Leading Change – The Need for Speed
This is the fourth installment in my series on Change Management:
Chapter 1: Leading Change – Part 1 of a Series
Chapter 2: Leading Change – The Art of Change Management
Chapter 3: Leading Change in a Perfect Storm
In 2000, I moved from software VP Sales to Managing Director of what was to become PeopleSoft Global Services (PGS). Prior to 2000, PeopleSoft's consulting service business was based on staff augmentation for larger projects, which were typically being led by System Integrators (SI). With the madness of the run-up to Y2K and with PeopleSoft's growth from a $31M company in 1992 to $1.4B in 1998, our consulting services business could not keep up with demand. Therefore, pre-2000, there had been little need for a services sales organization. Similarly, since our consultants were generally imbedded in SI project teams, there was also little need for project management competencies, implementation methodology, knowledge management systems, or other tools and technologies generally associated with a professional services company.
As discussed in my last blog, in 1999, PeopleSoft's new software revenues declined to almost zero, so now PeopleSoft needed to rely on services revenues to keep it afloat while it built PeopleSoft 8, our new Internet-enabled ERP application. Other factors were also at play that led to the genesis of PGS. During the late 1990's, many companies been stung by large, over budget, system integrator led ERP projects. As a result, post-Y2K, Gartner and other analyst firms were advising their clients to hold their software vendor accountable for future implementation projects by relying on them to implement the products that they sold. As well, with the introduction of a re-written internet-based PeopleSoft 8, our entire ecosystem of partners would have to learn this new product before they would be up to speed. These factors combined together to present us with a large opportunity for which we would not be adequately prepared without some rapid and major changes.
The transition of PeopleSoft's professional services business had been evolving during late 1999 but attrition was impacting both the ranks of the leadership and staff thus stalling the effort. Early in 2000, a new team came on-board. Mike Gregoire joined from EDS. 5 new VP's were externally recruited. I joined from sales. Together with 4 existing VP's, a new global services leadership team was formed. Time was not on our side. PeopleSoft 8 was scheduled to debut in August and the services team would be critical to the success of this new generation of products.
In the spring of 2000, we kicked off "Drive for 45". This was our internal project name for the 45 day transformation, from planning to go-live, into PeopleSoft Global Services. Under the then-current consulting structure, Professional Services Managers were responsible for selling, contracting services, managing clients, managing project deliverables, hiring, on-boarding, and managing consulting staff. This model had worked well for staff augmentation projects, it did not give us the skills or focus to allow us to sell and manage large prime-responsibility projects. With the transformation to PGS, the new organization was split into a three pillar business model: Sell – Deliver – Staff.
Consultants & managers with a propensity for selling were offered new roles. Additionally, new sales leaders and reps from external professional services companies were hired. Similarly, a delivery organization was created and staffed. This organization was responsible for client engagement management, program and project management and project profitability. The Staffing organization was re-focused. Since our entire organization would have to be re-trained on PeopleSoft 8, the task of retraining all of our consultants would fall to this team. As well, to meet the anticipated demand for PeopleSoft 8, we needed to prepare for additional hiring and on-boarding. This meant developing new recruiting, on-boarding and training processes. Support organizations were also created to develop methodology, tools and processes. A services marketing organization was created to establish our brand and promote our services. Finally, these changes had to be explained both globally and locally to our systems integration partners so they understood that this new organization was not a competitor but rather a benefit to them.
The cadence was intense but not panicked. Everything was driven off of a weekly conference call. Decisions were made quickly. We knew we wouldn't get them all right but those that we didn't; we would go back later and fix.
We re-launched our services business under the new brand PeopleSoft Global Services at our July Global Consulting Conference. With attrition due to the hype of the dot-com eating at our consulting ranks, we knew at this conference that we would have to engage our team with the new promise of PeopleSoft 8 and PGS. The outcome would either stem the bleeding or if we failed, push us over the edge. The results were spectacular and attrition dropped. Within months, the "Dot.Com" turned to "Dot.Bomb", PeopleSoft 8 had launched, and by year-end, software revenues were back on a growth trajectory and PGS was ahead of its plan.
Before experiencing the "Drive for 45", I never would have believed it was possible. From the experience, I learned the need for speed in any change. Over-analysis, delayed decision-making and loose project timeline management saps the energy from project teams. Effective change management requires aggressive demands and deadlines, crisp project execution and short time horizons. Like a sprint, a team can only significantly over-deliver for short runs so you can't afford to allow your change project to morph from a sprint to a middle distance or marathon run.