Through their backgrounds in the Energy, Construction and Utilities sectors, Sandra and Anthony both have many years experience in Alliancing, a model of project management that grew, in Australia, out of the construction industry.
What are the commercial requirements of Alliancing projects?
Anthony: Alliancing in its current form is a big process. Lets say you have three organisations that get together to bid to build a hospital. Those three bidders have to form their own alliance. In an example alliance I was involved in there was involving three major Melbourne based multinational construction groups who agreed to bid for a $450m project.
These individual organisations had to get agree and align about roles, responsibilities and money. They had to agree who is going to lead and there are a whole lot of legal requirements even at this stage, just to put the tender together. Then there is the clients bidding process with a number of different groups who have formed alliances. This effort is multiplied as each bidding group has gone through a similar alliancing and tendering process. Then there is this second work-shopping stage, which leads to the successful bidder being chosen.
Once they are selected, the successful bidding alliance has to be aligned with the client. This doesn’t happen automatically, it involves further discussions and workshops about roles and responsibilities to align everybody completely before you start. For large-scale projects it’s an expensive process. It generally costs over a million dollars.
Sandra – I have coached alliancing teams on how to work together, to help them understand and learn how to behave in a different way to their normal processes that they go through, where they just stand up and do a presentation.
One bid we did, we had to identify how we would recruit the best people out of the organisations that were there, and how we would do it to gain them to come and work on the alliance. We had 30mins to come back with our response. So we did a theatre production of The Hobbit! We had Gandalf, who gave the vision, and Bilbo Baggins who was the messenger who talked to the people.
Rather than just wanting a presentation, the client wants to see how well the teams work together and whether they can think outside of the box.
For large complex projects, there are legal agreements that are put in place and solicitors are involved to ensure due considerations are documented thoroughly.
There are agreed ways of working. The partners agree formally on how they will work together. They also agree on what the risk factors are and how the risks, the gains and the losses will be shared.
It’s documented in the contract upfront how much money each party is going to make. Also if there is a profit, above what the group expects, how that will be divided up. What we’re talking about here is total commercial transparency and this is what people find the hardest.
Sandra - I remember sitting in with two colleagues involved with Alliancing projects in Australia and in the New Zealand health industry. What they did really well was to create a really great environment for people to say I feel really uncomfortable about telling you and about my costing details are and what my profit is.
You might be in an alliance with other competitors, for example if you were in the construction industry you might find John Holland and Theiss – two direct and powerful competitors - working together. These direct competitors still have to commit to showing these details. It asks questions of peoples ethics. You really start looking at all of the qualities that people bring to an alliance. This element of the selection process therefore becomes very different to what you would normally have in a commercial project.
This a major change from common commercial practice in other partnerships or tender agreements. But what it does is that it stops people from being greedy.
An example is a project that was conducted to build the Royal Children’s Hospital in which the owners did form an alliance for the project. They would have contracted a group to facilitate the project.
The selection process is very different from procurement or even partnering. Bidding groups would put forward their representative teams. Once all he bidding teams were confirmed, to start the Hospital would have first bought in solicitors and explained the process for selection to the teams. All the different bidding teams were then taken away for a two-day program. There are representatives from within the hospital also involved as a panel.
The Alliancing facilitator will work with actual live scenarios. They will then give the teams live example scenarios, to work through and demonstrate their solution. Anthony – I was in a number of bids for alliances and I remember workshops where ‘out of the blue’ the panel would say, we’re now stuck in this scenario what would you do? What they are actually looking for is to understand how does each team actually relate to each other. Do they work as individuals or do they work collectively and collaboratively? If they are coming into an alliance they need to be fully committed to the collective.
It’s not about the skills of the teams because it’s generally assumed that if groups have got to that stage then they have the technical skills. They are also looking to particularly see how they handle conflict. How they resolve differences. Interpersonal skills. Creativity. These are the abilities that are really important to the alliance, so that is what they are being measured against.
They would have the project manager identified and they would be watching him really carefully to see, for example, whether he takes the lead all the time or whether he shares it with his people. Does he defer to his people and include them or does he do all the talking? They keep them overnight because it’s different when you go to dinner. You can put on a performance pretty well for a number of hours, but if over night you go out to dinner with everybody and then are back into it the next day, it’s harder to fake it.
How could Alliancing be applied creatively within the Health sector?
For the full formal alliancing process that we have described, with tenders and legal agreements and two-day workshops to be utilized, you would need to be building a hospital or running another big health related project, for example as it has been used by New Zealand District Health Boards. But I do think that with a smaller team and smaller projects you can use the concept and get that process up and running with an outside facilitator.
One interesting option that hasn’t been explored before is in the hospital environment. Hospitals would benefit from learning to aligning nurses, doctors and administration staff. The alliance would be within the organization. What I have observed is that they are different entities altogether. I hear Doctors complain about nurses, nurses complain about Doctors, and they all complain about the administration staff. It’s almost like saying 'this is the organisation, how do we create an alliance within the organization with our own people?'
Anthony: My experience is that usually in very senior roles you have functional managers and they tend to run their function separate to everybody else, and as a result they conflict with other departments, they don’t actually work together in unison. If you just went in to a large organisation like that and said that ‘we’re going to bring principles of alliancing to this whole place and for a particular project we’re going to work towards one vision as one entity towards this outcome. So you align all the divisions in the organisation for the outcome rather than individual outcomes for each group.
One thing that we’ve noticed, having been through major multi-million dollar alliancing projects, is that the breakdowns happen at the transition points. So you come from one system into the next, and it’s the transitions where it all screws up. For example, if you look at the information collection points. If a medical record is collected well then it’s easy for it to go to the next system. But if the initial collection is not good and clean and easily transferrable then the handover to the next department is no good and then they don’t fix it so when it goes all the way along the line inefficiencies develop. Clinicians have to repeatedly gather the same information or they have different ways of collecting information.
It would be much more efficient to work together right at the beginning by saying lets collect as much information as we can for all our needs at one point. This gives stakeholders the ability to also consider new ways of getting information that they may not have considered before. You see, they may have always been collecting it one way but simply need the opportunity to question if it needs to be done this way, or if it could be done differently.
It’s always the same. It’s the handover spots which is where the clunkiness happens and usually each just complains about the other, but in an alliance model they two groups have the opportunity to say ‘hey, we’re not communicating well here, lets sit down and align how we can make this work.
What are the steps involved in the alliancing process?
- You first need the facilitator to pull the management team together and agree on the project that the group wants to do.
- A project group is then bought together
- The facilitator works with the group to get the roadblock issues on the table and to agree on principles they are going to work by during the project.
- They would then facilitate the rest of the project process. First by facilitating the initial planning required by the management team.
So we start the alliancing process, by working towards and gaining an agreement of how we are going to behave as a group and identifying a number of key principles by which the alliance operates.
Then, because people have the opportunity to speak in a safe and trusting environment they get to unload their junk, which is a huge step forward. In these situations, you don’t generally have to deal with every individual issue that comes up. There are usually three or four issues that are the major ones and when you deal with them, the rest cease to be problems.
Sandra - An important part is to start of by going through all the issues that people bring to the partnership so that everything is on the table. As a facilitator I would use four questions what are the issues here? What does it cause to the organization here? How do you fix it? If you do fix it, what does it give you and the organization?
This is done in a workshop scenario. As this point we also generally bring in a manager to talk about the organizations expectation and vision. From there though we run the program as a neutral facilitator. Often what comes up are issues of confidentiality and trust. I need to be able to re-assure a person what is said in the room is in confidence and what leaves the room is by agreement. At the end of the day the group agrees, what is going out. Because often people who come to join alliancing groups simply need to be able to talk about problems that are going on.
There can be things that are considered ‘unspeakable’ within the organisation and until you get them out of the way you can’t get anybody to agree on anything. What I have found as a facilitator is that issues that arise might have been going on for a long time, even 10 years or more, that is still playing itself out. No matter which new manager comes along, and what they say, people are still seeing and hearing what they want based on these old longstanding issues.
So a first step is always to get the departmental issues out in the open and simply work through them, so that the group is able to move forward. You have to do this otherwise; you will not be able to get anybody to agree on anything.
Once the principles have been established of how the group will work together, the primary aim of the workshops is uncovering what the issues are and coming up with solutions. These solutions then go to management. Ill also work with management as well because management want peoples input but when they get it they don’t always listen.
Management can sometimes think they should have all the answers and they can sometimes think they are losing control. This type of decision-making system can cause them to question what their job is now? I work with them to help them understand that that they do play an important role of engaging with people, and that if they do that well they don’t have to make all the decisions.
I will be taking management through the same process so that they are also able to open up and speak candidly about the same situations about what they see as the issues. Often they are exactly the same as what the people reporting to them are saying. Sometimes their issue is that ‘I’m not understood upstairs and that I am working with all these rules and boundaries around me’. They might know that what the operational workers are saying is right, but they’re limited because they’ve not got the support from above.
Within the workshop, you have to work through the layers to get to the top, because what is going on at the operational level is a reflection of what is going on at the top.
In an alliance process, most of the work is with the leadership team so that they’re totally aligned and that they’re modeling the behavior that they want from everybody. If they walk into a workshop and I say ‘I want you to speak openly and honestly’ they have to show that this is what they actually want and that people are not going to get punished for speaking up. All of this stuff sounds great in a textbook but when you’re confronted it can be quite challenging to work with.
Also, how are they operating as a team? Because they are the model of the whole workforce. So I do one on one coaching with them and also sit in on management meetings and provide feedback on process. Ill always ask initially whether they want feedback in the group or later in a one-on-one setting. But later on it’ll be in the group environment. Some can handle feedback initially others cant.
Then facilitating down through to the project teams who work through the problems and identify the solutions. But you would treat this group as an alliance, not just as individual departments within that organisation so that the alliance principles could be utilized where the group is all working together for the good of all.
The ongoing alliancing process involves having a number of regular facilitated workshops. As a facilitator, I probably come in every 4-6 weeks depending on what is happening within the organisation.
As the end of it, the individuals would have learnt about and taken on the principles and processes themselves. It’s a facilitative way of leading. They would start to work that way in their normal work.
I did some work in a large construction group once and there were managers there who had been on a big alliance and they were sad that it was finishing and that they were going to be going back to doing procurements because alliance wasn’t happening and more. I said to him ‘you are a facilitative leader! You naturally lead this way and you don’t have to be in a formal alliance to keep doing this. Once you have had the experience you can create it’. I caught up with somebody last week that was on that project . He is a very senior manager now with another multinational construction group and is very much a facilitative leader.
Now back when he started on the alliancing project he was an environmental manager and he use to check everybody’s desk at the end of the day to see what they had been up to. He was a total micro-manager! He was really bright and a great guy, but everybody knew how micro-managed them and they were all complaining about it. As a facilitator during the alliance, I had to really challenge him on what he was doing.
When he spoke to me the other day, 6 years later - he’s just turned 40 - he highlighted how he understands the big picture and focuses the change in focus has not only freed up his workers to do their jobs, it has freed him up to focus on organizational wide issues. He’s learnt these skills through the facilitation process from alliancing. He said to me, I wouldn’t be doing this job if I hadn’t been through that alliance.
It’s a skill of taking people out of content, and bringing them up to context! If you are caught up in the detail of the undergrowth you cant see above the trees to the rest of the forest. Usually when we go to a worker about changing a system for example if we’re talking about the flow of paperwork in a hospital, they will talk to us about the detail and the individual steps. But the overall context of how everything in this system impacts on the wider environment and vise versa is just as important, but there are not many people who can live and work in context.
Seeds of Possibility are a business performance consultancy. They bring a wealth of experience in alliancing across different industries and Sandra has also worked closely with a Key consultant to a New Zealand District Health Board, who pioneered Alliancing within the New Zealand Health system. What Seeds of Possibility do differently is that they work with clients to improve systems and engage people both at the same time.
As Anthony highlights ‘ I saw a recent Gallup poll that revealed over 70% of people in the workplace are not engaged with the work they do which astounded me. ‘But it’s no use engaging with your people if your systems are no good, because if your systems are no good, the people disengage”.
When you get those elements right and include how you align everybody – the alliancing component - the organisation becomes powerful and strong and make a difference and get great results. Their contact details are:
Mobile +61 413663360