Strategic Programmes

Bridging the top management conceptual divide

Posted in Governing Programmes and Projects, Strategic Programmes on October 14th, 2009 by Raymond Young – 3 Comments

Executive Summary

Top management support is crucial for project success, but top managers are not interested in project level concerns. Programme management is the crucial link because programmes deliver the business benefits required to realise strategic goals. web name generator However the project and programme management community will have to learn engage at the strategy level and focus on the achievement of strategic goals. The current approaches are too heavily influenced by project management concepts to be effective in engaging top management.


The need for top management support

IT governance guru John Thorp has advocated for some time the need to manage projects at the programme level in order to realise the desired benefits. I’ve come to the same conclusion from a different angle:

There is now strong evidence that top management support is the most important critical success factor and is not simply one of many factors [i].

If so, then it is very difficult for projects to succeed if top managers do not consider project management to be a matter of direct concern and they don’t [ii].

If projects don’t succeed (in delivering business benefits) then corporate strategies aren’t implemented. Everyone loses. (This almost certainly appears to be the case with one of the best performers in the public sector: the State of Victoria; and it is likely to be the case with the rest of us. It is well known that two thirds of projects deliver no value at all [iii]).

This situation is very dysfunctional with as much as 3% of GDP is being lost because project managers can’t get the attention of top managers.

We can engage top managers through programme management

We believe there is a conceptual chasm between the top management and project management community. They do not have a common language and do not work together to achieve common goals. We have documented our analysis in Bridging the TMS-PM conceptual divide. Our major findings are:

Project management is increasingly being used to implement strategy; an application it was not designed to meet. Projects deliver products that might enable a strategy but they rarely if ever deliver strategies.

Portfolio management is not a solution because the focus is on the selection of projects. If projects cannot deliver a strategy then no matter how well you select projects, it will not result in a strategy being delivered. For strategic goals to be met, it is essential that portfolios are portfolios of programmes not portfolios of projects. This is not how PPM (project portfolio management) is currently practiced.

Programmes are the vital link between strategy and the realisation of strategic goals. We must as John has stated, focus our attention at the programme level. Plan for, select and fund entire programmes (or not). Our point of difference is that we believe mainstream programme management is currently too immature, too inflexible and too influenced by project management to engage the top management audience. Programme managers cannot assume strategy is delegated from on high and only needs to be implemented. The practice of programme management much be enhanced to deal appropriately with much lower levels of certainty than practitioners of strategic planning and programme management have traditionally assumed.

Finally active governance by top managers is essential to go beyond planning to actually realise the desired benefits over time. The future is inherently unpredictable and top level governance is required to steer or navigate around unexpected obstacles. Governance is not how the project management methodologies have portrayed it: to have a steering committee or a project board. Governance is an attitude and requires an active questioning. The 6Q Governance™ framework, an enhancement of HB280 and AS8016, is an excellent guidance that we recommend to all.

But we need to lift our game and learn to contribute to strategy

However, we face an uphill battle overcoming a considerable misdirection of effort being promoted by the project and programme management community. This might seem an arrogant statement but we would ask you to consider how many project managers operate at the level of the board or C-suite? An earlier blog summarised a professional presentation for ISACA that considered board level decision-making. The quotes below are taken from the ‘decision-making’ module of the AICD Company Director’s Course and we believe the last quote may apply particularly to the current thinking in the project and programme management communities. If we are to engage the top managers we need for our success, we need to do it at their level so that both they and we can succeed. The level at which we must engage is strategy and the achievement of strategic goals.

“Decision-making is a process rather than something that occurs in a single point in time”

“The process … begins when we need to do something but we do not know what”

“People in organisations such as managers must pass through stages in mastering greater and greater complexity. This is not a matter of handling more and more information, but learning what information is important – what not to think about – to focus on what is really important” Jaques (1998)

“When a person is out of their depth in terms of the level of complexity they have to handle, they will implement mechanisms to maintain control such as cutting the debate, seeking to silence people … often unconscious behaviours designed to avoid their own lack of understanding”


[i] R. Young and E. Jordan, “Top management support: Mantra or necessity?,” International Journal of Project Management 26, no. 7 (2008): 713 – 725, http://www.sciencedirect.com/science/article/B6V9V-4T8R1VR-1/2/cbb9982c137815f208ac6ca820c3b45f.

[ii] L. Crawford, “Senior management perceptions of project management competence,” International Journal of Project Management 23, no. 1 (2005): 7-16, http://www.sciencedirect.com/science/article/B6V9V-4D636C6-4/2/b6479d1c140991c277782e9cfaff6ffb .

[iii] R. Young, “What is the ROI for IT Project Governance? Establishing a benchmark.,” in 2006 IT Governance International Conference (Auckland, New Zealand, 2006).

Deficiencies with programme management?

Posted in Governing Programmes and Projects, Strategic Programmes on September 7th, 2009 by Raymond Young – Be the first to comment

Executive Summary

Having raised the question in a earlier post of why billions of dollars invested in projects were not resulting in the realisation of strategic benefits, and then exploring portfolio management, this post explores whether programme management may play a part.

It appears programme management is indeed the vital link but may be deficient in two critical areas:

  1. Current conceptions of programme management are often immature and inconsistent.
  2. Current guidelines may not be flexible enough to support strategy.
    1. The level of certainty that exists with strategy is far less than programme managers have traditionally assumed.
    2. It is not optimal to work on the basis that top managers set strategy and programme managers implement strategy.
    3. Programme management must adapt to the context within which it operates. This flexibility of practice is important to:
      1. support some level of challenging, feedback and dialogue on strategy, and
      2. easily redefine the program as new information comes to hand.


this post is an extract from an academic paper prepared for the IT Project Management SIG meeting at the2009  International Conference for Information Systems

Making Sense of Program Management

Programme management in contrast to project or portfolio management is not a mature discipline. There are less than a dozen textbooks and almost all of them start by commenting on the dearth of available guidance. This situation may have arisen because the origins of program management were in the US aerospace and defence industries where it was kept secret for decades. It was only in the 1980s as people moved did program management take hold in the commercial sector but even then it was sometimes only the term being misapplied to the management of large or multiple projects [1]. The US understanding is probably best captured by the Project Management Institute’s recently published Standard for Program Management with its focus on new product development. However, the UK’s Office of Government Commerce’s developed Managing Successful Programmes in the late 1990s to focus on the delivery of change and has begun to dominate the way programme management is being understood internationally [2].

However, there remains however considerable confusion [3]. Some successful project managers have been promoted into programme roles only to flounder [2]. It was an important clarification to find that project management and program management had different theoretical foundations and that programmes could not be treated as scale-ups of projects [4]. It was found that project management had been applied successfully mainly in the domain of new product development. Program management was characterised more as a tool for strategy implementation in domains that included manufacturing, quality, organisational change, change in work and industry and product development [5]. It is not well understood that programme management competence relates more to general management skills and generic leadership qualities than to project management skills [6].

Deficiencies with implementing strategy

A problem has arisen because strategy is becoming more complex and is increasingly less about the technical skills to develop new products and more about the leadership skills to introduce organisational changes to react to rapidly changing environments. A strategy may sometimes require development of new products and services but to be effective the strategy will still require organisational change to develop the capacity to deliver new services [7]. We are starting to realise that the programme management practices that we have inherited are not particular supportive of strategic thinking and are inadequate for strategy implementation.

Programme management practice has yet to reflect the insights from thirty years of experience with strategic planning. Strategic planning has been found to be fundamentally different to strategic thinking [8]. The WW1 battle of Passchendaele is an example of how a strategically desirable option was found to be tactically impossible. After four months and the loss of over a quarter of a million lives, the generals eventually found they were sending their men through a sea of impassable mud. This particular failure was inexcusable, because the map is not the reality and the general should have seen for himself. However, corporate leaders do not have this option because they are not dealing with a physical environment that can be inspected but a future environment which cannot. It is necessary for a strategy to be informed by the results of a strategic plan. A chosen strategy must be tested on an ongoing basis, whether it is working as expected, or whether an alternative strategy is a better option. The level of certainty that exists with strategy is less than the practitioners of strategic planning and programme managers have traditionally assumed. It is not appropriate to work on the basis that top managers set a strategy and programme manager implement the strategy. There must be some level of questioning, feedback and dialogue.

Deficiencies with programme management

This insight is rarely if ever reflected in practice. Mainstream programme management is strongly influenced by the project management tradition and programme management practices may have been codified too rigidly. Practice tends to be programme-centric and a clear boundary between the project and business domains is maintained [9]. Guidelines suggest a level of documentation rigour that works as a disincentive to challenging and redefining the program as new information comes to hand and the guideline underemphasise the need to adapt to the context in which a programme operates [2]. Responsibility for the realisation of benefits is often assigned to business managers outside a narrowly defined programme [10]. One major text provides an example of a program to develop a new product independent of another program to market the product without emphasising the need to coordinate decisions to realise a strategic goals such as profitably entering a new market [1]. When organisations view programmes in this way, they tend to shoe-horn programmes into project-level thinking, fail to focus adequately on building and maintaining support for the strategic programme goals and lose most of the benefits sought in setting up programmes in the first place  [11][2]

Effective programme managers have been shown to frequently adapt the formal guidelines in subtle and creative ways, or ignore or contradict them completely. Arguably the common guidelines were found by them to either be not useful or not make sense. They seek more to engage stakeholders than to manage them as the methodologies might suggest. The current codification into a common set of transferable principles and processes appears to be inadequate and some even question whether it is possible [2].

Conclusion

The conclusion is that programme management is far from uniform and is immature as a discipline. It is as much about coping as it is about planning and rational decision making, as much about re-shaping the organisational landscape as it is about delivering new capabilities. There is the suggestion that the tendency towards prescription based on ‘one size with minor variations’ approach may warrant re-examination [2]. These insights may explain why programme management concepts have not had more influence or lead to the realisation of more strategic benefits within the Victorian public sector or beyond. This would appear to be a crucial deficiency that justifies further work. It does not seem acceptable to allow governments or corporations to continue to invest tens of billions of dollars and not realise the strategic benefits that we expect of them. This finding seems particularly important in the context of the massive fiscal stimuli being funded by governments around the world to counter the GFC.

References

[1]       D.Z. Millosevic, R. Martinelli, and J.M. Wadell, Program Management for Improved Business Results,  Hoboken, NJ: John Wiley & Sons, 2007.

[2]       S. Pellegrinelli, D. Partington, C. Hemingway, Z. Mohdzain, and M. Shah, “The importance of context in programme management: An empirical review of programme practices,” International Journal of Project Management,  vol. 25, 2007, pp. 41 – 55.

[3]       A. Stretton, “Program Management Diversity – Opportunity or Problem?,” PM World Today,  vol. 11, Jun. 2009.

[4]       M. Lycett, A. Rassau, and J. Danson, “Programme management: a critical review,” International Journal of Project Management,  vol. 22, 2004, pp. 289 – 299.

[5]       K. Artto, M. Martinsuo, H.G. Gemünden, and J. Murtoaro, “Foundations of program management: A bibliometric view,” International Journal of Project Management,  vol. 27, 2009, pp. 1 – 18.

[6]       D. Partington, S. Pellegrinelli, and M. Young, “Attributes and levels of programme management competence: an interpretive study,” International Journal of Project Management,  vol. 23, 2005, pp. 87 – 95.

[7]       D. Williams and T. Parr, Enterprise Programme Management: Delivering Value,  Basingstoke, Hampshire: Palgrave Macmillan, 2004.

[8]       H. Mintzberg, “The fall and rise of strategic planning,” Harvard Business Review,  vol. Jan-Feb, 1994.

[9]       M. Thiry and M. Deguire, “Recent developments in project-based organisations,” International Journal of Project Management,  vol. 25, 2007, pp. 649 – 658.

[10]     CCTA, Managing Successful Programmes,  London: Central Computer and Telecommunications Agency (now called OGC), 2000.

[11]         S. Pellegrinelli, “Programme management: organising project-based change,” International Journal of Project Management,  vol. 15, 1997, pp. 141 – 149.

Deficiencies with Portfolio Management?

Posted in Governing Programmes and Projects, Practice Areas, Strategic Programmes on September 7th, 2009 by Raymond Young – Be the first to comment

Executive Summary

Having raised the question in a earlier post of why billions of dollars invested in projects were not resulting in the realisation of strategic benefits, this post explores whether project portfolio management has a part to play.

Project portfolio management (PPM) practice may be deficient in two main areas:

  1. PPM not is practiced in a way that supports strategy development.
    1. It is common practice to focus on project risk, a lower order concern, but even then fewer than 33% of organisations report they diversify projects to manage portfolio risk.
    2. PPM is mainly used to manage resource conflicts
    3. Investments in software are therefore not justified in most cases.
  2. PPM focuses decision-making at the wrong level.
    1. For strategy to be implemented and strategic outcomes realised the key is to select the right programme rather than the right project (projects alone rarely deliver the desired strategy).
    2. PPM must support programme management more adequately.

Portfolio Management

this post is an extract from an academic paper prepared for the IT Project Management SIG meeting at the 2009  International Conference for Information Systems

Project portfolio management (PPM) is a well established field, particularly in the US. It has an extensive literature and is supported in industry by an established and growing PPM software market. Portfolio management has its conceptual foundations in portfolio theory applied to the selection of financial investments to reduce risks and increase returns [1]. This theory was applied to the domain of project portfolio management to select IT projects [2] and PPM software vendors market on the basis of being able to reduce risk and increase returns on a portfolio of project investments [3].

However, the question is whether PPM adds any strategic value [4]. Portfolio selection has been justified in the context of selecting new product development projects [5], but it is far less convincing when applied to the implementation of strategy. A significant problem arises because there is a disconnect in the way strategy is developed and way the strategic is planned [6].  Strategy development is fluid and emergent. Strategic planning, especially when following the current approaches to PPM is relatively inflexible and mechanical. Project selection tends to be based on first degree criteria identified through risk management tools [7]. In contrast upper level strategic decisions have traditionally relied on non-linear processes and higher level considerations. As a result relatively few organisations use PPM strategically. Fewer than 33% of organisations report they diversify to reduce portfolio risk [4] and in our experience PPM is never used to inform or implement strategy. PPM is mainly used to manage project resource issues.

The potential of PPM appears to only be justified when other aspects are in place such as top management commitment, agreed benefits measurement and a willingness to deal with project interdependencies and resource constraints  [4]. Some believe that PPM, because it is meant to deal with fairly stable environments, can only be effective if combined with programme management which is meant to deal with more turbulent environments and emergent strategies [7]. We would agree and add that by definition, strategic outcomes can only be achieved when a whole program is undertaken. If strategic outcomes are to be realised, it makes no sense to select individual projects, selection criteria must be at the program level.

The Victorian public service investment frameworks are quite closely aligned to the concepts of project portfolio management because they emphasise selecting the right projects. However some Victorian managers believe the tools and frameworks are simply guidelines with little voluntary application and little influence in practice. This conclusion can be applied more generally because Victoria  is a leader in New Public Management and for many represents best-practice. This discussion goes some way to explaining why PPM concepts have not had more influence or lead to the realisation of strategic benefits. The crucial deficiency seems to the absence of meaningful linkages to programme management.

References

[1]    H. Markowitz, “Portfolio Selection,” The Journal of Finance,  vol. 7, 1952, pp. 77-91.

[2]    F. McFarlan, “Portfolio appraoch to informatiuon systems,” Harvard Business Review, 1981, pp. 142-150.

[3]    CA, “Leading Market Research Firm Finds PPM Software Delivering Over 500 Percent ROI – CA,” 2009.

[4]    B.D. Reyck, Y. Grushka-Cockayne, M. Lockett, S.R. Calderini, M. Moura, and A. Sloper, “The impact of project portfolio management on information technology projects,” International Journal of Project Management,  vol. 23, 2005, pp. 524 – 537.

[5]    A. Jamieson and P.W. Morris, “Moving from corporate strategy to project strategy,” The Wiley Guide to Project, Program, and Portfolio Management,  Hoboken, NJ: John Wiley & Sons, 2007, pp. 34-62.

[6]    H. Mintzberg, “The fall and rise of strategic planning,” Harvard Business Review,  vol. Jan-Feb, 1994.

[7]    M. Thiry and M. Deguire, “Recent developments in project-based organisations,” International Journal of Project Management,  vol. 25, 2007, pp. 649 – 658.

What’s the value in strategic programme management?

Posted in Strategic Programmes on July 27th, 2009 by Len Carver – Be the first to comment

There are good reasons to build the strategic programme management capability in your organisation.

Here are just a few of them:

Programme strategy – Make sure that the purpose, size and structure of the programme is suitable for the outcomes required, and that there is a clear understanding of the organisational drivers.

Programme design – Create the correct programme structures to deliver successfully, and ensure the processes needed to manage the programme are in place.

Programme and project execution –  Ensure that your programme is structured and then managed to deliver on its strategic objectives, rather than only ensuring delivery of tasks.

Systems integration, core system replacement, process improvement, business consolidation, cost reduction – Ensure that the full extent of change in these programs is understood and recognised.  Identify where, why and how to manage them as a programme of work to ensure wider organisational issues are managed.

Control – Ensure that success criteria are established, agreed and measurable. A well defined programme review process will pick up projects before they derail. Good control extends through to programme finalisation to ensure the desired business benefits are achieved.