Changing corporate culture--a breakthrough approach
Jeffrey A. Smith, PMP, Senior Manager, Network Services Product Management, Lucent Technologies, Inc.
Jerry T. Hughes, Lucent Technologies, Inc.
This is the story of the coming together of two projects, starting under separate charters and converging to form a strong alliance that revolutionized the way the company does business. The first project (The Service ADDvantage SM Project), utilizing the Classic PM approach, used tools and techniques such as Work Breakdown Structure (WBS), Responsibility Assignment Matrix (RAM), action registers, change control and After Action Reviews, managed by a centralized Program Office. The second project employed a new way of operating called Breakthrough. New tools and processes based on order information management, standardization, establishing a new company/new culture and a new way to implement were created and have now been regionally deployed and implemented. Despite the best tools and technology, a new “Lucent” corporate culture (which fosters innovation) and well-intending people, success was not guaranteed. At one point, both Teams were struggling and some people began to question the viability of both projects. At closer study, the same people that appeared to be supporting the individual projects were actually resisting change. It was determined that the best probability for success was to join forces and combine the two teams. The new unified strategy was to elevate the people issues above all others, sometimes at the expense of other project priorities. This focus on the people issues, proved to be critical in increasing the adoption rate of the new processes and making believers out of cynics.
The following sections will take you through the evolution of each project and the lessons learned individually and as a combined SABIT Team (Service ADDvantage/ Breakthrough Initiatives Team).
The Service ADDvantage SM Project
Service ADDvantage Pre-conditioning is a concept that allows Service Providers the ability to prepare their central offices in advance of growth and dramatically reduce the time it takes to add service capacity on an existing 5ESS® Switch (product of Lucent Technologies, Inc.). In today's marketplace, Service Providers need to respond to market demands for telephony and Internet services quicker than their competitors. With the increase in competition and explosive rate of technology evolution, there is no way that providers can accurately predict when and where the demand for services will arise next. The winner will be the provider that can get the end customer in business the fastest, allowing them to generate revenue sooner.
Service ADDvantage Pre-conditioning is a proactive partnership between customer and supplier that requires a significant amount of planning to prepare key central offices for growth. In the past, it could take more than 120 days to custom engineer and install a central office growth job. The goal of Service ADDvantage Pre-conditioning is to take the preconditioning work out of the critical path, preparing the office ahead of time, and being ready to respond to market demand with standardized solutions in 30 days or less. The concept is simple—identify the key offices, survey each office, use the results of the survey to precondition the office so it is capable of accepting a growth model, and finally grow that office with a fixed model when the market demand materializes. Implementation of the concept was not so simple. There was coordination that needed to take place across multiple geographically diverse Customer Teams, using different approaches to processing orders and meeting their customers needs. Service ADDvantage Pre-conditioning required a major change in the way Lucent did business. It was decided that the best way to tackle both the internal and the external issues was to bring together a cross-functional team utilizing classic Project Management tools and techniques.
The Service ADDvantage Project Team was established in November 1998. The Project Team was led by a small, dedicated team from Product Management with regional membership from many disciplines: Program Management, Engineering, Manufacturing, Customer Service, Asset Management, Sales, Legal, Finance, Installation, Marketing, and Contract Management. The Team met to map out the charter, the scope and the schedule of the project. Each Customer Team, responsible for a particular Customer or Customer Set, identified and committed to the number of offices they would survey, precondition, and “certify” as ready for growth. The overall Team objective was to certify 900 offices over a 12-month period. This objective was tied to the overall plan to reduce cycle time for the Business Unit from 139 days to 81 days.
A detailed program plan was developed for each region to coordinate the “selling” of the surveys, office preparation and office growth. Standard processes were developed for tracking and reporting, along with a “boilerplate” proposal and contract language. A WBS and RAM were used to identify the specific scope of work, the roles and responsibilities of the Team members and the specific deliverables required to complete the work. Bimonthly Project Meetings were initiated by the “Program Office” with weekly regional meetings held to focus on Customer deployment. Issues were identified and tracked on an Action Item Register and any changes in the program processes or tools were worked through a newly created change control process. At the same time, a complete Marketing Program was being rolled out which included articles, brochures and sales collateral focusing on the “need for speed” in the delivery cycle.
After Action Review (AAR)
Four months into the Project, results were lagging and the Team was getting a significant amount of pressure to pick up the pace. The program leaders conducted an After Action Review (AAR), which is a process designed to answer four basic questions:
1. What was supposed to happen? (Intent)
2. What did happen? (Capture)
3. Why? (Interpret the data)
4. What can we do about it? (Act)
The purpose is to clearly identify Lessons Learned and actions that need to be taken to correct the course of an existing project or to be used as standard practice on future projects.
Some of the findings were quite extraordinary. First and foremost, some Customer Teams had not bought into the concept at all and were still running into resistance at the working level. This new concept was different and required changes in processes that were “tried and true.” The clash of cultures was the first major issue that had to be overcome. The regional functional organizations needed to “end the debate” over whether it was the right decision to implement Service ADDvantage Pre-conditioning along with standard models and move on to “execution.” The second major finding was that some of the Customer Team members dedicated to the Service ADDvantage Project were dedicated to other competing projects as well. In fact, some team members continued to perform their regular “production” jobs, devoting their spare time to the Project Team. The Project Leaders needed to figure out a way to combine forces with some of the other projects instead of competing for resources. The third major obstacle was that the customer had not “been sold” on the standard solutions, developed to quickly grow an office in less than 30 days. Some work needed to be done to tweak the models and reposition the Value Proposition with customers.
Several actions were taken as a result of the AAR. First, a strong push was made with the Sales Executives to encourage Service ADDvantage Pre-conditioning and model deployment. This was accomplished through executive sponsorship and reestablishing commitment to the goals of a 30 day or less delivery cycle. The second major action was to ensure that a dedicated Program Manager be assigned to the Project in each region. In addition to a full time project manager, Customer Team members would be incented to meet the goals of the project and be held accountable if the goals were not met. The third action and maybe the most significant was to collaborate with another project team that was utilizing a new approach, a Breakthrough approach. This team had been commissioned by the Executives several months earlier to develop a process to deliver a standard growth model in seven days. This alliance proved to be more powerful than the sum of its parts.
The Breakthrough Project
The Breakthrough project was chartered to address a clear market need to which the company was not responding well. It was clear to the Executives that the market was moving faster than the company could respond and that in order to survive a “breakthrough” was needed to reduce cycle time by more than an order of magnitude. The challenge was to identify a new process that would enable the company to meet the market demand for 5ESS® Switch models with a cycle time significantly less than the competitive benchmark of 30 days.
The Breakthrough team was created in August of 1998. Its members were handpicked for out of the box thinking and being able to avoid distractions that often interfered with creativity. The team of 18 individuals were called together on less than one week's notice with little indication that the effort that they would be undertaking would revolutionize the way the company does business. One of the strengths of the team was its diversity. The team consisted of employees with one to 30 years of service, representatives from both the U.S. and non-U.S. locations, and members from all significant operational disciplines of the company. The Team symbol consists of three wishbone-shaped symbols, each of which is the Chinese symbol for a person. The three multicolored symbols represent a Team whose members come from diverse backgrounds and cultures. The pitchfork-like symbol represents the opportunity to get out of the box and find a new way of operating.
The first two weeks of the effort were spent in a team-building exercise during which the Team members got to know each other and build relationships that would stand the test of time and the stress of disagreements. The team training included exercises in how to communicate clearly and openly, as well as how to recognize and deal with cultural obstructionism. The Team then started working on the creation of the new process and established an objective of a seven-calendar day turnaround from order receipt to installation completion. It was at this time that the Team realized the enormity of the undertaking and had no clue how to achieve the objective, much less have a production system in operation before the end of the year.
During the next month, the Team stepped completely out of the traditional way of operating to create a web-based ordering system that was supported by new tools and a radically different process in which associates would use information and data as the basis of communicating and making decisions. This meant the empowerment of individuals to use information to get the job done and the elimination of a status quo that tolerated excuses for not having the information to make credible decisions.
Breakthrough Operating Principles
The early discussion of what the process should look like focused on establishing a set of operating principles that would guide the project through the coming months. The original list included 40 principles, which was too large to manage. The Team prioritized the list of 40 and realized that the following four would capture the essence of what they wanted to achieve:
• Order Information Management
• New Company/New Culture
• A New Way to Implement.
The legacy of the public telephone network is that it was prudent to cost minimize the hardware purchased by Service Providers to serve the needs of the telephony consumers. The advances of technology and the rate of growth of the public telephone network make this less important now than it has been in the past. In today's market, speed and responsiveness are the name of the game. It is quite easy to standardize the product into models and make those models available at the time an order is received, in fact Lucent Technologies has a large inventory of fixed models that can be ordered today.
It is quite a different thing to standardize the environment the model must be installed into. The Breakthrough team came to the conclusion that in addition to product standardization, the office needed a relative level of standardization in order to achieve the growth cycle times being demanded by the market.
The Breakthrough team further established that once an office was standardized and information defining the condition of the office was documented, a very rapid order to complete interval of as little as seven days could be achieved. Standardization of the office is needed to be at several levels. First the building infrastructure needed to be available to physically hold and power the standard product. Far end circuit terminations needed to be available to connect the standard product, and 5ESS® Switch infrastructure needed to be in place to accommodate the capacities the standard product would consume.
Order Information Management
The Breakthrough team spent a great deal of time understanding what would be required of the new process to support the drastically reduced cycle time that was being targeted. One of the issues people mentioned constantly was that they could not always make good decisions because they were missing critical bits of information. Sometimes it was hours or days too late when the information would become available to them. This often caused decisions to be reversed, wasting resources and worse yet leaving people feeling helpless and out of control.
It has been said that information is power. Lots of people had lots of information they did not know could be used by others, so it was never offered until someone asked for it explicitly. This was not an intentional sheltering of information, but a way of life where no internal processes required the sharing of specific information.
In every discussion, individuals agreed that if they had all of the information they needed to do their job they could be more effective and significantly reduce the amount of time required to complete their portion of an order. In the final analysis, information was the main thing people really needed to perform their jobs effectively. So the principle of Order Information Management was established as a critical element of the process. The intent was to ensure that all users of the new process would have access to the Right Information in the Right Place at the Right Time, and that this information would be available to all personnel at all times.
New Culture/New Company
Early in Team discussions it was agreed that there would be significant cultural resistance to the radical changes being proposed, so the cultural aspects of the existing operations were studied to identify and understand the mindset of the people who would be required to change.
The cultural aspects of the changes required were the most difficult to deal with. Some people viewed the new way of doing business as a huge asset and others, typically the associates with more time in their position, viewed the new process as a threat. Since those who viewed the process as a threat were often supervisors or managers of those who saw merit in the process, there was a great deal of false feedback given when things were not progressing as designed. The solution was to find the rare individual who will tell it like it is behind closed doors and work with the individuals who are obstructing progress in a calm, professional and persistent manner.
The Team selected the internal name R/EvoLucent.com to set itself apart from the rest of the company. While this name is not used outside the company for obvious reasons, the Team web site includes the name and tends to get people excited about using the new tools and process because it is so different. The Team was taught that when confronted with resistance, Team members should listen and empathize with the concerns of the old legacy culture, and then offer personal coaching and training to those who needed it on the benefits of the new ways. Regional champions of the new process were identified within each operating unit to facilitate problem resolution and to help create a sense of ownership. In spite of the resistance, things are improving and more advocates are joining the cause each day.
A New Way to Implement
In the past, any change that was proposed had to be studied to death and recast several times before it could be considered for implementation. This typically took so long that by the time the implementation could be considered, the reasons for the change had turned into other reasons that needed a different solution. The Breakthrough team selected a new way to implement change that accepted the fact that none of the deliverables would be perfect, but that they would be delivered rapidly and be fixed immediately if not working. In other words, get it roughly right the first time and fix any fatal problems the next day. This implementation method became know as the Spiral approach, where the requirements and deliverables were continually enhanced in a Ready-Fire-Aim type feedback loop. It does have some risk associated with it, but the level of risk is acceptable given the rapid fashion of implementation.
This bias toward action is made possible by empowering people to invest their intellectual property in their work and to fix their own mistakes without fear of retribution. The result was that the development cycle time on this project was almost an order of magnitude less than previous projects.
A Breakthrough Crisis
By early 1999, the Breakthrough Engineering “Selector” tool had been developed and made available to all North American operating units. A new Order Management Process was introduced that identified order owners from each functional organization to participate in an order kick-off meeting. This meeting is now known as the OO7 (Order Owners in 7 days) meeting with a single individual called Top Dog being responsible for that order from “cradle to grave.” The order is released via the web platform to all functional organizations. Once the work is completed in each functional area, the individual identifies their work completion by changing the state of their Work Flow Manager (WFM) bubble from green to gray. The system automatically notifies the other members of the team via e-mail that it is time for them to perform their function.
Although user acceptance of the concept was high, the ability to effectively implement on a large scale was limited. The scope of the project had clearly been targeted at the model delivery process, but the problems at the front end (preparing the office) and the back end (billing) of the Order Realization process had minimized the effectiveness of the “breakthrough.” It became apparent that the Team needed to recalibrate.
Several steps were taken to revive the excitement and expectations of Breakthrough. The first was to develop the necessary feeds to the financial systems that provided the customer with a mechanized receipt/authorization of an order as well as the invoice upon the completion of that order. The second was to once again provide a strong push with the Executives to reinforce the need for a drastically reduced cycle time. The third step was to combine forces with the Service ADDvantage Team. Service ADDvantage Pre-conditioning was the foundation of the Breakthrough process but to date, had been viewed as a separate project. Offices needed to be surveyed and certified as having the necessary resources available to grow the office with a standardized model utilizing the Breakthrough process. The information collected in that office survey was the same information that Engineering needed to engineer the order, that the factory needed to begin to manufacture/assemble the order, that Installation needed to begin to prepare for installing the order. The combining of forces allowed the company to better utilize its talented and dedicated staff and advance the web-based technology achieved to date. This alliance proved to be more powerful than the sum of its parts.
People, Processes, and Tools
The Service ADDvantage and Breakthrough Teams joined forces, taking full advantage of both human and technological resources to deliver “breakthrough” performance. The combined SABIT (Service ADDvantage/Breakthrough Initiatives Team) Project Team approached each Customer Team and began to focus individual attention on the attitudes and cultures of the regional functional team members. This individualized attention has proven to be critical in increasing the adoption rate of the new processes and making believers out of cynics. The Project Team has been open to new ideas that will enhance the processes and tools and has implemented an active change control program. Enhancements to the tools and processes are released on a regular basis, with special emphasis on resolving user-identified improvements.
The Technology Team incorporated a new database capability into the web platform that mechanized the Service ADDvantage office survey. The office details of every central office survey was loaded into a centralized database that was available to the entire Team. Once work was performed in that office, the office characteristics would be updated and maintained for future growth orders. Availability of this data early in the process proved to save an average of four hours per order. At the OO7-kickoff meeting, team members could feel confident that their commitments were based on hard data, not just “gut feel.”
As more offices were prepared for growth with Service ADDvantage Pre-conditioning, the number of Breakthrough orders accelerated and the overall average cycle time was reduced. At the time of release of this paper, over 900 central offices have been prepared for growth as part of the Service ADDvantage program. The average cycle time of an order has been reduced from 139 to 74 days a 47% reduction. The number of Breakthrough orders has tripled in the last three months to 50 orders per month, and the average cycle time of a Breakthrough order was 18 days (27% were completed in less than 11 days and 40% were completed in less than 14 days).
Of the many lessons learned on the SABIT Projects, the following four are the items that had major impact:
1. Elevate the People Issues Above All Other Priorities—The Project Teams had access to great new tools and processes, but they were not enough. It was determined that specific decision-makers needed to be sold on the value proposition of the project. The decision to elevate the people issues, above all other project priorities was critical in getting the key decision makers to become catalysts for change rather than resisters of change. These individuals were clearly shown the value of the project, both personally (what's in it for me) and professionally (what's in it for the company). They effectively become extended members of the SABIT Project Team and advocates for the new way of doing business.
2. Collaborate, Don't Compete With Other Projects—Interorganizational friction and competitive spirit is often a way of life in large corporations. It should be a manager's obligation to search for opportunities to collaborate with other corporate groups whose core competencies could strengthen their own operation and the company as a whole. In many corporate cultures, the thought of collaborating with other groups who may be competing for common budgets and resources is unheard of. In the case of Service ADDvantage Pre-conditioning and Breakthrough, the budget issue was very real since both teams were new operations and knew that funding going forward would be based on results. In order to give both operations a better chance of delivering positive results, the teams joined forces. The project leaders agreed to present a unified front to the rest of the company. Internal communications and rollout presentations were done together so that whenever people heard Service ADDvantage Pre-conditioning they would also think Breakthrough and vice versa.
3. Executive Commitment Is A Key Factor of Success—Key to the success on any project is the sponsorship by established and respected executives. The SABIT Project Team was fortunate to have constant support and council of the executives even when times got rough. The ongoing support was critical in “staying the course” and maintaining the momentum.
4. Establish A Bias Toward Action—At project start, a risk-adverse culture where maintaining the status quo was accepted. The culture is now shifting toward a bias toward action where people are empowered to take risks. The new way of operating (spiral approach) allows people to try new ideas before they are proven, which leads to better and faster solutions.
What began as two separate projects both targeted at cycle time reduction has revolutionized the way the company does business. Not only have the new tools and processes streamlined internal operations, but they have also contributed to operational savings for the customer as well. The collaboration of the Service ADDvantage and Breakthrough teams has now been extended to include a front end ordering capability on the Lucent iBuy web platform. Customers can now check to see if their offices have been Service ADDvantage certified, order standard models over the web and track the progress of those orders to completion. The order is then processed as a Breakthrough order and delivered in less than 30 days. These capabilities form the basis for the Lucent Technologies R/Evolutionary ADDvantage.
Proceedings of the Project Management Institute Annual Seminars & Symposium
September 7–16, 2000 • Houston, Texas, USA