pm-lotus by Howard Vaughan

Posts Tagged ‘Maturity’

Getting there - slowly

It’s good to see more organizations finally getting serious about project portfolio management. But why is it taking so long? While all the process elements have been understood by an enlightened few for many years, progress in putting portfolio management into widespread practice has been disappointingly lethargic.

The reality is that most organizations have a great deal to do to make portfolio management work for them. Meaningful portfolio management standards and usable software applications have been painfully slow to emerge. In addition, several pitfalls often derail implementation efforts. Here are four of the biggest:

Lack of Ownership

Managing a portfolio is the responsibility of executives and this is a message that does not always get driven home. Portfolio management provides the crucial linkage of project work with strategy and ultimately the enabler of that strategy. It is not just another level of tactical project management. Executives have to take ownership, get firmly involved and be supportive.

Ineffective Process

In the same way as projects need some form of process to facilitate successful execution, a portfolio requires a structured methodology for establishing oversight procedures, prioritizing projects, balancing resource capacity and demand, and optimizing project funding, scoping, integration, sequencing and resourcing for strategic value. Portfolio management is a discipline.

Mismatch with Maturity

Often lost in the conversations about project prioritization frameworks and strategic alignment is the simple fact that without solid planning and tracking at the individual project level, portfolio management can never achieve its primary goals. Proper portfolio management needs proper project management.

Misalignment with Culture

Portfolio management, like project management, is scalable. It has to be designed to fit the organization’s culture and the way in which decisions are made and work gets done. Misaligning the intensity of portfolio information needs, analysis and control with a firm’s culture is a guaranteed showstopper. Each activity should not only deliver real value – it has to be widely supported.

The Good News

On a positive note, portfolio management is getting increased executive level attention. There is a realization that the option to “Do Nothing” incurs a very significant cost in unrealized strategies, overstretched and demoralized project teams, a lack of knowledge and control over what’s really going on, and dissatisfied customers. No longer can organizations afford not to respond. The call to action is gaining traction.

When I first started in the project management services business, I was repeatedly led to believe that the construction industry was the beacon of leadership in project management maturity. My own experience over the years tended to question that wisdom and now the truth is out that this is indeed all nonsense. According to a recent survey by the Chartered Institute of Building (CIOB), which represents 42,000 members and sets standards for the management of the total building process, the construction industry has much to learn about project management.

The Shocking Truth

Not a towering force in project management

The survey results are based on data from 73 companies and over 2,000 projects. Its conclusions are available on the CIOB website – you can also watch an interesting video of the CIOB president Keith Pickavance presenting the results at the Project Management Asia Conference 2008. They make for a highly uncomplimentary denunciation of the state of project management practices in the industry- for example:

• less than 15% used a linked network to define the schedule
• more than 50% used only simple bar charts
  • (no chance of a critical path)
• more than 50% used paper (not computerized) records
• less than 15% kept logs of changes
  • (not much good in court)
• 95% did not report delays to progress because they:
  • hoped no-one would notice
  • hoped they could catch up
  • did not want to upset the client
  • thought they could blame someone else.

Its not a pretty picture. Little wonder then, that the industry is dogged by delays, compensation claims and disputes.

The Way Forward

Clearly there is a need for some serious project management skills development. In the words of Mr. Pickavance himself:

We have no standards, we have no training, we have no qualifications.

All of which should be manna from heaven for project management educators, particularly in those regions where construction investment is being pumped up to help resurrect limp economies. Assuming of course that the building firms are open to changing their ways.