deal with organizations characterized by diversity are in high demand. The demand is driven due to the fact that more and more organizations are expanding across geographical confines to overcome shortages in local opportunities and also to leverage the intellectual capital available across the globe. This trend has made it mandatory for change leaders to learn how to manage stakeholders across different cultures. Failing to do so may not only jeopardize the outcome of change initiatives, but also make stakeholder management an unnecessarily stressful exercise.
Change Agility is defined as the ability to quickly and effectively focus and implement change in an organization. Organizations that continually improve their change agility enhance the likelihood that their strategies will be fully implemented and achieve their expected benefits (PMI, 2014).
In other words, change agility is the ability to:
- Continuously define what needs to be changed
- Quickly and effectively focus and implement change in an organization
- Empower all members of the organization's team to be ready for the future change
The ongoing quest for change agility is a business strategy itself, and, as such, is most effectively carried out in a well-understood and replicable process.
Portfolio management is the coordinated management of one or more portfolios to achieve organizational strategies and objectives. As shown in Exhibit 1, portfolio management is practiced through interrelated processes which allow organizations to evaluate, select, prioritize, and allocate available resources to initiatives which are most likely to accomplish organizational goals. Many of portfolio management processes provide decision support information, which is used as key input in organizational decisions.
Portfolio management helps in determination of viable initiatives that meet the target of the organization while balancing various factors such as research versus development, short-term versus long-term, risk versus reward, and so forth. It also involves regular monitoring of planning and execution of selected initiatives. In many companies, the improvement of project portfolio management has become part of the organizational learning process.
ROLE OF AGILITY IN PORTFOLIO MANAGEMENT
In the ever-changing market economy, agility is increasingly becoming a key enabler of strategy realization. It helps organizations build the right things and to build them right, which maximizes value and keeps initiatives aligned with strategic goals.
Using the analogy of product vision, a high-level view of value—that an organization expects to provide—is developed. The agile principles and manifesto help in making the value more achievable by balancing the internal and external focus to better adapt to changing conditions and priorities.
The product vision is a high-level view of the value that a company wants to provide and an understanding of whom the company wants to provide it to.
Agile companies have the ability to recognize and respond quickly to market demands without losing the consistency of quality and involvement that made them successful—the hallmark of sustainable, successful organizations (Sushant).
DIVERSITY AND CULTURAL INTELLIGENCE
Cultural Intelligence is defined as a person's capability to adapt while interacting with others from different cultural regions. A cultural intelligence person has behavioral, motivational, and metacognitive aspects. Cultural intelligence is often measured through Cultural Quotient (CQ), a scale similar to that used to measure an individual's intelligence quotient. People with higher CQs are regarded as better able to successfully blend into any environment, using more effective business practices than those with a lower CQ.
LEWIS’ CULTURAL CLASSES MODEL
According to Richard D. Lewis, several hundred national and regional cultures of the world can be roughly classified into three groups:
- Task-oriented, highly organized planners (Linear Active)
- People-oriented, loquacious inter-relators (Multi Active)
- Introverted, respect-oriented listeners (Reactive)
The classification helps in understanding the behaviors when dealing with people from different cultures. It also helps in avoiding the offenses and understanding the reactions of stakeholders. A good understanding of the attributes of cultural classes can help with predicting an individual's behavior and knowing why certain people do what they do. These attributes should form the basis of any stereotypes we develop and maintain about other nationalities. A diagrammatic disposition of major nations into cultural classes is given in Exhibit 2.
A key attribute—which is very critical in stakeholder management—is how different cultures collect information. In data-oriented cultures, a lot of research is done to produce information that is then acted upon. The more developed societies turn to printed sources and databases to collect facts, which are then parsed through information systems to help in decision making. Dialogue-oriented cultures, on the other hand, rely more on their own personal information network. Dialogue-oriented people tend to use their personal relations to solve the problem from the human angle. Exhibit 3 shows a ranking of dialogue-oriented and data-oriented cultures around the globe.
Exhibit 3: Relative ranking of dialogue- and data-oriented cultures.
ATTRIBUTES OF LINEAR ACTIVE CULTURES
As mentioned earlier, Linear Active cultures are task-oriented and highly organized. Nations which belong to this class include, among others, the United States, Switzerland, Germany, and the United Kingdom. Key attributes of Linear Active cultures are given in Exhibit 4.
ATTRIBUTES OF MULTI ACTIVE CULTURES
Multi Active cultures are people-oriented and loquacious inter-relators. Nations characterized by this cultural class include Hispanic Americans, nations of the Middle East, Arabs, Africa, Russia, Italy, and Spain. Key attributes of Multi Active cultures are given in Exhibit 5.
ATTRIBUTES OF REACTIVE CULTURES
Vietnam, China, Japan, Korea, and Singapore are considered examples of Reactive cultures. Members of this class are introverted and respect-oriented listeners. Key attributes of Reactive cultures are given in Exhibit 6.
CULTURAL INFLUENCES ON CHANGE AGILITY
Change agility practices in Linear Active cultures rely more on solid data, processes, and clear steps defined through a system. Management is more process-oriented and stakeholders from this cultural class plan ahead methodically and mostly tend to focus on one major issue at any given time.
Change agility practices in Multi Active cultures rely more on high-level details. Management is more people-oriented and stakeholders from this cultural class only plan grand outlines, but can handle several issues simultaneously.
Change agility practices in Reactive cultures are characterized by a heavy reliance on communal harmony and respect of hierarchy. Management is more people-oriented and stakeholders from this cultural class tend to collect information that will let them envision the bigger picture before reaching a decision.
Change agility is not optional anymore in the current, dynamic world. In order to apply change agility, we have to adapt the organization to support the change at all levels, from portfolio management to all the lower components in the organization.
Portfolio management should be agile to maximize the value of the outcome, but this needs more flexibility.
People and communication are the most important factor for any change. People's culture is a major factor in managing any change, and we have to understand how to deal with different cultures if we need to implement change agility.
Change management processes have to consider the cultural diversity, and applying the proven model is very important for implementing change agility and making the organization dynamic.
ABOUT THE AUTHORS
MOHAMED KHALIFA HASSAN
Mohamed Khalifa Hassan, PMI-SP, PMI-RMP, PMI-ACP, PMI-PBA, PMP, PgMP, PfMP, Leadership Institute Master Class Alumni, is a renowned project management consultant and speaker. Mr. Hassan possesses a unique combination of broad-based skills, gained from more than twenty years of project management practice. He has developed, implemented, and operated many Project/Program Management Offices (PMOs) and Project Management Information Systems (PMIS).
MUHAMMAD A. B. ILYAS
Muhammad A. B. Ilyas, PMI-SP, PMI-RMP, PMI-ACP, PgMP, is an organizational transformation specialist with expertise in project management, information systems, and corporate governance. He is also a member of PMI's R.E.P. Advisory Group. Mr. Ilyas has worked with stakeholders from all continents across the globe. He has also spoken at various PMI forums in UAE, Bahrain, Kuwait, Turkey, the United Kingdom, and the United States.
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Lewis, R. D. (2006). When cultures collide: Leading across cultures. London, UK: Nicholas Brealey International.
Project Management Institute. (2014). Change agility: Readiness for strategy implementation. Newtown Square, PA: Author. Retrieved from http://www.pmi.org/changemanagement
Sushant, Project Management Services. (n.d.). Role of project portfolio management. Retrieved from http://www.portfoliomanagement.in/role-of-project-portfolio-management.html