When are projects identified

The need for a project can arise at any time, but many are identified during the annual planning cycle because the organisation is focusing on what it would like to achieve during the coming year. Yet both the organisation and the outside world will change during that year so a contingency budget should be created for initiatives approved outside the planning cycle.

When a project is identified, three things will apply:

e unless this is the first time the organisation has identified projects, it is likely that there will be a portfolio of projects that are under way, having been commissioned during the previous year, into which the new project may be slotted; e the project's selection, prioritisation and commissioning should be managed, not left to the whim of budget-holders; e some basic information must be known about each potential project if informed decisions are to be made about its future.

Most organisations have a pro forma to be used to outline a potential project. This is not only to make sure that subsequent debate is informed, but also formally to place the idea of the project in the organisation's roster of work. Thus the project does not emerge from chaos but is the product of a considered and cost-controlled process.

The pro forma is often called a project outline (see Table 2.2 for a typical example). This simple document seeks to record the answers to the most important questions at this early stage before the project is commissioned.

Table 2.2 A typical project outline

Sponsor

The name of the person who has driven the initiative thus far.

Title

The name of the potential project. If the initiative is confidential, use a

code name.

Objective

What is the purpose of the potential project? What problem or

opportunity is it seeking to address?

Benefits

What benefits may be expected from the project, should it take place?

Over what period is the return on investment expected?

Scope

Are there any specific inclusions or exclusions of note?

Key products

What will the project deliver?

Timescale

How long may the project take? Are there any important dates?

Investment

What investment will be necessary and over what period?

Investment needed

What investment is necessary for the next stage of the project?

for the next stage

Planning

What assumptions had to be made when identifying key products,

assumptions

timescales, budgets and benefits?

Risks

What may cause the project to fail? What mitigations may there be for

each risk identified?

If the senior managers think there is sufficient merit in the idea mapped out in the project outline and supported by their analysis, there is a chance of it becoming a real project.

There is a greater chance that those debating the merits of one potential project compared with another can do so when the features of each, no matter how scant, are clearly and commonly understood. Project outlines also make it possible to consider how the right projects may be selected, prioritised and commissioned for the vision to be achieved.

The way in which many organisations choose to achieve their vision is to put in place a combination of business-as-usual and change initiatives to deliver step-by-step improvements and value along the way. Once a year, those organisations develop their business plans, the result of which is usually a combination of old and new initiatives that will help achieve the business strategy.

For the most part, the once-a-year effort will focus on the initiatives the board want to deliver and will incorporate a combination of business as usual and change. At this level of the organisation, change is often best described in terms of programmes. Senior managers know that governance is needed to implement the delivery of something significant or new. But although programmes are designed with the innate governance to enable their control, they are still made up of interdependent projects. Add these to the other, smaller improvements that a company needs to make during the year and the organisation may have a large portfolio of initiatives that demands and deserves some form of overarching continuous governance.

Continuity is at the heart of the argument for a form of management of business change. Projects are being identified all the time, so there is a significant risk that initiatives can be identified and initiated that have little or no reference to the business plan, its sponsors or the organisation's vision for the future.

In recognising that a relationship exists between a project and the business plan, it should be possible to confirm that the list of projects being proposed or undertaken will substantially deliver the company's change agenda. So if an organisation wishes to know its true destination, it should look to the portfolio of projects it has chosen to invest in by design, by instinct or by mistake.

An organisation needs a clear line of sight between the business plan and its portfolio of projects, and assurance that the projects it undertakes will deliver the change it desires. Three steps can help to establish and maintain this line of sight. They are as easy to remember as abc:

e Articulating - describing the business plan so it helps to identify projects.

e Balancing - making sure that the proposed portfolio of projects is constructed to deliver across a range of measures. e Commissioning - sponsoring those projects that will make sure the organisation delivers the change component of the business plan.

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