Project management (PM) is a mission-critical process. Projects are performed to implement new or changed products, address customer requirements, make operational improvements and comply with internal and external standards and regulations. If projects are not being performed as effectively as they can, the organization suffers. Project management adds value. It enables the right projects to be done in the right way.
In many organizations, significant change in the way projects are managed is necessary to overcome chronic problems and obtain significant results. The problems including late delivery, cost overruns, chaotic implementation of new products and processes, over burdened resources, etc. directly impact the organization’s bottom line.
The complex organizational change required to resolve these issues must be well planned and executed. It is a program that may impact every aspect of the organization from executive compensation and corporate policy to the way individual performers plan their work.
This paper addresses strategic issues for successful project management improvement. A systems approach, organizational readiness for change, business objectives, the role and functions of key stakeholders and organizations, obtaining buy-in, managing change, education and ongoing support are elements of the improvement program.
In order to successfully improve PM, it is necessary to get executive level support. Executives want results.PM improvement results can be quite dramatic—according to Gerry Kendall, a Theory of Constraints expert, the Israeli Air Force reduced aircraft changeover project duration from three months to two weeks without investing in any new facilities. They achieved 100% compliance with scheduled due dates, and significant cost savings across a number of different types of projects within several months. Lucent claimed to triple their development capacity.
Degree of Change
The degree of organizational change required to achieve results depends on how dysfunctional current practices are, how much the organization desires change and is ready for change. Change to organization structure, roles, responsibilities, compensation, policies and procedures may all be required to achieve desired results. The change may go deep into the organization’s process and may have a wide impact across the organization.
As an example, when Los Alamos National Labs sought to improve project performance they established a project management methodology and a project management office with the responsibility for managing projects. The new approach changed the role and authority levels of the functional groups that had been running the projects and the point of primary contact with project clients. The change resulted in resistance from the functional managers who questioned their new roles and the implication on their careers (Pitagorsky, 1998, 7–16).
As change agents the people who lead PM Implementation must identify change possibilities and chart a course that implements a PM process that provides the maximum possible performance improvement while minimally disrupting the existing organization. Sometimes, this means a multi-phased approach that creates change incrementally.Victories, even small ones in a well-planned sequence, will sustain support from executive sponsors, middle managers, PM practitioners, clients and project performers. Often the initial victories can be quite dramatic.
In other settings, more far-reaching change is called for. The organization’s culture, particularly its adaptability, must be considered when planning any change.
Business Process Change
PM Implementation is a business process change program to improve performance, achieve cost savings, improve service levels, improve the quality of project results, and the relationships among project stakeholders. It has companywide, bottom-line implications.
The underlying principles of organizational and individual change are:
- Acknowledge that there are problems or opportunities for improvement
- Recognize cause(s)
- Realize that something can be done about it
- Do what is necessary to change the situation.
Improvement is not a one-time effort. These steps represent a spiral toward perfection.Whether perfection is ever reached is immaterial.Reaching for it in a systematic way will result in continuous improvement. It is always possible to improve a system.
PM improvement is complex, fraught with risk of failure, associated with automation, new procedures, role, responsibility, authority, organization and cultural changes. Taking an approach that is driven from the top and focuses on root causes can minimize complexity and help to guarantee success.
Systems Oriented/Holistic Approach
If PM improvement can be isolated to specific projects, the effort can be focused and results can be relatively quick.However, if projects are interrelated either because they share resources or other critical elements, a more organization wide approach is necessary.
For improvement to succeed, a systems oriented (holistic) approach is necessary. A holistic approach is one that recognizes the interactions between all the elements in a complex system.The system of managing projects includes all of the people, processes, policies, machines, facilities, roles, and relationships that are involved in, influence or are affected by project management.Any change to any part of the system may have affects elsewhere. Problems in the system can be traced to identifiable causes. Causes can be addressed by making changes to the system’s components.
For example, if project overruns and quality short-falls are caused by initiating multiple projects that far exceed the capabilities of the available resources, no new and improved scheduling tool and technique is going to substantially change things. Here, change to motivation and portfolio management would be needed to address what may seem like a project performance problem.
Readiness for Change
In order for an organization to successfully improve it must be ready for change. Readiness is the degree to which the organization acknowledges the need for change and commits to do what ever is necessary to improve.
Readiness is measured by how executives remove barriers and provide resources and how management and supervision follow through with the tactical changes required of them and the people who report to them.
Risk and Resistance
As in any program, risk management is a critical part of planning. Among the risks in PM improvement programs are disruption to the environment as project performers learn new tools and techniques, choice of inappropriate tools and process definitions, insufficient staff for managing and facilitating the change process, underestimated schedule and budget, insufficient support from senior management and other stakeholders, longer learning curves than expected, etc.While there are many potential risks, the probability of success is most closely related to resistance to change and how it is addressed.
Whenever there is process change, there is impact on the way people work and the way they relate to one another. Resistance is not inevitable, but we must assess its likelihood, the form(s) it might take and its potential impact. Then we can develop appropriate responses.
Managing resistance begins with a “selling” process. Improvement initiatives must include education, training and motivation for all stakeholders.Motivation strikes at the roots of resistance.
Each class of stakeholder is motivated differently. For example, executive sponsors are motivated by significant financial improvement, gains in market share, increased stability within the organization, etc. Performers are motivated by how much the change will make their lives more rational. Clients want better results, faster, cheaper, and more predictably. Functional managers want to be able to perform their functions effectively, perhaps, protect their turf, etc. Project managers want to be able to commit to rational project objectives, avoid conflict, serve their clients and sponsors and have clear understandings about the roles and responsibilities of all project stakeholders. Hopefully, all stakeholders share the motivation of increasing the organization’s capacity to perform.
Where resistance exists, permit it to surface, use it to test the correctness of the program, and address it firmly and candidly. Sufficient authority to break through unreasonable resistance is necessary.
Process maturity is intrinsically linked to PM implementation. Maturity Models provide both a path and criteria for assessing where an organization is. All of the maturity models support the need for a planned approach—an implementation program— over time frames that may be from several months to two years.
One PM Maturity model (Kerzner, 2000) identifies five levels of maturity
- Common Language
- Common Processes
- Singular Methodology—including portfolio management
- Continuous Improvement.
The levels overlap. Benchmarking including establishing measurement baselines and processes can begin at the onset of the improvement process.
The maturity model can be used as part of the selling of PM, as a basis for program planning and as a means for understanding the complexity and duration of PM improvement. A gap analysis, comparing where the organization is today and where it would like to be regarding project performance is effective to establish goals and motivations for change.
Maturity implies that the organization exhibits specific characteristics. Richard Bauhaus (Knutson, 2001, 304–5) identifies seven critical characteristics in:
- Consistent processes
- Everyone knows and follows the PM process
- Clearly defined roles and responsibilities
- Common principles, language and expectations
- Portfolio management
- Project’s linked to business strategy
- Continuous change, including education, improvement projects, measurement, etc.
There is no single way to implement PM improvement in an organization. Each organization is unique and, given the complexity of the change process, it is necessary to adapt to the organization’s current conditions. There are generic models based on business process redesign projects that can be used as a foundation for planning the improvement program