Chapter Introduction

Today's global market companies, regardless of industry and size, are looking to improve their systems and processes to become more competitive. One way they are attempting to do this is by establishing project management as a core competency throughout the organization. By setting up standardized procedures within the company, they hope to learn from past mistakes, make processes more efficient, and develop people's skills and talents to work more effectively. This book is written for those organizations that are considering taking, or that have already taken, this first step, but are having difficulty gaining the level of acceptance necessary to achieve complete success. The list of organizations attempting to integrate project management disciplines and best practices into the way they manage their businesses is expanding daily; however, those who have succeeded in doing so is significantly smaller. The answer for many of these companies is positioning. By positioning we mean that the group charged with the implementation of project management and best practices is positioned in the uppermost levels of the firm. It is critical that all levels of workers and managers see that the executive level of the firm supports it without hesitation, publicly, and completely. Without support from the top, it won't get off the ground. Typically, the group charged with the responsibility to get the system up and running is called a Project Management Center of Excellence (PMCoE). Positioning is a critical aspect of establishing project management as a company's enterprise-wide core competency. It must first be viewed and treated as a key business function throughout the organization. It is the first critical step toward successfully institutionalizing project management best practices as a core competency. The first step that is required to achieve the goal of establishing project management enterprise-wide is the creation of a PMCoE that has the authority and responsibility to get the job done.

This book provides examples that show how to implement project management disciplines and practices successfully. Establishing project management centers of excellence should not be viewed as a quick-fix solution, but rather as a long-term, foundation-building effort. It is not a trivial pursuit. Deciding to establish an effective PMCoE is the opening action. It requires significant changes in organizational structure and obliges people at all levels in the company to learn new concepts of managing by applying new methods to complete the work they do. Careful planning with the tenacity to stay on track and not lose sight of the end goal is essential.

In this book, we identify the structural changes required; how to effectively manage and distribute company resources; how to develop and distribute an effective project management methodology; how to identify education and training criteria, curriculum, and performance evaluation methods; how to ensure a project's readiness before work begins; and, finally, how to identify the growth levels the organization must progress through as it matures.

The Driving Forces

Competing globally, increasing market share, reducing costs, and improving profits—all in the pursuit of producing better products and services faster through the use of high technology solutions— are just a few of the reasons why most organizations seek better ways to improve time-to-market, cost-to-market, and quality-to-market. The effective use of project management techniques is a critical element for achieving improvements in these areas. Some firms even view project management as a key weapon in their arsenal to increase customer satisfaction and beat the competition. Dr. Harold Kerzner, Executive Director for Project Management at the International Institute for Learning, states the case well in this excerpt from the preface of his book, In Search of Excellence in Project Management:*

Project management is no longer viewed as a system internal to the organization. It is now viewed as a competitive weapon that brings quality and value added to the customer.

Kerzner identifies twenty-seven companies that are considered world-class organizations that excel at using project management as a strategic management tool and that have either achieved some degree of excellence or are headed in the right direction to achieve excellence in the future.

The organization as a whole must recognize and adopt new attitudes that embrace project management best practices as the normal way of working. This enables them to bring the full power of this new competitive weapon to bear in the battle of continued business growth and, in many cases, ultimate survival in today's highly competitive global market.

PMCoEs are created for many different reasons; however, they typically share an origin that involves some degree of pain, which brings about a need to take action to relieve or eliminate the pain.

Changes often occur as a result of pain, which is caused by some circumstance—either internal or external—that is outside the control of the organization. Figure 1-1 shows a simple example of how changes typically come about. These circumstances may motivate organizations to establish a PMCoE. Some examples include:

• Losing market share due to increasing global competition

• Poor cost vs. profit ratios resulting in falling or stagnant stock values

• Competition with faster time-to-market

• Changing economic conditions that force downsizing

• Effective use of fewer resources caused by downsizing

*Harold Kerzner, In Search of Excellence in Project Management (New York: John Wiley & Sons, Inc., 1998).

Figure 1-1. Steps Leading to Change

Figure 1-1. Steps Leading to Change

The PAIN caused by driving force(s) must be strong enough to establish a NEED for relief.

NEED

The ACTION taken is often in the form of a quick fix that provides short-term relief rather than a long-term solution to eliminate the root cause of the pain.

The PAIN caused by driving force(s) must be strong enough to establish a NEED for relief.

NEED is translated into a desire to take ACTION that will provide a solution to remove the pain.

The ACTION taken is often in the form of a quick fix that provides short-term relief rather than a long-term solution to eliminate the root cause of the pain.

• Implementing new technology to become more efficient

• Managing changes brought on by dynamic growth

• New executives who have seen it add value elsewhere

Understanding the motive behind the decision to create a PMCoE is very important, because if the motive is unclear or poorly communicated, then defining the purpose, goals, and objectives of the PMCoE becomes challenging.

The desire to set up a PMCoE can originate from any level of the organization, but frequently emerges from an area of the organization whose projects have the greatest impact on all sectors of the company. Information Technology (IT) is typically the functional area where PMCoE start out in most organizations, regardless of industry. This happens for several reasons.

• The rapid growth in technology and desktop use of business applications have generated a large number of projects that affect the whole organization.

• IT is most often where the greatest number of strategic, mission-critical projects affecting the whole organization occur.

• The Y2K issue brought the effectiveness of project management to the forefront for many IT executives.

• IT consumes a significant portion of the annual operating budget in most large organizations, thereby giving mission-critical projects high visibility.

• Reports from IT watchdog groups, such as Gartner and Standish, indicate a poor record of successes for IT projects in general.

Where the PMCoE is positioned in the organization's management structure has a significant impact on the overall success of establishing project management disciplines enterprise-wide. Positioning also affects the title you give this function or unit and how you define the role it plays in the organization.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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