defining organizational project management 2012
DESCRIPTION
TRANSCRIPT
Defining Organizational Project Management
Dr. Nigel L. Williams, PMP, Prince2( Twitter) @org_pm OPM COP/ University of Bedfordshire
Organizational Project Management (OPM) COP
• PMI Online community that examines the strategic role of PM (http://opm.vc.pmi.org)
• Discussions• Content
– Webinars– Podcasts– White Papers
Background
• Increasing importance of PM• Trillions of dollars spent in Projects Worldwide• Increasing investments in PM• PM emerging as a important profession ( >20
million PMs worldwide)
• How do organizations create value?• What is the relationship between PM and
Strategy?• Why should organizations have a project
strategy• How can organizations craft a project
strategy?
• Inside Out
– Resource Based
(Penrose 1959,
Barney 1991)
– Dynamic
Capabilities (Teece
et al., 1994)
How do Organizations create value?
• Outside-In
― Environmental and
Competitive Forces
Approaches (Porter
1980, Miller and
Friesen 1983)
― Entry Deterrence
(Shipario 1989)
Projects, Strategy and Uncertainty
Pre 1960’s 1960-1990 1990 to Present
Pidd, M. (1996)
Environmental Uncertainty
Puzzles
• No ambiguity about the problem• The issues and options are clear • PM for adjustment
– Type 1 projects(Turner & Cochrane, 1993 ): :Defined Method & Defined Outcome e.g Construction projects
Problems
• Formulation of problem may be agreed• Variety of approaches to solving it.• PM for Adaptation
– Type 2: Defined Outcome NOT Method, eg Product development
– Type 3:Defined Method NOT Outcome, eg Software development
Messes
• High ambiguity• No agreement about issues • PM as an organizing framework
– Type 4 Projects :Undefined Method AND Unknown Outcomes, e.g. Organizational Development
Example: Widget Co
• Widget manufacturer• Identifies possible need for additional
capacity– Puzzle: Build facility– Problem: Build facility or outsource?– Mess: Do we need additional capacity? Where?
Dr Nigel L. Williams, PMP 10
Current View (Outside- In): Projects are an instrument
StrategyProjects & Programs: Defined Outcomes
OperationsPortfolio:Strategic Objectives
Portfolio Adjustment
Business Impact
Existing Perspective may be inadequate
• Greater role for PM in Organizations– Shorter horizon for strategy– Increasing numbers of Projects– Greater complexity of Projects
What is Known about OPM?
• Evidence Based Approach• Dimension current knowledge• Understand major paradigms• Build research informed definition of OPM
Research Method
• Systematic Review – Tool employed in Medicine: Cochrane Collaboration
(US)
– Policy EPPI Centre (UK)
– Management (Evidenceinformedmanagement.com)
Systematic Review Process
• Identify keywords• Identify databases• Scan databases• Review abstracts• Create final list of studies for review
Systematic Review of OPM
• Keywords– “OPM”, “OPM3”, “P3M3”,”P2M”,
“Organizational Project Management”, “Project Management AND Organizations”
• 79 Studies published from 1989 to 2011• Final group of 31 articles
Paradigms of OPM
• OPM as Structure• OPM as Practice
OPM as Structure
• Companies as collections of projects (Garies 1989,1990)
WidgetCo
Mkt Eng IT
Project A
Project D
Project B
Project C
Shared TechnologyShared ClientRelated Objectives
Traditional
Project Based Organization
OPM as Structure
• Key company challenges: Integrating and Differentiating
IntegratingCombining
Project Outputs
DifferentiatingCreating new
projects to respond to
threats/ opportunities
OPM as Structure: Change
• Organizational Change Management• Projects: 1st order change• Programs: 2nd order change
Widgetco Project
Programs
OPM as Practice
• Maturity Models– Operations– Software
• Evaluate current activities against best practice
• Identify areas for improvement• Implement improvement actions
Maturity Models Compared
Maturity Model GoalsAreas Assessed Classification
OPM3 (PMI)Align PM to Strategy
Projects, Programs, Portfolios
1 (standardize) to 4 (Continuously improve)
P2M- Japan Align PM to Strategy
Projects, Programs,
1 (haphazard) to 5 (optimization)
P3M3- UKImprove project practice
Projects, Programs, Portfolios
1 (awareness) to 5 (optimized)
Project Excellence Model
Improve project practices Projects
Continuous scale from 1 to 1000
Linkages
• Structure- Practice• Organizations may create projects to
respond to opportunities– Projects may create new practices– If they are found to be superior, may become
best practice
OPM Definition
Organizational Project Management is the systematic management and integration of temporary activities (projects, programs and portfolios) to enable the realization of strategic initiatives in enterprises
Combination of Inside Out AND Outside In Approaches
• (Outside- In) PM supports the creation and modification of firm competencies– Facilitates adaptation to changing environment– Organizations may also influence the environment
for their own benefit (Oliver & Holzinger, 2008)• (Inside- Out) PM can also be used to redefine
organizations– Change programs– New technology– New business processes
OPM( Combination of Outside in and Inside Out): PM Integrated with strategy
• Two way relationship between projects and strategy
• OPM’s role is greater than simply alignment
StrategyProjects & Programs: Defined Outcomes
OperationsPortfolio:Strategic Objectives
Portfolio Adjustment
Business Impact
Formulating Project Strategy: Decision Areas
OPM
Positioning
Architecture
Performance Measures
Practices
Interfaces
Governance
Positioning
• Role of Project Management in the Organization
• Driving Strategy – Project Driven Organizations/Project Based
Organizations: Construction, Consulting, Lean Startups
– Enabling Strategy: Companies undergoing large scale transformation
– Supporting Strategy : Projects to execute defined objectives
Project PositioningPrimarily Inside- out
Primarily Outside- in
Strategy Formulation Perspective
Supporter Enabler Driver
Architecture
• Configuration of Projects, Programs, Portfolio within a given company setting
Project Architecture
• Number• Scale• Complexity• Project Type 1-4
Governance• Systems for
managing responsibility for Projects/Program/Portfolio
• Systems for demonstrating accountability
Governance Structures
• Project Manager• Project Office• PMO• EPMO
• Linkages between Projects/Programs/Portfolio
• Linkages between PPP and Operations
Interfaces
Interfaces
• Functional Interfaces (Iqbal 2009)– Integration between PPP
• Domain Interfaces– Integration with enterprise
Practices
• Project/Program/Portfolio level activities
• Methodologies, Tools and Techniques
Practices
• Current Practices• Rate of Improvement• Path of development
Performance Measures
• Approaches used to evaluate Project /Program/Portfolio outcomes and processes
Comparison of Project Based Organizations
• Project Based Organizations• Company 1: Engineering firm in energy
sector• Company 2: Construction firm
Company 1(Engineering Firm)
PM is Strategic
ArchitectureType 1 Projects (Custom Manufacturing)Type 2 Projects (Product Development)
InterfacesFunctional (Shared
technology/resources)
PracticesDerived from PMBOK
Trajectory of development: Toward
higher maturity
GovernanceProject Team
Performance MeasuresFrom PMBOK
Output: Cost/Time/Quality
Company 1
Domain Gaps Recommendations
Governance Lack of framework for monitoring multiple projects
Project Team supported by Integrating Information System
Practices/Performance Measures
Output oriented No measures for improvement/innovation
Incorporate input/process metricsIncorporate metrics for identifying new/improved practice
Architecture/ Interfaces
Multiple unconnected projectsFunctional Interfaces
Group projects by shared technology/Functions
Company 2
PM is Strategic
ArchitectureType 1 projects (Construction)
InterfacesFunctional (Shared
resources)Domain (Finance/Marketing)
PracticesPMI
GovernancePMO
Performance MeasuresOPM3
Trajectory: Toward Higher level of maturity
Company 2Domain Gaps Recommendations
Governance Low investment in training/developing PMs
Implement internal mentoring/PM competency development program
Practices/Performance Measures
Output oriented No measures for improvement/innovation
Incorporate input/process metricsIncorporate metrics for identifying new/improved practice
Architecture/ Interfaces
Functional/Domain interfaces Project dashboard providing views from both domains
Future Research
• Empirical validation of OPM Elements• Process view of Project Management and
strategy; beyond life cycles• OPM Competencies
Summary
• Organizations are engaging in increasing number of projects
• Project Managers need to go beyond deliverables
• OPM can link Projects with context• Provides view of organizations rooted in
Project Management
Contact Information
Nigel [email protected],
[email protected]_pm (Twitter), OPM COP, OPM group on
References• Barney, J. (1991). Firm resources and sustained competitive advantage.
Journal of Management, 17(1), 99–120• Gareis, R. Management by project: the management approach for the future,
International Journal of Project Management, (1989), Vol. 7, No. 4, pp. 243 - 249.
• Miller, D. and Friesen, P. (1983). Strategy-making and the environment: the third link. Strategic Management Journal, 4(3), 221–235.
• Penrose, E. (1959). The Theory of the Growth of the Firm. London: Basil Blackwell.
• M. Pidd (1996) Tools for Thinking: Modelling in Management science. Wiley, Chichester.
References• Porter, M. (1980). Competitive Strategy. New York: Free Press• Shapiro, C. (1989). The theory of business strategy. RAND Journal of
Economics, 20(1), 125–137.• Teece, D. and Pisano, G. (1994). The dynamic capabilities of firms: an
introduction. Industrial and Corporate Change, 3(3), 537–556.