January 2007

One of the most important things a leader can do (if not the most important) is to ensure that their organization executes the appropriate plans/actions to reach the organizations’ goals.

Val Willis had an interesting post on Tom Peters’ blog about the recent Ford Motor Company announcement of record losses. In the post, Val discusses the need for leaders to focus on execution:

Getting a strategy executed requires more than a detailed plan, it requires getting everyone in the organization from the front lines to the C-Level engaged, passionate, and excited about the plan. Great execution happens in small manageable chunks by taking large plans and breaking them into manageable parts.

Sounds a lot like project management to me. I think most people would agree with me that the corporate world has ‘project-ized’ itself and is trying to deliver value via projects, which is what Ford is trying to do with their grand ‘re-organization and re-building’ plan.

The problem with making everything a project is that there still needs to be leadership within the project team. A good project manager doesn’t necessarily equate to a good project leader.

A good project manager may be able to create an nice Gantt chart and manage projects to deliver ‘on time, on scope and on budget‘ but to be a great project manager a person must lead the project…not just manage it.

I hope Ford has some excellent leaders within their teams…they will need them to execute their plans.

[tags] Project Management, Leadership, Execution [/tags]

Ran across an interesting Wiki for book summaries today. From Wiki Summaries:

Free book summaries that anyone can edit! WikiSummaries.org provides free summaries of books, plays and other written documents.

There aren’t many summaries yet, but I expect there will be once more people find out about this Wiki.

Check out Wiki Summaries @ http://wikisummaries.org/Main_Page

Thanks to Rob Millard @ Adventure of Strategy for the link.

[tags] Wikisummaries [/tags]

Mike Griffiths has a great post about Agile Project Leadership worth checking out. An excerpt worth sharing is:

Management is concerned with mastering the mechanical knowledge and skills of how to run a project. Leadership builds on these skills to add the people based skills to increase the chance of the project team wanting to make the project successful.

[tags] Agile, Project Management [/tags]

I’ve recently decided to stop calling myself a Project Manager and start calling myself a Manager of Projects.There is a difference as I hope you will see in the next few paragraphs.

I have 11 years experience in managing and delivering services to clients and during this time I gained plenty of project management experience but even more importantly, I gained experience in managing projects and leading people. The experience I gained as a project manager was excellent and led me to be the person that I am today, but I oftentimes wondered about the value that the project was bringing to the organization (many times, the value was vary small or even negative…but that’s a story for another post).

Everyone in the project management world knows about Portfolio Management and other areas of strategic project management, but I haven’t run across many people that have used the term “management of projects” to describe the overall process of selection, management and control of an organizations’ projects.

Dr. Jeffrey Pinto has defined the term “management of projects” on the IEEE Engineering Management Society’s Transactions website as the following (pay close attention to the last sentence):

The management of projects recognizes that while traditional project management techniques of scheduling, resource assignment, and control are still important, they must be considered as part of the larger challenge in successful projects. Research over the past two decades has demonstrated clearly the importance that client and stakeholder issues and technology management play in project success. What is required is that we broaden our focus to consider the management of external and front-end issues, including technology, design and testing, supply chain and procurement, and project stakeholders.

The last sentence really drives home the fact that a more strategic approach to managing projects is needed and is the area that I am most interested in researching and contributing to in my career. Of course, I am still very interested in Project Management and improving the methodologies and skills within the field, but my focus has been and hopefully will continue to be on the more strategic areas around managing projects.

The Project Management Institute (PMI) has been addressing the areas of strategic project management in recent years with their standards for Program Management and Portfolio Management. I hope to see updates in these standards address the more strategic levels of managing projects and I have volunteered to assist the PMI in updating the Project Portfolio Management standard.

As for my career in the field of Project Management…it still exists and I will still use the title of Project Manager as necessary but I don’t want to limit my area of practice to the traditional areas of PM and pigeonhole myself and my consulting practice.

Anyone know of a certification for a “strategic” project management professional? If there isn’t one out there…there should be.

[tags] Management of Projects, Strategic Project Management, Portfolio Management, PMP [/tags]

Of course
My blog post titled “The Problem(s) with Linear Thinking” made it into this week’s Carnival of the Capitalists, which was hosted by David Maister over on Passion, People and Principles. Although I didn’t make it onto David’s “posts I liked best list” I at least got a mention (as did anyone who submitted a link).

Go check out the other blogs listed…there are some great posts listed.

[tags] Carnival of the Capitalists, Linear Thinking [/tags]

In my post titled “Earned Value Management - The next “buzzword” I belittled Earned Value Management (EVM)…and now its time to eat some crow, although some of my objections to EVM still stand.

After doing more reading I realized the EVM can be a very powerful tool to use to manage and measure the performance of value creation on a project. Using EVM, a project manager is able to understand the actual value that the project is bringing to the organization as well as whether the project is truly on schedule and within budget.

To properly use EVM, a project manager must have the following information:

1. Planned Work - What work is scheduled to be completed?
2. Cost Estimate for Planned Work - What is the cost estimate for the scheduled work?
3. Actual Work - What work has been completed?
4. Cost Estimate for Completed Work - What is the cost estimate for the work that has been completed?
5. Actual Costs - What costs have actually been incurred?
6. Variances - Cost difference, Schedule difference, Estimate Difference.

If a PM can accurately capture the actual costs at any given moment during the project, EVM can be used and can provide a tremendous amount of information to a PM. Using values such as the Cost Performance Index (CPI) and the Schedule Performance Index (SPI), project managers can measure that financial performance of a project.

The key to utilizing EVM is to ensure that details about the costs incurred during a project are measurable and accurate. This is the sticking point that most PM’s have with using EVM since it can be difficult to accurately measure costs, but if EVM processes and systems are put into place at the beginning of a project this difficulty can be be removed (or at least alleviated).

As mentioned previously, I do still have some objections to some of the recent comments about using EVM, most notably the use of this tool as a sole means for performance measurement. Like any other methodology and/or tool used in life there needs to be some common sense applied its usage.

For anyone interested in a great debate about utilizing EVM in projects, please check out Max Wideman’s “Earned Value Discussion sparks debate” article on his web page.

[tags] Earned Value, Project Management, EVM [/tags]

Brad Appleton has a great list of resources listed on his blog. The list, titled Lean Software Development Resources provides links to a ton of books, articles, blogs and websites to learn more about Lean/Agile project management.

The blog “Slow Leadership” recently had a good post about Building Trust. An excerpt from the article is:

Trust is an essential basis for a productive, satisfying and fun business environment. Suspicion corrodes working relationships and undermines people’s confidence in themselves and their colleagues. Leaders need to offer trust, since the only way to prove whether others are trustworthy or not is by experience. Organizational leaders have nearly all the power, so it’s usually up to them to set the ball rolling. Trust is always a gift. As a leader, you need to be the one who begins the giving process.

On the flip side, think about the following comment by a VP of a US company taken from the Autumn 2006 special edition of Strategy+Business from a story about Participative Management. The comment is the VP’s thoughts of Participative Management and how it wouldn’t work in most American companies. The VP says that the only way for this type of management style to succeed is:

…for the company to have complete trust in you (the employee). We make them (employees) earn it first; we don’t assume the trust (Fisher, 2006, p.42).

I wonder if the employees of the US company that this VP works for would say that he is a great person to work for and that they love their jobs? After doing some digging on the company, it appears that it isn’t the ideal place to work and that there are a lot of employee relation problems. Perhaps if the leaders of this company were to step out in front and offer trust to their employees instead of requiring them to “earn” it, there would be less problems.

References:

• Fisher, L. M. (2006, Autumn 2006). Ricardo Semler Won’t Take Control. Strategy+Business, (Special Issue), pp. 32 - 43.

[tags] Leadership, Participative Management, Building Trust, Strategy+Business [/tags]

I was asked by a former professor to write a review of Peter Drucker’s “They’re not employees; they’re people” article to provide as an example to his class…I hope its a good example and not a bad one. I thought I’d share it here for others to read.

Article Review
The main theme of this article is that an organization must be mindful of the fact that employee relations should remain in focus even while the organization is outsourcing their human resources function.

In recent years, outsourcing has become a widely accepted and implemented method of cost control. Organizations are outsourcing their human resource (HR) functions for various reasons, but the main driver seems to be to cut costs and to offload the headache of the “growing burden of rules and regulations” (Drucker, p. 73).

According to Drucker, a study performed in 1997 by the consulting group McKinsey & Company shows that a large organization can decrease labor costs by 25% to 33% by outsourcing human resource functions (Drucker, p. 74). The cost savings argument for outsourcing seems to be an easy argument to make for any organization; however, an organization must seriously consider whether they are willing to save money at the risk of losing control over one of the most important assets within the organization, which are the people within that organization.

Another argument that has been used in the past for outsourcing HR functions is that outsourcing non-core functions can help an organizations’ HR team to remain focused on the core (i.e., strategic) functions of the organization. This argument makes sense and is one that Drucker fails to address in his article, although it seems as though his focus was the effect on the people within the organization than on the actual outsourcing. To follow up on the thought of outsourcing non-core HR functions, author Davidson (1998) writes:

Most experts agree the outsourcing option for human resources continues to be a viable long-term solution. The key is figuring out what human resources activities are core, and which are noncore. If HR professionals focus their outsourcing strategy from a strategic-partner perspective, their plans will not conflict with efforts to support high-performance HR systems, but will in fact, support those efforts by leaving human resources to do what is most important, managing and supporting the organization’s most valuable capital - its human assets (Davidson, 1998, p. 40).

Davidson and Drucker both reiterate that human assets are an organization’s most important capital and that outsourcing HR functions can create (or destroy) strategic advantage for an organization depending on how the organization handles the outsourcing.

The article does a very good job of describing the outsourcing of HR functions and the reasons that this outsourcing has become so popular. The article also does a very good job of outlining the need of an organization to think of their human assets not as just “employees”, but as people who can bring a great deal of advantage to the organization.

The last line of the article does a very good job of summing up the entire argument: “Employees may be our greatest liability, but people are our greatest opportunity“ (Drucker, 2002, p. 77).

References

• Davidson, L. (1998, January). Cut away noncore HR. Workforce, 77(1), 40-45.
• Drucker, P. F. (2002, February). They’re not employees; they’re people. Harvard Business Review, 80(2), 70-77.

[tags] Peter Drucker, Strategic use of Human Resources, Outsourcing [/tags]