Welcome To 2021: New Projects, Change Management, and M&A

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Welcome to the New Year! We are all thankful to see 2020 in the rearview mirror and January is a welcome fresh start.

One thing is sure; 2021 will be a year of change. The promised stimulus and tax law changes will drive some of them. I know many of you are waiting for some clarity to resume investing in your businesses to create growth. The Texas economy is already benefitting from companies fleeing employer-unfriendly and/or high-tax states. Also, we are already seeing M&A activity increasing.

Based on these assumptions, there will be increased pressure on clients to define and communicate what they want to do, then implementation will follow. When I assist companies, I refer to these types of engagements as decision support and project management. Decision support is needed to make a case for change, and project management to execute change that secures the benefits. Over the next few weeks, I’ll share my approach to both of these to increase the success you will have from leading change. We’ll start with project management.

Most of our companies deliver a product or service focused on repeatable, high-quality processes. We build teams to deliver consistent value to customers while generating a profit. The same qualities that make your team good at consistently delivering value don’t translate to projects. A project is a temporary concept to accomplish a specific objective within an expected time and cost. Most projects have the effect of creating change, while most operational processes seek to minimize it. The difference between the two is key because change management is not something that springs to mind when thinking about a project but is almost always essential in realizing the benefits from change.

Let me differentiate between a project that creates change versus a projectized service delivery system. For example, in my practice, I assist clients with projects that create change. At the same time, I’m managing that project internally with my project work management system (e.g., tracking budgets, hours, variances, billings, etc.). A CPA firm that does tax work has a projectized service delivery system (a series of short, repeatable projects); a construction company has long projects that create change.

Four months & $50,000

In my experience, it’s not unusual to manage multi-year, multi-million dollar, multi-vendor process/technology projects that impacted thousands of employees, customers, and vendors. What if your project is four months and $50,000 – do the same concepts apply? Some of them, yes; others in proportion.

Every project needs a sponsor, the person who “owns” the project. Usually, this person has management authority to define the need for change (new technology, a new organization, a new business location). Often a business leader or plan owner is counting on benefits created by the project. So, what are they? Most often:

  • Increased revenue
  • Decreased cost
  • Cost avoidance
  • Creating a previously unavailable strategic capability

Project managers are responsible for executing a project to realize the benefit. Almost every project needs a plan approved to start (requirements, schedule, budget, resources, benefits). Most every project requires some form of change management, whether that is implementing/integrating new technology or improving a process. In many cases, the benefits are realized from the change management, not technology installation. For example, an improved accounts payable process involving ten people might benefit from improving the number of transactions processed and reducing errors and rework on a per-person basis. While this might be enabled by new technology, you are unlikely to realize the benefits unless you invest in standardizing the process and training the users.

What are the top priorities for you this year? Is there uncertainty about how to polish and execute your plan? I am happy to help you realize your company goals. My direct number is below. Let me or one of the partners at BKM Sowan Horan know if we can assist you with planning for 2021 innovation to realize your growth and profitability.