So far in this series of blogs for April our Guest Blogger, Ruth Murray-Webster has shared views on the challenges of setting up major projects for success in early life cycle – particularly those where there is a need for speed in decision-making –  a given in the context of mergers, acquisitions and divestitures.

Is it better to make a flawed investment (or one that seems great, but you don’t have enough data to support your level of confidence?), or to wait until you know more and maybe miss the opportunity? There is clearly is no correct answer to that question – but it is those very judgements that we need to make.  Continually improving how we do that seems important.

“In this post I’ll switch focus to another key learning from Beyond the Deal’s experience in supporting M&A and divestiture related major projects over the past two decades – the importance of thinking about the whole, not just the parts.

When we are scoping projects, it’s really easy to focus on things that clearly need to be done/changed rather than looking at the whole operating model as a system.

For the engineers reading this, you’ll get systems thinking – an holistic approach to analysis and decision-making that focuses on the way that constituent parts of an overall system interrelate. I love the quote from that says (and I paraphrase) that people don’t start using systems thinking because it’s cool, but because they realise that relationships between people and things in their organisation are not linear – not a simple cause and effect between two things.

Organisations are complex systems, yet we desperately try to make them simple – trying to fit connections into cause and effect type logic – we do this at our peril.

Major projects that arise out of investments such as M&A, or a need to fundamentally change a business due to market disruption, need to look at the desired operating model as a system.  Only this week in BTD we have needed to talk to clients about the risks of investing in changing organisational structure without understanding the knock-on impacts on processes, systems, incentives, behaviours, culture etc.  (Re)design and transformation of operating models is a challenging exercise in ‘connecting the dots’ between multiple moving parts and being able to accommodate multiple feedback/learning loops into the change process.

Systems thinking also applies to people – stakeholders and their relationships with others. Understanding stakeholders so you can craft effective communication and engagement interventions is a core activity in major projects, yet we often fall back on the ubiquitous 2×2 matrix as our only attempt to make sense of stakeholders.  Adopting a social-systems thinking approach – mapping networks of relationships and alliances, we can start to think more deeply about relationships between stakeholders that help us to navigate sources of organisational politics and soft power.

My learning over the years is that thinking about stakeholders and operating models as systems – as connected wholes – is always important. When we are planning to change we need to create imbalance in those areas from which benefits will arise while at the same time recognising the areas where we could maintain stability if there was a benefit in doing so.

I have learned that big ambitions to change everything for everybody, however exciting that may seem, don’t deliver in the timescales envisaged.  I believe our value as change practitioners is to know what must be changed and where stability can be maintained for sanity (if nothing else), and to help the investors in change to really connect the dots, to dive into the detail where that’s needed, but to help them not to get dragged down into too much detail.

That’s a really key thing that BTD is doing differently in the M&A context – working with clients to design their ‘to-be’ operating model in a joined-up way that recognises the relationships between people and things in the system – and to plot the path from now to the future state recognising that straight-lines between A and B might be simple to draw but rarely reflect the reality of complex change.

I wish you well in your connected thinking endeavours.”

Read Ruth’s first blog post in the Series

Read Ruth’s second blog post in the Series

Read Ruth’s final blog post in the Series

Dr Ruth Murray-Webster is a Partner with Beyond the Deal (BTD), a specialist consultancy focused on ensuring that clients put good-quality thought into their M&A integration, or divestiture carve-out and separation plans. Ruth’s work, with her colleagues helps clients address all aspects of delivering the promised value from deal-related organisational change.  Prior to joining BTD Ruth was Director, Change Portfolio and Group Head of Risk at Associated British Ports and before then, Director of KPMG’s Risk in the Boardroom practice.  Ruth has a fascination with the people aspects of effective risk taking and has co-authored four books on the subject with David Hillson (A Short Guide to Risk Appetite, 2011; Managing Group Risk Attitude, 2008 and Understanding and Managing Risk Attitude, 2nd edition, 2007) and Penny Pullan (A Short Guide to Facilitating Risk Management, 2012) – all published by Gower.  She holds an executive doctorate from Cranfield School of Management where she researched project-based change from the perspective of the recipients of change and is a Teaching Fellow at Warwick Business School where she is module leader for the project management module on MBA and Masters in Business courses.

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