11.9. PROCESS APPROACH

Now that we've defined a few high-level committees and described their roles, we have to establish how they function and interact. The underlying reason for their existence is to ensure that resources are deployed optimally for the greatest return, working on the projects aligned to the corporate goals. To start off, it's perhaps a good idea to take stock of the inventory of "work." We use the term "work" and not "projects" because, unless you're able to account for all of the work that is occurring in the company and have an inventory of all the resources available, it will be difficult to match your capacity (resources) to the demand (work).

11.9.1. Stage 1

To get started on this daunting journey, it's best to take baby steps, letting the PPM system slowly mature by giving each stage time to stabilize before moving on to the next. So, first have the sponsor of the PPM create a PPM process recommendation committee. Have this committee be chaired by a senior executive who is eloquent as well as an advocate of the PPM process. The committee should be composed of key leaders from IT, profit centers, service centers, and the PMO. Have the committee work together as a group to develop a PPM process framework. Also, have this committee recommend the composition of the governance committee, the executive steering committee, and the project management standards committee. Have this group set expectations for each of these committees. After the process framework has been documented, have this group present their recommendations to the rest of the organization's leadership to get the consensus.

The benefit of going through this process is that it's easier to get buy-in from senior leadership, which is so crucial for the success of the implementation. Note that neither the project portfolio managers nor the PMO is taking an active role at this stage. The PPM project manager is working quietly behind the scenes to steer the PPM recommendation group in its appropriate direction while actively influencing the naysayers. It's important that you create an environment where it doesn't appear that any one person is driving the organization in a certain direction. There needs to be a feeling of teamwork and self-achievement by the PPM recommendation team members.

Once the framework is blessed by the senior executives (most of whom have in one way or another contributed to the final framework), it's time to engage the members of various committees identified by the PPM recommendation team. It's best if the PPM project manager and the chair of the PPM recommendation team meet with each of them individually and explain the purpose of their role and the importance of it. It's also important to have these individuals realize that the process has been blessed by the executives at the highest levels of the organization.

The desired state at the conclusion of this stage is that the entire leadership is on board with the PPM process framework and the various committees are in place. The PPM project manager has been given an implicit go-ahead with the entire leadership behind him or her.

11.9.2. Stage 2

Identify the best possible meeting facilitator. Have this person facilitate the project management standards committee and the governance committee meetings. Kick off the PM standards committee meetings and have the committee agree on the following:

• The committee should identify the main categories of work such as projects, maintenance, operations, and the like. Once the categories of work have been identified, very clearly document the definitions of the categories. For example, a project could be defined as "Any work that has a specific start and end date and utilizes resources from departments other than the sponsor's department, and has a total cost of at least $100,000 (inclusive of internal labor cost at the blended rate of $x/hr)." The threshold for the funding of the project is built into the definition of the project. For certain companies, the currency for budget is internal labor cost and not necessarily capital expense. Organizations should articulate the definitions of a project that suits their environment and needs. Given the definition of a project as stated above, any work that falls below this threshold is noncritical work.

• There should be just four or five of the most basic elements of a project tracked consistently across the organization (all departments). Clearly define these elements, for example:

  • State of the project (Not started/In progress/Cancelled/On hold/Closed)

  • Milestone status (In concept/Requirements/In IT development)

  • Health of the project (Red/Green/Yellow)

Once the committee has agreed on these items, go about documenting an inventory of projects as defined by the PM standards committee.

It's very important not to get overzealous and attempt to document the smallest detail of every project. It is a maturing process. Perhaps the first round is just to get an inventory of "projects" in an Excel spreadsheet. Once you have the list of projects, you could then add a column and write the name of the person who is accountable for the success of the project. If the maturity level of the organization is low, having someone's name that is playing the role of a project manager could be a very challenging task. You then gradually begin to add columns and collect more information. At every stage, display the document prominently, perhaps on your Intranet. The visibility of the document will help to build credibility for PPM. Figure 11.2 is an example of a projects-tracking spreadsheet.

11.9.3. Stage 3

Once a credible inventory of projects has been established, the governance committee can begin to meet. Though at this stage there may not be formal business case or project charter documents, the individuals in the governance committee can begin to prioritize projects based on their knowledge of the business and the value of the projects. Why prioritize? There may not be a lot of value to the profit centers to prioritize projects at this stage. However, it's of immense value to the shared services. Shared services serve multiple profit centers or business units. Prioritizing projects at the corporate level makes it easier for the service centers to allocate resources appropriately, removing the guesswork and politicking from the process.

Figure 11.2. Project information can be displayed in a variety of formats, but it's critically important that information is displayed prominently so all stakeholders can clearly understand the status of the project portfolio.

It's to be fully expected that there will be departments that will not play by the rules and will not volunteer project information easily. In such circumstances the service centers can play a very critical role in making sure that everyone complies with the process. In essence, service centers can state that they will not be able to allocate resources to projects that are not on the projects list and have not been prioritized by the governance committee. If you can influence the service centers to abide by this strategy, it will not only help service centers to manage their resources optimally, but will also help mature the process by getting all the departments into compliance.

11.9.4. Stage 4

Once you begin to have a stable document that lists all ongoing projects, it's time to begin developing the discipline of building business cases and charter documents. To get the processing going, have the project management standards committee set simple standards for the amount of detail that goes into business cases and charters, making it commensurate with the size and complexity of the project. If it's a small project, perhaps just a few lines or a paragraph will be sufficient to detail the costs and benefits associated with the project. Larger projects will be accompanied by more detailed and thorough charter documents and business cases. The business cases and charter documents will begin to provide more objective information to assist the governance committee in prioritizing projects. Prior to this stage, prioritization of projects didn't mean a lot to the profit centers. Now, with business cases in place, profit centers can begin to make more informed decisions on which projects to fund and which ones not to. From a profit center's perspective, a business case and a charter document will validate the idea, justify the expense, and develop an understanding of the return on investment.

This is also the best time to introduce the project funding process. The governance committee should work closely with the financial arm of the company to define and set guidelines for funding and monitoring project budgets.

It takes several months for a mid-sized organization to reach this stage. One has to understand that this is a maturing process and that it takes time to build the discipline. Now what? We have an Excel spreadsheet with a list of active projects. Each project on the list probably also documents basic details such as the name of the project manager, status (red/green/yellow), start and end dates, and so on. The projects also probably have documented charters and business cases. Please note that we have not talked about an enterprise PPM tool yet. We have been managing the process with spreadsheets.

11.9.5. Stage 5

The various committees that have been established can continue to function, but in a limited manner. Projects can be evaluated, funded, approved/disapproved. We still cannot efficiently forecast resource bottlenecks, cross-project dependencies, or perform what-if scenarios of the impact on projects due to constantly changing business conditions. You will need a robust enterprise PPM tool for this kind of sophisticated tracking and analysis of project data. It's recommended that while the PPM process is maturing, the PMO work closely with the project management standards committee to select the enterprise PPM tool. It's best that these initiatives run more or less in parallel. The PPM tool selection process, implementation, and training of associates on its use are outside the scope of this book. It's also assumed that a well-structured estimation process, resource allocation/management processes, and time tracking would be addressed within the scope of the PPM tool implementation. At this stage, we'll assume that the tool is in place and that all the users have been trained on all aspects of the tool.

The next stage is to mature the process of matching the demand with the capacity of the organization. There are many different variations on the implementation of this process.