Building the Professional of 2020: An Approach to Business Change Process Integration (

Building the Professional of 2020: An
A h t B i ChApproach to Business Change
Process Integration
Change Risk Assessment Model: Results Discussion & AnalysisChange Risk Assessment Model: Results Discussion & Analysis
Harris Apostolopoulos BEng(Hons), MSc, MBA, PhDc
City University London 31 May 2013

CRAM (Change Risk Assessment Model) is a novel model
About
CRAM (Change Risk Assessment Model) is a novel model
approach which can significantly contribute to the missing formality
of business models especially in the change(s) risk assessment
area.
Project Management has long established the need for risk
management techniques to be utilised in the succinct definition of
associated risks in projects and agreement on countervailingassociated risks in projects and agreement on countervailing
actions as an aim to reduce scope creep, increase the probability
of on-time and in-budget delivery.
U t ll d h dl f i d l itUncontrolled changes, regardless of size and complexity, can
certainly pose as risks, of any magnitude, to projects and affect
project success or even an organisation’s coherence.

CCRAM’s Processes
• CRAM is composed of three interrelated processes (steps) which are continually
recorded and monitored. CRAM’s processes accomplish specific risk objectives
(identification, assessment, monitor & control) which are applied to projects or at a
greater extend to business environments with a view to facilitate and control change.
Risk IdentificationRisk Identification
Risk Monitoring &
Control
Risk Assessment
Figure 1: CRAM’s Triple Processes

CCRAM’s Hierarchy
• CRAM hierarchical tree consists of one
(1) core (root) node, eight (8) parent
nodes, five (5) child nodes and its
respective sixty one (61) attributes Forrespective sixty-one (61) attributes. For
example, ‘Communication’ parent node
consists of seven (7) risk attributes
(sub-factors).
• Depending on the scope and
deliverables of a project, CRAM’s
nodes and related risk attributes
hierarchy per level can change so as to
accommodate more of fewer criteria.
Figure 2: CRAM’s Hierarchy Tree

CCRAM’s web page
http://www.changemodel.net

A dAgenda
Significance11
22 CRAM Overview22
33 Analysis of ResultsAnalysis of Results
44 Open Discussion
55 Summary

Analytical Hierarchy Process (AHP)
• Analytic Hierarchy Process (AHP) is an established and structured hierarchical pairwise• Analytic Hierarchy Process (AHP) is an established and structured hierarchical pairwise
process for making complex decisions that helps users sort out the "best" decision for
their challenge.
• Sets priorities being a systematic method for comparing a list of objectives leading to a• Sets priorities being a systematic method for comparing a list of objectives leading to a
decision; utilising pairwise comparisons; eigenvalues and eigenvector.

Weighting Scale
• In order to able to quantify the respondents replies a relative weights mapping scale is• In order to able to quantify the respondents replies, a relative weights mapping scale is
used, for example:

Weighting Scale (cont.)
• A typical pair wise comparison matrix is seen below (diagonal is always completed by• A typical pair wise comparison matrix is seen below (diagonal is always completed by
1’s):
• When comparing the elements together the smaller one to be compared is consideredWhen comparing the elements together, the smaller one to be compared is considered
to be the unit and the larger one is assessed to be so many times more than that it,
using the intensity of feeling and translating it to the numerical value.

Weighting Scale (cont.)
A t i l i i i t i i b l (di l i l l t d b• A typical pair wise comparison matrix is seen below (diagonal is always completed by
1’s):
• When comparing the elements together, the smaller one to be compared is considered
to be the unit and the larger one is assessed to be so many times more than that it,
using the intensity of feeling and translating it to the numerical value.

AHP Calculations
1 Let Aij equals the intensity of relative importance between criterion i and criterion j1. Let Aij equals the intensity of relative importance between criterion i and criterion j ,
as defined in previous with:
2. Compute , the sum of each column of A
3 Normalize A by dividing each element Aij in the comparison matrix A by Aj3. Normalize A by dividing each element Aij in the comparison matrix A by Aj
4. Compute the weight of criterion i
Step 3 :(normalisation), actually permits meaningful comparison among elements.
Step4:yields the percentage of overall relative priorities, or preferences. or preferences).

AHP Calculations Example
The numbers in the table represent the relative importance between the criteria ForThe numbers in the table represent the relative importance between the criteria. For
instance, the relative importance of criterion.
For example: the relative importance of criterion 1 versus criterion 3 is 5 and between
criterion 3 and criterion 1 it is 1/5. This indicates that criterion 1 is strongly important
compared with criterion3 The numbers in the weights column show the relative weightscompared with criterion3. The numbers in the weights column show the relative weights
of the corresponding criteria.
To evaluate the credibility of the estimated weights, Saaty (1980, 1983) proposed an
eigenvector which is considered a theoretically and practically proven methodeigenvector which is considered a theoretically and practically proven method
for evaluating the credibility of the weights.

Credibility of Weights – Eigenvectors
1 Calculate the maximum eigenvalue λ of the pair-wise comparison matrix A;1. Calculate the maximum eigenvalue λmax of the pair-wise comparison matrix A;
After computing the nth root of the products of the values in each row, λmax can be found
as follows. The priority vector is the nth root divided by the sum of the nth root values.
λmax = Sum of Priority Row
Priority Row = (sum of the row value) x Priority vector
2. Compute the consistency index (C.I.) defined by Saaty as:
If a matrix [A] which represents the pairwise comparisons elements is absolutely
consistent then it should be equal to the the matrix which denotes the ratios of theconsistent, then it should be equal to the the matrix which denotes the ratios of the
weights matrix [W].
In effect if A = W , then λmax = n
The weights (w1...n) which can be obtained by using the eigenvectors, should
be positive and normalized, in effect satisfy the reciprocity property.

Credibility of Weights – Eigenvectors (cont.)
N id d th t th i b l t i t th λ i ff t thi l l fNow, provided that there is no absolute consistency then, λmax > n, in effect this level of
inconsistency has to be measured. For this reason Saaty, defined the consistency ratio
(CR).
3 C l l t th i t ti (C R )3. Calculate the consistency ratio (C.R.)
C R = C. I/R.I
h th d i d (R I ) f diff t b bt i d fwhere the random index (R.I.) for different n can be obtained from:

Random Index (RI)
Random Index (RI) is the average of (CI) for random matrices using the Saaty scaleRandom Index (RI) is the average of (CI) for random matrices using the Saaty scale.
500 random reciprocal n x n matrices were generated for n = 3 to n = 15 using the 1 to 9
scale. CR in a sense is normalised as a value as it is divided by the arithmetic mean of
random consistency indexes (RI)random consistency indexes (RI).

Consistency Ratio (CR)
After a lot of experiments Alonso & Lamata (2006) concluded to the following calculationAfter a lot of experiments Alonso & Lamata (2006) concluded to the following calculation
of consistency ratio (CR) as better results can be obtained:
The maximum eigenvalue, based on Saaty, can be determined by raising each random
matrix to increasing powers and normalizing the result until the process converged. The
consistency index was then computed on each matrix for n = 1 through n = 15consistency index was then computed on each matrix for n = 1 through n = 15.
As a rule of thumb, a value of C.R. ≤ 0.1 is typically considered acceptable.
In other word inconsistency is permitted in AHP as long as it does not exceed the ratio ofIn other word inconsistency is permitted in AHP as long as it does not exceed the ratio of
0.1. Nevertheless, AHP is flexible enough that can trace the inconsistent elements and
reform the matrix where required; taking into account that changes in the hierarchy or
judgements may lead to changes in the outcome.
If CR equals 0 then that means that the judgments are perfectly consistent..

Further Examples (Consolidated)
k = 3 (number of participants)k = 3 (number of participants)
n = 3 (number of criteria), with respective pairwise values as seen below:

Further Examples (cont.)
For the consolidated matrix taking as an example the pairwise comparison of nFor the consolidated matrix, taking as an example the pairwise comparison of n1,2
(shaded light gray) then:
All remaining elements of the consolidated matrix as calculated with the use of geometric
mean formula.
So:So:

Respondent’s Background
Figure 3: PM Methodology Use
Figure 4: PM Experience

( )Respondent’s Background (cont.)
Figure 5: PM Team Members
Figure 6: Current Industry

• Leadership: Project success is accounted in many ways to strong leadership and commitment to
Leadership
• Leadership: Project success is accounted in many ways to strong leadership and commitment to
project scope and objectives. Active leadership remains important throughout the entire project
lifecycle, with the application of skills and determinacy to succeed. Therefore, efficient resource
management is necessary to complete each task in its predefined priority. Senior management’s
accountability is key to effective decision making in the context of ‘firm but fair’ handling, to inspire
and lead the project team in achieving high performance levels and overall high adaptation rate to
proposed and authorised changes.
Figure 7: Leadership's Risk Attributes Process

C
• Communication: Refers to the exchange of ideas or information among stakeholders e g project
Communication
• Communication: Refers to the exchange of ideas or information among stakeholders e.g. project
manager, team members, board of directors, which are related to change and associated risks.
The more complex the organisational structure or the proposed changes, the more communication
channels have to be engaged. Effective communication is a bi-directional activity which has to be
controlled and monitored. Communication is an important business environment factor
incorporating cultural values) as project’s success is highly dependent on communication.
Figure 8: Communication's Risk Attributes

C
• Culture: Collection (but not limited to) of beliefs attitudes core values ways of acting and
Culture
• Culture: Collection (but not limited to) of beliefs, attitudes, core values, ways of acting and
thinking shared among members or organisations. Culture can impact the way of business
conduction, decision making process, communication attitude and in effect influence project
success. A supportive, knowledge sharing organisational culture can be enough ‘risk taking’ so as
to match complicated project’s scope and objectives with success. A risk averse business culture
might be problematic against accepting proposed changes which in turn, might cause problems to
over decision making, communication and leadership of the project.
Figure 9: Culture's Risk Attributes

• Resistance: Change is a time consuming (transitional) and risky process often resisted by
Resistance
• Resistance: Change is a time consuming (transitional) and risky process, often resisted by
employees. If changes are not communicated in the right way, then team members might feel
threatened and undervalued. Because change actually ‘changes’ the way things used to operate
in projects, resistance is frequently observed as a phenomenon which might jeopardise project’s
success. Feeling anxious which is associated to anticipated changes is more or less normal,
nevertheless the project processes have to run as planned.
Figure 10: Resistance's Risk Attributes

• Requirements: Conditions often dictated by the project’s user which the deliverables
Requirements
• Requirements: Conditions often dictated by the project s user which the deliverables
of the project should meet. Any non conformance to customer’s requirements may
lead to partially or full unacceptance of the project’s deliverables. Change
requirements have to be documented and closely monitored from start till end of the
projectproject.
Figure 11: Requirement's Risk Attributes

(
Monitoring
• Monitoring: The change process monitoring should be continuous (but have an end
at some point), involving benchmarking, milestones establishment, Key Performance
Indicators (KPIs) and proper feedback. The end at some point, may become
unnecessary for a reason e.g. if the change becomes obsolete and does not serve
any purpose anymore.
Figure 12: Monitoring's Risk Attributes

/
• Flexibility (Adaptation): Refers to the ability to affect changes and to the level which are
Flexibility / Adaptation
• Flexibility (Adaptation): Refers to the ability to affect changes, and to the level which are
adaptable to the project scope. Flexibility is also related to the level of quick response to change.
For example, there are cases where time is limited and quick decision making is required. Since
not all organisations are adaptable to changes the responsiveness to change is an overall added
value. Changes process flexibility results from ability to embed changes in project management
policies and procedures; sometimes proactively in response to anticipated changes in the project
life cycle.
Figure 13: Flexibility's Risk Attributes

• Project Management Team (PMT): Project team members who are directly involved
Project Management Team
• Project Management Team (PMT): Project team members who are directly involved
in project management activities, processes and in effect ‘execute’ the project within
defined scope and objectives.
Figure 14: PMT’s Risk Attributes

f
Performance: Based on the achievement of preset metrics such as KPI’s (Key
Performance
• Performance: Based on the achievement of preset metrics such as KPI’s (Key
Performance Indicators), Balanced Score Cards, KSFs, (Key Success Factors), 360,
SLAs (Service Level Agreements); assessing measurement and trends to effect
processes improvement and goals.
Figure 15: Performance’s Risk Attributes

• Motivation: Motivation can inspire and encourage individuals (create value) or
Motivation
• Motivation: Motivation can inspire and encourage individuals (create value) or
groups of people who constitute the project management team to cope with the
changes strategy and increase their overall performance. If motivation is weak then
this might have serious effects on the project constraints which consequently might
lead to project failure Effectively motivation can be seen also as a driver forlead to project failure. Effectively, motivation can be seen also as a driver for
successful project management.
Figure 16: Motivation’s Risk Attributes

• Appraisal: Assessing the performance of employees against agreed change targets
Appraisal
• Appraisal: Assessing the performance of employees against agreed change targets
and consequently to project’s deliverables. Appraisals are better conducted on a
systematic, periodic basis. In such a way individual’s job performance and
productivity will be assessed in relation to certain pre-established criteria and
organisational project change objectivesorganisational project change objectives.
Figure 17: Appraisal’s Risk Attributes

• Rewards: Tangible and/or intangible benefits given or received in recompense for worthy
Rewards
• Rewards: Tangible and/or intangible benefits given or received in recompense for worthy
behaviour, for example after the successful result of change/s have been acknowledged. In many
cases rewards may lead to internal team member’s competition which up to a point may be
considered healthy. People who will place change effort on their priorities list, and especially those
who will succeed change goals can be rewarded with benefits. The reward, if any, should not be
an incentive for competition among team members rather than for effective cooperation and goals
and performance accomplishments.
Figure 18: Reward’s Risk Attributes

• Training: Training can be regarded as the acquisition of knowledge skills and competencies as a
Training
• Training: Training can be regarded as the acquisition of knowledge, skills, and competencies as a
result of teaching and course taking. Irrespective of contemporary project management
framework followed, change management training, can be seen as an overall advantage (value)
since the knowledge gained is not only specific but necessary to identify, plan and validate
changes, tackle risks in a structured and documented manner.
Figure 19: Training’s Risk Attributes

C O
• Successful Change Management: Change management mostly observed and
Change Risk Overall Assessment
• Successful Change Management: Change management mostly observed and
utilised as an integrated process within project management, is a rational process for
exploring decision and behaviour alternatives in an attempt to realign the course of
“derailed” deliverables due to change and ensure project success.
Figure 20: Change Risk Attributes

S
Depending on the scope and deliverables of a project, CRAM’s nodes and related risk attributes hierarchy per level can be changed so as to accomm
CRAM as a novel model approach has the capacity to define the internal dynamics of change management within
project management eliciting also risk cause-and-effect relationships.
Summary
11
Depending on the scope and deliverables of a project, CRAM’s nodes and related risk attributes hierarchy
per level can be changed so as to accommodate more of fewer criteria.
Depending on the scope and deliverables of a project, CRAM’s nodes and related risk attributes hierarchy
per level can be changed so as to accommodate more of fewer criteria.
project management eliciting also risk cause and effect relationships.11
22
A functional hierarchy is constructed so as to decompose the complex system in smaller criteria or attributes in a
logical and simpler way.
CRAM allows users to describe a problem as they see it, refine the complexity and structure a hierarchy of attributes.CRAM allows users to describe a problem as they see it, refine the complexity and structure a hierarchy of attributes.33
44
The only restriction on the hierarchic arrangement of elements is that any element in one level must be capable ofThe only restriction on the hierarchic arrangement of elements is that any element in one level must be capable of
g p y
A hierarchical ‘tree like’ graphical model representation can be easily interpreted being capable of representing
probabilistic relationships among a set of variables and associated attributes,55
Can be applied to variety of industries / projects irrespective of size and complexity.Can be applied to variety of industries / projects irrespective of size and complexity.
y g y
being related to some elements in the next higher level, which serves as a criterion for assessing the relative impact
of elements in the level below.
.
y g y
being related to some elements in the next higher level, which serves as a criterion for assessing the relative impact
of elements in the level below.
.
66
77

“I do not believe you can do today’s job with
yesterday’s methods and be in business tomorrow”
Nelson Jackson
Building the Professional of 2020: An Approach toBuilding the Professional of 2020: An Approach to
Business Change Process Integration
Thank You!
Questions?
info@changemodel.net
harris.apstolopoulos@gmail.com
Research conducted at City University London

Building the Professional of 2020: An Approach to Business Change Process Integration (

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