Cultural Attitude within Sydney Water - Assignment Example

Project Governance Issues Name: Course: Tutor: Date: Task 1 Discuss the cultural attitude within Sydney Water There are two ways of defining the cultural attitude at Sydney Water Board: through outcomes and inherent processes. On outcomes, the cultural attitude can be defined as a clear pattern of behaviour. Most people apply the term culture to define patterns of cross individual consistency in behaviour. For instance, when individuals say that culture refers to the mode of operation of a particular organisation, they are actually referring to consistency in how tasks are performed, problems are solved, conflicts are addressed, and employees and customers are treated. Going to inherent processes, cultural attitude is defined as the informal beliefs, norms and values that determine how groups and individuals in an organisation relate with one another and with the people outside (Shukla 153; McKenna 470-471.). These two approaches are relevant in comprehending and evaluating cultural attitude within the Sydney Water Board. Prior to evaluating the cultural attitude within the Sydney Water Board, it is imperative to highlight the nature of organisational culture, the levels of organisational culture and the various models of organisational culture. The nature of an organisation’s culture may be depicted in various forms espoused by the organisation. This could take the form of routine patterns and language, equality in gender and payment, physical infrastructure, dominant elements like efficiency and quality, and so on. Looked at individually, none of these factors represent the cultural attitude of an organisation, but together, they reflect the organisational cultural attitude (Buswell and Williams 138). Even though cultural attitudes attributed to an organisation bear common properties, big organisations possess a dominant culture and myriad sub-cultures. The main values shared by a large proportion of an organisation’s members shape up the organisation’s dominant culture. Whenever one is referring to an organisation’s cultural attitude, what they are actually referring to is the organisation’s dominant culture. An organisation’s culture exists at three different levels. These levels are based on culture manifestations in both tangible and intangible forms (Ashkanasay et al 274-275). In the first level, an organisation’s cultural attitude is observed in the form of technology, physical objects, and other tangible behavioural forms like rituals and ceremonies. Even though cultural attitude can be observed in various forms, it would be only at the exterior level. For instance, people may interact with each other but to ascertain their internal attitude or whether they disagree or agree with one another would be subject to probing. At level two, there is more understanding and internalisation of culture values. Groups and individuals within the organisation attempt to solve problems using techniques that have already been tried and tested. If the problems are successfully solved, then there will be a mutual perception of success among the organisational members. Consequently, this perception of success is turned into values and beliefs. Level three reflects a conversion process. When the group observes repeatedly that the technique works, it becomes their preferred choice and gets incorporated into the fundamental assumptions or the dominant orientation value (Ashkanasay et al 274-275). A cultural attitude attributed to an organisation can vary in many ways. It is these variances that distinguish one organisation from another. The numerous cultural attitudes assumed by organisations are: strong versus weak cultural attitude, soft cultural attitude, and a formal versus informal cultural attitude (Robbins 425; Trevino and Nelson 15; Hellriegel and Slocum 474-475; Saiyadain 254). An organisation’s cultural attitude can be weak or strong based on how the core values are shared by members of the organisation. Incidentally, the extent to which these members are committed to the core values is also a key factor. The more the commitment on the organisation’s core values, the stronger the cultural attitude. On the other hand, a weak cultural attitude depicts lack of commitment by the organisation’s members to the organisation’s core values (Robbins 425; Trevino and Nelson 15; Serrat 1). A soft cultural attitude in an organisation is observed when the organisation pursues several conflicting goals. Under this culture, the organisation’s employees’ seek only those goals that serve their personal interests (Saiyadain 254). The cultural attitude of an organisation, to a significant degree is determined by the organisational culture’s formal components. Accountability, responsibilities, roles, regulations, rules, and regulations are all elements of the formal cultural attitude. They outline the organisation’s expectations on every employee and highlight the repercussions for failing to meet these expectations. On the other hand, informal culture has specific and non-specific, tangible and intangible manifestations of shared values, assumptions, and beliefs (Hellriegel and Slocum 474-475). The cultural attitude present at the Sydney Water can broadly be classified as a lacklustre one, but from a more specific perspective, the cultural attitude can be described as weak and informal. The cultural attitude is deemed weak because the findings on the Customer Information and Billing System review reveal the organisation’s mode of operations due to its slow paced approach in dealing with organisational issues. This is due to lack of commitment to the organisation’s values by the members. In addition, the organisation’s operations are inefficient (Auditor-General’s Report 12). The findings revealed that the management did not report significant issues to the board of directors in a plain, inclusive, and timely manner. The board had requested for a bi-monthly report to ascertain the project’s progress against the predetermined budget and plan; however, the management did not oblige to this request. This depicts lack of commitment to implementing change by the management (Auditor-General 12). The project director had projected a negative net present value with regards to the Customer Information and Billing System project. It is worth noting that the net present value technique is the main technique of assessing a prospective investment. It is a technique for evaluating the net expected monetary loss or gain by discounting all the projected future cash outflows and inflows to the present period. Therefore, an investment project should to a great extent be determined by the projected net present value. An organisation ought to take into consideration those projects with a positive net present value. This is based on the fact that a positive net present value implies that a project’s returns exceed the cost of capital opportunity cost. In light of the concerns raised by the project director with regards to the negative net present value, it is unclear why the general manager finance, the general manager customer care, as well the managing director did not attempt to investigate these issues further (Schwalbe 44: Auditor-General’s Report 12). This not only reflects laxity in addressing critical issues within Sydney Water, it also shows lack of seriousness by the management in dealing with these issues. The lack of commitment to incorporating change, laxity in addressing critical issues, and level of seriousness shown by the management in key issues reflects the weak cultural attitude within Sydney Water. The cultural attitude within Sydney Water was also described as informal. This is because an informal cultural attitude does not centre on accountability, responsibility, roles, rules and regulations - features that apparently are lacking within Sydney Water based on the findings. This is evident in the lack of delivery of outcomes attributed to the features highlighted above. Other elements include the lax approach by the management in acting on issues of concern and so on. Task 2 The reporting process to the Sydney Water Board of Directors by the management and the involvement of the Board The findings revealed that from the project’s inception, the process of reporting to the Board of Directors was poor. In several cases the information presented was short, inconclusive, and unclear (Auditor-General 15). It did not give a clear picture of the project’s progress to the Board on a regular basis in a manner necessary for making decisions as well as evaluation of the project’s status. Schwalbe (77) states that organisations with more established project management techniques have enhanced project management performance. Subsequently, this leads to a project being completed within the predetermined time and budget. Maturity in project management is strongly associated with a more predictable cost performance and programme schedule. Organisations that adhere to good project management methodologies experience lower direct project management costs compared to those that do not do so. It is necessary that a project be monitored based on the fact that during the project’s lifeline it is more likely to veer off track hence the need for constant supervision. At the core of project governance, there is a formal pecking order of decision making authorities, starting from the board descending downwards. It is worth pointing out that the project governance structure should be appropriate for the organisation incorporating it. A critical factor though is that decisions should be made in a timely manner to ensure success (Calder, 146). According to the findings however, it is revealed that even though the Board was being issued with the project progress, the content was not adequate. Progress reports to the Board by the Sydney management did not show any doubts on the completion of CIBS. However, minutes of the executive steering committee of the CIBS revealed that the significant issues related to the project’s completion were escalating. These issues entailed the escalating volume of change requests; concern regarding long term technical viability of the CIBS; technical readiness was in serious jeopardy; and pressures affecting use acceptance testing. As of March 2002, some of these issues were already evident as well as financial concerns. However the findings reveal that they were not adequately presented to the board. In fact, the managing director personally admitted that some of these issues were never presented to the Board despite the fact that he believed it was appropriate to report to the Board at all times (Auditor-General 15). It is worth noting that the Project Director and the General Manager of customer care services reported to the Managing Director and helped in the preparation of documents to be presented the board. There were more than 45 meetings between both or one of these officials with the managing director. However, it was the Managing Director who had the last word on what was to be presented to the board and headed the CIBS’ discussion. A Project Director was hired by the Sydney Water Board in February 2002. His duty was to assist PricewaterhouseCoopers to complete the project. Subsequently, the Project Director re-evaluated the progress of the project and prepared briefing notes for the managing director. The Project Director raised serious issues with regards to the project’s ongoing viability. These concerns included uncertainty as to whether a satisfactory outcome could be attained within the budget and time frame acceptable by the Board and the present one concerning the situation attributed to lack of the needed expertise on both sides of the contract over a drawn out period. However, no action was taken by the managing director to address the issues raised by the director and neither did they report the same to the Board (Auditor-General 15-16). To this end, it can be deduced that the process of reporting applied by Sydney Water management to the Board of directors is poor in light of the aforementioned facts. The reporting process is also bureaucratic and lacks flexibility bearing in mind that subsequent to preparing the reports, it is the Managing Director who had the final say on what was to be presented to the Board (Auditor-General 15). This depicts single-handedness in compiling reports which could culminate to the reports being corrupt or biased. The findings argue that the Board was not involved enough during development of the project. However, from the report findings it can be observed that the Board to a significant degree was involved in the project development. The directors during a progress report meeting with the Board had requested for extra funding. Subsequently, the Board requested for a report that outlined how the additional funds were to be used. This helped in reflecting the organisation’s inefficient system when the directors responded to the Board’s call that the estimates were yet to be prepared (Auditor-General 16). This implies that though slippery, the Board had a grip on the project. Still on the Board’s defence, it can be noted that the Board relied on the progress report to make decisions on areas that required improvement. However this was not to be as the management did not cooperate with the Board. In effect, this made it virtually impossible for the Board to execute their duties as expected of them. Therefore, with regards to whether the Board was effectively involved in the project process, it can be noted that it did, but could have done more. Had the managers executed their duties as was expected of them by the Board and other stakeholders, then this perception could have been different. As Schwalbe (77) points out, without commitment from the top management, many projects are bound to fail. Projects are part and parcel of the larger environment within which the organisation operates. Several factors that are likely to affect a project are out of the project manager’s grip. It is therefore imperative that an organisation’s top management be fully committed during the entire project development process. However, this was not the case at Sydney Water; lack of commitment by the top management was evident as they overlooked some important issues. For instance, reporting to the Board on the project’s status in a timely fashion is paramount for the project’s success – but this was not sufficiently done. However, there are some areas where criticisms to the Board are justified based on the report findings. The findings revealed that an external auditor was not engaged to evaluate the performance of PricewaterhouseCoopers as well as Sydney Water. During the approval phase, the General Manager customer services issued a memorandum to the Board’s chairman indicating that the internal auditor’s ongoing role on performance assessment was supposed to be supplemented by that of an external auditor (Auditor-General 17). Incidentally, the Board had asked for a bi-monthly project status from the management. Not only did the management fail to adhere to these reporting requirements, but most of the reports were not comprehensively detailed and lacked critical information. The Board on its part did not enforce the management’s responsibility to conform to these requirements (Auditor-General 17). These two case scenarios reflect laxity and negligence from the Board’s part with respect to their involvement in the project. Task 3 Discuss whether there was adequate disclosure and reporting during the project Report findings on the Customer Information and Billing Systems (CIBS) reveal that reporting and disclosure with regards to the project was insufficient. The CIBS report to the Board in March 2002 highlighted issues pertaining to the need for extra funding due to extra function enhancements. Incidentally, the progress report also requested for a possible extension of completion time (Auditor-General 16). This shows that the progress report did not give the status of the project as required for such a report. Rather, the report revolved around finance issues and request for additional time while leaving out crucial information that could have been used by the Board to make critical decisions. The Managing Director stated that he had sufficiently informed the Board on the significant issues that needed to be addressed. To an extent, the statement by the Managing Director on adequately informing the Board on critical issues is supported by the fact that by requesting for more time had finance, he had technically highlighted the critical issues. There is also evidence of secretarial notes supporting the minutes of the Board meeting. These minutes support the fact that different options regarding the project were discussed during the meeting including terminating the project (Auditor-General 16). However, the minutes do not give context regarding the same. This coupled by revelation of the CIBS report that the tone applied by the directors during the Board meeting was not that of urgency shows that the information issued by the directors was ambiguous. Subsequently, the Board requested for a more detailed report from the Sydney Water management in June 2002 indicating the extra funds required to complete the project. However, the progress report was not complete. It stated that the funds required to complete the project were yet to be estimated. It is worth noting that in March 2002, the directors had requested for additional funds to facilitate completion of the project but when requested to outline the same their response was that the estimates were not ready. The same trend was observed in other progress reports in July, August, and September (Auditor-General 16). This implies that reports and disclosure issued by the management were insufficient. Oakes (196) states that when presenting a report it is important to maintain a clear distinction between facts, recommendations, and interpretations. In most cases, documentation of data gathered from empirical studies and interviews is sufficient to give a clear picture of the project’s status hence the areas that need to be improved. The evidence gathered also provides a basis for ascertaining emerging issues, their causes, and how they can be addressed. Oakes emphasizes that without a basis for ascertaining emerging issues, findings can easily be disputed. The CIBS progress report offered by Sydney Water management to the Board did not distinguish between facts and interpretations, in particular the March 2002 report. The March 2002 report did not formally and in a clear manner tell the board that completion of the project would stretch beyond the predetermined timeframe and within the budget. It is true that the management requested for more time allocation and additional funds which could as well be interpreted as an inadequate timeframe and finance. However, this it did this in an indirect manner. Oakes (196) provides a framework for shaping his thoughts with regards to how the management ought to have developed their project progress report prior to issuing the same to the management. Using the Satir interaction model, Oakes classifies the process into four key phases: intake, meaning, significance, response. Intake refers to what has been observed or heard during while carrying out interviews on the various participants to the project, that is, the project leaders, project members, organisational members and so on. Meaning refers to how the information gathered could be interpreted to give a meaning. For instance, does the information gathered imply that there are certain processes that are not working? Such are the issues that the meaning phase seeks to clarify. The significance phase determines the magnitude that the emerging issues are likely to have on the project. Finally, the response phase pretty much gives a direction on the steps to be taken to adequately deal with these issues (Oakes, 196). In this respect, Sydney management should have prepared progress reports with a more or less similar format. Much as the Sydney water’s management might not want to agree, reports and disclosure were seriously inadequate. A key factor that reflects insufficient disclosure and reporting during the project is the findings of the CIBS report. Even though the Sydney water project management had known that there were inherent grave problems in the project, the general progress reports to the Board did not clearly convey the same (Auditor-General 16). The genesis of this problem could to a significant degree be attributed to the organisation’s subordinate staff. In February 2001, it was revealed that project reporting and tracking did not have vigour as CIB progress reports to the management were not formal. Progress reports had not been frequently or regularly produced and that which was produced was executed in a sub-standard format. The internal communication plan was not structured and most of the CIBS project team members were not sure of the project’s progress except within their immediate work area. A QA review by the PricewaterhouseCoopers in May 2002 identified that the structure of the project did not support cross-team communications effectively, which culminated to lack of clarity around certain tasks and responsibilities; inadequate processes to convey changes across the teams; and team members coming to learn about their assignment extensions from other avenues other than the appropriate project communication (Auditor-General 24). As of September, 2002, the Board was still sure of the project’s successful completion. Significant doubts as regards to the projection’s successful completion came to the Board’s attention in October 2002 - a month later, which subsequently led to the project’s termination (Auditor-General 15). This shows that prior to the project’s termination, the Board did not have adequate information; that is, there was no adequate reporting and disclosure. Works Cited Ashkanasy, Neal., Wilderom, Celeste and Peterson, Mark, The Handbook of Organizational Culture and Climate. California. SAGE, 2010. Auditor General, Review of Sydney Water’s Customer Information and Billing System. Vol 1 2003. Buswell, John and Williams, Christine, Service quality in leisure and tourism. Cambridge, MA, CABI Publishing, 2003. Calder, Alan, IT Governance: Guidelines for Directors Author, Cambridgeshire, IT Governance Ltd, 2005. Hellriegel, Don and Slocum, John. Organizational Behavior. Mason OH, Cengage Learning, 2009. Mckenna, Eugene, Business psychology and organisational behaviour, Church Road, Hove. East, Sussex, Psychology Press, 2000. Oakes, Graham, Project Reviews, Assurance and Governance, Hampshire. Gower Publishing, Ltd., 2008. Robbins, Stephen, Organisational behaviour: global and Southern African perspectives. Pearson South Africa, 2009. Saiyadain, Mirzan, Organisational Behaviour. Delhi. 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