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In this issue:
Quarterly Review
The
incorporating ItemPlus Consulting
Issue three 2009
1-3 Organisational Transformation
4 Interim Managers
4-5 Major Construction & Infrastructure Projects
5 The Middle East
6 Reducing Costs
7 Pandemic Planning
8 Mergers, Acquisitions & Divestments
9 Chaucer Rugby
to the BARCLAY’S PREMIERSHIP
WOLVES PROMOTED
In recent years, organisational transfor-
mations seem to have been the magic
How many times have we heard “We need
to simplify our processes, let’s transform”, or
“we need to improve our performance, let’s
transform” or even “we need to attract and
retain top talent, let’s transform”.
A famous French chemist, philosopher and
economist at the end of the XVIII century
coined the phrase “rien ne se perd, rien ne
se crée, tout se transforme”which translated
is “nothing gets lost, nothing gets created,
everything gets transformed” to illustrate
his “law of conservation of mass”. Is there a
link between molecular chemistry and or-
ganisational evolution that could explain
the recent transformational“boom”?
Continued on page 2
Organisational
Transformation,
friend or foe?
sponsor Chaucer Consulting is delighted to celebrate Wolves
promotion to the Barclays Premiership League.
For both Chaucer Consulting and Wolves reaching the Premiership is the culmination of a
Wolves Chief Executive Jez Moxey, added: “Bob Laslett and Chaucer have provided tremen-
ness which has contributed to the clubs commercial excellence”.
Chaucer Consulting was set-up 22 years ago by lifelong Wanderers fan Bob Laslett. Since
then, the company has grown into an internationally renowned management consultancy
Bob Laslett, will remain involved with the club as he was appointed to the Wolves board of
directors in 2008. Bob Laslett said “Chaucer Consulting is extremely proud to have been as-
Premiership League is a dream come true”.
Celebrating together...
Chaucer Consulting & Wolves
Pictures courtesy of Express & Star.
2
Organisational Transformation, friend or foe?
Have all those “transformations” been thor-
oughly planned and scoped to deliver opti-
mal results or are we going to be surprised to
find out that those companies who embarked
upon a “transformation” (more about the
speech marks later) two or three years ago are
now about to embark upon another one to
get back to where they once were?
Chaucer Consulting has been involved in a
number of major organisational “transforma-
tions”for global companies over the past five
years, and in our experience only a few of
them truly deserve the title.
For a Transformation to be truly transforming
and to obtain the support of employees,
managers, leaders, customers, shareholders,
etc. (the so called stakeholders) the instigator
needs to clearly articulate what is going to
change and why it has to change. Once the
Transformation is complete it must be obvi-
ous that indeed things have changed. And by
changing we don’t mean just improving or
replacing with something more suitable, but
rather fundamentally and totally changing.
At Chaucer Consulting we believe the issue
to be that too many improvements, rationali-
zation, cost cutting or headcount cutting ini-
tiatives have been wrongly labeled “transfor-
mation” (hence the speech marks in the first
paragraph) and as a consequence have failed
as Transformations but have sometimes been
very successful initiatives in so far as they
have led to improvements, reducing cost or
headcount.
Chaucer Consulting has identified
that a true Transformation needs:
1	 to have a vision clearly articulating what
an organisation is transforming into and
why.
2	 a new organisational structure (de-
signed to support transformed processes
and/or systems).
3	 a review of employees’ capabilities to
ensure alignment between required ca-
pabilities in the transformed organisation
and existing ones.
4	 a clearly defined set of human resource
management processes and principles
to lead the Transformation process.
5	 a set of learning and development pro-
grams aligned with the required capabili-
ties in the transformed organization.
6	 a detailed communication and engage-
ment plan to consistently provide evi-
dence of the transformation progress and
alignment with expected benefits.
7	 a rigorous program management
framework to ensure delivery on time,
within budget and with the expected
quality.
The vision (1) of what the transformed or-
ganisation will look like and what it will
achieve is critical. It needs to be owned by a
leader and embraced by his/her leadership
team.
The vision needs to articulate what will
change, why it needs to change and what
different stakeholders will get out of the
transformed organisation (stating the obvi-
ous they need to get something more than
previously). One final point for any Transfor-
mation to be successful it needs to have a
consistent vision, it can not change mid way
through the process.
Back to our constituents of a true Transforma-
tion, the organisation structure (2) (OS) is
probably as critical as the vision since it will
be the first tangible evidence that things will
be different. The OS is the “window” of the
Transformation, it will give indications about
the true nature of the Transformation and will
send strong signals to both employees and
customers; it has to be right first time and has
to be designed in a way that will motivate
employees in participating in the Transforma-
tion journey but also in the transformed or-
ganisation.
It is, in our experience, an activity which (de-
pending on the size of the organization) will
become a work-stream in itself and can easily
be under-estimated.
The OS work will include:
XX Review of existing organisation structure
(include review of all associated job de-
scriptions, levels/grades and relation-
ships).
XX Development of new organisation model
in support of the vision/strategy.
XX Redesign of the organisation structure.
XX Re-production of all job descriptions (de-
scribing new roles identified to support
new accountabilities).
XX Test structure/delivery model to ensure
optimum delivery of the vision.
XX Ensure current roles and accountabilities
are clear and that job descriptions are in
line with best in class talent expectations.
XX Engagement with key stakeholders on
process and outcome.
The design of the organisation structure is
time critical in jurisdictions where collective
consultation is required. As the OS will dictate
future requirements and as a consequence
potential job losses, no consultation can be
closed until the new OS has been shared (and
in some jurisdictions agreed) in consultation.
Continued on page 3
Continued from page 1
3
Organisational Transformation, friend or foe?
Capability assessment (3) is the process
by which the potential gaps between exist-
ing capabilities and capabilities required for
the future are identified. It is a process that
has recently been suffering from bad press
and needs to be carefully managed as it is
wrongly perceived as the unique rationale
for potential exit decisions.
It is an important part of a Transformation as
it forces the organisation to define upfront
the competencies framework of the future
organisation.
Capability assessment will include:
XX Definition of a leadership and/or techni-
cal capability framework to be used as
the benchmark for assessing existing
capabilities.
XX Design and run assessment pilot.
XX Scheduling and managing of assess-
ment events.
XX Coordination of results calibration.
XX Coordination of detailed report produc-
tion.
XX Management of data flow, assessment
of data privacy, integrity and accuracy.
No Transformation has the luxury of being
delivered in a vacuum, while transforming,
organisations will need to continue operat-
ing and delivering“business as usual”and as
any Transformation will one way or another
be affecting employees, the design, roll out
and monitoring of the application of HR
processes and principles (4) is critical and
includes:
XX Definition of the “rules of the game” in-
cluding guidelines on promotions, ex-
ternal hiring, and internal moves during
the Transformation process. This should
include an exception process and moni-
toring mechanism.
XX Definition of a selection process poten-
tially including:
ZZ Design and roll out of selection in-
puts.
ZZ Design and delivery of a consulta-
tion process where applicable
ZZ Design and delivery of a manage-
ment offer and notification process.
ZZ Designandapplicationofanappeals
process.
ZZ Design and application of a rede-
ployment process.
With regards to timing, the learning and
development (5) area of aTransformation is
probably the least critical, as organisations
will need to wait for the completion of the
assessment programs to be able to identify
areas of improvement and thus designing fit
for purpose programs.
It is however, critical to demonstrate the in-
vestment in building internal capabilities as
part of the Transformation.
None of the above will be achieved without
comprehensive communication and en-
gagement (6) plans to engage employees
in the overall Transformation strategy, and
build greater sense of recognition from cus-
tomers and traditionally this means:
XX Identification and mapping of key stake-
holders.
XX Design and set up of central communi-
cation’s repository.
XX Production and execution of overall
communication plan.	
XX Support to each work-stream on key
communications requirements.
XX Design and delivery of punctual com-
munications events i.e. Town Halls.
An Organisational Transformation is a true
synergy where the final outcome is greater
than the sum of its parts. This outcome is
arrived at by the application of program
management (7) rigour and discipline.
Chaucer Consulting has more than ten years
experience of providing the “glue” for suc-
cessful Organisational Transformations. Dur-
ing this time we have experienced a variety
of plans and outcomes. Rich in this experi-
ence we can now share some interesting
lessons learned as well as common pitfalls
and “quick wins” with organisations who
truly want to transform.
NickFaure
Nick Faure, Head of Chaucer’s
Continental Europe Region,
can be contacted on
+44 7775 796094 or by email
nick.faure@chaucerconsulting.
It is often very helpful to carry out a project review of other similar
projects prior to embarking on a major project. Reviewing other similar
projects in detail can provide some very valuable insights into where
the project was particularly successful as well as where it did not go so
well or where issues and risks where encountered and what they were.
A project analysis of other projects can significantly help in the produc-
tion of the overall project schedule as well as help in the reduction of
risk. This can contribute to the project cost in a beneficial way.
The benefits of a project analysis study either at the beginning or early
on in a project life cycle can be very beneficial to both cost and sched-
ule. It is important however to focus on similar projects in respect to
size, complexity, geographic location and so on. Not necessarily from
within the same industry but with the same characteristics. It is also
important not to confuse by reviewing too many projects that may be
held in a database as often these are not of a similar enough profile to
provide meaningful data.
It is very important to chose the correct projects when doing any com-
parison in order to maximise the data available and hence the potential
benefits.
In the first instance it is necessary to fully understand the project for
which the study is being used as a means of improving. It is then nec-
essary to identify several similar projects that have been implemented
for the subject of analysis.
Any review must be done by an independent party with the necessary
expertise in project analysis as well as significant experience in similar
project implementations.
Estimating, Cost and Schedule are key elements in any project. The
precursor to the schedule is the workscope definition. Get any of these
badly wrong and the project is in trouble. Accurate detailed cost and
scheduling based upon sound and comprehensive workscope defini-
tion and good estimates forms the bedrock of any project, without
these components the project is on quicksand and will quickly and
easily get into difficulty.
RecommendationsonCostandScheduleperformanceimprove-
ment together with Risk reduction for Major Projects
XX Basis of comparison
XX Procedures and Methodolo-
gies
XX Estimating and Cost Analysis
XX Workscope Definition
XX Detailed Project Planning
XX Tracking and Remedial Action
Capability
XX Metrics & Gap Analysis
XX Project Component Analysis
and Effect
XX Schedule Milestones
XX Common Risks and Issues
XX Project Drivers
XX Management and Approach
XX Front End Loading & Key
Resources
XX Regulatory & Environmental
XX Technology
XX Geographic Location
XX Macro Economics & Infra-
structure
XX Difficulties & Parties Involved
XX Large Project/Mega Project
Characteristics
XX Interfaces and Interdepend-
encies
XX Contract and Procurement
Philosophy
XX Best Practice
The importance of the benchmarking process is key to
this analysis and should include:
4
Major Construction and Infrastructure Projects
Interim Managers
Continued on page 5
Chaucer Consulting have been successfully
providing Interim Managers for a variety of
business roles for the past 12 years.
Many of our senior consultants have from time to
time been involved in an Interim Management
role. The provision of Interim Managers has be-
come more frequent in the last 18-24 months
so we have now formalised a new service to
enable us to provide suitable Interim
Managers to clients quickly, efficiently
and cost effectively.
To date we have provided individuals
from within Chaucer Consulting to
fill the following Interim Manage-
ment roles:
XX Chief Technology Officer (CTO) – board level appointment of
quoted company.
XX Financial Controller – several appointments across both na-
tional and international companies.
XX Commercial Manager – including an International appoint-
ment.
XX Marketing Manager – regional appointment.
XX HR Manager.
XX Business Manager – several including International appoint-
ments.
These roles have been in major global enterprises as well as blue
chip plc’s and have included being based in varying locations
from Toronto to London and from China to Germany.
The roles fulfilled over the past years have been for periods rang-
ing from 3 months to 18 months in duration.
At Chaucer Consulting we
have developed a process and
methodology for the review
and assessment of major
projects for the specific pur-
pose of identifying potential
cost and schedule perform-
ance improvement as well as
risk reduction:
This methodology is the Chau-
cer Project Diagnostic which
facilitates the assessment and
benchmarking of large and
complex projects.
The Chaucer Project Diagnostic
NickLaslett
5
Major Construction and Infrastructure Projects
The Middle East
Continued from page 4
Nick Laslett is the Head of Chaucer Consulting in the
Middle East. Nick relocated with his family to Dubai in
2008 and allocates much of his time travelling be-
tween the different countries within the Middle East,
in order to meet and support new and existing
clients.
Nick has been with Chaucer for over 15 years during
which time he has worked on many business change
and business performance projects including Euro-
pean and International programs for major global
enterprises.
Chaucer Consulting has worked for many clients in
the Middle East since 1992.
The many consulting assignments successfully exe-
cuted by Chaucer have included projects and pro-
grams in oil / gas and petrochemicals, manufacturing,
banking and financial services, utilities, engineering
and construction.
Chaucer provides management consult
ancy for clients including but not limited
to:
XX Strategy Implementation.
XX Mergers & Acquisitions Design/Delivery.
XX Project & Program Management.
XX Enterprise Risk Management.
XX Change Management.
XX Operational & IT Excellence.
XX Business Transformation.
XX Strategic Procurement.
Chaucer’suniqueexpertiseandexperienceinproject
and program management has provided the basis
for the successful delivery of difficult and complex
business change projects to the significant benefit
of many Chaucer clients during the past 22 years.
Chaucer has also worked on many large cross
border Merger, Acquisition and Joint Venture
programs.
Chaucer Consulting has provided support to
clients throughout the Middle East including
companies and organisations in the following
countries:
XX Bahrain
XX Egypt
XX Kuwait
XX Oman
XX Qatar
XX Saudi Arabia
XX Turkey
XX United Arab Emirates
Chaucer’s consulting assignments have
been both varied and complex, includ-
ing specific country projects as well as
pan-region and global programs.
Nick Laslett can be
contacted directly on
+971 (0) 505154835 or by email
nick.laslett@chaucerconsulting.com
or through his office at:
Chaucer Middle East Limited
Office 1705
Silicon Oasis
PO Box 341064
Dubai
United Arab Emirates
Tel:+971 (0) 4501 5884
Fax: +971 (0) 4501 5886
PRODUCTIVITY
Productivity is a composite of:
Effectiveness: Doing the right things
Efficiency: In the right way at the right speed
Cost-effectiveness: At the right price
Resource utilisation: Making full use of all resources
“What gets measured gets done”
Productivity monitoring at an individual and team level
Short interval scheduling
Targets and personal productivity plans
Whiteboards or equivalent
Competitions and events
ACTIVE SUPERVISION
Performance is driven by active supervision:
The key to operational excellence is the deployment of well
trained and informed active supervisors. Supervisors need to be
provided with good, fact based information on the performance
of the operation and the individuals within it. It is the
supervisor's role to:
Walk the patch, watching and listening in
Mentor and coach
Cajole
Drive performance – productivity, quality and service
Manage priorities
Co-ordinate continuous improvement
MANAGEMENT CONTROL SYSTEMS
An effective MCS is crucial to success:
To enable productivity to be measured and monitored
To objectively assess the staffing levels required
To provide up to date performance information to
supervisors
Chaucer can provide a simple MS Excel based tool to
capture inputs and outputs, calculate Work load,
performance and staffing requirements and to enable
simple resource forecasting
DeborahFeakins
6
Chaucer is often asked by its clients “how to” reduce costs in business. Many organisations have
already been through multiple cost cutting exercises and it can seem that there is little else to
prune.
Quick wins have been identified and delivered in earlier iterations making the task of scoping
further cost reductions more challenging. This is where Chaucer can help.
There are, of course, many ways to reduce costs in a business.
One point to consider before embarking on cost reduction reviews or implementation is
whether this activity may impact business as usual.
Keeping day to day activities running is crucial to ensure that the benefits from the cost cutting
exercise are not eroded by a shortfall in delivery elsewhere in the organisation.
A further consideration is whether the activity can be managed and delivered by internal re-
sources or whether third party support may be required.
Some areas often considered to reduce basic business costs are:
XX Efficiencies
Costs can be reduced through increases in efficiencies. With our experience Chaucer can
help you consider a wide range of potential efficiencies. Sometimes these may involve the
use of third party suppliers and services.
XX Process
Business processes can often be simplified. Or best practice processes emulated and
implemented across the business. The fitness of business processes needs to be looked at
regularly in our world of perpetual change. Processes can quickly become inefficient and
costly. Regular reviews to consider options for automation, outsourcing or other new
techniques should be part of an ongoing program of improvement.
XX Continuous Improvement
This can be one of the most cost effective ways of reducing costs quickly within a business
organisation especially where there are many operations and/or processes that need to
operate as part of business as usual. Chaucer has helped its clients set up fruitful CI
programmes that have incrementally led to significant cost reduction.
XX Performance Improvement
Can be based upon a variety of productivity improvement methods such as lean, six sigma,
etc.
A Performance Improvement project can be targeted at a specific area of a business where
it has been identified that major or significant cost savings can be made. These cost savings
may come from various individual sources or there may be serious cost savings to be made
in a linked array of processes or operations.
Chaucer has frequently managed Performance Improvement for a variety of
clients, which have primarily focussed on cost reduction and have involved:
ZZ Leadership or support of cost reduction initiatives
ZZ Development of lean six sigma programmes
ZZ Operational efficiency reviews
ZZ Metrics systems development
ZZ Development of performance management
ZZ Development of competency regimes
Reducing Costs NOW
At Chaucer we recognise that it can be difficult
to identify cost reduction possibilities
especially when involved in the day to day
operations.
This is particularly true where a business has
already cut staff so pressure to complete
business as usual has to take priority. In today’s
workplace there are often limited or no
resources available to focus on cost reduction.
At Chaucer we have been involved in many
cost reduction and process improvement
projects as well as project managing business
process simplification and efficiency increase
programmes.
The use of a low cost management consul-
tancy such as Chaucer Consulting can often
bring significant benefits that can make a
business more efficient and hence more
profitable. It could be the differentiator to take
a business from being a loss maker or
breakeven business into a profit generator.
Reducing Costs is an essential part of managing any business.
Reducing Costs at any time is important but reducing costs in to-
day’s financially constrained environment is vital,
even essential to secure survival.
Deborah Feakins can be contacted directly on +44 7799 893402 or by email deborah.feakins@chaucerconsulting.com
The best memorial should be your plans
On assignment in Hong Kong recently, I came across the SARS flu
pandemic memorial in the business district, nearby the Bank of
China, and was moved to tears by the faces of the young doctors –
so motivated, so positive, staring back from the memorial – they
gave their lives combating the pandemic. Irrespective of the out-
comeofthecurrentswineflupandemic,thebestcorporateresponse
should be your global plans.
What will happen if you do nothing?
The specific challenges that a pandemic presents over
the next 12 months:
XX Up to 50% reduction in staff through illness or caring for de-
pendants.
XX Transport disruptions hit raw materials, workforce, goods &
services.
XX Supply chain failures impact production and service provision.
XX Customer frustration & anger as service is hit; queues exceed
SLAs.
XX Customers switch to electronic means or to competitors.
XX Organisations compete for shared standby sites, & latecomers
lose out
XX Experts who run your business are no longer available.
XX Cash flow comes under severe pressure and the risk of business
failure spirals.
XX Competitors take your market, in the battle of the fittest.
XX At the centre, your corporate negligence.
Updating your plans – a tailored response
The governments of the world are doing their part. You are doing
yours;‘catch it, bin it, kill it,’hand-washing and staying isolated if un-
well. So what should your organisation do?
You may well have built a plan several years ago, but today your or-
ganisation is radically changed, so will it work? This pandemic plan-
ning approach fits within your existing business continuity frame-
work. It meets best practice standards for pandemic planning and
focuses on the actual needs of your organisation.
7
How serious is it? – Pandemic Planning
Continued on page 9
“We should build a me-
morial, but not to sing
praises, either for the peo-
ple or their fighting spirits.
The purpose should be to
give warnings so that
people will forever re-
member this disaster, the
dead and their families
(including medical profes-
sionals) and the lessons
we learned.”
China Law & Govern-
ance Review Interviews
- January 2004
The Fighting SARS Memorial – Hong Kong
Photo: Brokensphere May 22 2007
Will your contingency plan succeed, in a
pandemic?
Scenario testing against your organisations capabili-
ties, flexibility and resilience:
Organisational considerations include:
XX Changing HR policies.
XX Increasing staff work-flexibility & cross-training.
XX Guaranteeing raw materials & supplier services.
XX Ensuring transportation arrangements.
XX Flexing technology services to meet anticipated changing de-
mands.
XX Pre-prepared communications.
XX Proactively changing business operating models and re-model-
ling.
XX Reacting to reduced business demand and increased social
needs – earning customer/client long term goodwill.
XX Invoking force majeure legal terms – as a last resort.
Companies considering acquisitions or other similar activities would
do well to commence some pre-emptive due diligence. By this I
mean getting all the various departments in the organisation to pre-
prepare activity checklists and plans in readiness for any potential
M&A activity.
In addition to checklists, departments or business units and service
functions can prepare other tools which will significantly help in as-
suring that everything is reviewed, checked and approved before any
decisions are taken. These tools can be plans or schedules, roadmaps,
interface or interdependency matrices as well as more conventional
checklists.
The value of being prepared from a governance, compliance and
prudent business perspective are inestimable and therefore must not
be undervalued or ignored however tempting it maybe to ‘cut-cor-
ners’, take short cuts or make decisions on poor quality data, lack of
data or inappropriate data.
The following are some areas that need to be addressed
pre day 1:
XX Structure
A key component to the success of any acquisition is to put in
place a structure that will both drive and control the post merger/
acquisition integration with pace to ensure the synergy benefits
are achieved as early as possible and that the newly acquired or-
ganization is sustainable going forward.
XX Regulation
It is essential to understand the present and future regulatory
landscape for the merger or acquisition. Pay close attention to
HSE, competition law, security, statutory reporting obligations,
etc.
XX Acquisition Target
It is essential to fully understand any new acquisition. This must
include due diligence on all subsidiary companies and organisa-
tion structures, operating practices, markets, processes, locations
of work, technologies, suppliers and customer relationships.
XX Competitive Advantage
Ensure that you have a detailed plan for the realization of syner-
gies in any merger or acquisition including the expected values
of the synergies to be realised and when they are to be realized as
this is vital for financial forecasting etc.
XX Communications
A rigorous internal and external communications and engage-
ment plan from pre Day-1 is essential.
XX Governance
How will the governance of the new entity be established and
implemented, what delegations of authority sit with whom and
what controlling processes will be established. A key element of
governance is the scope of the MI reporting.
XX Technology
How integrated are the technologies, is it easily achievable and is
it a key benefit of the M&A business case?
XX Supply Chain
Do you understand the full supply chain for yourself and your
newly acquired or merged entity?
XX Branding
What brand will you retain or discard and how will this be
achieved without loss of value in respect to any merger or acqui-
sition.
XX Change Program
Have you got a change program ready for Day 1 spanning people,
processes and technology?
XX Profit
In the newly acquired entity how will profit and investment be
treated?
An acquisition may have significant tax benefits that can be used to
the benefit of the acquirer, these need to be identified and not lost.
It is better to be prepared and be capable of doing due diligence in a
very timely manner to ensure uncertainty and therefore risks are not
entered into. The value of being prepared is very significant whereas
the danger of acting or making decisions without proper preparation
can be catastrophic.
Even if not used the time and effort in producing a checklist can often
bring other benefits such as the discovery of hidden assets or unreal-
ised value.
If fact in doing a relatively straightforward checklist in readiness for
any possible M&A activity can often uncover inefficiencies when re-
viewing business processes or discover issues and problems that can
then be addressed and rectified or maybe changes made that will
result in cost savings and/or greater efficiencies.
We have seen in recent time, and in my view rather surprisingly and alarmingly big
business enter into major M&A projects‘apparently’without too much or if what is
reported is to be believed hardly any formal preparation or due diligence.
BobLaslett
8
Merger, Acquisition and Divestments
bob.laslett@chaucerconsulting.com
RogerBaker
Roger Baker can be
contacted directly on
+44 7787 532356 or by email
Roger.Baker@Chaucerconsulting.com
9
www.chaucerconsulting.com
How serious is it? –
Pandemic Planning
The WHO outlook:
XX Summer 2009 (Mild) – 4 months
XX Winter 2009 (Severe) – 4 months
XX Spring 2010 (Recovery profile)
– 3 months
Continued from page 7
So that our readers do not think we are just a Football (Soccer) company please
find below photographic evidence of our Rugby sponsorship which is for the
current season. This particularly fine Rugby club is based in North America.
CHAUCER RUGBYCHAUCER RUGBY

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Chaucer Quarterly Review Issue 3 EN

  • 1. In this issue: Quarterly Review The incorporating ItemPlus Consulting Issue three 2009 1-3 Organisational Transformation 4 Interim Managers 4-5 Major Construction & Infrastructure Projects 5 The Middle East 6 Reducing Costs 7 Pandemic Planning 8 Mergers, Acquisitions & Divestments 9 Chaucer Rugby to the BARCLAY’S PREMIERSHIP WOLVES PROMOTED In recent years, organisational transfor- mations seem to have been the magic How many times have we heard “We need to simplify our processes, let’s transform”, or “we need to improve our performance, let’s transform” or even “we need to attract and retain top talent, let’s transform”. A famous French chemist, philosopher and economist at the end of the XVIII century coined the phrase “rien ne se perd, rien ne se crĂŠe, tout se transforme”which translated is “nothing gets lost, nothing gets created, everything gets transformed” to illustrate his “law of conservation of mass”. Is there a link between molecular chemistry and or- ganisational evolution that could explain the recent transformational“boom”? Continued on page 2 Organisational Transformation, friend or foe? sponsor Chaucer Consulting is delighted to celebrate Wolves promotion to the Barclays Premiership League. For both Chaucer Consulting and Wolves reaching the Premiership is the culmination of a Wolves Chief Executive Jez Moxey, added: “Bob Laslett and Chaucer have provided tremen- ness which has contributed to the clubs commercial excellence”. Chaucer Consulting was set-up 22 years ago by lifelong Wanderers fan Bob Laslett. Since then, the company has grown into an internationally renowned management consultancy Bob Laslett, will remain involved with the club as he was appointed to the Wolves board of directors in 2008. Bob Laslett said “Chaucer Consulting is extremely proud to have been as- Premiership League is a dream come true”. Celebrating together... Chaucer Consulting & Wolves Pictures courtesy of Express & Star.
  • 2. 2 Organisational Transformation, friend or foe? Have all those “transformations” been thor- oughly planned and scoped to deliver opti- mal results or are we going to be surprised to find out that those companies who embarked upon a “transformation” (more about the speech marks later) two or three years ago are now about to embark upon another one to get back to where they once were? Chaucer Consulting has been involved in a number of major organisational “transforma- tions”for global companies over the past five years, and in our experience only a few of them truly deserve the title. For a Transformation to be truly transforming and to obtain the support of employees, managers, leaders, customers, shareholders, etc. (the so called stakeholders) the instigator needs to clearly articulate what is going to change and why it has to change. Once the Transformation is complete it must be obvi- ous that indeed things have changed. And by changing we don’t mean just improving or replacing with something more suitable, but rather fundamentally and totally changing. At Chaucer Consulting we believe the issue to be that too many improvements, rationali- zation, cost cutting or headcount cutting ini- tiatives have been wrongly labeled “transfor- mation” (hence the speech marks in the first paragraph) and as a consequence have failed as Transformations but have sometimes been very successful initiatives in so far as they have led to improvements, reducing cost or headcount. Chaucer Consulting has identified that a true Transformation needs: 1 to have a vision clearly articulating what an organisation is transforming into and why. 2 a new organisational structure (de- signed to support transformed processes and/or systems). 3 a review of employees’ capabilities to ensure alignment between required ca- pabilities in the transformed organisation and existing ones. 4 a clearly defined set of human resource management processes and principles to lead the Transformation process. 5 a set of learning and development pro- grams aligned with the required capabili- ties in the transformed organization. 6 a detailed communication and engage- ment plan to consistently provide evi- dence of the transformation progress and alignment with expected benefits. 7 a rigorous program management framework to ensure delivery on time, within budget and with the expected quality. The vision (1) of what the transformed or- ganisation will look like and what it will achieve is critical. It needs to be owned by a leader and embraced by his/her leadership team. The vision needs to articulate what will change, why it needs to change and what different stakeholders will get out of the transformed organisation (stating the obvi- ous they need to get something more than previously). One final point for any Transfor- mation to be successful it needs to have a consistent vision, it can not change mid way through the process. Back to our constituents of a true Transforma- tion, the organisation structure (2) (OS) is probably as critical as the vision since it will be the first tangible evidence that things will be different. The OS is the “window” of the Transformation, it will give indications about the true nature of the Transformation and will send strong signals to both employees and customers; it has to be right first time and has to be designed in a way that will motivate employees in participating in the Transforma- tion journey but also in the transformed or- ganisation. It is, in our experience, an activity which (de- pending on the size of the organization) will become a work-stream in itself and can easily be under-estimated. The OS work will include: XX Review of existing organisation structure (include review of all associated job de- scriptions, levels/grades and relation- ships). XX Development of new organisation model in support of the vision/strategy. XX Redesign of the organisation structure. XX Re-production of all job descriptions (de- scribing new roles identified to support new accountabilities). XX Test structure/delivery model to ensure optimum delivery of the vision. XX Ensure current roles and accountabilities are clear and that job descriptions are in line with best in class talent expectations. XX Engagement with key stakeholders on process and outcome. The design of the organisation structure is time critical in jurisdictions where collective consultation is required. As the OS will dictate future requirements and as a consequence potential job losses, no consultation can be closed until the new OS has been shared (and in some jurisdictions agreed) in consultation. Continued on page 3 Continued from page 1
  • 3. 3 Organisational Transformation, friend or foe? Capability assessment (3) is the process by which the potential gaps between exist- ing capabilities and capabilities required for the future are identified. It is a process that has recently been suffering from bad press and needs to be carefully managed as it is wrongly perceived as the unique rationale for potential exit decisions. It is an important part of a Transformation as it forces the organisation to define upfront the competencies framework of the future organisation. Capability assessment will include: XX Definition of a leadership and/or techni- cal capability framework to be used as the benchmark for assessing existing capabilities. XX Design and run assessment pilot. XX Scheduling and managing of assess- ment events. XX Coordination of results calibration. XX Coordination of detailed report produc- tion. XX Management of data flow, assessment of data privacy, integrity and accuracy. No Transformation has the luxury of being delivered in a vacuum, while transforming, organisations will need to continue operat- ing and delivering“business as usual”and as any Transformation will one way or another be affecting employees, the design, roll out and monitoring of the application of HR processes and principles (4) is critical and includes: XX Definition of the “rules of the game” in- cluding guidelines on promotions, ex- ternal hiring, and internal moves during the Transformation process. This should include an exception process and moni- toring mechanism. XX Definition of a selection process poten- tially including: ZZ Design and roll out of selection in- puts. ZZ Design and delivery of a consulta- tion process where applicable ZZ Design and delivery of a manage- ment offer and notification process. ZZ Designandapplicationofanappeals process. ZZ Design and application of a rede- ployment process. With regards to timing, the learning and development (5) area of aTransformation is probably the least critical, as organisations will need to wait for the completion of the assessment programs to be able to identify areas of improvement and thus designing fit for purpose programs. It is however, critical to demonstrate the in- vestment in building internal capabilities as part of the Transformation. None of the above will be achieved without comprehensive communication and en- gagement (6) plans to engage employees in the overall Transformation strategy, and build greater sense of recognition from cus- tomers and traditionally this means: XX Identification and mapping of key stake- holders. XX Design and set up of central communi- cation’s repository. XX Production and execution of overall communication plan. XX Support to each work-stream on key communications requirements. XX Design and delivery of punctual com- munications events i.e. Town Halls. An Organisational Transformation is a true synergy where the final outcome is greater than the sum of its parts. This outcome is arrived at by the application of program management (7) rigour and discipline. Chaucer Consulting has more than ten years experience of providing the “glue” for suc- cessful Organisational Transformations. Dur- ing this time we have experienced a variety of plans and outcomes. Rich in this experi- ence we can now share some interesting lessons learned as well as common pitfalls and “quick wins” with organisations who truly want to transform. NickFaure Nick Faure, Head of Chaucer’s Continental Europe Region, can be contacted on +44 7775 796094 or by email nick.faure@chaucerconsulting.
  • 4. It is often very helpful to carry out a project review of other similar projects prior to embarking on a major project. Reviewing other similar projects in detail can provide some very valuable insights into where the project was particularly successful as well as where it did not go so well or where issues and risks where encountered and what they were. A project analysis of other projects can significantly help in the produc- tion of the overall project schedule as well as help in the reduction of risk. This can contribute to the project cost in a beneficial way. The benefits of a project analysis study either at the beginning or early on in a project life cycle can be very beneficial to both cost and sched- ule. It is important however to focus on similar projects in respect to size, complexity, geographic location and so on. Not necessarily from within the same industry but with the same characteristics. It is also important not to confuse by reviewing too many projects that may be held in a database as often these are not of a similar enough profile to provide meaningful data. It is very important to chose the correct projects when doing any com- parison in order to maximise the data available and hence the potential benefits. In the first instance it is necessary to fully understand the project for which the study is being used as a means of improving. It is then nec- essary to identify several similar projects that have been implemented for the subject of analysis. Any review must be done by an independent party with the necessary expertise in project analysis as well as significant experience in similar project implementations. Estimating, Cost and Schedule are key elements in any project. The precursor to the schedule is the workscope definition. Get any of these badly wrong and the project is in trouble. Accurate detailed cost and scheduling based upon sound and comprehensive workscope defini- tion and good estimates forms the bedrock of any project, without these components the project is on quicksand and will quickly and easily get into difficulty. RecommendationsonCostandScheduleperformanceimprove- ment together with Risk reduction for Major Projects XX Basis of comparison XX Procedures and Methodolo- gies XX Estimating and Cost Analysis XX Workscope Definition XX Detailed Project Planning XX Tracking and Remedial Action Capability XX Metrics & Gap Analysis XX Project Component Analysis and Effect XX Schedule Milestones XX Common Risks and Issues XX Project Drivers XX Management and Approach XX Front End Loading & Key Resources XX Regulatory & Environmental XX Technology XX Geographic Location XX Macro Economics & Infra- structure XX Difficulties & Parties Involved XX Large Project/Mega Project Characteristics XX Interfaces and Interdepend- encies XX Contract and Procurement Philosophy XX Best Practice The importance of the benchmarking process is key to this analysis and should include: 4 Major Construction and Infrastructure Projects Interim Managers Continued on page 5 Chaucer Consulting have been successfully providing Interim Managers for a variety of business roles for the past 12 years. Many of our senior consultants have from time to time been involved in an Interim Management role. The provision of Interim Managers has be- come more frequent in the last 18-24 months so we have now formalised a new service to enable us to provide suitable Interim Managers to clients quickly, efficiently and cost effectively. To date we have provided individuals from within Chaucer Consulting to fill the following Interim Manage- ment roles: XX Chief Technology Officer (CTO) – board level appointment of quoted company. XX Financial Controller – several appointments across both na- tional and international companies. XX Commercial Manager – including an International appoint- ment. XX Marketing Manager – regional appointment. XX HR Manager. XX Business Manager – several including International appoint- ments. These roles have been in major global enterprises as well as blue chip plc’s and have included being based in varying locations from Toronto to London and from China to Germany. The roles fulfilled over the past years have been for periods rang- ing from 3 months to 18 months in duration.
  • 5. At Chaucer Consulting we have developed a process and methodology for the review and assessment of major projects for the specific pur- pose of identifying potential cost and schedule perform- ance improvement as well as risk reduction: This methodology is the Chau- cer Project Diagnostic which facilitates the assessment and benchmarking of large and complex projects. The Chaucer Project Diagnostic NickLaslett 5 Major Construction and Infrastructure Projects The Middle East Continued from page 4 Nick Laslett is the Head of Chaucer Consulting in the Middle East. Nick relocated with his family to Dubai in 2008 and allocates much of his time travelling be- tween the different countries within the Middle East, in order to meet and support new and existing clients. Nick has been with Chaucer for over 15 years during which time he has worked on many business change and business performance projects including Euro- pean and International programs for major global enterprises. Chaucer Consulting has worked for many clients in the Middle East since 1992. The many consulting assignments successfully exe- cuted by Chaucer have included projects and pro- grams in oil / gas and petrochemicals, manufacturing, banking and financial services, utilities, engineering and construction. Chaucer provides management consult ancy for clients including but not limited to: XX Strategy Implementation. XX Mergers & Acquisitions Design/Delivery. XX Project & Program Management. XX Enterprise Risk Management. XX Change Management. XX Operational & IT Excellence. XX Business Transformation. XX Strategic Procurement. Chaucer’suniqueexpertiseandexperienceinproject and program management has provided the basis for the successful delivery of difficult and complex business change projects to the significant benefit of many Chaucer clients during the past 22 years. Chaucer has also worked on many large cross border Merger, Acquisition and Joint Venture programs. Chaucer Consulting has provided support to clients throughout the Middle East including companies and organisations in the following countries: XX Bahrain XX Egypt XX Kuwait XX Oman XX Qatar XX Saudi Arabia XX Turkey XX United Arab Emirates Chaucer’s consulting assignments have been both varied and complex, includ- ing specific country projects as well as pan-region and global programs. Nick Laslett can be contacted directly on +971 (0) 505154835 or by email nick.laslett@chaucerconsulting.com or through his office at: Chaucer Middle East Limited Office 1705 Silicon Oasis PO Box 341064 Dubai United Arab Emirates Tel:+971 (0) 4501 5884 Fax: +971 (0) 4501 5886
  • 6. PRODUCTIVITY Productivity is a composite of: Effectiveness: Doing the right things Efficiency: In the right way at the right speed Cost-effectiveness: At the right price Resource utilisation: Making full use of all resources “What gets measured gets done” Productivity monitoring at an individual and team level Short interval scheduling Targets and personal productivity plans Whiteboards or equivalent Competitions and events ACTIVE SUPERVISION Performance is driven by active supervision: The key to operational excellence is the deployment of well trained and informed active supervisors. Supervisors need to be provided with good, fact based information on the performance of the operation and the individuals within it. It is the supervisor's role to: Walk the patch, watching and listening in Mentor and coach Cajole Drive performance – productivity, quality and service Manage priorities Co-ordinate continuous improvement MANAGEMENT CONTROL SYSTEMS An effective MCS is crucial to success: To enable productivity to be measured and monitored To objectively assess the staffing levels required To provide up to date performance information to supervisors Chaucer can provide a simple MS Excel based tool to capture inputs and outputs, calculate Work load, performance and staffing requirements and to enable simple resource forecasting DeborahFeakins 6 Chaucer is often asked by its clients “how to” reduce costs in business. Many organisations have already been through multiple cost cutting exercises and it can seem that there is little else to prune. Quick wins have been identified and delivered in earlier iterations making the task of scoping further cost reductions more challenging. This is where Chaucer can help. There are, of course, many ways to reduce costs in a business. One point to consider before embarking on cost reduction reviews or implementation is whether this activity may impact business as usual. Keeping day to day activities running is crucial to ensure that the benefits from the cost cutting exercise are not eroded by a shortfall in delivery elsewhere in the organisation. A further consideration is whether the activity can be managed and delivered by internal re- sources or whether third party support may be required. Some areas often considered to reduce basic business costs are: XX Efficiencies Costs can be reduced through increases in efficiencies. With our experience Chaucer can help you consider a wide range of potential efficiencies. Sometimes these may involve the use of third party suppliers and services. XX Process Business processes can often be simplified. Or best practice processes emulated and implemented across the business. The fitness of business processes needs to be looked at regularly in our world of perpetual change. Processes can quickly become inefficient and costly. Regular reviews to consider options for automation, outsourcing or other new techniques should be part of an ongoing program of improvement. XX Continuous Improvement This can be one of the most cost effective ways of reducing costs quickly within a business organisation especially where there are many operations and/or processes that need to operate as part of business as usual. Chaucer has helped its clients set up fruitful CI programmes that have incrementally led to significant cost reduction. XX Performance Improvement Can be based upon a variety of productivity improvement methods such as lean, six sigma, etc. A Performance Improvement project can be targeted at a specific area of a business where it has been identified that major or significant cost savings can be made. These cost savings may come from various individual sources or there may be serious cost savings to be made in a linked array of processes or operations. Chaucer has frequently managed Performance Improvement for a variety of clients, which have primarily focussed on cost reduction and have involved: ZZ Leadership or support of cost reduction initiatives ZZ Development of lean six sigma programmes ZZ Operational efficiency reviews ZZ Metrics systems development ZZ Development of performance management ZZ Development of competency regimes Reducing Costs NOW At Chaucer we recognise that it can be difficult to identify cost reduction possibilities especially when involved in the day to day operations. This is particularly true where a business has already cut staff so pressure to complete business as usual has to take priority. In today’s workplace there are often limited or no resources available to focus on cost reduction. At Chaucer we have been involved in many cost reduction and process improvement projects as well as project managing business process simplification and efficiency increase programmes. The use of a low cost management consul- tancy such as Chaucer Consulting can often bring significant benefits that can make a business more efficient and hence more profitable. It could be the differentiator to take a business from being a loss maker or breakeven business into a profit generator. Reducing Costs is an essential part of managing any business. Reducing Costs at any time is important but reducing costs in to- day’s financially constrained environment is vital, even essential to secure survival. Deborah Feakins can be contacted directly on +44 7799 893402 or by email deborah.feakins@chaucerconsulting.com
  • 7. The best memorial should be your plans On assignment in Hong Kong recently, I came across the SARS flu pandemic memorial in the business district, nearby the Bank of China, and was moved to tears by the faces of the young doctors – so motivated, so positive, staring back from the memorial – they gave their lives combating the pandemic. Irrespective of the out- comeofthecurrentswineflupandemic,thebestcorporateresponse should be your global plans. What will happen if you do nothing? The specific challenges that a pandemic presents over the next 12 months: XX Up to 50% reduction in staff through illness or caring for de- pendants. XX Transport disruptions hit raw materials, workforce, goods & services. XX Supply chain failures impact production and service provision. XX Customer frustration & anger as service is hit; queues exceed SLAs. XX Customers switch to electronic means or to competitors. XX Organisations compete for shared standby sites, & latecomers lose out XX Experts who run your business are no longer available. XX Cash flow comes under severe pressure and the risk of business failure spirals. XX Competitors take your market, in the battle of the fittest. XX At the centre, your corporate negligence. Updating your plans – a tailored response The governments of the world are doing their part. You are doing yours;‘catch it, bin it, kill it,’hand-washing and staying isolated if un- well. So what should your organisation do? You may well have built a plan several years ago, but today your or- ganisation is radically changed, so will it work? This pandemic plan- ning approach fits within your existing business continuity frame- work. It meets best practice standards for pandemic planning and focuses on the actual needs of your organisation. 7 How serious is it? – Pandemic Planning Continued on page 9 “We should build a me- morial, but not to sing praises, either for the peo- ple or their fighting spirits. The purpose should be to give warnings so that people will forever re- member this disaster, the dead and their families (including medical profes- sionals) and the lessons we learned.” China Law & Govern- ance Review Interviews - January 2004 The Fighting SARS Memorial – Hong Kong Photo: Brokensphere May 22 2007 Will your contingency plan succeed, in a pandemic? Scenario testing against your organisations capabili- ties, flexibility and resilience: Organisational considerations include: XX Changing HR policies. XX Increasing staff work-flexibility & cross-training. XX Guaranteeing raw materials & supplier services. XX Ensuring transportation arrangements. XX Flexing technology services to meet anticipated changing de- mands. XX Pre-prepared communications. XX Proactively changing business operating models and re-model- ling. XX Reacting to reduced business demand and increased social needs – earning customer/client long term goodwill. XX Invoking force majeure legal terms – as a last resort.
  • 8. Companies considering acquisitions or other similar activities would do well to commence some pre-emptive due diligence. By this I mean getting all the various departments in the organisation to pre- prepare activity checklists and plans in readiness for any potential M&A activity. In addition to checklists, departments or business units and service functions can prepare other tools which will significantly help in as- suring that everything is reviewed, checked and approved before any decisions are taken. These tools can be plans or schedules, roadmaps, interface or interdependency matrices as well as more conventional checklists. The value of being prepared from a governance, compliance and prudent business perspective are inestimable and therefore must not be undervalued or ignored however tempting it maybe to ‘cut-cor- ners’, take short cuts or make decisions on poor quality data, lack of data or inappropriate data. The following are some areas that need to be addressed pre day 1: XX Structure A key component to the success of any acquisition is to put in place a structure that will both drive and control the post merger/ acquisition integration with pace to ensure the synergy benefits are achieved as early as possible and that the newly acquired or- ganization is sustainable going forward. XX Regulation It is essential to understand the present and future regulatory landscape for the merger or acquisition. Pay close attention to HSE, competition law, security, statutory reporting obligations, etc. XX Acquisition Target It is essential to fully understand any new acquisition. This must include due diligence on all subsidiary companies and organisa- tion structures, operating practices, markets, processes, locations of work, technologies, suppliers and customer relationships. XX Competitive Advantage Ensure that you have a detailed plan for the realization of syner- gies in any merger or acquisition including the expected values of the synergies to be realised and when they are to be realized as this is vital for financial forecasting etc. XX Communications A rigorous internal and external communications and engage- ment plan from pre Day-1 is essential. XX Governance How will the governance of the new entity be established and implemented, what delegations of authority sit with whom and what controlling processes will be established. A key element of governance is the scope of the MI reporting. XX Technology How integrated are the technologies, is it easily achievable and is it a key benefit of the M&A business case? XX Supply Chain Do you understand the full supply chain for yourself and your newly acquired or merged entity? XX Branding What brand will you retain or discard and how will this be achieved without loss of value in respect to any merger or acqui- sition. XX Change Program Have you got a change program ready for Day 1 spanning people, processes and technology? XX Profit In the newly acquired entity how will profit and investment be treated? An acquisition may have significant tax benefits that can be used to the benefit of the acquirer, these need to be identified and not lost. It is better to be prepared and be capable of doing due diligence in a very timely manner to ensure uncertainty and therefore risks are not entered into. The value of being prepared is very significant whereas the danger of acting or making decisions without proper preparation can be catastrophic. Even if not used the time and effort in producing a checklist can often bring other benefits such as the discovery of hidden assets or unreal- ised value. If fact in doing a relatively straightforward checklist in readiness for any possible M&A activity can often uncover inefficiencies when re- viewing business processes or discover issues and problems that can then be addressed and rectified or maybe changes made that will result in cost savings and/or greater efficiencies. We have seen in recent time, and in my view rather surprisingly and alarmingly big business enter into major M&A projects‘apparently’without too much or if what is reported is to be believed hardly any formal preparation or due diligence. BobLaslett 8 Merger, Acquisition and Divestments bob.laslett@chaucerconsulting.com
  • 9. RogerBaker Roger Baker can be contacted directly on +44 7787 532356 or by email Roger.Baker@Chaucerconsulting.com 9 www.chaucerconsulting.com How serious is it? – Pandemic Planning The WHO outlook: XX Summer 2009 (Mild) – 4 months XX Winter 2009 (Severe) – 4 months XX Spring 2010 (Recovery profile) – 3 months Continued from page 7 So that our readers do not think we are just a Football (Soccer) company please find below photographic evidence of our Rugby sponsorship which is for the current season. This particularly fine Rugby club is based in North America. CHAUCER RUGBYCHAUCER RUGBY