"Red" Should Not Be Bad: February 2023

When I was a partner at a large consulting firm, one of my responsibilities was to regularly review project status reports submitted by the managers of client engagements for which I was accountable.?Like many consulting firms, we used a traffic light system of red, yellow, and green status across a range of performance criteria.?Status reports were usually created weekly, and reviewed with the project teams and clients.

In addition, several times each year I would be the assigned Quality Assurance (QA) partner on other partners’ engagements, to provide an independent assessment of project performance and client satisfaction.

In performing these reviews, one of the cultural beliefs that I tried very hard to foster was that a red score on one or two status criteria was not a bad thing, but a very good thing.?Yes, green is supposed to be good, and red is supposed to be bad.?But too often that “red is bad” approach resulted in project managers and team members being terrified to report anything other than green, lest they be exposed to criticism and retribution.?Troubles were swept under the carpet rather than being properly addressed and mitigated when they were still small and easy to fix.?In the non-politically correct words of one of my more outspoken clients, everything was always “fine” right up to the point when it was “f-*$&’d”.?Status reports, rather than being a useful tool for measuring project health, were too often a useless misrepresentation.

So, how can consulting leaders, project managers, and team members create a better culture to enable more effective status reporting??Here are three suggestions.

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1.??????Something should always be “red”

Especially when project status criteria are subjective, there has to be something on the project that is the lowest performing measure when compared to all the others.?No project is ever 100% awesome, 100% of the time.?Even when things are going well overall, something somewhere is the worst.

As a result, project leaders and project managers should create a culture where every status report has at least one measure that is evaluated as “red”.?The red score might really reflect a problem, or it might simply be that the measure is the worst-good.?Either way, that measure should be the thing on which leadership and project management focuses incrementally more attention.?

This is not to say that we should have a doom and gloom attitude of always finding fault with something.?Rather, the attitude should be that things are never perfect, and nobody ever expects that they will ever be perfect.?So, what should we pay just a little bit more attention to this week, to make sure it doesn’t become a bigger problem next week or next month??

As a leader, instruct your PMs to always have at least one thing that is scored as red.?When the status report also goes to the client, make sure to talk with them beforehand to explain this reporting approach, so that they do not become unduly alarmed by red scores.

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2.??????Use objective numerical criteria to determine red, yellow, and green ratings

Criteria that are subjective are, by definition, exposed to the shifting opinions of the consulting project team.?What might be considered green by someone might be considered red by someone else.?Or even the same person might think a measure is green in the early days of the project, when there’s months left to go, but red in the final days when a deadline is looming.

So, it is usually better to use objective, numerical criteria to determine traffic light ratings.?This takes the opinion and human perception out of the equation and replaces it with pre-agreed specific numbers.?For example, instead of a criterion of “missed deadlines”, assign specific numbers of missed project milestones to the traffic light colours, like green 0-2 milestones overdue, yellow 3-4, and red 5 or more.?Instead of “client satisfaction”, have the traffic lights refer to specific scores on a periodic client survey.

As the project evolves, the client and team can agree to change the numerical criteria as necessary.?For example, maybe a much smaller number of unfixed bugs is needed in the final days before a new piece of software is released to production in order for a green rating to apply.?Just be careful that you don’t change rating criteria in order to cover up problems.?What was a “red” rating last week shouldn’t magically become “green” this week just by lowering the performance standard bar.

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3.??????Red should be seen as a trigger for providing help, not a penalty

Too many PMs and team members fear that a red status rating is an indication and admission of failure.?Too many have seen the resulting reactions from their leaders and consulting firms be dominated by shouting, retributions, and career-impacting adverse performance ratings.

Now, I won’t argue that these consequences weren’t sometimes deserved.?But more often, I observed that the first reaction to a red status rating was “Who screwed up?”?I have been part of too many failed-project reviews where the status reports were consistently green right up to the week before the client filed a formal complaint.?Clearly, there is too often a culture of hiding problems rather than reporting them.

At the beginning of every project, a consulting leader should set expectations with their PM that you will not penalise them for red status ratings.?Say that you expect things to sometimes go wrong, that you expect the things that go wrong will be accurately and promptly reported, and that you expect that you and the PM will work together collaboratively to fix things.?Fixes might include additional resource, additional expertise, negotiations for changed deadlines, whatever is needed.?The PM has to do the same with all the team members so that the weekly status reports are a true indicator of the health of the project.

Status reports must serve to help fix the problem, not to affix the blame.

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Conclusion

The dog in the title photograph of this article is “Red Dog”, a kelpie/cattle cross who was famous in the Pilbara mining region of Western Australia.??A statue of him is located in the town of Dampier, and a movie was released in 2011 documenting his adventures and exploits.??Red Dog was an exceptionally good dog.

Nobody ever thought that Red Dog needed to be Green Dog in order to be good.?Similarly, a red rating on a consulting status report should not be instinctively regarded as bad.?Rather, a red rating should be welcomed as a way of identifying problems in the early days, before the problem causes a catastrophic project failure.?Senior leaders and QA partners should set an expectation that something, somewhere, on the project should always be “red” relative to everything else going on in the project.?Performance criteria should be objective and numerical in order to take opinion out of the rating.?Leaders should also make clear that red scores will result in assistance and additional resource, not penalties and reprisals.?

Projects must not be “fine until they’re f-*$&’d”.

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Did you like this article??What things have you learned about being a better consultant??Contact me at [email protected].

Scott Frederick is Managing Director of Barkley Services, providing short term or part-time consulting services in business analytics, sales and marketing, business strategy and planning, change management, and process automation and outsourcing.?Prior to starting Barkley Services, Scott was a Partner at Accenture and IBM Global Business Services.?Scott is based in Brisbane Australia and has over 30 years’ experience in management consulting.