Why Do Strategic Projects Fail

By Sougata Ray, Sasanka Chanda

DOI

http://dx.doi.org/10.2139/ssrn.3836325

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Citation

Ray, Sougata., Chanda, Sasanka. Why Do Strategic Projects Fail http://dx.doi.org/10.2139/ssrn.3836325.

Abstract

There is no dearth of literature inquiring into the reasons for failure of strategic projects—major organization change efforts involving significant, irreversible commitment of resources. However, researchers have failed to go beyond blaming company managers, for example by observing that managers function in silos, protect own turf to the detriment of the project and escalate commitment to failing courses. Yet, in other situations, the same managers obtain excellent organizational outcomes. Thus, there is a need for inquiring into more distal causes of failure embedded in micro-level organizational arrangements. We study the failure of a strategic project by Burawoy’s extended case method. This approach applies reflexive science to ethnography to extract the general from the particular, facilitating a move from the micro to the macro level. We find that administrative tenets drawing from dominant management orthodoxies—setting direction and settling issues by fiat, rigorously metering accomplishment of organizational members to goals committed to ahead of time, and swift punishment upon deviation from commitments—give rise to dysfunctions that lead to failure of a strategic project. We offer practical advice to managers to help lower the risk of failure of a strategic project. We suggest that, in order to foster the level of coordination necessary in an organization-wide change project, it is necessary that internal and external stakeholders provide reassurance there shall be no sanctions when project goals morph over time as the organization progresses on the execution path through trial-and-error learning. Specifically, relaxation of near-term performance expectations is necessary.

Sougata Ray is a Professor of Strategy and Entrepreneurship (Practice), Thomas Schmidheiny Chair Professor, and Executive Director of the Thomas Schmidheiny Centre for Family Enterprise, at the Indian School of Business (ISB). Earlier, he served at the Indian Institute of Management Calcutta for over two decades as a Professor of Strategic Management, a member of the Board of Governors, and Dean. He was also a senior-level executive at Infosys Technologies Limited for two years in a strategic role as Head of innovation Lab. He is an alumnus of Indian Institute of Management, Ahmedabad and the Indian Institute of Engineering, Science and Technology, Shibpur.

Professor Ray’s research interests have evolved over the years in understanding various facets of strategic management, entrepreneurship, innovation and the governance of firms and business groups in high-growth economies. Given the ubiquity of family firms in India and observing how family owners and leaders play a pivotal role in shaping the future of enterprises, he was gradually drawn into family business research. In recent years, under the aegis of the Thomas Schmidheiny Centre for Family Enterprise, he has been spearheading a mega programme towards developing a solid research-based understanding of family firms and business groups in India and South Asia. He has also been leading a research programme in the areas of social entrepreneurship, corporate sustainability strategy and practices, bottom-of-the-pyramid initiatives, and involvement of corporations in inclusive and sustainable development.

Professor Ray is one of the most prolific and cited home-grown strategy scholars in India. He has been publishing regularly in reputed scholarly journals and presenting in leading peer-reviewed international conferences. He has received over half a million dollars in research grants, several prestigious research and teaching awards, and numerous award nominations.

He blends over three decades of experiences in diverse roles – as an international-quality academic, research, and institution builder, alongside hands-on corporate managerial and governance roles as an executive, member of the Board of Directors, and co-founder of startups.. He has been an advisor to numerous medium and large corporations, family businesses, and startups, and he has served as Principal Consultant to leading international development agencies. He currently sits on the governing and advisory boards of several listed and unlisted companies, startups, and social enterprises.

Professor Ray has taught in numerous executive education programmes and has designed and conducted many workshops exclusively for owner-managers, entrepreneurs, and C-level executives of companies in India, Asia, Middle East, Nordic and Scandinavian countries. Over the years, he has led over thirty C- level executive delegations to countries on every continent for high-level meetings with the ministers, high-ranking officials, multilateral agencies such as the WTO and ILO, Chambers of Commerce, MNCs, industrial organisations, research labs, and academic institutions.

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