Results tagged “Michel Thiry” from Voices on Project Management

Change has become a constant in our fast-moving world, but very few organizations are leaders of change.

How can project and program management help? One of the key factors of success is value creation--understanding the context, reasons and impact of a change and defining how to create value out of it.

Both strategic managers and project managers have traditionally tried to keep change to a minimum because it affects their plans. This won't work anymore!

Complex situations, where multiple stakeholders compete with each other and try to influence the outcome on a continual basis, create ongoing change. This requires constant adjustment of the plan through a series of integrated, mutually reinforcing decisions that form a coherent whole.

But how can we keep direction if we are continually adjusting? Program management may be the answer.

First, key stakeholders must be identified. Then, based on their needs and expectations, measurable and agreed benefits that will achieve the stated strategic objectives are defined. This is called the "value proposal."

To construct the value proposal, the program management board and other key stakeholders must first make sense of the impact of the change and agree on the program's expected benefits.

Typically, workshops and individual interviews will enable the program board to build agreement on stakeholders' needs and expectations and classify them into critical success factors (CSFs) and subsets of CSFs.

The sum of the CSFs constitutes the value proposal and will give direction to the change. Projects are then defined and initiated to produce deliverables that will enable the realization of these CSFs.

Because the CSFs are fairly high level, they will not change drastically when new needs appear through external or internal influences. But the relative importance of the CSFs may need to be adjusted.

CSFs will directly influence the projects that are part of the program, sometimes requiring the early closing of a project and the initiation of a new one.

The key to value creation is to understand that:

•    Without direction, time and resources will be wasted on distinct, unconnected projects and activities.

•    The change program direction must be based on key stakeholders needs and expectations, and clearly defined through agreed CSFs.

•    Strategic direction can evolve and be adjusted on an ongoing basis, but always for explicit reasons that will generate added value.

I will address two other factors for success--transition and value realization--in upcoming posts.

Portfolio direction is how an organization decides to invest its resources in different types of activities. Portfolio direction sits above the project portfolio--covering all the organization's activities.

The first step in portfolio direction is to identify the organization's main activities.

Here are the three main types:
•    Change actions (for example strategic programs, change projects)
•    Incremental actions (for example improvement projects, systems updating, continuous improvement)
•    Ongoing actions (for example administration, operations and maintenance)

Many organizations also consider mandatory actions (such as conformity projects or regulatory requirements) as a distinct type of activity. However the organization divides its activities, it is important that there be no overlap between activities and that every area is covered.

The decision to invest in a portfolio direction is highly dependent on the organization's corporate strategy. For example, if the organization is in a turbulent environment and needs to be highly responsive, it will invest more in change activities. If, on the opposite end of the spectrum, it is in a stable environment and occupies a good market position, it will invest more in ongoing activities. If the investment strategy is not clear from the start, the organization will invest its resources in activities that will not support its strategy.

Once the organization has decided which percentage of its resources it should invest in changes--incremental and ongoing--it must develop selection criteria that these actions should fulfill. For example, criteria might indicate that change actions must support market penetration, a strategic initiative or help resolve a significant issue.

In general, every investment decision of the portfolio direction should ultimately increase the organization's responsiveness and competitiveness.

I am just back from the PMI Global Congress 2009--EMEA in Amsterdam, Netherlands.

PMI seemed focused on the environment--with a keynote emphasizing the need to be more green--and on the value of project management, with the Research Working Session and a few tracks by PMI personnel on the subject.

The majority of tracks, however, seemed to hit on different topics, including:

1.    People issues, like decision-making, leadership, communication, culture, politics and stakeholder management
2.    The strategic link of projects, like organizational project management, project selection, portfolio and program management and the PMO
3.    Agile

I think this last one is a growing trend in project management.

Many of the concepts of Agile can be traced back to fast-track construction projects, where basic principles like co-location, fast prototyping, iterative development, daily orientation meetings and other concepts were developed.

In IT, the Agile methods evolved in the mid-1990s in reaction to what is called the "waterfall model," a sequential approach to programming.

In 2001, 17 prominent thinkers of what were then called "lightweight methods" issued the Agile Manifesto, which states four basic principles:

•    Individuals and interactions over processes and tools
•    Working software over comprehensive documentation
•    Customer collaboration over contract negotiation
•    Responding to change over following a plan

Although, in a way, Agile seems to be the antithesis of project management, as explained in A Guide to the Project Management Body of Knowledge (PMBOK® Guide), it can be very advantageous to use it in turbulent and strategic settings.

As project management is used more and more to manage strategic change and projects become more complex, Agile principles will influence more and more the management of projects, and more specifically, program management.

More in my next post ...

When I started in project management many years ago the only measures we had for success were cost, time and quality--the famous (or infamous) triple constraint. Nobody was talking about scope or earned value.

Many variations of this triangle exist and today its basic concept is getting more and more muddled.

In the early 1990s, the concept of scope started to become more and more important and was seen as the area of the triangle, again varying against cost, time and quality. And value was still very much focused on quality. Good value was when the highest quality was achieved for the least expenditure of resources.

Today, stakeholder satisfaction, which can include quality, but also scope and other issues have replaced the concept of quality.

In project management, value could be represented as scope and quality (satisfaction) on one side of the scale and cost and time (resources) on the other side: the more scope and quality for the least cost and time yielding the most value.

Although this is an interesting concept, it is usually not the project manager's role to define these elements. They are usually imposed as parameters in the project charter.

It is the role of the sponsor to define the value that the project will generate by setting the scope and quality that will satisfy the stakeholders and define the cost and time that will be acceptable and achievable.

There is a simple equation that can be represented graphically to represent this:

If offered benefits are greater or equal than expected benefits, satisfaction is achieved. If available resources are greater or equal than required resources, value can be realized.

Typically projects are measured against their capability to fulfill strategic objectives and business benefits, including increased operational capabilities.

Estimated resources (time, cost and human resources) are measured against resources available at the time the project is scheduled to take place. If both ratios are positive, then value will be achieved. If many projects are competing against each other, those that provide the highest benefits to resource ratio will be chosen.

But is this truly the norm? Is this how things work at your organization?

I am currently delivering a master class on project-based organizations (PBOs) at the University of Technology Sydney, as part of a the school's PMI Global Accreditation Center accredited master's program.

Part of the class included a workshop discussion on key issues concerning the transformation of a traditional organization into a PBO.

Five issues impeding the transformation were:

1. Selling the PBO concept to senior management
2. Ensuring collaboration across all levels of the organization and empowering people in light of the traditional hierarchical structures of organizations
3. Dealing with the effects of the current economic downturn on implementation
4. Bridging the gap between corporate and business strategies
5. Measuring PBO maturity and determining when an acceptable level of transformation been reached

While we only had time to delve into issues one and two, I feel the conclusions are worth sharing.

-To sell the PBO concept to senior management, project managers should:
-Be convinced of the value of the PBO.
-Secure the support of a champion at the executive level.
-Educate people about the PBO.
-Find examples of successful PBOs.
-Understand top management concerns and speak their language.
-Stress benefits of flexibility and dynamism in turbulent environment.
-Be realistic in selling it--do not promise things that cannot be realized.
-Plant the seed and let it germinate--do not try to rush the process.
-Build on existing strengths and don't try to reinvent the wheel.
-Take into account existing organizational culture and structures.
-Pilot the system in business areas that are receptive to it.
-Implement PBO components one at a time but always keep the big picture in sight.
-Make sure you address perceived threats.

Use emotional intelligence.And in terms of collaboration and empowering people, our conclusions were:
-What works in theory may not necessarily work in practice.
-Hierarchical organizations are very efficient, PBOs enhance effectiveness.
-PBOs can add flexibility and opportunities of career development.
-PBOs focus on multiple stakeholders, whereas traditional organizations usually focus on shareholders, so motivation of staff can be increased in PBO.
-Often in traditional organizations, career advancement is based on conformity. In PBOs, advancement should be based more on capability and innovativeness
-The PBO encourages feedback and learning,
-Bureaucracy is rigid and kills initiative, while a PBO is evolving and encourages initiatives.

I am writing after having just finished conducting a seminar in Bahrain and am preparing to fly back to London tomorrow morning.

For the third year in a row, CIOs identified project alignment with the strategy as the number one management priority in a CIO magazine survey. And for the first time, CEOs rated "meeting other strategic objectives (e.g., reputation of your business, entering a new market, securing access to natural resources)" as more important than "maximizing financial or shareholder return" or "meeting or exceeding a specific financial return" (e.g., return on invested capital).

In most organizations, business heads select the majority of projects. Those projects are then submitted as part of an annual budget allocation process, with the selection often based on these functional managers' needs, not as a response to an aligned strategy.

Often these initial proposals have to be cut back when budgets are reduced. And because the current organizational focus is on short-term results, the projects that are cut are mostly those that would produce long-term results. But the recent economic downturn has brought into light the failure of the short-term financial profit approach and the need to look for longer-term sustainable value. Recent surveys show the interests of top management are shifting; increasing competitive advantage and the ability to adapt to change have become foremost in their priorities.

The key to delivering this value is in the development of an integrated portfolio-program-project approach supported by a sound governance system. Typically, executive stakeholders agree on the strategic objectives that will produce competitive advantage. At the program level, they are translated into business benefits. Project deliverables are then defined to produce new capabilities that will enable the realization of these benefits.

As project results are measured and benefits are assessed, the program and the strategy are modified to adapt to changing circumstances. This, in turn, gives the organization the necessary agility to stay competitive in a challenging environment and to realize value consistently.

I'm just back from the PMI Global Congress 2009--Asia Pacific in Kuala Lumpur, Malaysia, and I wanted to share with you what I have seen in the various presentations and in the more general cultural aspects of the Asia Pacific area.
    The congress was small, compared with the North American ones, but the quality of attendees and speakers was very high.  Plus, small congresses offer much more opportunity for meaningful networking. Malaysia is a very diverse country: 60% Malay, 35% Chinese, 3% Indian and the rest a mix of other races. The country's official religion is Islam, but everybody is very open, and all faiths are practiced. I have seldom been in a country where more people always smile and are so keen to strike a conversation and learn more about you.
    The interesting thing about the congress was that many papers and presentations focused on the strategic aspect of projects and the need for project managers to start thinking more intuitively. Many studies have shown that managers make decisions based on intuition and soft factors rather than hard data. Anyway, before you get all the necessary data to make a "sure bet" decision, the opportunity has passed. Project management often focuses on the need to collect hard data. In a "pure" project environment, where deliverables, time and cost are quite well scoped, this is fine; but as project management is used more and more to manage organizations, this does not hold true anymore.
    Let me summarize three good sessions I attended. Patrick Weaver, from Australia, explained how the concept of scheduling must change when dealing with complex projects. In such cases, the schedule will be high-level and flexible to accommodate for opportunities.
    Manon Deguire, from London, England made a distinction between the data that can be handled statistically, which has limited boundaries, and the data that cannot, which has limitless boundaries. In the latter case, project managers cannot use rational decision making tools and should rely more on intuition.
    Michel Gagné, originally from Montreal, Quebec, Canada, who has lived in Malaysia for the last 20 years, presented a session on how to sell projects to C-suite executives. He talked about executives as the "why" people and of project managers as the "how" people. Both are needed, but if you want to talk to and sell your projects to the C-Level, you need to speak their language.
    In summary, the message I got from the congress was that project managers are best placed to become leaders in the new economy, but they need to be open-minded and seize all the opportunities. They also need to be able to communicate with the executive level of the organization to sell their ideas. Project-based organizations are the way to the future, are you up to it?

In this very first post, I would like to introduce myself. I am currently in London, England, where we had the biggest snowfall in 20 years this week.
    I started my professional life as an architect in Montréal, Canada in 1974; as such, I worked within a project environment from the beginning. Architects traditionally represent their clients and are expected to act "in lieu" of the client in their relationship with the authorities (planning department, construction permit department, etc.) other professionals (engineers, urban planners, landscape architects, interior designers, etc.) and with contractors (suppliers, building trades). After having worked in most areas of my profession, from urban planning to architectural programming, design, specifications writing and site supervising, I decided that it was time to integrate all this knowledge. So I opened my own practice and started developing turnkey projects for my clients. This meant that I needed to look at the bigger picture. It also meant that I needed to work in harmony with all the players of the project.
    After a few years, I joined a larger firm that shared this philosophy and became their director of development. That is when I started calling myself a project manager and that is also when I became member of PMI and got my Project Management Professional (PMP^®) credential.    
    During that time we developed a recognized expertise in fast-track construction. Many of these fast-tracking techniques were later adopted by IT/information sciences and are today known as "agile and iterative development." As our expertise became recognized, we got to work on large, multiphased construction projects and started to develop a reputation for pragmatic and effective long-term planning and development. Today, this type of expertise would be called program management.
    In 1996, I moved to the United Kingdom with my family. After more than 20 years of working in construction, I became a management consultant and have since practiced in a wide range of industries. I have come to realize that many organizations still don't understand how to integrate their project components to their business practices. This is especially true of the end-to-end process necessary to implement strategic decisions, realize benefits and, ultimately, create value. I intend to address these issues in my posts and hope that you will be interested in commenting.
    I travel extensively and will therefore write from different locations around the world. I am preparing to leave for Kuala Lumpur, Malaysia to attend the PMI Global Congress (where I will present a paper on the comparison between the three most recognized program management standards) and then deliver a 2-day seminar for SeminarsWorld^®.