Documenting Assumptions

All innovation assumptions should be documented at project initiation. Throughout the project, the project manager must revalidate and challenge the assumptions. Changing assumptions may mandate that the project be terminated or redirected toward a different set of goals and objectives.

Documenting assumptions is necessary in order to track the changes. Examples of assumptions that are likely to change over the duration of an innovation project, especially on a long-term project, might be that:

• The cost of borrowing money and financing the project will remain fixed.
• The procurement costs will not increase.
• The breakthrough in technology will take place as scheduled.
• The resources with the necessary skills will be available when needed.
• The marketplace will readily accept the product.
• Our competitors will not catch up to us.
• The risks are low and can be easily mitigated.
• The product can be manufactured using existing facilities.

Scope Freeze Milestones

Scope freeze milestones are locations in the project's timeline where the scope is frozen and further scope changes will not be allowed. In traditional project management, we often do not use scope freeze milestones because it is assumed that the scope is well-defined at project initiation. But on other projects, especially in IT and innovation, the project may begin based on just an idea and the project's scope must evolve as the project is being implemented. This is quite common with techniques such as Agile and Scrum.

According to Melik:

There will be resistance to scope freeze; if it is too early, you may have an unhappy customer, too late and the project will be over budget or late. Striking the right balance between the customer's needs and your ability to deliver on time and on budget is a judgment call; timing varies from project to project, but the scope should always be frozen before a [significant] financial commitment is made. (2007, 205−206)

What if the scope baseline cannot be agreed on? One of the following approaches may be helpful:

• Work more with the customer until scope freeze is achieved.
• Agree to work in phases; proceed with partial project execution, clarify and agree to the rest of the scope during the course of the project. Pilot, prototype, or fit-to-business-analysis mini-projects are helpful.
• Structure the project with many predetermined milestones and phases of short duration; such a project is far more likely to remain aligned with its ultimate objectives.

Scope freeze milestones are important in innovation projects because highly talented people may want to create a perfect product and continue designing and experimenting. There is a point where one must freeze the design, commercialize the product, and allow all further enhancements to be part of the next generation of this product. Scope freezes may be necessary to enter the marketplace quickly and generate revenue.

Design Freeze Milestones

In addition to scope freeze milestones, there can also be design freeze milestones. Even if the scope is well defined and agreed to, there may be several different design options to meet the scope. Sometimes, the best design may require that the scope change and the scope freeze milestone must be moved out.

A design freeze milestone is a point in a project where no further changes to the design of the product came be made without incurring a financial risk, especially if the design must then go to manufacturing. The decision point for the freeze usually occurs at the end of a specific life-cycle phase. There are several types of freezes, and they can occur in just about any type of project. However, they are most common in new product development (NPD) projects.

In NPD projects with technical innovation, we normally have a both a specification freeze and a design freeze. Innovation teams usually dislike specifications claiming it limits their freedom to be creative.

I think that a lot of the most interesting and novel solutions come when you don't have a definite specification.

Dr. William McLean, Sidewinder project director, in hearings before the Committee on Armed Services, US Senate, December 1971, p. 233.

However, specifications are often necessary and dictate the set of requirements upon which the final design must be made. There may be health and safety reasons for the specifications.

Following a specification freeze, we have a design freeze whereby the final design is handed over to manufacturing. The design freeze may be necessary for timely procurement of long lead items such as parts and tooling that are necessary for the final product to be manufactured. The timing of the design freeze is often dictated by the lead times and may be beyond the control of the company. Failing to meet design freeze points has a significantly greater impact on manufacturing than engineering design.

Design freezes have the additional benefit of controlling downstream scope changes. However, even though design changes can be costly, they are often necessary for safety reasons, to protect the firm against possible product liability lawsuits, and to satisfy a customer's specific needs.

Changes to a product after the product's design is handed over to manufacturing can be costly. As a rule, we generally state that the cost of a change in any life-cycle phase after the design freeze is 10 times the cost of performing the change in the previous life-cycle phase. As an example, let's assume that if a mistake is made prior to the design freeze point, the correction could have been made for $100. But if the mistake is not detected until the manufacturing stage, then the correction cost could be $1000. The same mistake, if detected after the customer receives the product, could cost $10,000 to correct a $100 planning mistake or a $1000 manufacturing mistake. While the rule of 10 may seem a little exaggerated, it does show the trend in correcting costs downstream.

Customer Approval Milestones

Some innovations may be designed for a specific customer base and may be done as part of co-creation. Project managers often neglect to include in the life-cycle phases timeline milestones and the accompanying time durations for customer approvals of the project's schedule baseline with the mistaken belief that the approval process will happen quickly. The approval process in the project manager's parent company may be known with some reasonable degree of certainly, but the same cannot be said for the client's or partners' approval process. Factors that can impact the speed by which the approvals take place can include:

• How many people are involved in the approval process
• Whether any of the people are new to the project
• When all the necessary participants can find a mutually agreed on time to meet
• The amount of time the people need to review the data, understand the data, and determine the impact of their decision
• Their knowledge of project management
• A review of the previous project decisions that were made by them or others
• How well they understand the impact of a delayed decision
• Whether they need additional information before a decision can be made
• Whether the decision can be made verbally or if it must be written in report format

Simply adding a milestone to a schedule that says “customer approval” does not solve the problem. Project managers must find out how long their customers need before making a decision, and it may be better to indicate customer approval as an activity rather than as a milestone.

Nontraditional Life-Cycle Phases

As stated earlier, innovation projects may not work well within the traditional life-cycle phases. Some companies use product development life-cycle phases in additional to traditional life-cycle phases on other projects. Techniques such as Agile and Scrum are flexible approaches that set up their frameworks according to the unique requirements of each project. Once again, one size does not fit all.

Innovation can use nontraditional life-cycle phases, as shown in Figure 5-4. These life-cycle phases can still use scope freeze milestones, design freeze milestones, and customer approval milestones. There can be different nontraditional life-cycle phases on innovation projects based on whether we have product, service, or process innovation and whether the innovation is intended to be incremental or radical.

Background

The project consisted of four steel cylindrical tanks, each with a height of 21 m and 110 m diameter with capacity of 190,000 cubic meters, service buildings, roads, and supply of all materials, equipment and services required for the project. The project would supply up to 760,000 cubic meters of drinkable fresh water for the Mashaer Area in Makkah (Arafat, Muzdalefa, and Mena, Saudi Arabia) resident population. Timely completion of the project was crucial, since these reservoirs were needed to meet increased water demand for the pilgrimage in 2016.

Solving a Linear Equation

First, I will provide a definition for the situation and relationships:

• Individual situation refers to capabilities (all types of resources, knowledge, and awareness), the exact plan, and the agenda to perform the work.
• Relationship (between the two parties) is how both will tackle/deal with challenges, issues, and risks, and the limits of this relationship.

To understand the individual's situation and his/her entire capabilities, we must put ourselves in the other person's shoes and see the project through their eyes. With multiple relationships we will have more than two parties that need to communicate with each other, and all those parties are stakeholders. Their interference can have an impact on the project. We will analyze each two-party relationships separately. For example, in a construction project, the three important parties (i.e., stakeholders) whose interference has the great impact on the project are the client (owner), the contractor, and the supervising consultant. Each party has a role and an input for the completion of the project. The relationship is controlled by a contract between each of two parties or an item/article written in the contract. This relationship must be controlled (balanced) all the time.

As in mathematics, I have considered these relationships as linear equations. First, each of the two parties will have its own relationship, and finally, we will have one equation containing all the parties together.

where the constants A, B, C, and later D representing the type of communication based on the relation itself (the harmony).

To have an effective and efficient communication pattern, which will serve the project's target, we need to have all parties in the same harmony of communication:

This equation represents the final shape of the communication map of all parties involved in the project; any misunderstanding of the type of relationship will result in a distortion in the final shape of the equation and will not result in the exact value of D.

By substituting one variable in the place of another to solve all the above equations, you can build a suitable system of communication by substituting (imagining) yourself in the contractor/client place to understand his situation. During this substitution, a SWOT (strengths, weaknesses, opportunities, and threats) analysis was done for each variable (X, Y, and Z), which included gathering information and building trust, identifying weaknesses, strengths, opportunities, threats. There were also some specific objectives recorded for all parties. Then the picture became clear and answered the question concerning communication barriers. Based on this information, I was able to bridge the gap to build a strong and effective communication strategy.

I began by explaining my strategy to my team and sharing my concerns. This resulted in a great deal of support for my communication model. I was able to motivate them during all of the project's stages, and maintaining their enthusiasm. Continuous meetings, integrity, patience, brainstorming sessions, and motivation were important factors for success.

Unfreeze

The client (owner) had been engaged in projects for some time, using habits and routines that were based on past project experiences. Tasks and procedures that were not relevant or useful any longer were still being performed by force of habit, without anyone questioning their legitimacy. The client's organization was in a mode where people or processes were not open to or willing to accept a major change.

During unfreezing, my aim was to get the stakeholders to gain a perspective on their day-to-day activities, unlearn their predefined procedures that were not relevant to the project, and expose them to innovative ways of reaching their objectives. The current practices and processes were reassessed prior to the start of the next stage.

During this phase of the change process, we went through different sessions to explain the current situation to all the stakeholders (shock-negative) and its impact on the project. I explained all technical and management issues and guided them scientifically to uncover all the bad scenarios that might result with the current approach. The purpose of change was very clearly explained to all stakeholders during this stage. Several presentations and awareness sessions were arranged at the site office (contractor and my team) as well as the client office to enable them to adapt to change. During this stage, the following steps were taken:

• Explaining the current situation to all stakeholders and its impact
• Being transparent with them and explaining the change process
• Discussing and recording feedback and objections.
• Reaching an agreement formula for each change that gets all parties satisfaction

Change

Understanding that this stage is quite important and dynamic, I did everything feasible to make the change stage successful and assured them that for each activity there would be sufficient time. This transition phase basically is the process of educating people on the changes, putting them into practice, testing them, and doing change assessment to make sure policies line up, and that related policies and processes don't clash once the changes are implemented. To gain efficiency, I engaged in some tasks and responsibilities, such as conducting training sessions and conducting meetings, which entailed a learning curve that could show the project's progress. In the end, we had benefited with project progress, quality, and EHS requirements.

During this phase, different training sessions were arranged for the client and contractor to bring them to the required level of project management awareness. Along with this, different but useful information was shared with them regarding quality control and EHS. Some of the training sessions were carried out as part of an on-site tour to understand exact areas where change was essential. I also encouraged all parties to utilize information technology in their work, using the relevant software programs. . I found that they were having difficulties with some programs, for many reasons, so I developed an easy to use software program to deal with some aspects of the project.

In summary, the following was done during this stage:

• Conducted several training sessions for the client and contractor
• Measured response to the changes in a timely manner
• Constant contact with all concerned for the success of the project, encouraging them, getting their feedback, and managing their difficulties
• Prepared the project management plan
• Prepared the risk register

Freeze

After changing the previous approach of the client and the contractor to an acceptable degree, and make sure the change was permanent, some steps were followed. Further changes in the project procedures had been made along the way. The final project management plan and quality procedures were monitored and controlled. This was achieved by regular feedback and following up all the details, even minor ones. At each stage of the project, we ensured that the contractor was conforming to the quality control procedures and EHS standards.

One tool to ensure continued improvement is effective communication management. We kept the client informed at every stage of the project so the client could learn the different skills needed for project management. Also, to ensure that the change would be permanent, “shock-positive” was presented; not just by showing the positive impacts on the project itself but also by applying the same approach to the client's other projects, especially the projects with poor performance. The good results were impressive.

During this stage, the following was done:

• Explained the change process and received feedback from all stakeholders
• Updated the project management plan
• Updated the risk register

Shock-Negative

Before and during the unfreeze stage, there should be an explanation of the current approach and its potential negative impacts. This should come as a shock to prepare them (the client and contractor) for the unfreeze stage. Without this shock the change will not start. The shock will provide clear evidence that the current approach will lead to disaster and will result in not achieving the project's target. There were some major technical issues explained, and all parties were convinced that they needed to change their approach and to follow approved procedures and standards.

Shock-Positive

During and after the freeze stage, there will be evidence that this new approach has very positive impacts on the project (and on other projects, if applied).

These two shocks have been explained and presented during meetings, presentations, and lectures.

The Software Program

There was not much use of information technology (IT) by the contractor and client in the project. The challenges, such as the need to have exact information, how to recover the completion plan, lack of IT awareness or importance, and the contractor and client's difficulties using the available software in the market motivated me to create an easy software program to steer, monitor, and control most project activities. This software program is still under development, and with hope within two years it will be available for public use.

Unfortunately, the contractor began blasting activity without considering the existing utilities during the project initiation or site study. Also, there was no risk management plan, which would have included a risk register and assessment for these utilities. We explained to the client the dangerous impacts that blasting could have on nearby structures. The blasting activities were suspended until a technical evaluation and a proper assessment of the related risks were carried out. The evaluation report came up with some recommendations for the blasting activity, such as limited blasting per day and using a limited number of explosives per blast. The related risks were eliminated but resulted in a delay at this stage.

Everyone understood that the blasting activity, which is one of the critical path activities, would take longer than expected, and would have a time-delay impact on other project activities. This could lead to a significant delay in the completion date if these issues were not resolved. The complexity of the situation increased as a result of my detailed study of the baseline and showed that some activities needed more time than planned.

My goals were to optimize the resources and find ways to accelerate the progress of activities after blasting. Major activities after the site preparation (blasting) included removing rocks resulted from blasting to the dumping area, which is around 10 kilometers from the site, and welding steel sheets (10 meters by 2.5 meters, with an average weight of 6 tons each) to form the reservoir structure. The project consisted of four reservoirs, and each reservoir structure was almost 43 meters in height (including the aluminum roof dome) with a diameter of 110 meters. Construction required major resources such as cranes, a submerge arc welding (SAW) machine, an electro gas welding (EGW) machine, welders, and coating machines, all working in several shifts.

I became obsessed with the word “time” and examined all activities to find suitable ways to decrease activity durations and/or find alternative solutions. At that stage, I managed to have all parties working as one team and all were thinking in the same way—to decrease time.

After a detailed assessment, we managed to decrease the duration of many activities by restructuring the way we were performing or by increasing resources. But the major two activities that had the greatest time impact on the project were removing the excavated rocks to the dumping area and the construction of the steel reservoirs.

The nearest dumping area was almost 10 km from the site. The contractor's plan was to use 30 long trucks to shift the excavated rock, which totalled around 990,000 cubic meters, from site to the dumping area. Each truck could accommodate approximately 20 cubic meters of rock; hence a maximum of 160 cubic meters per truck (8 trips per day based on geography and traffic analysis) could be shifted per day. This activity alone would take almost 206 days to complete, and we needed a cleared site area to start other activities. The remaining time at that stage was about 300 days. It would be impossible to complete the project on time if we followed that approach. The issue had been escalated to find an urgent alternative. After searching for an alternative, an idea came to the team to build a riprap from the excavated rocks near to the site. (Riprap is also known as rip-rap, shot rock, and rock armor.) Rock or other material such as concrete is used to armor shorelines, streambeds, bridge abutments, pilings, and other shoreline structures against scour and water or ice erosion. (See Figure 5-5) This opportunity to save time and the sustainable reuse of the construction waste was explained to the client. The client supported the idea and helped get all the approvals from the concerned authorities. This idea saved around 150 days.

The contractor constructed a riprap at the edge of the mountain and around the parking area to prevent any loose rocks from falling. Also, the riprap protected both the public and local properties in case any loose rocks did fall. The location of the constructed riprap wall was around 500 meters from the project site. This riprap wall construction idea not only saved time but reduced cost and pollution. This result was based on a numerical calculation, which enabled all stakeholders to have a clear vision about what they should do.

I decided to utilize software to develop an accurate recovery plan for the project. I developed a program to calculate the exact resources required for the completion of each stage that was part of the construction of the reservoir. I started by using readily available software, Microsoft Excel. Then, when I had decided to add more interfaces, I utilized the programming language V.net to build the software program.

Interfaces were also part of the software program. The intent of one of the interfaces was to calculate the optimum time to complete an activity as well as provide a clear idea about the exact resources needed for on-time completion. The most accurate time duration for each activity was calculated. I converted the required resources to a data format to be incorporated into the program. Several surveys and samples of data were taken on site and compared to similar current projects and some past projects. Converted data was used to calculate and identify the exact time required to complete each layer of the structure. Some activities were subdivided for more accurate output. This helped in monitoring the progress. Another usage of this interface was to identify the required working hours/shifts for each resource.

Conclusion

Results from a test simulation were confirmed against the known outputs. Successful completion of the tests showed the possibility of completing the project on time if the proposed set of actions were followed. The test program calculated the required resources and optimization of resources for greater productivity. The contractor was very pleased to have the exact information and guidance since they were under pressure to find a suitable solution that would function as a recovery plan. Implementing effective resource management practices based on the developed program, the contractor succeeded in establishing an action and recovery plan. The program identified the exact resource allocation requirements and optimization ideas to squeeze the activities to comply with the project's crucial completion time.

The other interfaces were for monitoring the progress, recording inspections, providing quality control for documentation, fundamental design for a steel reservoir, and more. Multi-capability forms of this program can be developed and can be applied to any similar project. The program idea can be used in any project, regardless of scope, activity, or resources.

Innovation and Project Management

Without a doubt, we are now in an age where the pace of change in IT and services is greater than ever before. Rapid innovation is demanded by clients and expected by the markets. There are continuous developments in technology (e.g., digital transformation, automation, robotics, etc.) and methodologies (e.g., Agile, DevOps). So, the question is, is there still a place for a standard project management framework that will enable companies to succeed and bring value to their clients?

At NTT DATA, the answer is yes. So how do we balance the need for rapid, transformative innovation while leveraging our project management framework? The answer is that we use both the “art” and the “science” of project management.

About NTT DATA

NTT DATA partners with clients to navigate and simplify the modern complexities of business and technology, delivering the insights, solutions, and outcomes that matter most. We deliver tangible business results by combining deep industry expertise with applied innovations in digital, cloud, and automation across a comprehensive portfolio of consulting, applications, infrastructure, and business process services.

NTT DATA is a top-10 global business and IT services provider with 100,000+ professionals in more than 50 countries, and is part of NTT Group, a partner to 85 percent of the Fortune 100.

NTT DATA welcomed Dell Services into the family in 2016. Together, we offer one of the industry's most comprehensive services portfolios, designed to modernize business and technology to deliver the outcomes that matter most to our clients.

What We Ask of Our Project Managers

The patented PM3¹ is the NTT DATA Services Global Project Delivery Framework, which encompasses the project and program management framework, the project management office (PMO) framework, and the internal project delivery governance standards and processes. The patented PM3 methodology and supporting documents require qualified project management team members to interpret and apply the methodology, standards, and tools appropriately, based on the specific needs of the project or program.

Project management cannot be executed successfully, nor can the value and benefits be fully realized, by following a checklist, or step-by-step procedure. Standards, process, and tools are only half of the equation. Successful project management relies on strong leadership, decision making, and expert judgment, as well.

To reap the maximum benefits, the use of the PM3 Project–Program Management Framework, project managers must strike a balance between the science of disciplined execution and the art of using sound judgment in leading the effort.

The value comes when the processes and tools are applied properly and most efficiently for both our clients and NTT DATA Services, balancing risk with the degree of rigor applied.

When you are dealing with requirements that need a great deal of innovation, you are going to lean more heavily on the “art” of project management while you leverage the best practices available from the “science” of project management where they make sense.

• The project management standard processes and supporting tools and templates are designed to mitigate risk and deliver predictable and repeatable results—these processes and tools are what we refer to as the science of project management.
• Project managers must focus not only on the processes they need to follow, but also on the intent of the processes and the results, or outcomes, these processes and standards are designed to produce.
• The art of project management is the judicious and cost-effective application of the science to the business problem and environment.
• The methodology and tools are flexible and require experienced, qualified project managers to apply them appropriately. Although our methodology provides guidelines for scaling based on the project size, complexity and risk, every customer engagement is different, and this scaling requires judgment and experience on the part of the project manager to decide where to customize, and where to flex (within the guidelines of the PM framework and standards).

Remember: The PM3 Framework is a means to an end. There can be several paths that lead the PM practitioner to the critical outcomes that are necessary for project success.

The strong project manager will balance the “art” and “science” to ensure the critical outcomes are achieved.

How Do We Help Our Project Managers?

It is essential for the success of our projects and our clients that we invest in our project managers by providing them with the tools that will enable them to deliver on critical outcomes. At NTT DATA, our people are not only who we are today, but are the future of our organization. We know our employees are our most important investment and with the right tools and environment, the potential to succeed is unlimited.

In addition to technical skills related to the specific project management processes and tools, or what is sometimes referred to as the “science” of project management, the NTT DATA Services Project Management Learning System (PMLS) emphasizes the importance of human performance skills, or the “art” part of project management. Excellent leadership skills and good judgment are critical to the success of any Project Manager.

The PM3 Project Management Certification Program and associated PM3 Training are critical to long-term sustainability of the standards. The PM3 includes a comprehensive curriculum that provides project management team members the opportunity to build project management skills and understand the NTT DATA Services approach.

All of the PM3 training is web-based, offered online to provide easy access and navigation, in the most convenient and cost-effective manner for NTT DATA Services project management team members.

Contributors

PM3 contributions by subject matter experts from across NTT DATA Services, with specific authorship for this publication by the Services Enterprise PMO Team:

• Michele A. Caputo, PMP
• NTT DATA Services Enterprise Project Management Office (EPMO) Leader and Enterprise Project Management Standardization (EPMS) Program Senior Director
• José R. Figueroa, PMP

Background

Michael Bauer, head of the Global SSMO (Solutions and Services Management Office) at Philips Business Group MA&TC Services (Monitoring and Analytics and Therapeutic Care) and Mary Ellen Skeens, director of Solution Design and Delivery Processes at Philips Business Group MA&TC Services, describe how innovative solutions are successfully supported by a scalable solution design and delivery services framework.

Special thanks to Lisa Midttun (solution release manager in MA&TC Solution and Segment Marketing) and Stacy Meyer (MA&TC SSMO senior consultant) for their valuable contributions in the respective areas of solution innovation and commercialization process and importance of communities of practice (CoP) and social learning for solution innovation success.

In the fourth edition of Project Management Best Practices Achieving Global Excellence, Michael Bauer provides an overview of the Philips SOLiD Framework, along with key takeaways on how a scalable approach enables organizations to achieve solution implementation and services excellence (Kerzner 2018, 453−456).

In this section, we review key trends in health care driving solution innovation, translation of these into customer needs and solution complexity, as well as enablers for achieving solution design and delivery service excellence, including:

• Solution development and commercialization
• Scalable and role-specific solution design and delivery services framework
• Solution Design and Delivery Services and specific capabilities
• Holistic and fully integrated approach for the customer life cycle
• Communities of practice
• Process harmonization and standardization
• Continuous improvement of capabilities

Enabling Innovation Success in Solution Design and Delivery in Health Care Business

Royal Philips² (NYSE: PHG, AEX: PHIA) is a leading health technology company focused on improving people's health and enabling better outcomes across the health continuum from healthy living and prevention, to diagnosis, treatment and home care. Philips leverages advanced technology and deep clinical and consumer insights to deliver integrated solutions. Headquartered in the Netherlands, the company is a leader in diagnostic imaging, image-guided therapy, patient monitoring, and health informatics, as well as in consumer health and home care. Philips' health technology portfolio generated 2017 sales of EUR 17.8 billion and employs approximately 77,000 employees with sales and services in more than 100 countries.

The Monitoring and Analytics (MA) Business Group is a software and solutions business encompassing patient monitoring and its capabilities. Reaching more than 370 million people every year, MA solutions are advanced intelligence platforms, providing key insights and information to clinicians when and where they need it. The ultimate priority for the MA Business Group is to enable smart decision making for caregivers, administrators, and patients such that costs are controlled, efficiency is increased, and better health is supported.

The Therapeutic Care (TC) Business Group is expanding access to and quality of respiratory care, resuscitation, and emergency care solutions (including devices, services, and digital/data solutions). Hospital respiratory care (HRC) and emergency care and resuscitation (ECR) solutions are helping caregivers and lay responders both inside and outside the hospital.

Mega Trends in Health Care Toward Innovative Solutions

The health-care industry is quickly evolving (see, e.g., www.results.philips.com/publications/ar17#/strategy). Digital technology and innovative solutions are shaping the industry to support individuals taking charge of their own health.

There are four key trends driving disruptive change in health-care technology:

1. The shift from volume to value-based care, due to global resource constraints. The World Health Organization estimates that 17 million more health-care workers are needed to close the gap to meet demands of the system in 2018.³
2. The growing population of older patients and increase in chronic conditions such as cardiovascular disease, cancer, and diabetes. The world's older population is forecasted to outpace the younger population over the next three decades (He et al. 2016, 6).
3. Patients are exerting more control over health-care decisions and choosing which health-care organizations they utilize as consumers. With access to digital health-care tools and the incentive of reducing out of pocket expenses, patients are making more carefully informed decisions regarding care (Cordina et al. 2018, 4–6).
4. The initiation of health-care digitalization, triggering growing demand for integrated solutions over discrete products. Physicians can now leverage digital and artificial intelligence solutions to automate data collection and translate it into useful information to make evidence-based medical decisions (World Economic Forum and The Boston Consulting Group 2017, 19).

These trends have resulted in health-care organizations striving to find solutions to reach the goals of improving clinical, patient, and financial outcomes while also addressing the well-being and engagement of health-care employees (Bodenheimer and Sinsky 2014).

Philips has adopted a solution-oriented approach in delivering value to customers via integrated solution offerings. Philips defines a solution as a combination of Philips (and third-party) systems, devices, software, consumables and services, configured and delivered in a way that solves customer- (segment) specific needs.

Varying Customer Needs and Different Solution Complexities

Solutions address the customer's need to cost-effectively maximize speed and consistency of clinical decisions, actions, and usage of patient information for reduced clinical variation and improved clinical performance within their IT ecosystem.

Designing and delivering solution projects is a local activity performed at hospital organizations in every country, often in the local language. Philips operates with both local and centralized resources to support this. This global/local organizational design often leads to virtual working environments with specific requirements to efficiently drive the solution project delivery. The requirements and maturity levels in each country, market, and hospital customer vary greatly. Each project in a hospital is unique and varies in duration (from weeks to years), in size (up to multimillion euros/dollars) and in complexity (from stand-alone solution for one clinician to regional distributed solution for thousands of users). The range of size and complexity for solution projects in health care is broad. It includes simple products, highly configurable systems, as well as software and services, including clinical consulting. It is influenced by different customer situations, demand, and existing and new technologies. A solution design and delivery framework addresses customer needs and requirements, which vary from project to project:

• From single department to multihospital deployment across country borders
• From standalone solutions in group practice or small departments to complex solutions with different systems, software, services fully integrated in the hospital infrastructure across multiple departments
• From simple clinical processes to highly designed workflows
• From “greenfield” implementations across all modalities and applications to customized solutions into an existing hospital environment

Figure 5-6 gives an overview of the complexity drivers in health care projects.

The variability in customer needs drives the solution commercialization process. Important elements considered include scalable solution requirements in product and service design, solution delivery readiness, and quality of execution in markets.

When designing and delivering low-complexity, single-solution projects in one hospital department on a simple, stand-alone network, the project manager will implement basic tasks within the five Project Management Institute (PMI) process groups (for more information, see www.pmi.org). They include stakeholder identification, plan development, performing installation, controlling scope, and obtaining customer acceptance. When a high-complexity solution is delivered within a health system, with many stakeholders and a variety of solutions, the solution design and delivery model becomes much more detailed. The project manager and the multidisciplinary project team will execute additional tasks from the five PMI process groups. These include performing a customer expectation analysis, developing a stakeholder RACI matrix, performing a workflow analysis, performing solution integration testing, controlling risk, cost and labor budgets, and conducting lessons learned reviews.

The different complexity drivers lead to different complexity levels (see Figure 5-7, with three different complexity levels).

Implications for Solution Innovation Development and Commercialization

Solution innovation development and commercialization processes are key enablers for an effective and efficient solution design and delivery process. These processes support the development and launch of new solutions, define new ways of working, and drive necessary changes to supporting infrastructure.

In order to develop a solution that includes systems, devices, software, consumables and services, first we rely on stellar project management for product and services realization and market launch. Second, we build on this foundation to add new capabilities (process, tool, content) as needed for a complete solution for a customer. An example is new ways of transacting business with Philips, such as subscription services. Third, we underpin both with the human resource capabilities (skill) required to design, deploy and deliver the solution. This may include new roles, or new ways of working across the organization. Fourth, as we transform into a solutions partner, we are assessing our organizational structure and ensuring an E2E systems approach is followed. Customer experience is driving all of our decisions regarding changes to our internal processes and organization.

Two new processes have been developed in response to solutions transformation:

1. Develop a process to de-risk innovation prior to solution commercialization:
   • The process is based on the industry-proven process for managing venture investments.
   • Design it to incorporate learnings from previous experience.
   • Ensure that the solution is created and matured through a stage-gated approach.
   • Use multitiered governance.
2. Develop a new process for solution commercialization:
   • Drive customer solution requirements for consideration in product and service designs.
   • Ensure continued alignment and execution on accepted requirements.
   • Use commercialization through a gated process that is scalable, repeatable, and leverages enabling realization processes.
   • Ensure delivery readiness and quality execution of solution in markets.

Due to the nature of solution innovation, the traditional aspects of project management are needed but are not enough. Focus on the human aspects is necessary to help impacted parties (internal, partners, customers) to transition through change. It helps to ensure adoption and to sustain the change. Key to this is strong, aligned messaging, delivered by all levels of leadership, articulating business and customer benefits and our contribution to that benefit.

Solution Design and Delivery Services

Solution projects need a specific combination of services, executed by a multidisciplinary team consisting of project managers, solution architects, technical consultants, clinical consultants, and field service engineers in teamwork with sales and other professional services team members. Some of the solution-related services are specific to the solution, some are more generic and independent of the solution. For any solution, it is a combination of both (see Figure 5-8 as an overview).

Solution Design and Delivery Capabilities

A set of capabilities are required to provide solution design and delivery services. Philips considers the following important capabilities with regard to solution design and delivery services:

• Skills. Well educated, certified, skilled (hard, soft), and continuously trained solution architects, projects managers and project team, and professional services consultants with a professional mindset, appearance, and behavior. This also includes recruiting the best talent.⁴
• Processes/methodology. Highly efficient, standardized, lean, repeatable and well documented processes, which are continuously improved.
• Tools. Highly integrated and efficient tools, templates and applications from the project acquisition until the end of the project.
• Content. Role-specific content (templates, training material, diagrams) around the solution design and delivery.

Some of the solution-related capabilities are specific to the solution, some are more generic and independent of the solution. For any solution, it is a combination of both. The solution-specific capabilities are directly linked to the solution innovation. To be fully successful with selling, designing, and delivering solution projects, these capabilities need to be prepared, designed, and deployed to executing organizations in the countries.

The SOLiD design and delivery framework has an integrator function to combine a solution-specific and solution-independent capabilities for any solution, which enables every role to contribute successfully to the project (see Figure 5-9 as an overview).

Philips strives for solution design and delivery excellence. This is not seen as a static goal, and the ambition is to continuously raise the bar for the overall maturity and all capabilities.

The following aspects are critical to build and improve solution-related capabilities:

• Solution design and delivery services excellence matters. Provide key aspect to value and improving skills, processes and tools.
• Change management . Identify, drive, and implement improvements and changes in the organization.
• Standardization. Enable standardized and lean practices and processes across product domains and regions.⁵
• Continuous learning. Train, review, and mentor as required.
• Facilitation of community of practice (CoP) for all professions. Provide key aspect to enable to share, learn, leverage, network, and communicate.⁶

Solution Services along the Customer Life Cycle

MA&TC Services strategized a fully integrated approach on how to offer and implement solutions and services from a process and methodology perspective. This is getting more important as the MA&TC portfolio transitions more and more into a solutions and services business. A more holistic approach is key for scoping and designing, delivering and servicing solutions to the customer throughout the customer life cycle (see Figure 5-10 for a graphical overview.⁷

The customer life cycle begins with solution discovery. This involves intensive dialogue with the customer to fully understand the customer needs. It is followed by the solution design phase during presales, where reference architectures and design guidelines help to shape a strong customer solution. This phase is essential for following solution phases, it builds the real foundation. “Having a solid foundation is an essential element for delivering project excellence” (Martin 2010). The work performed in the solution design phase is captured and documented into a statement of work (SOW), which is referenced throughout the rest of the project. McKinsey emphasizes the importance of technical and commercial capabilities: “Companies that invest in this capability are able to achieve win rates of 40 to 50 percent in new business and 80 to 90 percent in renewal business.”⁸ Following the solution design phase, a multi-year solution life-cycle plan is aligned with the customer. Then the solution delivery phase is executed to implement the solution initially and additional services are provided over the lifecycle to fully create the customer value. Continuous customer engagement is key for full success and enablement of the desired customer outcome (including continuous partnership and collaboration going forward).

Out of the entire customer life cycle several key areas need to be highlighted:

Solution Discovery

• Understand our customer's clinical, technical, and operational requirements.
• Drive consensus with customer stakeholders on solution vision.

Solution Design

• Be technically feasible and implementable.
• Be supportable by Philips and the customer.
• Ensure financially transparent and profitable.
• Align with customer expectations.

Solution Delivery

• Provide successful implementation, in line with what was scoped.
• Enable a lean and scalable project management approach.
• Provide the right tools to deliver an exceptional customer experience.
• Align the way of working across all markets.

Service Management

• Focus on the service, not only the technology or products.
• Standardize the way we define and add value to support customer experience.
• Have flexible and responsive processes to support value creation.
• Be service oriented internally and externally.

Solution Services Life Cycle and Customer Experience

Philips is conscious that each organization leaves an imprint with the customer, an experience made up of rational and emotional aspects that determines what health-care customers associate with the Philips brand, and what Philips means to them. This is especially pronounced in a services business. Customer experience is at the heart of a relationship that translates into whether customers repeatedly rely on the organization's capabilities and embrace them as a trusted advisor.⁹ Therefore another important aspect is how the organization actively and holistically “design” the customer experience end-to-end (E2E) in terms of all capabilities (e.g., tools, processes and skills). Philips strives to apply this customer experience–focused approach across the entire customer life cycle from the point in time that customers share their vision through solution design, delivery, and continuous engagement and improvement.

In this context, solutions design and delivery services excellence are key strategic ingredients to ensure that Philips reliably and repeatedly delivers the desired customer experience. Hence, building and sustaining project solution design and delivery services excellence and reaching a high level of project management maturity with solution implementation projects is an adamant ambition of vital importance for both the customer and Philips.

The SOLiD Framework

In close collaboration with the Philips Solutions and Services Community around the globe, the SOLiD Framework was developed. The SOLiD Framework is now the Philips solution approach for designing, managing, executing and servicing customer facing solution implementation projects and services. SOLiD stands for:

• Scalable, which allows flexibility to meet the demands of our low, medium and high complexity projects.
• Operationally agile, meaning a rapid, customer focused development approach was utilized, and we will continue to build and improve via iterations over time.
• Lean, only including the tasks that would add value to the Project and Services Team and even more important to hospital customers.
• iT focused, including the structure, tools and processes needed to successfully manage Projects and Services in an IT Solutions environment and lastly SOLiD will help to
• Deliver consistent results and bring business value by providing a standard and lean way of working.

The underpinnings of this framework are the process groups of initiating, planning, executing, monitoring/controlling and closing as defined in the Guide to the Project Management Body of Knowledge (PMBOK® Guide) by the Project Management Institute (PMI).¹⁰ Each process group is then further broken down into more specific processes and procedures detailing the implementation of solution projects and services. All project team member roles are included in the framework, along with the related activities each is responsible for during the solution design and delivery phases. This definition enables the organization to deliver high quality implementations and includes a holistic approach to solution design and testing. An important element of the approach is the definition of a customer reference architecture for the solution. This serves as the vision for the solution where use models, application/configuration, and infrastructure elements are defined. The reference architecture specification is utilized to develop the system design and define the solution test plan.

Scalability in project implementations is key to allow the right, flexible, agile, and efficient approach per project but to leverage from a rich tool set. Solution projects are defined by their level of complexity. Typical factors when defining complexity are total cost of the project, number of team members involved, number and size of deliverables, complexity of deliverables, complexity of the customer environment, and time frames involved.

PMI defines a project as being different from other ongoing operations in an organization, because unlike operations, projects have a definite beginning and an end—they have a limited duration and bring value to the organization.

The SOLiD Framework is designed to help offer guidance based on various complexity levels and modules (Figure 5-11 gives a graphical overview about the modular concept):

• Integrated. Incorporates both foundation and advanced frameworks with additional activities needed to design, manage, and execute more intricate, high-complexity projects. An integrated level usually needs more clinical workflow analysis, technical integration and testing activities, and different level of risk and stakeholder management.
• Advanced. Incorporates the tasks in foundation with additional activities / processes to help better scope, manage, and execute medium-complexity projects. It includes solution design components.
• Foundation. Designed for low-complexity projects with basic project management tasks required. Examples include basic testing and simple statement of work.
• Consultancy. Activities that should be performed in the design and delivery of consultancy projects include clinical practice/outcomes consulting, operational improvement consulting, or technical architecture consulting.

Value of Social Learning in Solution Innovation

In developing the solution design and delivery capabilities needed for customer success, it is imperative to ensure connections exist between project team members and their domain peers for the purpose of ongoing learning, knowledge sharing, continuous process improvement and people development. In a multidisciplinary team environment, it is important for the project team members to have access to a network of peers that share their experiences and lessons learned. Two specific approaches for social learning have been utilized in Philips: community of practice and virtual brainstorming.

The basic model for a CoP includes three main parts—domain, community, and practice. First, the shared domain of interest that people identify with is defined. The community then determines who should be included and what kind of relationships they should form. Lastly, within the practice, members determine what they want to do together and how they can make a difference in practice. These elements are essential for a CoP to thrive. There are key differences between CoPs and formal work groups, which should be recognized. The purpose of CoPs is to develop self-selecting members' capabilities and to exchange knowledge with one another whereas, a formal working groups' purpose is to deliver a product or service with everyone reporting to the group's manager. Both groups can be complimentary to each other and are essential for innovation to occur (Wenger and Snyder 2000).

The real value practitioners' gain from being part of a CoP is to help each other solve problems, reflect on practices to improve, keep up with change, cooperate on innovation, and find a voice to gain strategic influence.¹¹ As new communities emerge, within and across business groups, functions, and markets, even more knowledge is shared. In today's world, knowledge sharing is simply not enough. To truly transform and innovate faster, social learning spaces are necessary to pay attention to the data, engage uncertainty and move people to make a difference. Learning partnerships created to cross boundaries can turn into valuable learning assets. Value-creation frameworks provide a structure for capturing the flow of events or ideas from social learning spaces (virtual or in person), through data and stories. The information learned together in the space, new ideas, methods, and tools flow back into the real world through the small and big actions taken as a result.

An example of applying this social learning concept is to facilitate open collaboration, between boundaries by bringing people together to share ideas, feedback and questions on a specific topic. This type of virtual brainstorming is a powerful way to find new and exciting improvements to challenges and unknowns in our rapidly changing world. Customers are increasingly looking for solution propositions that will help them add value and address their business challenges. Communities of practice create environments where exchanges can happen in real-time between various functions that trigger new ideas leading to solutions customers really need.

Philips designs, facilitates and supports CoPs in close teamwork with functional leadership. Consulting is provided for new communities wanting to form as well as facilitation of a global group of CoP moderators. This moderator group consists of leaders with a passion for CoPs who collaborate regularly to share insights, knowledge, and best practices they have learned in building and working with different types of communities.

A key takeaway from our community development experience is to ask the community first, before sharing what is already known, because this helps to build engagement by allowing the members to find the answers themselves through collaboration. Sharing value creation stories that come from their ideas, creates strong feedback loops. Results are achieved by applying learnings to build on strengths. Innovation comes from finding something new out of something known.

Key Takeaways for Solution Innovation Excellence

The key takeaways for achieving solution design and delivery service excellence could be summarized as follows:

• Create a scalable and role-specific solution design and delivery framework. This enables success for different project complexities and all project team members.
• Solution design and delivery services require a specific set of capabilities at the organization and market. Some of the capabilities are solution specific, some capabilities are generic for any solution.
• Use a holistic and fully integrated approach for the customer life cycle. This is key for scoping, designing, delivering, and servicing solutions for health-care customers.
• Work intensively with CoPs and the experts around the globe. A CoP for the different professions is a state-of-the art approach and recognized best-practice to share, learn, leverage, network, and communicate together.
• Process harmonization and standardization. This is highly important for the success of an organization operating globally and reducing complexity. Tight integration in the upstream processes (e.g., sales, bid management) and downstream processes (e.g., entire life cycle) are very important, too. This must be supported by solid change management and training activities.
• Solution design and delivery service excellence is not a static objective. It requires continuous improvement around all capabilities. Even though it is not an absolute objective per se, it is considered a proactive way to anticipate and fulfill the needs of our customers with regards solutions and services.

Challenges

Innovation in silos often posed a huge challenge at Dubai Customs, especially when business units and departments were running their own research and analysis to build prototypes of similar nature initiatives, limiting the transparency of opportunities addressed in dealing with disruptive technologies. As disruptive technology impacts the work we do, Dubai Customs sets out to explore a more collaborative solution that enables business owners, SMEs, and customers to be involved in every part of the exploratory process and find new ways to better enhance project management capabilities in innovation to gain a competitive advantage.

Approach

Dubai Customs, as an innovative organization, realized that these disruptions in the nature of new advancements in knowledge/technology, involving some level of uncertainty and having multiple dimensions (in terms of the kind of outcomes/cost and time), presented the opportunity to evolve our existing best practices. For this, the most important aspect was to create the culture within Dubai Customs that can support agility by embracing a new a design thinking-led approach (Figure 5-12) to better manage disruptive technologies, such as blockchain, artificial intelligence (AI), Internet of Things (IoT), augmented reality and virtual reality, relying on project success as a competitive advantage and succeed in a fast-paced and disruptive business environment to move quickly, decisively, and effectively to anticipate, initiate, and take advantage of change, yet remain robust enough to absorb any setbacks.

Accelerated Exploratory Lab Solution

Using the approach Dubai Customs further set out to create a collaborative accelerated exploratory environment which was a joint task force (Figure 5-13) formed between demand management, services innovations, project delivery and customs IT development, which better served as an opportunity to advance, focus on the value delivery landscape for the business community, and enable project managers to play a more strategic role in managing disruptions and embrace the value delivery landscape. The lab offered a unique, collaborative environment specifically designed to facilitate idea exploration through research and development to seek the desired results focused in establishing a partnership from idea to impact by having all the concerned partners working together both internal and external to Dubai Customs exploring and prototyping the changes/ potential solutions systemically through agile projects in rapid iterations.

The accelerated exploratory lab landscape (Figure 5-14) addresses three main areas; determining the strategic direction, then learning to determine if something works and finally scaling to growth the potential solutions that create value for the organization. In the figure, CDC is a governing body overseeing all technology-related investments at Dubai Customs. The landscape helps teams quickly get on-boarded and encapsulates the complexities and challenges involved in testing and building a solution development overlooked by the innovation governance process. The entire governance process is integrated into the landscape with an innovation committee overseeing all the R&D initiatives and ensuring traceability with infused expertise in agile project management approaches wherein project managers are involved right from the start having more subject matter expertise creating more in the value delivery process.

In dealing with all disruptive technologies project categories were categorized under the umbrella of innovation projects (Figure 5-15), such as hypothesis research projects, data research projects and new product / experimental development projects run in an agile approach with rapid iterations for all the exploratory initiatives to determine value delivery capabilities and differentiate our customer experiences.

Benefits

The benefits realized from all innovation engagements:

• Provides a collaborative environment where all partners collectively work together
• Helps to filter and focus on all the valuable ideas, based on the research results
• Accelerates discovery process
• Ensures better transparency and visibility across the organization

Lessons Learned

• It is always important to get support from senior management in the organization on the way we approach disruptive technologies vs. already established technologies.
• For disruptive technologies, start using the approach to prototype to know if a solution works for addressing specific challenges before we proceed with a full investment.
• Test in small scale using chosen scenarios by inviting all the required participants (internal and external stakeholders) to jointly explore the potential of disruptive technologies.
• Radical collaboration between all relevant stakeholders is a must.
• An innovation governance process serves as a mechanism to help the organization provide a full visibility on all disruptive technology initiatives including every stage of the design process.
• Embed a culture of prototyping in the organization.
• Shift the mindset to show, don't tell.
• Display a bias toward action (focus more action-oriented then discussion-based to show if something works versus assuming something will work).

New Technology Development Process

For the new technology development process, the project management style should be different, as it requires more flexibility and agility. This process should focus on new technologies to be embedded into future new products but also to acquire knowledge.

Let me share with you some thoughts on this process.

Even if this process is flexible or agile to allow for creativity, you cannot let a team circle around for months or years knowing that you have limited resources and budget. You still must have some project management basics as, for example:

• Team charter with a clear scope and objectives for the project/activities
• As soon as you are going through a phase, you need to have an evaluation of time and budget needed to cover the next one
• Defined phases and deliverables
• Sponsors and signatories

You can have creativity, brainstorming, and so on during a phase, but at the end of the day, the team should know where to go and the desired end point. This has already been addressed, using design thinking in each phase where design thinking is necessary, while keeping in mind the original global goals and objectives of the project, as budget and resources are not unlimited, unfortunately.

This is where the project manager's role becomes important: Letting the team be creative but ensuring that the framework is well understood and managing the team within that framework. This is key for a project manager: the ability to drive the team within a defined framework to a defined goal but allowing for enough flexibility to “unchain” the team members.

We have encountered many situations where the project manager was following the defined process as is, without taking into account the situation or the personalities of the different team members. This is a recipe for failure. With this separate process, you then have the possibility of knowing exactly what the budget is you are investing in new technologies and potentially this budget may not be recoverable through future sales.

Product Development Process and Portfolio Management

One of the first steps in portfolio management activities a company must take is to build the definition of the innovation categories. Why? These definitions will be critical in order to implement portfolio management. Breakthrough innovations are at risk and you need to know how much money you want to be at risk.

A very reference is Harvard Business Review, “Managing your Innovation Portfolio,” by Bansi Nagji and Geoff Tuff (2012). In this paper, they describe how to build the definition for three innovation categories—breakthrough, incremental, and sustaining—based on two axes: through the customer's lens and through your internal capability's lens. This way, we can define the different categories in such a way that they can be used in all types of industries.

With these definitions, you can tag your projects in your company and then have additional information to manage your portfolio. Keep in mind that a complete disruptive technology can be embedded or hidden in an incremental product. This is what we see in the automotive industry, for instance: cars are incremental, but with new features and breakthrough technologies. This is why multiple processes are needed: to maintain an efficient innovation portfolio and for project management.

When you are developing a new product, you can run in parallel the multiple processes described above: the product development process and the new technology development process. This can happen when you identify the need for a breakthrough technology during the development of your product. This technology will be then embedded into the product.

It is quite a challenge to to run both activities through the same process and at the same time. The pace, the project management style, is not really the same for each. The project manager is responsible for driving decision making.

If the technology you are looking for is not part of your company's capabilities, you as project manager need to ensure that a clear decision is made by the sponsors whether to “make or buy.” This happened on one of our projects; we wanted to develop our own technology, and after several month of work, project management personnel pushed for a clear decision. Then a compromise was formed because similar technology had already been developed.

One of the key terms in all situations, and whatever the process used, is common sense. A project manager's key skill is to be able to adapt and to lead the team through complex situations. This is where we can recognize an efficient project manager.

Case Study

Some time ago, based on our strategy and customer needs, it was decided to start working on new technologies that would be able to quickly detect microorganisms in different matrices for a dedicated market. The choice had been made to develop these technologies within the company instead of forming partnerships. At that time, new technology choices and evaluation were in the hand of the R&D group. We had a clear process with defined milestones and R&D was the only signatory for each step. Scope was defined by R&D and the work started. The team's status reports stated that we were progressing well and after two years, results were shared with and approved by the head of R&D.

Then we started a project to develop a new product using this promising technology. Marketing confirmed the customers' needs, the different matrices to be used, and the conditions for product usage. During one of the first project meetings, the R&D team started to compare the work already done on the technology with the product features and requirements. There was no, or little match! The technology defined had been tested on some topics that were not relevant for the future products at all. As a result, the R&D team was frustrated by the loss of time and money:

• Question: How could the team have done better on this?
• Answer: Following a lesson-learned session on this project, it was decided to review our process to develop a new technology. We still had some defined phases, but we included the following improvement:
  • Marketing is now one of the signatories along with R&D for each stage.
  • We have included a specifications list defined by marketing as a support for R&D and to ensure that the work done will answer future market needs.
  • At the last stage of the process, a representative of the future team that will develop the new product will be part of the team meeting and stage gate review. During this meeting the focus will be on the features tested, results obtained, and expectations to ensure this new technology will answer our future needs.

First Phase: Acquiring Knowledge (2011–2012)

Until 2011, innovation at Repsol was focused on R&D activity. In 2011, the innovation program was launched in response to the strategic plan (2011–2014) about the quality control and knowledge management functions. The program was sponsored by upper management that decided to incorporate innovation as one of the corporate values since 2012. The main objective was to embed the innovation in our culture and day-to-day activities.

In addition, an organizational structure was created to support and encourage the innovation program. The corporate innovation unit, business innovation units, and the innovation committee were the organizational units in this structure. An innovation network was created including entrepreneurs, innovation teams, and facilitators.

Second Phase: Strengthening the Organization (2013–2015)

In 2013, the focus was to build the capacity for the organization. The first edition of the Facilitators Training Program was held to support continuous improvement processes with lean-based methodologies.

Besides that, a pilot within the chemical business started. This pilot is a successful case in our company and it has become the lean transformation program for this business and other businesses and corporate areas where it has been deployed according to their needs.

The aim was to promote a culture of innovation in 2014. The strategic innovation reflection (SIR) was held with the participation of all the innovation units generating a company model to add more value from innovation. Meanwhile, the first edition of the IN awards was launched with the participation of +5.000 employees and +500 initiatives. In 2014, the innovation network continued growing until around 75 innovation and improvement teams.

In 2015, some KPIs were defined and put in place to measure the impact of innovation. A global corporate program called “Go” started with the aim to generate innovative proposals in order to improve the EBITDA. In addition, business units deployed the innovation model through specific roadmaps to leverage their strategic plans.

Figure 5-17 shows actions put in place to support and encourage innovation from the innovation units in corporation and business areas.

Third Phase: Leverages for Transformation (2016–2018)

New Models of People and Organization Management: Agile Philosophy as the Engine of the Change

Some global initiatives foster a more flexible and efficient corporate environment, taking advantage of the new technologies:

• Development and implementation of policies and models to ensure that the culture of innovation is promoted
• Proposal of new ways of working to be implemented in the units depending on their own and global needs
• Promotion of continuous improvement projects in order to optimize processes (lean)
• Definition and proposition of the cultural change necessary to achieve a flexible and collaborative organization
• Development of leaders to ensure behaviors associated with innovation and entrepreneurship
• Recognition of entrepreneurs and innovation teams who develop initiatives
• Generation and development of capacity in the organization, both in project teams and units
• Surveillance, validation, and divulgation of new effective and replicable approaches with high potential impact in order to respond to the problems and opportunities of the businesses

The result, as shown in Figure 5-18, is a cultural transformation based on innovation and new ways of working that have provided Repsol some important leverages of this transformation toward becoming a lean company.