HS2: A Symptom of Multiple Causes

In this guest article, Frank Devine, culture change expert and author of ‘Rapid Mass Engagement: Driving Continuous Improvement through Employee Culture Creation’, takes a closer look at the scrapping of the second phase of HS2 and the leadership lessons that can be learned from this event.

One of the co-writers of Yes Prime Minister had been a senior civil servant. He knew where the bodies were buried. In one episode a bemused Prime Minister asked if the main security threat to the UK was from the North, i.e. The Soviet Union, why were all the senior decision-makers based in London?

The PM rebutted Sir Humphrey’s initial lame justifications, leading his top Civil Servant to reach for the nuclear button and declare, and I paraphrase: “You can’t expect them to send their children to schools in the North!’, Why, they would even miss Wimbledon, Henley and Ascot!”

This narrow, personal-experience bias around decision-making is a common charge faced by politicians. But whilst it’s tempting to reach for what could be seen as the most obvious cause, the reality is often far more complex – something that many business leaders will be all too aware of in their own experiences of project management.

Whichever side of the argument around HS2 you sit on, there are leadership lessons to be gleaned from the failure to deliver this landmark project. Let’s look at other, less visible organisational issues and dig deeper into what we can learn from this.

1. ‘Rubbish in; rubbish out’ estimating

The promotors of big prestigious schemes such as HS2 know that a cost-benefit analysis is needed. The key issue is who does the calculations of the costs and the benefits. The ’best’ result for those promoting the scheme are to select those who will minimise costs and maximise benefits.

HS2 estimates that ignored the so-called ‘ground conditions’ guaranteed an unreliable and low-ball cost estimate. Could you imagine any competitive business ignoring the actual conditions on the ground before building a new facility or office-space? If leaders want scientifically robust outcomes, they must insist on scientifically robust inputs.

2. Hiding behind systemic issues

When faced with clear performance issues, some leaders find it easier to blame ‘systemic issues’ than to manage performance robustly yet fairly. There are systems issues and often they overpower the significance of individual accountability, but this is not always the case. Be sceptical of any explanation that lazily attributes ‘systemic’ anything as the cause of complex multi-causal issues.

3. Leadership approach

Leadership development is frequently delivered as a series of over-academic, insufficiently skill-based, and over-theoretical interventions. Why do we tolerate leadership interventions that absorb the precious time of leaders while adding little practical, skills-based, value? Doing so leads to a skills gap in improvement science (Lean; Six Sigma; Agile etc.) and a failure to deploy behavioural data to predict and prevent issues.

Such leadership skills gaps highly correlate with poor cost-control, failures of accountability and scope creep. In addition, top-down initiatives frequently are perceived by employees as ‘just another management initiative’ and thus fail to engage and enable employees. Generally, leadership as a system, rooted as it is in skill acquisition and improvement science, will always outperform isolated, and unsustainable leadership interventions.

4. Sunken cost fallacy, avoidance of accountability and fear of admitting mistakes

Big investment sponsors and supporters know it is embarrassing to call a halt once a major project has started. This is the sunken cost fallacy, the idea that ‘we have spent so much, we have to continue’.

The decision to halt the second stage of HS2 was an unusual one that did not accept sunken cost or political embarrassment as reasons to continue. The calculation was that the opportunity cost of continuing with HS2 was not improving hundreds of local transport links, that it was a better value to help many more people get to work, to hospital, etc. than condemn them to watch a high-speed train fly past their windows.

Whilst the decision has its pros and cons and arguably should have been made far sooner, it’s an important reminder that leaders need to embrace being accountable for their decisions, however unpopular, and be willing to admit mistakes.

5. Lack of cognitive diversity

Rail infrastructure, like other sectors, recruits from people with sector-specific experience. This sector was previously a public sector monopoly (British Rail) and, given the highly specialised nature of the work, remains dominated by people with limited experience outside of the railways.

Creating cognitive diversity by the infusion of leaders with proven track records in globally competitive markets would increase commercial capability, act as a bulwark against groupthink and increase diversity generally, not only cognitive diversity. Leaders in other sectors also need to find the sweet spot between crucial sector expertise and the cognitive diversity that drives innovation and improvement.