In any kind of project or program, situations often occur that require escalation for decisions to be made above the level of the project team. Typical examples of such situations include changes of project scope, unforeseen technical problems, overspending, lost expertise, and schedule slippages or changes. The problems can get especially costly in a heavily matrixed organization, wherein people who report to various functions (engineering, marketing, finance, manufacturing, etc.) are essentially “on loan” to a program manager to complete the deliverables. Some or all of these people may be working on more than one program team, plus contributing work to their functional teams.
When a program encounters a roadblock in such a system, something close to chaos can occur, putting a halt to productive progress and polluting the organization with animosity. For example, say that something technical happened that will cost the program 10% more money and require more resources or time. The finance team member may go back and report to his boss – the controller – that the engineers want to go over budget. An engineer may go back to her supervisor saying that the scope changed and now they can’t meet the technical requirements. The product manager may go back to his boss – the marketing manager – and say that the engineers aren’t smart enough to meet the customer requirement, and so forth. Those managers may kick the problem up to their bosses at the VP-level. In the meantime, the program manager is pleading with her PMO team or boss for more time and money. These supervisors may then meet one-on-one or in various groups to discuss the situation, argue about whom is to blame, etc., as illustrated in Figure 1.