Category Archives: Project Management

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Project Management vs Managing Projects

A few months ago, I read an article on LinkedIn entitled, The PMP – How it Ruined Project Management which compelled me to respond quickly. In my response The PMP – How it Ruined Project Management – A Follow-Up, I noted a cultural shift in how we recognize and hire project managers (as well as other recognized positions). Early in the new millennium, we (culturally) adopted a process of recognizing excellence through certifications. The problem with certifications is that they are test-based, rather than skills-based. While some believe you can estimate someone’s skills through testing, I believe that, at least in the case of project management, testing is not only insufficient in measuring skills, it also shifts focus away from the more important skills needed by project managers.

Some (many) years ago, a colleague and I contemplated the difference between “project management” and “managing projects”. We concluded that project management consisted of a framework (or structure) for managing projects; while managing projects includes the actions that project managers perform day-by-day. The former is knowledge-based, the latter is skills-based. We discovered that many individuals “know” project management, but still can’t run projects successfully.

To put this into perspective, most people have an intellectual and working knowledge of screwdrivers and other basic tools. Many have an understanding of the internal-combustion engine. Despite this knowledge, very few would be capable of fixing a broken car. Conversely, one doesn’t need a thorough understanding of the internal combustion engine to be a good mechanic, a basic understanding will suffice when combined with sufficient experience.

The separation of knowledge and skill has been well-known and well-documented for many years. In the training business, most instructional designers (IDs) design these two perspectives into their programs. Knowledge transfer can be accomplished through lecture, open discussion, and demonstration. Skills transfer requires practice, so IDs build exercises and role-plays into their programs to allow students to practice and develop their skills.

You might be interested to note that when I first entered the training business in the mid 1990’s, basic project management classes were 4- and 5-days long. Now, they’re typically only three with many companies asking for 2-day and 1-day programs. With some minor exceptions, we cover the same material in all these classes as there is a minimum knowledge set required to understand project management. The difference in the durations is in the skills development. Pure knowledge transfer can occur quickly, but skills development takes time. In 4- and 5-day classes, students were challenged with difficult situations and left classrooms with well-developed skills. To reduce the training duration, IDs were forced to simplify the exercises leaving students with only partially-developed skills. In 2-day and 1-day classes, instructors only have time for knowledge transfer, leaving students with little or no skills development.

With this background in mind, let’s get back to basics.

Knowledge and Knowledge Transfer

We begin with some basic definitions. The following definitions derive from Chen (2010) regarding knowledge and knowledge transfer:

Explicit – Explicit knowledge can be articulated in numbers and words and is expressed using data, specifications, or scientific means. This kind of knowledge is free of context and can be easily shared.

Note: while Chen implies technical learning here, many organizational issues can be trained this way, for example: simple process training.

Tacit – Tacit knowledge is the accumulated practical skills or experiences. It is personal and “deeply rooted in individuals’ cognitive processes and/or ingrained in the routine and non-routine processes of an organization’s unique culture”.

Note: Chen makes a big leap here. The key word is “accumulated”. Certainly, accumulated experience takes time to become “deeply rooted” and involves varying situations.

Individual – Individual knowledge

Collective – Organizational knowledge

These perspectives combine to form four (4) basic types of knowledge (Chen, 2010):

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Individual-Explicit              Easiest to transfer, theoretical knowledge

Individual-Tacit                  Action oriented, practical experience

Organizational-Explicit       Written roles and procedures

Organizational-Tacit Routines, norms, and shared beliefs

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Note that organizational-tacit refers to the organization’s culture (routines, norms, and shared beliefs).

While Chen offers an excellent model for knowledge transfer, we’ve discovered that complex skills (including project management) require further gradient steps. For example, you can’t expect an individual who just finished a 2-day introductory project management class to successfully manage a 3-year project involving hundreds of stakeholders. In the next section, I outline these steps and highlight challenges associated with each.

Knowledge, Knowledge Transfer, and Organizational Growth

In this section, we examine the path individuals and organizations follow to successfully affect change. We also examine the barriers that inhibit change. This is not an exhaustive presentation as the number of barriers can be extensive. For brevity, we examine the more common barriers seen in practical experience.

For our scenario, we make the following assumptions. First, we assume a single individual receives training in a new topic. Second, we assume the topic is new to the organization. By this I mean that, while the organization may be aware of the subject, it lacks sufficient knowledge about the topic and have few subject matter experts, or supporting practices in place. I will relate the examples to project management.

Step 1:               Motivation and the Belief System

While Chen first introduces “belief” in his organizational-tacit level, our experience demonstrates that this is the first barrier to affecting change. If an individual believes that planning projects (for example) is a waste of time, they won’t want to learn how to plan a project. Motivation to learn a new skill is a prerequisite to any change initiative. The prospective student has to see a benefit to the learning. Here are some typical responses trainers experience in classrooms:

  • This (topic) is a waste of time
  • That will never work here (a very common response)
  • I don’t have time to learn this
  • It’s too difficult

One very common barrier exists when the student was “forced” into the training initiative, especially as a punitive action (“to get fixed”). Frequently, the student will become defensive and actually attempt to prove their punisher wrong by finding every possible reason why this topic is invalid.

True learning cannot occur unless the student is motivated to learn.

Step 2 – Explicit Knowledge

The next step is to introduce the student to the new idea and provide basic information about it. As indicated above, this must include the benefit. This generally is considered the easiest of the steps as it simply requires discussion or reading.

Step 3 – Individual-Tacit – Controlled Environment

Learning and skills development occur in gradient steps. You can’t teach someone quantum mechanics if they haven’t mastered linear algebra. The next step to learning involves practicing the new skill in a controlled environment and in gradient steps. The classroom offers an excellent environment to begin this process, but is generally insufficient to develop thorough skills of complex tasks. The degree of development depends upon the complexity of the task and the effect of the environment. For example, we can teach children how to add two numbers in a classroom as this skill is independent of the environment. One plus one is two no matter where you are.

Projects, however, are complex endeavors involving multiple, diverse stakeholders. While some environmental factors can be simulated in a classroom through role-play and other means, it is impossible to simulate all possible environmental factors in the classroom.

Step 4 – Individual-Tacit – Environment Independent

The student now attempts to practice their new skills in different environments. As the student experiences new environments, they adjust and hone their tacit knowledge and adapt their style to the different environments. As the learning continues, they find common threads that work in most situations, and adaptations that work in alternate situations.

This is where most project management (and I presume other) training fails as the student jumps from a well-controlled classroom environment to the complex and ever-changing organizational dynamic. The problem lies in the gradient steps. While some savvy students might survive “being thrown into the deep end”, most struggle. There are several reasons for this, but most can be categorized as organizational culture. Some common issues include: management or colleagues are unaware or unsupportive of the new actions; time pressures frequently associated with projects; and existing, outdated, or misaligned processes and systems.

New skills take time to develop. The student will likely make mistakes as they develop their new skills, requiring more time to recover. The likelihood of success depends on a supportive environment where such time is allowed, and mistakes are accepted and offered as learning experiences. Mentoring and peer reviews can play a major role and substantially reduce the learning curve.

Step 5 – Organizational – Explicit

At this point, the individual (we can no longer call him/her a “student”) has developed sufficient skills and demonstrated success in multiple environments and situations. As the organization recognizes the success, they begin to develop policies, procedures, and roles to embed the new skills into the organization. This includes training other individuals and managers in the new skills, adjusting processes and procedures to the new practices, and developing support systems.

Step 6 – Organizational – Implicit – Controlled Environment

The next step involves organizational learning. Like the original individual, the rest of the organization’s individuals will experience the same learning barriers. The belief system must be in place (the rest of the organization must see the benefits), and the various individuals across the organization must be given time to adapt their new skills to their environment, make mistakes, recover and learn from them.

Organizational learning generally progresses from the initial group or team outward. The initial team has experienced the benefits first-hand and has already learned new skills by their proximity to the initially-trained individual. Generally, the farther away a group or subgroup is from the original group, the more challenging the transition becomes. 

Step 7 – Organizational Implicit – Organizational Culture

Finally, as more individuals develop skills and practice them in different environments, the new practices become habits; they become the norms and routines of the organization – it becomes their culture.

Cultural Effects that Thwart Improvement

The previous discussion presented the steps to enacting organizational improvement along with barriers that may occur as the organization attempts to improve. Here, we summarize common cultural effects of these barriers and offer solutions.

Time Pressures

Likely the most challenging of the cultural issues surrounding improvement, this issue has only worsened with the global environment and society’s need for instantaneous satisfaction. Every organization is under time pressure and most organizations push employees to deliver fast.

My esteemed colleague, Ms. Kimi Ziemski highlights this issue in one of her most prevalent speeches, The Tyranny of the Urgent. For our purposes, this includes not allowing enough time for learning. Ironically, sending a student to a training class, then not allowing them the time to develop their new skills and recover and learn from mistakes, invalidates the learning, making it a waste of time.

Solutions include:

  • Allowing sufficient time for skills development
  • Allow time for mistakes, recovery, and additional learning
  • Establishing support systems, including mentoring or subsequent training activities

Uncontrolled and Dynamic Environment

Environmental factors greatly affect a student’s ability to develop their skills for complex tasks. Throwing a student “into the deep end” may work occasionally with savvy students, but more frequently overwhelms the student and thwarts learning.

Solutions include:

  • Protect the student from too many new and unexpected environmental challenges. This can be done by the manager as well as other group or team members.
  • Anticipate new challenges and allow the student to plan for them.
  • Allow mistakes and make them a learning experience.
  • Establish support systems, including mentoring, peer reviews, or subsequent training activities.

In projects, for example, a manager may decide to handle the more challenging stakeholders on behalf of the project manager. As the project manager’s skills improve, the manager may allow him to handle more challenging stakeholders.

Gradient Steps

Individuals learn skills in gradient steps. A new project manager, for example, may be able to handle a small project with, say, 100 activities with two team members, but not a large project with, say, 1500 activities and 15 team members. Certainly, other gradient issues exist. Some examples include: level of political complexity, level of client cooperation, number and capabilities of vendors, degree of uniqueness of the endeavor (or project), geographical issues, and many more.

Solutions include:

  • Control the size and complexity of the endeavor
  • As the student improves, push for higher gradients as the student can handle them
  • Establish support systems, including mentoring, peer reviews, or subsequent training activities

Unaware or Unsupportive Environment

Step 1 of our knowledge transfer model involves the individual’s motivation and belief system. If a student is not motivated to learn, they will resist the learning. While savvy instructors can manage the individual in the classroom, when the student returns to their work environment, the same issues may exist in their management, team, and groups. In our scenario, we assumed a single individual was trained, implying the management and team to which they return were not trained. If the management and team don’t understand the new activities of the student, or don’t believe they will be beneficial, they will resist further learning for both themselves and the student.

This is a very common situation. While most managers and staff members are aware of the topic of project management, few realize the depth of complexity, degree of rigor, and level of knowledge needed to successfully run a project. As the student attempts to implement their new skills, managers and staff members alike tend to disbelieve the benefits or need for such activities, and so resist the actions.

Solutions include:

  • Train the managers first to establish sufficient understanding and belief in the topic
  • Train the entire team or group at the same time
  • Allow experimentation
  • Conduct peer reviews

A Brief Organizational Change Model

The previous discussions lead us to a model for affecting organizational change. It is beyond the scope of this paper to present this model in its entirety. More complete presentations will following in subsequent papers. However, we offer an overview and rationale of the model here.

This model is based on multiple works and decades of experimentation and experience. Some works include: Douglas McGregor’s presentation of Theory-X and Theory-Y (McGregor, 1957), Maslow’s hierarchy of needs (Maslow, 1943), Flamholtz and Randle’s presentation of organizational culture (Flamholtz & Randle, 2012), Chen’s presentation of knowledge transfer (Chen, 2010), Hamilton and Bender’s presentation of project risk management and senior management optimism (Hamilton & Bender, 2015), and many others.

Step 1: Establish the Need

The first step in any endeavor involves establishing the need. People are unlikely to change if not motivated. One esteemed colleague, Dr. Zoe Quan notes in her developing thesis, the Dimensions of Impetus™, motivation for change involves three elements:

  1. Degree of Awareness (recognizing the ability of the change to cause improvement)
  2. Degree of Propinquity (recognizing that the change will have an effect in the immediate environment)
  3. Degree of Exigency (recognizing that the change will have an immediate effect)

Step 2: Train the Managers First

This step allows the managers to both understand the impact the change will have on the group/team as well as allowing them to create a supportive environment as outlined above. Key goals for this training include:

  • Recognizing the time considerations needed to support learning, mistakes, and recovery
  • Developing mentoring and subsequent training systems
  • Protecting new learners from unexpected and complex environmental factors
  • Developing a gradient scale system that initially supports success and to allow growth

Step 3: Train the Entire Group/Team Collectively

This action establishes common beliefs and skills across the group and team. While each member of the group or team will develop different skills at different rates, each can seek mentoring or council from others within the group or from the manager. Mistakes will be readily accepted (at least within the group/team) and quickly recovered, reducing the learning curve while allowing continued growth.

Key issues to improve learning:

  • Ensure the training allows sufficient time for students to develop skills
  • Align the training with the organization’s existing culture (to the degree possible)
  • Align the training with existing issues and needs

The size of the team or group is not important. We have successfully developed teams as small as four and as large as over 600. Certainly, the latter offers greater challenges and stronger management knowledge and structure.

Step 4: Continued Support

This step involves two sub-steps.

  1. Create an implementation plan
  2. Start implementing the new skills

The first sub-step takes remarkably short time and need not be perfect. Depending on the size of the group/team, a one-hour meeting with managers and group/team will usually suffice, although add-on activities may follow. One of the benefits of having the group trained collectively is that they will experience a learning curve together, so mistakes are accepted ­– this includes mistakes in the implementation plan. 

Deliverables for sub-step 1 may include (but are not limited to):

  • Establishing environmental controls (assigning responsibilities for handing difficult stakeholders to the manager, for example)
  • Drafting initial tools, forms, and procedures
  • Establishing mentoring systems and protocols
  • Establishing review and further learning initiatives (peer reviews are excellent here)
  • Establish and align reward systems

Sub-step 2 involves actually implementing the changes. Key foundations that aid and reduce learning curves include:

  • Encouraging use of draft forms and procedures
  • Frequent and planned peer reviews
  • Cross-mentoring/cross-training
  • Supplemental training systems
  • Acknowledging and rewarding successes

 

Summary

Affecting organizational improvement is one of the (if not “the”) most difficult challenges a manager faces. Culturally, we send someone to a training class and instantly expect results. While this may occur with knowledge-based training, skills training, especially with complex activities, is more involved and takes more time. Understanding the barriers, complexities, and tools available enables managers to quickly affect improvement with a minimum of risk and pain.

In this paper, we present a methodology for effecting organizational improvement that accounts for many of these challenges. In future works, we will examine these in further detail.

May all your projects be successful!

Michael B Bender, MBA, PMP, CSM

The Value Strategist

President, Ally Business Developers 

References                                                                  

Bender, M. B. (2016, May). Financial benefits of effective project management and team performance. Sugar Grove, IL: KSP Partnership. Retrieved from http://ksppartnership.com/wp-content/uploads/2016/05/Financial-Benefits-of-PM-v1-0.pdf

Berk, J., & DeMarzo, P. (2012). Corporate Finance: The Core. Boston, MA: Pearson as Prentice Hall.

Chen, J. &. (2010). Knowledge transfer processes for different experience levels of knowledge recipients at an offsort technical support center. Information Technology & People, 54-79.

Flamholtz, E. G., & Randle, Y. (2012). Corporate culture, business models, competitive advantage strategic assets and the bottom line. Journal of HRCA: Human Resource Costing & Accounting, 76-94.

Hamilton, B., & Bender, M. (2015). The intersection of senior management optimism and project risk management. Proceedings of the Intellectbase International Consortium. 40, pp. 18-25. Nashville: Intellectbase International Consortium.

Maslow, A. (1943). A theory of human motivation. Psychological Review, 40(4), 370-396.

McGregor, D. (1957). The human side of enterprise. The Management Review, 46(11), 22-28.

Pearce, J. A., & Robinson, R. B. (2011). Strategic Management (12th ed.). New York: McGraw Hill.


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Papyrus, White Boards, Glibness, and Cerebral Knowledge

Glibness (n): fluent but insincere or shallow.

I once consulted to a high-tech engineering company outside of Pittsburgh. The engineers had attended one of my project management seminars a short time prior, and asked that I come in and do a bit of coaching.

One of the best students in the class asked for some help with his project. He was about half-way through the project and looking for some guidance to help him finish. We met, exchanged pleasantries, and got to work. I went through my usual checklist and inevitably came to the precedence diagram (a diagram showing the sequence and flow of the project work). “Of course I have one”, he responded (as I had stressed this topic in the class).

“Excellent, let’s pull it out so I can see it”, I replied.

“Well… it’s in my head”, he responded.

It took a half-second for me to recover (I didn’t expect that response), put a smile back on my face, cleaned off his white-board and said, “Okay, let’s go through it.”

The next few minutes went exactly as I expected. He started confidently, telling me what activities were currently active and what followed them. It didn’t take long before the confusion started. “Oh, wait, I forgot about (some task)”. “Oh, yes, then there’s (some other task)”. This went on for a short while.

Tasks were missing in his head. He had thought about them at one time, but his mind relegated them to the background. He hadn’t thought through the sequence (we changed many sequences during the exercise, and had to add a few new tasks). But after we were done on the white board, we had a solid plan to finish his project. The entire exercise only took about 20 minutes.

We’ve become a cerebral society. If we need information, we just GTS (Google the S[tuff]) and move on. We tend not to study it, we don’t analyze it, we frequently don’t even challenge it (after all, it must be true… it’s on the internet). We get fast answers to quick questions and move on.

It’s a form of glibness, a shallow understanding of the topic. He is a bright engineer, caring, hard-working, and wants to do things right. He just kept everything in his head, never put it on paper or a white board, or even in electronic format. He never spend the time to really look at the sequence, challenge assumptions, and get it right.

The problem is the mind forgets, it automatically reprioritizes what’s in short-term memory. Things go missing, they go to the background, and of course, the mind doesn’t bother telling us when it does this, it just does it.

Examples of this are so numerous I dare not mention them all. One of the techniques Kimi and I started doing some time ago in our speeches is asking senior managers if they ever laid out all their projects in front of them to see how resources were allocated. Their usual response… deer in headlights! That tells me that if they actually did that, they’d realize the difficulties they were placing on their staff.

I still love paper. I frequently sketch things out on white-boards, go over it many times (and usually with a second pair of eyes); then, once I truly understand it, it will end up in electronic format somewhere so I can pull it up any time. I write down my assumptions, decisions, and rationales. I can’t tell you how much time this saves me.

While I believe mankind is getting smarter, we still can’t just run things from our heads. We can’t run projects from your heads, we can’t manage strategic plans, business processes, or research cerebrally.

Try it. Spend the time and effort, lay it out, see it in the physical universe, and go over it several times. Peer review it… have another pair of eyes look at it. It’s amazing what you’ll discover and the mistakes you’ll avoid and the time you’ll save!

… not that I’m opinionated on this!

Cheers,

Michael B Bender
The Value Strategist


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White Paper: Why Focus on Organizational Culture

PDF Version: Click Here

Introduction

Our ability to manage projects is declining despite the significant number of people receiving training in project management. While one could easily argue that the training is at fault, those of us who have run projects successfully will quickly attest that the technologies taught in project management courses do work. This begs the question, “What’s wrong?”

There’s been an explosion in the field of organizational culture over the past decade. My research suggests that the interest in this field began in earnest with the 2008 recession and has focused primarily in two areas: ethics (including social responsibility) and global cultures. However, my interest in this field began over two decades ago and for very different reasons. As a project manager in the 1980’s and ‘90’s, I noticed a distinct and wide gap between a project manager’s view of projects and senior managers’ views. This view was confirmed during my MBA studies which barely mentioned the word “project”. While these studies included several models regarding task complexity, these too fell short of understanding the true nature of projects.

In this article, we explore the concept of organizational culture as it applies to productivity, specifically project work. 

Why Focus on Organizational Culture?

At the turn of the last century, the US became the global economic leader not because of project work, but because of process work… specifically manufacturing. “Big Business” back then focused on improving manufacturing processes. Our GAAP (Generally Accepted Accounting Principles) accounting system can slice and dice cost accounting for manufacturing down to the square inch of floor space, yet all project work fell into the very general financial category of SG&A (Sales, General, and Administrative). To this day, very few organizations account for project work separately and most still don’t account for the cost of internal resources in project work.

The principles that made the US the global economic leader of the 20th century worked back then; after all, as Henry Ford put it, “You can have it (the Model-T) in any color you want, as long as it’s black”.

Despite the focus on process, major projects of the period were relatively successful. We built a huge infrastructure in the US ranging from roads and skyscrapers to a successful nation-wide mail system, telephone system, and even put a man on the moon. I was personally mentored by one of the major project managers of the AEGIS project: a project that upgraded the entire US Navy’s on-board radar system in the 1950’s - 1960’s. These people knew how to run projects.

Today, things are very different. The air traffic control system in the US is over 40 years old. The last two attempts to upgrade it failed. One was shut down in 1991 and the other in early 2000. Over six billion of US tax dollars were spent with nothing salvaged. The “Big Dig” in Boston went from $5.2B to over $22B and was over 6 years late (Lewis & Murphy, 2003). Those of us old enough recall the SSC (Superconducting Super Collider) project that was started in 1987 with an initial budget of $4.4B in 1987 dollars (Appell, 2013). The House of Representatives tried to kill the project in 1992 when the estimated cost rose to $8.25B but it was saved by the Senate. It was finally killed after the minimum cost reached $11B (Murphy, 2008). Then, of course, there was the Denver airport baggage handling system (Calleam Consulting Ltd., 2008), Millennium Park’s Cloud Gate (referred to as “the Bean” by locals) which ran 3.5 times the original budget (Reiss, 2014), and the lessor known US Air Force ERP system which cost $1B and which offered, “… no significant military capabilities” (Charette, 2012).

Why should You Care?

Government projects are not the only ones in trouble. Flybjerg & Budzier (2011) noted that one out of every six IT projects experiences cost overruns of 200% on average and 70% schedule slippage on average. More importantly, the fallout of these cost overruns is not limited to the IT budget. In 2003, Levi Strauss was forced to close three (3) US distribution centers resulting in a $192.5M write-off against earnings in a failed $5M SAP project (Flybjerg & Budzier, 2011). Kmart filed bankruptcy after an IT modernization project failed in 2002 (Flybjerg & Budzier, 2011). Sears Holdings bailed them out and closed 600 stores and laid off 67,000 employees. More recently, most of us are aware of the Volkswagen emissions test scandal (Financial Times, 2017).

The bottom line is… in general, we’re getting worse. The Project Management Institute released a study of project management trends noting that the number of projects cancelled or delayed due to economic conditions has risen from 32% in 2011 to 45% just a year later.

Methodology vs Culture

Over 15 years ago, I belonged to a leadership consultant “test kitchen”, a group of people who could feel free to safely solicit opinions from other leadership consultants regarding their research. I posed the question of whether it’s better to focus on process and methodology or culture. The responses were fast and unanimous: culture beats process any day.

Why? In one view, culture is how we handle process. Do your employees follow processes or routinely ignore them? Do they care about the results of their work or simply “check the boxes”? I have had many students in my seminars that have told me that they don’t need to develop skills, they can Google whatever information they need to get something done. This philosophy, combined with our constant interruptions from e-mail, twitter, and instant messaging have created an interrupt-driven society pushing processes to the side. These are all cultural issues. Without a strong culture, your processes will quickly become meaningless and in extreme cases, harmful.

I posed the question because I saw the trend. As project management became more mainstream, our abilities to handle projects deteriorated. Yet, the technology of classical project management hasn’t changed since at least the 1960’s, back when projects were successful. This might suggest that the methodologies are now failing us. That the technology of project management simply doesn’t fit in mainstream organizations. While the Scrum Alliance might support this position, those of us who have been successful in classical project management will quickly attest that those technologies developed over half a century ago still work. And while Scrum (and other new project methodologies) perform quite well in many circumstances, many projects still require a classical approach.

Successful Cultures

There is some good news. While my research suggests that the general trend regarding project productivity is downward, some organizations have embraced project management at the cultural level with great success. For example, in 2010, the Project Management Institute reported that 51% of organizations had mature PM practices which declined down to 44% in 2012 (Project Management Institute, 2013). The number of organizations training in project management declined from 65% to 59% in the same period (Project Management Institute, 2013). Yet the number of Project Management Professionals (PMPs) doubled from 2011 (Project Management Institute, 2011) to 2016 (Project Management Institute, 2016).

I see two possible scenarios to reconciling these numbers. First, cultural issues are thwarting the training. The second is that the successful project management is localized to a few organizations. Anecdotal and statistical research suggests both are occurring.

A recent article demonstrated the impact of successful project management, noting that high-performing organizations risk only $20M per $1B spent on projects vs $280M for low-performing organizations (Project Management Institute, 2013). That’s a 14 times ratio.

Conclusion

Projects are the mechanisms that organizations employ to implement strategic initiatives, deliver new products to market, and improve organizational performance. The money lost on failed projects expands well beyond the budget overruns, impacting organizations at the strategic level. Despite the staggering increase in the number of PMPs, our ability to manage projects is declining, due in part to cultural issues. 

Organizational culture, therefore, becomes a critical focus for organizations looking to survive in this challenging global economy. In future articles, we’ll examine the specific effects culture has on project performance and look for ways to improve organizational culture.

References

Appell, D. (2013, Oct. 15). The Supercollider that never was. Scientific American.

Calleam Consulting Ltd. (2008). Case Study - The Denver International Airport baggage handling system - an illustration of ineffectual decision making. Retrieved Jan 3, 2017, from http://www5.in.tum.de/~huckle/DIABaggage.pdf

Charette, R. N. (2012, Nov 15). U.S. Air Force Blows $1 Billion on Failed ERP Project. Retrieved from IEEE Spectrum: http://spectrum.ieee.org/riskfactor/aerospace/military/us-air-force-blows-1-billion-on-failed-erp-project

Financial Times. (2017, Jan 3). Volkswagon: system failure. Retrieved from FT.com: https://www.ft.com/content/47f233f0-816b-11e5-a01c-8650859a4767

Flybjerg, B., & Budzier, A. (2011, September). Why your IT project may be riskier than you think. Harvard Business Review.

Lewis, R., & Murphy, S. P. (2003, Jun 24). Bill is filed for independent cost recovery on big dig. Boston Globe, p. B.4.

Murphy, S. P. (2008, July 17). Big dig's red ink engulfs state. Boston Globe.

Project Management Institute. (2011, January). PMI Facts. PMI Today.

Project Management Institute. (2013). PMI's pulse on the profession: the high cost of low performance. Newtown Square, PA: Project Management Institute.

Project Management Institute. (2016, December). PMI Today.

Reiss, D. (2014, Aug 1). 10 years of Millennium Park history. Michigan Avenue. Retrieved Jan 3, 2017, from https://michiganavemag.com/10-years-of-millennium-park-history

 


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75% of Project Changes are Avoidable

Some time ago, I started running an informal survey in my seminars. I asked attendees to estimate the percentage of project changes that are internal to the project team vs external.

Internal changes are all avoidable. They result from internal team miscommunication, incomplete or faulty internal deliverables, lack of planning, ill-defined work, etc. External changes come from the customer or senior management and are somewhat unavoidable.

I’ve run this in approximately 25 seminars so far, consisting of a broad range of industries and geographical regions… including the US, Europe and India. Every group, without fail, estimated at least 70% of their changes were internal and avoidable. It averages about 75%. In my last group, the estimate was above 90%.

Imagine how much faster your projects would complete if
75% of your changes vanished!

Here is a typical list of avoidable changes (internal to the team):

  • Miscommunication
  • Ill-defined work
  • Incomplete work
  • Faulty internal deliverables
  • Lack of planning
  • Gold-plating
  • Chasing down information
  • Cross-checking questionable information

Curious about how you rank? Take this 4-question survey and I’ll publish the results shortly.

Survey (SurveyMonkey): https://www.surveymonkey.com/r/NKLFN6X

May all your projects be successful!

Michael B Bender
The Value Strategist


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Key Skills for Product/Project Management

This is a culture of specialists. I get that. Companies have problems that need special resources to address. I know that. I am one of them. Our company rescues failing or failed projects.

But it's not a surprise to read that there are some positions that have the same skill set as others. I came across an intriguing article recently that looked at the world of product managers penned by one of their own.

What quickly became clear to me is how closely the worlds product and project management hew to each other. Both are results-driven roles that share a goal of delivering products designed and produced to customer specifications.

The article featured the product management skills the author, Brian de Haaff, leans on most in his work. And as I read it, I saw that most of these skills are shared with successful project managers.

Here they are….
1. Vision
A clear vision means an understanding of the ‘why’ for product / project decisions.
Once determined this will be your driver for the project.
2. Motivation
It’s often been said that people don’t work for money. Sure the work can be satisfying enough, but what drives a team is the guidance provided by the leader, step by product / project step.
Success is incremental, and gaining momentum means being able to motivate yourself and others around a shared goal.
3. Prioritization
Once you’ve got a project on track and scheduled, it’s simply a matter of considering any prioritization requests against the vision for the project.
4. Transparency
Being candid about project challenges within the team is crucial. You are responsible for swaying your team, sharing plan changes and inspiring them through your comments and actions.

The kind of top level thinking in this article speaks to the importance of a vision at the core of every project / product.

How many times have you seen a product or project team fall apart almost before they get started?

All because they didn’t decide on a unifying vision.


Upcoming Events

  • ACT-W 'She Started It' panel - KhZ in Chicago October 18, 2017 Motorola Theater - Chicago, IL http://chicago.act-w.org
  • Introduction to PM - MB Private Client October 19, 2017
  • Private Client - KhZ in Louisiana October 20, 2017
  • PM Quality Mgt. Black Diamond Charities October 21, 2017 Chicago Project Quality Management presentation to veterans and active-service military for Black Diamond Charities.

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