In innovation, you aim to introduce something new; make changes in anything established. You could go right or could go wrong. Of course you do all preparations necessary to go right every time, but if you don’t, you take the lessons learned and be better next time.
Romeo Siquijor is a good friend and compatriot. He now heads Information Security in CEMEX in Mexico while I found my way to Houston after several stints in different countries. We both started as young IT managers in the Philippines. Our offices were adjacent. The thing I remember most was Romeo repeatedly telling his IT Operations team that “failure is not an option” — like it was their mantra. I did not disagree with him, but it was not the same message I would tell my team.
I headed the IT Business Processes group at that time. My department’s task was to enable and support IT solutions. For us, the mandate was to find new ways to do things, to innovate, and to test new tools with potential application to our business processes. Of course, I wanted my team to succeed but on the other hand, I did not want to have the fear of failure limit their quest for new things. I believe that sometimes the cost of finding innovation is failure – finding out what does not work on your way to finding out what does.
While working with our commercial department, we implemented a sales automation tool using handheld devices. Unfortunately, it did not fly when we piloted the project and we failed. We did not get the buy in because the tool was not user-friendly and robust. The sales managers simply did not use it. We explored another innovation we called mobile selling. Romeo helped design a simple technical architecture to run it. At the time, in 2003, text messaging or SMS was already big in the Philippines. It was a phenomenon and the use of it quickly became part of our culture. Our goal was to incorporate the use of texting to our sales process. We developed a tool that would allow our customers to request orders using SMS and they did just that. In just a few months, 60% of our sales orders were coming from our mobile channel. We were open to exploiting the best technology at that time by applying it to our sales process but we were not sure how our customers will react. We were willing to fail and so we took a risk and gave it our best shot.
When mobile selling was already operating, it became a mission critical application. The system was hosted by the IT infrastructure that my friend Romeo manages. In that perspective, I loved it when he told folks “failure is not an option.” I did not want any service interruptions to impact my mission critical applications. Romeo values productivity, availability and reliability. He wanted no failure and no surprises. He wanted things done yesterday, done better, faster and cheaper today.
My goal is to show you two different perspectives from two different functions in IT. “Failure is not an option” is a good mindset for day-to-day IT service delivery. Although, I would argue that this does not apply to areas whose mandate is to innovate. In innovation, you aim to introduce something new; make changes in anything established. You could go right or could go wrong. Of course you do all preparations necessary to go right every time, but if you don’t, you take the lessons learned and be better next time.
I have always been fascinated about how developed countries excel in the Olympics. In the recently concluded summer games in London, 6 countries from G8 were in the top ten of the medal standings. Do countries’ economies have anything to do with how their athletes fair in games? Absolutely! How?
Allow me to use some project management concepts to explain.
Portfolio Management – Strategy in Sports and Funding
Obviously, developed countries have more resources, i.e. money, to invest in sports development and therefore, more and better sports programs translate to more chances of success. The U.S. Olympic Committee shelled out close to $250 million in 2008 to help American athletes win 110 medals in Beijing. That is a huge investment in a national sports program (and this excludes funding coming from corporate sponsorship for more popular teams). The portfolio managers — or I should say Olympic committee leaders — determine goals, value indicators and programs that can help fulfill its overall sports goal. The sports’ governing body is responsible for allocating the investment into programs that has the potential for more success. They monitor aggregate performance, track spending and measure value of results.
These are the types of decisions that sports leaders have to make as part of portfolio management.
- How much is allocated for sports programs we already excel in so as to maintain success?
- How much is allocated for developing sports with the best potential for future success?
- How much is allocated for improving equipment and facilities?
- How much is allocated for the athletes’ rewards program and development program in general?
Program Management – Managing Sports Programs
A program, according to PMI, is a group of related projects managed in a coordinated way so as to obtain benefits and control not available from managing them individually. Let’s use the USA basketball program as an example. The objective of the program is to return USA to dominance in basketball. Previously, the USA team failed to win the 2002 FIBA World Championship and finished with bronze at the Athens Olympics. Jerry Colangelo was appointed as the director of the USA basketball program in 2005. He redefined the entire basketball program with the intention of coping with the increasing competition from other countries like Russia, Spain and Argentina. This current USA basketball program was projected to take 6-8 years with the objective of qualifying for the Olympics and winning Beijing and London. The USA basketball program has an even large scope and that is, to promote basketball globally.
The program manager, in this example, Jerry Colangelo is responsible for developing the overall program plan and creating high level plans for a detailed execution at the component level. The component level items are the projects.
Project management – Preparation and Games Participation
Now let’s break down the USA basketball program into projects.
- Assemble the team and train (no longer ad-hoc collection of NBA stars)
- Participate in qualifying tournaments (players projected to participate in main events for continuity)
- Participate in the basketball tournament (with the objective of winning the gold medal)
As you can see, we dissected the basketball program into three main projects. A project, according to PMI, is a temporary endeavor undertaken to create a unique product, service or result. It has a defined beginning and end and therefore a defined scope and resources. Colangelo appointed Mike Krzyzewski (Coach K) as the USA basketball coach. Essentially making him the project leader of the components of the basketball program we listed above.
This example illustrates how portfolio management helps manage a collection of programs and projects to achieve a strategic objective. The main goal of portfolio management is to maximize the value of the portfolio by the careful management of its components—the constituent programs and projects. Countries with resources to invest in sports programs and with the leadership to guide the program through have the advantage over others.
A lot of technology and application specialists who used to spearhead management of IT projects from beginning to end see project managers as competition. This becomes a source of disempowerment – the single biggest hurdle, in terms of organizational transformation in IT – when IT leaders start to introduce a Project Management Office (PMO) group. My point of view is completely the opposite. If there are enough project management resources, I would rather have PMO support all my projects. Here are the top three reasons why IT needs a PMO group:
Bring More Bang for Your Buck
A number of IT professionals are seeing increased budget and head-count reductions as more large business decision-makers turn to cost-cutting measures. Because of this, projects are watched very intimately by IT leaders – reining in projects more closely than ever. This challenge has lead IT to turn to project management offices (PMOs) as an approach to boost IT efficiency, optimize cost, and deliver projects on time and in full. We have to bear in mind, however, that establishing a PMO team is not a short term strategy for lowering costs. Numerous studies have indicated that the longer companies have been operating PMO, the better the results in terms of accomplishing project goals.
Standardize Project Management Practices
For large corporations, scores of projects happen at the same time and more often, it is just too hard for the CIO to keep track of them. This is where PMO provides its biggest contribution to IT. PMO introduces economies of repetition in the execution of projects and makes it easier for the CIO to track progress and results. It is the job of the project management office to make sure that the projects follow the established project management standards. The PMO group is responsible for defining and maintaining the standards of processes related to project management. It is the source of documentation, guidance and metrics on the practice of project management and execution.
Facilitate IT Portfolio Management
The implementation of a PMO group is a stepping stone to IT portfolio management. I have reiterated this several times but I think it is important to note that progression from project management to portfolio management is intertwined with the maturity of the IT organization. If the organization doesn’t have a strong project management discipline and Project Management Office, it is difficult to even imagine how IT portfolio management can be achieved. PMO should have a staff of program managers who can manage multiple projects that are related – such as infrastructure technologies, desktop applications, processes, business model implementation and so on – and allocate investments and resources accordingly. IT Portfolio Management is focused on investments and business results as compared to the focal point of Project Management which is project deliverables. This will bring IT (and the business) double bang for its buck!
Someone who has experienced working with an effective project management office surely can give more than measly three reasons – but to me the three that I have just mentioned are the most essential. There is no uniform recipe to success when establishing a Project Management Office (PMO). PMO is not a quick-fix solution only created to deliver immediate savings. It is an important component of the organizational maturity of an IT organization. It is important that the PMO structure is closely aligned to the team’s culture. A final note: Projects exist in virtually all areas of the company – the PMO practice can also be implemented there. In some companies, IT’s project management office provides support and internal consulting to other departments.
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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.