The project that I am currently involved in has been very successful. Unfortunately, I can’t give you many details about it, except that the team is tasked to implement a new business model. It involves blueprinting the new model, construction, organizational transformation and implementation in a multinational company. We are not even finished with the project yet but the business return on investments has been unprecedented. In projects as big as this, you can talk about many success factors. The common clichés are senior management support, adequate change management, good business model design and construction, excellent resources, etc. However, I would like to single out one success factor that has inspired me to write this article—project management discipline.
Project management has been practiced since early civilization. It began with engineering projects and it was in the early 1950s that companies started systematically applying project management principles and tools in complex business projects. It could be the oldest trick in the book. But it is still a key element to any business integration initiative.
Steve Small is a colleague of mine. He manages Project Management processes. I would like to quote him about his views on project management.
“I look at Project Management as the force that provides the structure, framework, and guidance for all the participants, activities and deliverables; however, the ultimate success factor for any project is the strength of the team you have in place. I know it is a cliché but it is really all about the people!”
Let’s analyze Steve’s quote and from it, derive key points of project management concepts.
Structure, Framework and Guidance
Let’s start with structure and framework. There are many project management frameworks and methodologies out there but there is a common theme in all of them. They all contain the traditional sequence of steps. They are typically comprised of the following stages: Initiation, Planning, Execution, Monitoring and Completion. These steps tell you what you have to do – how to manage your projects from start to finish. It describes every step in the project life cycle, so you know exactly which tasks to complete, when and how. Whether you’re an experienced project manager or a novice, it guides you in administering the project.
Activities and Deliverables
When it comes to explaining activities and deliverables, the PRINCE2 diagram and approach is my favorite. Why? It is because the framework provides the life cycle based on the project processes with clearly defined inputs and outputs.
- Starting up a project – Inputs: Project Mandate; Outputs: Project manager and project management team appointment, business case and project brief
- Initiating a project – Inputs: Project brief, business case and approach; Outputs: Project plan, refined business case, project controls, project initiation documents
- Directing a project – Inputs: Project plan, project controls; Outputs: Authorized initiation and stages, day to day project management and controlling.
- Controlling – Inputs: Status reports, alarms, issues and risks; Outputs: Issue resolution, reviewed project stage output, issue escalation.
- Managing stage boundaries – Inputs: Project stage progress; Outputs: Planned next stage, updated project plan (if necessary), updated business case (if necessary) and Stage end reporting.
- Closing a project – Inputs: Overall project results / output; Outputs: Project decommissioned and project evaluation reviews.
People and Other Resources
Resources are essential to carry out the project task set forth by the project mandate. They can be people, equipment, facilities and financial. When you lack a project resource, it becomes a constraint that might affect the completion of the tasks. Resources need to be managed and balanced through project management so these are adequate in any given time to complete project activities. Normally, resource assignment considers how each task is prioritized. Resource scheduling, availability and optimization are considered key to successful project management.
I spent a good portion of my work experience in projects. I had the privilege to work with people from different nationalities, cultures, backgrounds and process areas. I like participating in projects because it gives me an ever changing set of opportunities and challenges. As they say, no two projects are the same. It is mainly because of the temporary nature of a project — having a defined start and end date. It is a complete contrast to business-as-usual operations, where individuals and groups have predefined, usually repetitive tasks and goals to achieve value.
To be continued…
In my succeeding post, we will discuss program management. Viewing program management as just administration of a collection of projects is a mistake. Program management is more than that. It is more involved with the firm’s over-all Process Culture. Vaughan Merlyn has written extensively about this topic in his blog IT Organization Circa 2017. Let’s see what we can draw up from his ideas and discuss it in the next article.
Peter Drucker (November 19, 1909–November 11, 2005) was a writer, management consultant, and self-described “social ecologist.” The Harvard Business Review honors Drucker’s contributions with a spread in its current November edition. The issue has a lot of interesting and insightful articles about the continuing relevance of his perspectives and wisdom in today’s turbulent times.
Drucker’s Influence in Asia
I remember my professor in the Asian Institute of Management who talked passionately about Peter Drucker’s perspective in business and management. Managers in Asia have described Drucker influence as essential in making their business successful and helping countries develop. Drucker frequently travelled to Asia, particularly Japan, throughout his life. He has profound influence there, not only as a management consultant to companies such as Toyota and retail giant Masatoshi Ito but also as a consultant to governments such as Japan, South Korea and China.
Many influential and revolutionary ideas have run through Drucker’s career and writings. He preached about decentralization, simplification, impact of knowledge workers, management by objectives, customer service, corporate compensation, need for community, organizational business processes among others. I have chosen two out of Drucker’s many ideas to discuss:
1. The Purpose of a Company Is to Create a Customer
A company’s primary responsibility is to serve its customers. Profit is not the primary goal, but rather an essential condition for the company’s continued existence. There is only one valid definition of business purpose: to create a customer.” – Peter Drucker
Profits come when customers continue to buy your products and services. That is the reason why Drucker’s perspective always pointed out the importance of putting customers first. A.G. Lafley, chairman of P&G board of directors, always sought out Drucker’s advice during his tenure as CEO of the company. He attributes their corporate principle to Drucker’s customer service principle that the consumer – not the CEO – is boss. P&G have made it their purpose to touch more consumers and improve more of each consumer’s life. By putting customers first, according to Lafley, they have nearly doubled the number served, from 2 billion to 3.8 billion; doubled sales and tripled P&G profits.
2. Essential Condition for the Company’s Continued Existence
“The need for planned abandonment – businesses have a natural human tendency to cling to “yesterday’s successes” rather than seeing when they are no longer useful.” – Peter Drucker
Many companies focus on placing as many products and services as possible in the market and reap as much profits as possible. Their center of attention lies in what they have achieved in the past and what they are maximizing in the present. According Zhang Ruimin, CEO of the Haier Group based in China, sole focus on generating profits today could not ensure his company’s survival tomorrow. Early on, Haier’s profits were dwarfed by its competitors in China while Haier focused on quality. They could not compete with companies offering the same products in the market. But when supply-demand balance changed in China, according to Ruimin, lots of companies lost customers and went bankrupt overnight while Haier strengthened its position in the market. This is one of Drucker’s key principles – the assumptions on which the organization has been built and is being run no longer fits reality. Zhang Ruimin takes this to heart as a constant warning. He wrote, “All decisions I make must be consistent with the ever-changing external environment. If they aren’t, the consequences may not emerge right away, but once the danger show up, it will be too late.”
To read more about Peter Drucker’s perspectives and find out how his wisdom can help your company navigate these turbulent times, take a hold of the current November edition of Harvard Business Review with the headline: The Drucker Centennial – What Would Peter Do?
Photo courtesy of Harvard Business Review.