Areas of influence in the diagnosis of a scenario or marketplace

15 May 2017

The 90% of unsuccessful projects fail due to an inadequate diagnosis of the starting point, the scenario on which to act, or the marketplace to enter or interact with. Allow me to emphasise that point again: 90% of cases. The rush, a lack of humility (we think we already understand the scenario or the market) and a tendency to pay more attention to prejudices than our conscience —which tells us we should make more effort to accurately diagnose the starting point— lead us, in many cases, to design projects that are based on rumour, assumptions or hunches; to fail to properly gauge the objectives and scales of the project indicators; to devise plans that will never be fulfilled; or to draw up budgets which will undoubtedly be exceeded.

All of this can be caused by poor diagnoses. How can I hope to design a good project proposal or develop an idea appropriately if I do not have all the information I need about the scenario it is being created for? Also, how can I hope to achieve the targets within their ranges if I am completely unaware of how difficult it is to achieve what I am trying to achieve? And lastly, how can I hope to design a plan and a budget that are realistic if I am unaware of the reality (even if this lack of awareness is only partial)? It is impossible; simply impossible. Yet many projects that are undertaken show obvious signs of misdiagnosis and a lack of understanding of the scenario or the marketplace.

There are many methodologies, tools and methods that can help us to make our diagnosis much more accurate and useful: SWOT, Problem Tree, Actors Map, Analysis of the Participants, Sociogram, Ishikawa Diagram, etc. But none of them will be of any use if we don’t have any raw material to feed them. And what, you may ask, is this raw material? What is it made of? It is made of data, an essential first step when conducting any thorough analysis or accurate diagnosis. A wide range of possibilities can be found here too: a specific bibliography, interviews, surveys, focus groups, statistics from various sources, etc.

But let’s assume for a moment that we already know all of this, that we are already familiar with and know how to use all of these tools, both those aimed at information gathering and those used for analysis. Even if this is the case, we are still missing something important: a guide to which fields of knowledge we need to analyse.

The first thing we need to do is correctly identify three major areas in which we will search for information, and then analyse said information to establish an accurate diagnosis. These three areas are the Internal, External and Context areas. Let’s review them separately.

Internal Area

This area contains all the aspects that are relevant to our project and are under our control. Most of the time, this means everything that falls within the limits of our organisation. Since this is where these aspects are framed, within the scope of our organisation, it can be assumed that we have a high degree of control and the capacity to change them. To be more specific, we are referring to aspects like our resources, the way we work, our experience, our facilities, our contacts, our finances, etc. We have the capacity to control and change all these things.

External Area

There are also a series of factors that are outside of our control, but with which we must still interact. Outside of the boundaries of our organisation is where our clients or potential clients, banks, suppliers, etc. can be found. We interact with them all in one way or another. We can’t control them, but we can exert a certain degree of influence over them, in the same way they can influence us. For example, whatever we decide with regard to a product or service will affect our clients, but in turn, if our clients change their shopping habits that will have an impact on us. Within this External Area, it is important that we do not forget any important agents that we have relationships with so that nothing relevant is left out of our analysis.

Context Area

Lastly, we also need to search for information and establish a diagnosis of the “macro” factors that determine the rules of the scenario we are in or wish to enter. These aspects include legislation, the political environment, society, technology, the economic climate, etc. They are all factors over which we have absolutely no control. But they do exert a powerful influence over us, because they establish the rules of the game. Technology is what it is nowadays, and this can either limit us or provide us with new opportunities, but we can’t change it. The law is also what it is, and we can be forced to comply with it or, perhaps, find a loophole we can use to our advantage, but we can’t change it. And the same applies to every other case.

Overview

These are the three areas. The boundaries between them must be very clear, but it must be even clearer that we cannot produce an accurate diagnosis if we do not include all three areas, both separately and together. At the same time, we need to be aware of our strengths and weaknesses, pay attention to the external factors that affect us, and monitore aspects of the context we are working in that determine the boundaries of the game. Furthermore, we need to triangulate and combine all the information we obtain from all the areas so we can see how they interact with each other. For instance, how an internal strength works with a technological factor, and, at the same time, with our clients. Or correctly diagnosing the relationship between a specific weakness we have detected in our organisation with the relationship we have with our banks in the context of an economic recession.

It is often said that data come first. Data are gathered, they are cold, and do not convey anything.

These data are then selected and read so they can be turned into information, which then communicates something and allows us to move on to the next step…

… Which happens to be analysis, or diagnosis, to transform the information into knowledge. Because it is knowledge that allows us to make good decisions, formulate suitable and effective proposals, plan correctly, design realistic budgets.

So remember: data becomes information, and information becomes knowledge. It is only by diligently following this entire process that you can improve the reliability of your projects and, therefore, the likelihood that they will help you to achieve the goals that made you take the leap in the first place.

Marc Ambit – Consultant and teacher at TBS Barcelona Campus

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