We are all organization change managers, like it or not!

 

Founder and Chairman
RPM Systems Corporation

Shankar Sankaran PhD, PMP

Professor, School of the Built Environment
Faculty of Design Architecture and Building
University of Technology, Sydney

Abstract

In numerous client engagements over more than 30 years, both authors have witnessed a number of significant failures to achieve the planned benefits both on program and portfolio-level initiatives. In retrospect, the underlying causes were almost always related to not adequately addressing organizational change from the earliest stages of each initiative.

What follows is a practitioner's perspective of how the fields of program and portfolio management have benefited from the incorporation of Project Management Institute (PMI) research. The research of Crawford and Nahmias was the catalyst. That research identified unique characteristics of change managers. Those characteristics were mapped to a Work Preference Indicator (WPI) instrument developed by G. Ronald Gilbert.

The objective of this paper is to expand the current body of knowledge in managing change in the organization by raising the Change Quotient (CQ®) (Trautlein, 2013) of all initiative participants, not just program teams and project management offices, but everyone who may be affected by the change. We are all change managers. We may not be leading the change, but we are at a minimum responsible for managing ourselves in relation to accepting and embracing changes required to achieve the planned benefits.

Introduction

In recent years managing change in organizations has received increasing emphasis. One example is the 2013 Project Management Institute (PMI) publication, Managing Change in Organizations: a Practice Guide. The PMI publication does not specifically address the role of a Business Change Manager; however, the UK publication, Managing Successful Programs (MSP®) outlines in detail the responsibility of the Business Change Manager (BCM). See the Appendix to this paper for additional detail. Whether or not a program or portfolio initiative specifically identifies an individual in this role, change management skills are almost always a prerequisite to achieving the planned benefits.

The authors of this paper have been using the WPI since 2008 to identify individuals having a preference for organizational change work. Subsequent interviews with the individuals achieving high organizational change scores on the WPI assessment confirmed that the majority of them were actually involved in organizational change initiatives, either as leaders or planners or both.

While the initial focus has been on identification of individuals having preference for organizational change work, in reality, We Are All Organizational Change Managers, Like It or Not! Leaders of program and portfolio initiatives are almost always working with a team, two examples of which are a program management team and a program management office. Not surprisingly there is a wide range of preferences for organizational change work, with some individuals scoring extremely low in having a preference for this type of work. Nevertheless, it is suggested that all team members—no matter how low their preference for change work—will benefit from a greater understanding of managing change in the organization.

This paper examines an action research methodology designed to raise an individual's Change Quotient (CQ). CQ is defined as a measure of an individual's ability to lead and/or participate in portfolio and program-level initiatives requiring significant organizational change to maximize strategic throughput and benefits realization.

The CQ measure was developed by looking at the unique characteristics of change managers, and then mapping those characteristics to a Work Preference Indicator (WPI). The WPI has been administered to 245 individuals who work primarily in the project and program management domains.

This paper proposes three follow-on projects:

  • An action research project conducted with a subset of the 245 individuals who have taken the WPI.
  • A large-scale PMI research survey that includes an invitation to participants to take the WPI.
  • Publication of a book titled: We Are All Change Managers, Like It or Not!

Background

Poorly Managing Change Is the Primary Reason CEOs Are Fired

According to a study of 1,087 directors “CEOs get fired when the board of directors or shareholders have lost confidence in the CEO's ability to generate sufficient financial returns in the future” (Murphy, 2005). Poorly managing change is at the top of the list, with 31% of CEOs being fired for poorly managing change, specifically:

Virtually every organization we interviewed indicated they were undergoing, or had recently undergone, a change initiative. However, half of board members said that their change initiative did not go well. Most pointed to a failure on the CEO's part to properly motivate employees and managers, and more specifically, to adequately sell the need to change course. Another group identified the CEO's inability to follow- through and solidify the gains as the cause of failure.

(Murphy, 2005)

Maximizing Strategic Throughput and Benefits Realization

Maximizing strategic throughput of portfolio and program-level initiatives almost always involves significant organizational change (Garfein, 2009). Cabanis-Brewin & Pennypacker (2006) surveyed 84 leading companies using identified best practices. They found that on average, companies achieve only 56% of their intended strategy, leaving 44% unrealized (see the right side of Exhibit 1, Strategy executed to plan). Simultaneously executing strategy to plan and managing organizational change are essential to full benefits realization.

 

Exhibit 1 – On average, strategy is executed to plan 56% of the time, leaving 44% unrealized. (Garfein, 2009 and Cabanis-Brewin & Pennypacker, 2006)

Bridging the Gap

The research of Crawford and Nahmias (2008) identified the unique characteristics of change managers. Those characteristics were mapped to a Work Preference Indicator (WPI) instrument developed by G. Ronald Gilbert. This gap was first identified and described in a research paper by Garfein and Sankaran (2011). The objective of this research is to improve the probability of successful outcomes of program and portfolio level initiatives requiring significant organizational change. Organizational change initiatives are more difficult to effectively manage than most managers realize (Nahmias & Crawford, 2008). Organizational change causes people to do their jobs in a different way.

Organization Change Projects are Different:
Pitfalls of a Project Management Approach in Managing Programs

It is likely that if the individual or team responsible for the change has come from a technical background or even a project management background, they would have technical skills and project management skills but not necessarily the skills to implement organizational change (Pellegrinnelli & Partington, 2006). Project management techniques are not always conducive to achieving organizational change.

Taking a project-based view is often too restrictive. Typically project managers seek to impose degrees of order, control, stability, and predictability that prove to be pitfalls in initiatives requiring substantial organizational change.

A number of pitfalls have been identified that are associated with taking a project-based view of programs, as shown in Exhibit 2 (Pellegrinnelli & Parrington, 2006). If these pitfalls are brought forward to the program and portfolio levels, they may actually lead to a lack of flexibility, poor idea generation, and subpar benefits realization.

 

Exhibit 2 – Pitfalls associated with taking a project-based view of initiatives requiring substantial organizational change at the program and portfolio levels.

“Project Manager or Change Manager: Who Should Be Managing Change?”

A survey of 134 project professionals from all project sectors across the world confirms high failure rate for organizational change projects, with only 44% of change projects coming close to achieving their goals (Accountancy, 2003). Based on the pitfalls described above (Pellegrinnelli & Parrington, 2008), it is clear there can be potential problems in having project managers, who are promoted to the role of program manager, run organizational change projects (Nahmias & Crawford, 2008).

In practice, the role of change manager has emerged from different disciplinary backgrounds than that of project and program managers. In practice, this is an emerging role with responsibility for the management of any type of organizational change (Nahmias & Crawford, 2008). Exhibit 3 suggests a process model wherein a project is just a project if it does not require organizational/behavioral change (see top left-hand box labeled “1. Project”). In this case, a project management focus is appropriate. If, on the other hand, there is a requirement for organizational and behavioral change, the remainder of the model (steps three through eight) comes into play. (See Nahmias & Crawford, 2008 for a detailed description of the steps in this model.)

 

Exhibit 3 – Suggested process model for project managers and change managers involvement in organizational change (Nahmias & Crawford, 2008).

Suggested Matrix for Engagement of Project Managers (PM) and/or Change Managers (CM)

Nahmias and Crawford use a two by two matrix (Exhibit 4) to portray the dimensions of organizational change: 1) The strength of the supporting culture and leadership, and 2) The degree of behavioral change required. Of particular note is the top right-hand quadrant of the matrix that suggests both an organizational change manager and a project/program manager may be required where there is a high degree of behavioral change required in the supporting culture/leadership. Note however that the Project Management Institute literature does not recognize the role of either an organization change manager or a business change manager as defined in Managing Successful Programs (UK TSO,2011)

 

Exhibit 4 – “Suggested Decision Matrix for Engagement of Project Managers and Change Managers” (Nahmias and Crawford, 2008).

In the upper right quadrant, a high degree of behavioral change in a weak supportive culture and leadership will require more intensive change management activities, highlighting the need for a designated change manager. At the other end of the spectrum (lower left quadrant), if there is little behavioral change required and there is a strongly supportive culture and leadership, then change may be effectively managed by a project manager with some change management skills.

Similarities and Differences

Nahmias and Crawford identified one group of competencies that were shared by program, project and change managers (Exhibit 5). They also identified competencies that are unique to change managers. Change managers are different. While they may also be effective project and program managers, it is their unique change management competencies that set them apart. The question is, is it possible to identify individuals with these unique organizational change competencies?

 

Exhibit 5 – Similarities and differences between project managers (PM), program managers (PG) and organizational change managers (CM) competencies. On the right side of this Exhibit are the characteristics unique to change managers (Nahmias and Crawford, 2008).

The Work Preference Indicator

There may be a meaningful difference between a person's skills and their work preferences (a person may be competent at something but prefer not to do it). The Work Preference Indicator (Gilbert, Sohi & McEachern, 2012) is a scientifically-based instrument that measures an individual's work preferences. Work preferences can be used to help identify individuals who are more likely to be successful as organization change managers.

In what follows, quantitative results were gathered using the WPI from a population of 245 participants. In depth, qualitative conversations were conducted with individuals having a change management score of 75% or higher to better understand their roles in leading or participating in change management initiatives. These conversations were part of a pilot effort that will be incorporated into the action research project described later in this paper.

Preliminary Research: Mapping of Change Manager Characteristics to Work Preferences

To answer the question, “Is it possible to identify individuals with these unique organizational change competencies?” we began by correlating unique change manager competencies identified by Nahmias and Crawford (see prior Exhibit 5) within three Work Preference Indicator measures: 1. Achieve Results, 2. Flexibility, and 3. Explore Ideas (Exhibit 6). For additional details see Appendix 1, Summary of Work Preference Indicator Dimensions.

 

Exhibit 6 – Mapping of the Nahmias and Crawford change management characteristics to the Gilbert WPI.

Identification of Work Preferences

“The Work Preference Indicator (WPI) is a scientifically-based instrument that measures an individual's job task preferences” (Gilbert 2008). See Exhibit 6, WPI mapped to CM, PM, and TM.

 

Exhibit 7 – The WPI measures an individual's job task preferences. See Appendix D for additional detail.

Criteria for the Classification of CMs, PMs, and TMs

The criteria for classification of CMs, PMs, and TMs (team members) are shown in Exhibit 8. These change manager (CM) thresholds were driven by the high level of skill required to successfully drive organizational change. Thus a CM had to score higher than 75 on the WPI in the three measures indicative of these three CM work preferences (1. Achieve results, 2. Explore Ideas, 3. Flexibility). The minimum project manager and team member specials were set at 50.

 

Exhibit 8 – Thresholds for determining work preference alignment in the domains of project management and change management.

When an individual scored over 75 in CM and over 50 in TM, they were considered to have both change manager and program/project manager work preferences. “ Suggested Decision Matrix for Engagement of Project Managers and Change Managers,” Nahmias and Crawford recommend that strategic initiatives, which by their nature are complex and require significant organizational change, have both a CM and a PM. It may be the case that the job is too big for one individual. Simply put, in this situation the CM figures out what to do and the PM determines how to achieve the desired results.

The 17 WPI Preferences Organized by CM, PM, and TM.

The Nahmias and Crawford CM, PM, and TM (team member) template developed in this paper is overlaid on the 17 factors of the WPI as shown in Exhibit 9.

 

Exhibit 9 – The 17 WPI preferences mapped to CM, PM, and TM competencies.

Expanded Definitions of Change Manager Work Preferences

Exhibit 10 provides additional definitional detail on the three characteristics indicative of organizational change managers. Appendix D provides a summary of Work Preference Indicator dimensions.

 

Exhibit 10 – Achieving results, exploring ideas and flexibility are indicators that map to the skills needed for effective organizational change.

Conceptual Model for Expanding Strategic Throughput when Organization Change Is a Significant Factor

While the WPI is helpful in the identification of those individuals with a preference for organizational change work, the WPI is only one of three relevant factors. See Exhibit 11. The other two are: 1) the individuals organizational change management knowledge and interpersonal skills, and 2) their capabilities and project, program and portfolio management. See Exhibit 12.

 

Exhibit 11 – Change Management: Two competencies and a work preference.

 

Exhibit 12 – Capabilities along all three axes (X, Y, and Z) become increasingly important as the requirement for organizational change increases

References: Supporting the Three Axes of the Conceptual Model

 

Exhibit 13 – The references shown on the left support the preferences and competencies shown in the conceptual model for expanding strategic throughput when organization change is a significant factor.

Conclusions

Conclusion 1. Three of the 17 Work Preference Indicators point to a preference for working in an organizational change role. These indicators are: 1) Results oriented behavior, focus on getting results and achieving goals; 2) Flexible, have flexibility, spontaneity, and freedom to act at work; 3) Focus on ideas, work with concepts, ideas, and theories

Conclusion 2. The Work Preference Indicator is useful in the selection of individuals who are more likely to have organizational change skills.

Conclusion 3. In cases where projects and programs require significant change, individuals with organizational change skills, serving in either a leadership or supporting role, are likely to be helpful in expanding strategic throughput, that is, to increase benefits realization.

Conclusion 4. Dissemination of this research in academic journals, PMI publications, and as an actionable management book, when coupled with the actual WPI instrument, will lead to measurable improvement in program and portfolio level initiatives.

Conclusion 5. The use of measures of work preferences at the start of a project will help practitioners:

  • Identify those who are more likely to serve as change manager (CM), project manager (PM), or specific roles as a team member (TM).
  • Improve knowledge of the work related gifts each member is likely to bring to the project.
  • Enhance job placement and task assignment decisions.
  • Facilitate team work by building on the understanding and respect for one another as members of a project team.

References

Accountancy. (2003). New business: Most change management projects fail. Accountancy, 26.

Cabanis-Brewin, J., and Pennypacker, J. S. (2006). Best practices for aligning projects to corporate strategy. PMI Global Congress, North America. Newtown Square, PA: Project Management Institute.

Garfein, S. J. & Sankaran, S. (2012), Selection of organizational change managers and why they are different. Proceedings of the PMI Global Congress, North America, Vancouver, Canada. Newtown Square, PA: Project Management Institute.

Garfein, S. J. & Sankaran, S. (2011). Work preferences ofproject and program managers, change managers and project team members: The importance of knowing the difference. PMI Global Congress, North America, Dallas, Texas. Newtown Square, PA: Project Management Institute.

Garfein, S. J. (2009). Closing the gap between strategy and results: Expanding strategic throughput, PMI Asia Pacific Congress, Kuala Lumpur, Malaysia. Newtown Square, PA: Project Management Institute.

Garfein, S. J. (2007). Executive guide to strategic portfolio management: Roadmap for closing the gap between strategy and results. Proceedings of the PMI Global Congress, North America, Atlanta, Georgia. Newtown Square, PA: Project Management Institute.

Garfein, S. J. (2007). The new PMI global standard for portfolio management: An executive perspective. Proceedings of the PMI Global Congress (EMEA), Budapest, Hungary. Newtown Square, PA: Project Management Institute.

Gilbert, G. R. (2006). Work Preference Indicator Instrument. Port St. Lucie, FL: GilbertEMS, LLC (www.Gilbertems.com).

Gilbert, G. R., Burnett, M. & Leartsurawat, W. (2009). The psychological work preferences of business students. Journal of Career Assessment, 18(2).

Gilbert, G. R., Sohi, R. S. & McEachern, A. G. (2012) Measuring work preferences: A multidimensional tool to enhance career self management. Career Development International, 13(1), 56–78. Used with permission of the lead author. (www.Gilbertems.com).

Murphy, M. (2005). Why do CEOs get fired? Retrieved from http://www.globalbusinessmobiletalent.com/story.asp?sid=661

Nahmias, A. H., Crawford, L. (2008). Project manager or change manager? Who should be managing organizational change? Paper presented at the Project Management Institute (PMI) research conference, Warsaw, Poland. Newtown Square, PA: Project Management Institute.Project Management Institute.

Pellegrinelli, S., & Partington, D. (2006). Pitfalls in taking a project-based view of programmes. PMI Global Conference, Madrid, Spain. Newtown Square, PA: Project Management Institute.

Trautlein, B. A., (2013). Change intelligence: Use the power of CQ to lead change that sticks. Austin, TX: Greenleaf Press Group.

United Kingdom, (2011), Managing Successful Programmes, TSO (The Stationery Office).

 

Appendix 1: Results to Date

Summary of WPI Venues and Number of Participants

Beginning in July 2009 WPI has been administered to 245 individuals as shown in Exhibit 14. In what follows, three groups will be presented in more detail: The Pilot Group (July 2009), the University Master Class (October 2010), and the PMI Workshop (January 2013).

Exhibit 14 – 245 individuals have taken the WPI. The 67 individuals (line 9 above) are the focus of the next phase of our research.

Representative Individual Output: Subject 105, Pilot Group, Seattle

  Event City Country n  
1   Pilot Group (July 2009)   Seattle   United States 10  

The Exhibits 15 and 16 are representative of the output generated in our analysis of WPI results. In this example, the individual (Subject 105) scored above the thresholds (75% and 50% for CM and PM) to be classified as both a CM (84%) and PM (54%). Interviews and observations with this individual confirmed the low work preferences in the areas of mechanical interests (0%), working with data (4%), written material (7%) and task specificity (22%). The overall conclusion was that this individual was an outstanding change manager (actually observed in practice over a period of months); a good project manager and a good team member, but did not particularly like to work with data, written material, and has a very low interest in things mechanical.

 

Exhibit 15 – Subject 105 work preferences. This individual scored above the threshold to be classified as both a CM (84%) and a PM (54%).

 

Exhibit 16 – Work preferences of Subject 105.

Results from University Masterclass: Sydney, Australia

In October 2010 all 34 students in a weeklong master class in project management took the WPI prior to the beginning of class.

  Event City Country n  
3   University Master Class (October 2010)   Sydney   Australia 32  

The five day course is built around a case study requiring seven project teams. Early on the first day of the course project managers were selected based on the seven highest WPI change manager scores. Exhibit 17 shows a high correlation between change manager score and class score (grade). Further, all seven project managers—those with high change manager scores—finished in the top half of the class grade-wise (see box).

 

Exhibit 17 – WPI-based change manager score versus master class score.

Action Research Population: Participants in the PMI Workshop, Victoria, BC, Canada

In January 2013, 67 individuals in a PMI workshop in Victoria, British Columbia, took the WPI.

  Event City Country n  
9 PMI Workshop (January 2013)   Victoria, BC   Canada 67  

The next phase of our research will revisit two subgroups of the 67: 1) The 13 individual scoring low averaged over 70% on the three WPI change manager measures, and 2) the 15 individuals with low change management scores, below 35%. See Exhibits 18 and 19. An action research methodology will be used to conduct this research. Additional detail is included later in this paper.

 

Exhibit 18 – The action research sample includes 13 out of 67 individuals with change manager scores over 70%.

 

Exhibit 19 – The action research sample includes 15 out of 67 individuals with change manager scores less than 35%.

Exhibit 20 shows the distribution of the 67 participants. 19% had high change manager scores, 24% had low scores, and 57% were in the middle when scores 35% and 69%. The thesis of this paper is, “We Are All Change Managers, Like It or Not!”

 

Exhibit 20 – Change manager score distribution across a population of 67 individuals.

Appendix 2. Business Change Manager

The following is based on the role of the business change manager (BCM) as described in Managing Successful Programs (pp. 41–44):

There is a fundamental difference between the delivery of a new capability and actually realizing measurable benefits as a result of that capability. The difference is reflected in the complementary roles of program manager and BCM. The program manager is responsible for delivering the capability, while the BCM is responsible for realizing the resultant benefits by embedding that capability into business operations, and facilitating business changes to exploit that capability.

While PMI does not recognize the role of a business change manager in their literature, the Managing Successful Programs BCM framework is useful in our research in determining what individuals involved with organizational change actually do. This BCM framework will be used to develop the interview questions for the next phase of our action research with the population described earlier in this paper.

4.9.1 Responsibilities of the Business Change Manager (MSP 4.9.1)

The role of the BCM is primarily benefits-focus. The BCM is responsible, on behalf of business operations and the senior responsible owner (SRO) for:

  • Defining the benefits.
  • Defining the future operating state of the business area they represent.
  • Assessing progress towards “Realizing the Benefits.”
  • Achieving measured improvements.
  • Monitoring performance.

This need to define and realize benefits in terms of measured improvements in business performance means that the BCM must be ‘ business-side,’ in order to provide a bridge between the program and business operations. The BCM responsibilities comprise the following, which may be integrated into individual terms of reference and objectives:

  • Maintaining the focus on realizing beneficial change.
  • Contributing to the development of the benefits management strategy.
  • Ensuring that the development and business responsibilities for benefit profiles and the benefits realization plan are clearly attributed.
  • Identifying, defining, and tracking the benefits and outcomes required of the program.
  • Designing the future operating model (‘to-be’ state) and ensuring that it is contained and maintained within the program blueprint.
  • Identifying organization changes that happen outside the boundary of the program, which may affect the contents of the blueprint.
  • Preparing their sections of the organization for change.
  • Identifying opportunities and realizing benefits that arise during the program, which might not have been originally profiled and ensuring that the achievements a recognized.
  • Ensuring effective communications with all areas of the business that they represent.
  • Identify and monitoring the performance metrics used to track the operational ‘health’ of the organization.
  • Implementing the mechanism by which benefits can be realized and measured.
  • Monitoring business stability and ongoing capacity to cope with the level of change; this will include acceptable levels of performance variation (deterioration) while the change is embedded.
  • Reporting to the SRO of the readiness of the change, achievement of outcomes and realization of benefits.
  • Advising the program manager whether the work of the program in each project covers the necessary aspects required to deliver the products/outputs and services/outcomes that will achieve the blueprint and lead to benefits.
  • Ensuring that there is no double-counting of benefits for which they are responsible.
  • Preparing the affected business areas for the transition to new ways of working; potentially implementing new business processes.
  • Ensuring that business stability is maintained during the transition and that the changes are effectively integrated into the business.
  • Initiating business assurance reviews to ensure that capabilities are being embedded and established.
  • Optimizing the timing of the release of project deliverables into the business operations.
  • Notify delivery of expected benefits.

As the program progresses, the BCM is responsible for monitoring actual outcomes against predicted results.

4.9.2 Key Attributes of the Business Change Manager (MSP 4.9.2)

The BCM is a senior role which reports directly to the SRO in the program and will have been nominated by a member of the sponsoring group. Any individual appointed as a BCM should:

  • Be drawn from the relevant business area in order to demonstrate detailed knowledge of the business environment and have direct business experience.
  • Have ongoing operational responsibilities within their business areas. Their participation of the program may be an integral part of their normal responsibilities in order to enable changes resulting from the program to be firmly embedded in the organization.
  • Have the confidence of senior managers from the areas to be changed.
  • Understand the management structures, politics, and culture of the organization(s) involved in the program.
  • Have management skills to coordinate personnel from different disciplines and with different viewpoints.
  • Have change management skills and enough experience to be able to bring order to complex situations and maintain focus on the program's objectives.
  • Have negotiating skills, interpersonal fluency, comfort with ambiguity, and business continuity management.

The ideal BCM has a deep understanding of the organization's operational business, identifying, quantifying, and defining benefits, and is skilled in change management tools and techniques.
Such people may not be easy to find. Faced of this dilemma some organizations have brought in and external change management experts to fill these roles. However, this can lead to a lack of responsibility within the businesses, limiting take-up of the capability of realization of the benefit. The business operations must take responsibility for the program to avoid being in a position where they are on the receiving end of change rather than i it.

A more effective approach is to place credible business individuals into the BCM roles and then put in place training and coaching to develop the benefits and change management skills these individuals require.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

© 2014, Stephen J. Garfein, MBA, PMP, Shankar Sankaran PhD, PMP
Originally published as a part of the 2014 PMI Global Congress Proceedings – Dubai, UAE

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