Telecom Leader Dials Up a Winning Strategy

A manufacturer turned to Smart Simplicity to foster internal cooperation and speed up product innovation.

A telecom-system manufacturer was taking more than 30 months to develop each new release of its network hardware and software. The industry benchmark was 20 months. The delays had wide-ranging consequences. The company’s profit margins and market share were in decline—and to catch up after the delays, quality tests were skipped. Something had to change, but they didn't know what.

A FOUR-STEP APPROACH FOR SUCCESS

The company called in BCG to help it address the systemic problems. BCG applied the four-step Smart Simplicity approach.

  1. Smart Start: What are the problems caused by complicatedness that must be solved? Interviews with senior management and other important stakeholders were conducted to bring everyone into alignment on the critical performance issues. Management surveyed the three engineering groups assigned to the project and the project managers. They discovered that only one of the engineering groups was meeting its deadlines. They also learned that there was resentment among the engineers, particularly toward the high-performing group. Yet no group members had strong feelings about the project manager positions one way or the other.
  2. Diagnosis: What are the root causes of complicatedness? Deep-dive organizational interviews focused on stakeholders and their relevant behaviors. The goal was to understand why people behaved as they did given their goals, resources, and constraints. The real heart of the performance problem—ironically—was the high-performing group. The other engineering groups had to struggle to incorporate customer feedback into their new designs. The high-performing group was responsible for a component governed by international standards, so it didn’t have to change much. This meant it was able to deliver on time. As a result, the other engineers had to do even more work: they had to make additional changes to accommodate and integrate with the only component that was already finished.
  3. Solution Design: What are the targeted interventions to reduce complicatedness and address the root causes of the performance issues? BCG designed a plan for the company to eliminate the project manager positions, observing that they did not wield power over the program. After this cut, they suggested that the company make the high-performing engineering group accountable for delays, not only in their component but also throughout the entire system.
  4. Implementation: How do you implement the solution, make it sustainable, and ensure constant improvement? The company carried out BCG's plan. Within the new structure, the high performers had to attend long meetings with angry customers—and come up with ways to cooperate more effectively with the other engineers. They became the integrators. After 15 months, the company was beating industry benchmarks for speed-to-market by 20%, while matching competitors on cost and quality. No delays were passed from one release to the next.

The company gained a 20% time-to-market advantage over competitors in 15 months.

THE CRUCIAL ROLE OF INTEGRATORS

An effective integrator has both an interest in making others cooperate and the power to impel them to do so.

Here’s how to identify integrators:

  • They love or hate their job. This means they are at a nexus where constraints and requirements meet.
  • They are loved or hated by others. This shows they have their hands on the levers of cooperation and are using this power to their own advantage.
  • They are never met with indifference. Indifference is a sign that people have no power to “force the issue” and impel cooperation.
  • They are at the center of tension. Tension in this case can be a good thing. It might mean that people are doing the hard work of cooperating. A lack of tension can mean that people are avoiding cooperation.

Here's how to turn managers into integrators:

  • Remove managerial positions that don’t incentivize people to cooperate.
  • Minimize rules. Too many rules keep managers from exercising judgment.
  • Rely on judgment over metrics. Cooperation cannot be measured directly—it’s impossible to say who contributes what. Turn managers into integrators by relying on their judgment instead of pseudo-precise metrics.
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