Changing a company culture with project management
This work presents the PM@Siemens program; a project management program started in Siemens Germany in 2001, and in process of implementation in Siemens Mercosur. As part of this program, the company started several Project Management Professional (PMP®) preparation courses. The idea of this paper is to show how the program, these courses, and the certifications are changing the project management culture inside the company. The work is illustrated with the case of the PMP® courses of Siemens Brazil, as part of the PM@Siemens program. The main purpose of this work is to identify practical criterion that will lead to a successful change in the project management culture inside a company, as well as make a parallel with the academic knowledge. Interviews were conducted with the project managers and the responsible managers for project management at Siemens Mercosur.
A project is a temporary endeavour undertaken to create a unique product or service and project management is the application of knowledge, skills, tools and techniques to project activities to meet project requirements (PMI 2001, p204). The world today works with projects. This could be demonstrated by the number of companies adopting the project management methodology (Kerzner 2001). Besides that, the project management methodology is the way chosen, by many actual top managers, to take care of the critical aspects of their business (Cleland & Ireland 2000).
The world today works with projects. This could be demonstrated by the number of companies adopting the project management methodology (Kerzner 2000). Project management is the ability to coordinate activities with the main purpose to satisfy the stakeholders’ expectations. To create capabilities in the formation of work teams became a main worry, as means to manage different functions in different perspectives (Frame 1994).
Project management was developed as a leadership concept of interdisciplinary activities with the objective to solve a temporary problem. This characteristic permits project management to reach a high degree of innovation in the presented solutions to more complex works (Litke 1995). So, human resources must be prepared for this challenge.
Courses in project management are an important topic in many organizations around the world. Companies are sending their project managers to these courses to improve their control over the projects; so, project managers are becoming better in concluding their project on time, on cost and according to the defined scope (Hallows 2002).
The PMP certification of the Project Management Institute (PMI®) is the most acknowledged certification in the field of project management around the world and the courses that teach project management methodology and prepare the experienced project managers to take the exam are in important part of the process's certification.
The PM@Siemens Program
Siemens is a giant German based company, 150 years old, with more than 400,000 workers, in almost 200 countries. The company produces and installs a great variety of electrical, electronic and telecommunications equipment, the great majority delivered to customers through specific projects adapted to the necessities of each one. The products innovation tax is extremely high and the products actually sold were developed, at most three years ago. Basically the company sells customized solutions to their customers.
The Siemens project management initiative, called PM@Siemens, was begun in 2001 in Germany. The company made an analysis, with 8 groups, and realized that more than 50% of its gross sales are managed as projects. In fiscal year 2003/2004 this represents almost € 32 billion. This demonstrates the importance of good project management for this company.
The Siemens project management initiative has the following objectives (Siemens, 2003):
- Systematic best practice sharing;
- Standards in project management;
- Sufficient number of qualified project managers;
- Uniform project culture throughout Siemens;
- Sustained profitability.
The key success factors of project management considered by the company are (Siemens, 2003):
- Offer quality;
- Contract management;
- Qualified project managers;
- Claim management.
The company concluded that 80% of all order processing problems could be traced back to negotiation and contract management failures or weaknesses.
As an initial step, the basic conception work was carried out, the main topics on which the company will focus their attention were defined, and they were instructed to work out the content of this initiative together with Siemens groups and to implement the results throughout Siemens. With the first analysis from the 8 groups it was possible to obtain topics that a division, a department, or a sector, that manages its projects with successful results, have. These topics were called recommendations. In the program's last version, delivered in June 2003, there were 53 recommendations grouped into 12 modules (Siemens, 2003):
- Processes and roles;
- Contract management;
- Project controlling;
- Personnel management;
- Knowledge management;
- Operative quality management;
- Transfer and implementation process;
- Project procurement;
- Small projects.
Training Courses for Technical Certifications
There are several technical certifications available nowadays. All of the training courses for these certifications are structured in the same phases:
- Initial assessment: this initial phase has the objective to measure the participants degree of knowledge to better program the training;
- Theoretical and practical explanations: it is in this phase that all of the course contents are delivered to the participants;
- Simulation: some technical certifications are based in computer based tests, in these cases there are some simulators available for training; it is in this phase that the participants are trained to answer the tests;
- Final assessment: this final phase is made to guarantee that the participants are ready to take the certification exam and be successful.
The following Exhibit presents some of the technical certifications available in the market:
Exhibit 1 – Technical certifications (Font: Certmag 2002).
The PMP® Certification
The PMP certification is the most acknowledgeable certification in project management. It is delivered by the Project Management Institute (PMI) and consists in two phases:
- Project experience check: 4.500 hours (university degree) or 7.500 hours (technical degree) in the last 6 years;
- Knowledge check: 68,5% of correct answers in a specific knowledge test based on the Guide to the Project Management Body of Knowledge (PMBoK® Guide) (137 correct answers in 200 multiple choice questions).
Actually there are 17 million people working in projects around the world, and according to PMI (2004), there were 76,550 PMP certified project managers as of December, 2003. So it's possible to conclude that only 0,45% of the people working in projects around the world are certified as PMPs. Another important point is that the certification has a validation of 3 years.
The growth rate of the PMP® certification is almost 20% per year. The Exhibit 2 presents the data from the last two years.
Exhibit 2 – Growth of the PMP® certification (PMI 2004).
The Siemens PMP® Certification Course
The training methodology of the Siemens PMP® Certification Course tries to multiply the contents and prepare the project manager for PMP® certification from the (PMI), an international professional certification program, whose objectives are the growth and valorisation of the project managers.
The Siemens internal course duration is six months with maximum twenty participants. The project managers that obtain the PMP certification are invited to become the new program's instructor. The idea is that the project managers become the knowledge multipliers.
Klose (2002) presents the following skills necessary for project managers:
It is possible to verify that there are hard and soft skills necessary to become a good project manager. So, from this year forward, the company is beginning with new courses in project management based in the European methodology from the International Project Management Association (IPMA). These courses will embrace technical and personnel abilities and will train from team members to project directors. The main difficult for the company, now, is to unify the American and European international certification methodologies.
The course is structured in ten topics; nine of them are the same of the project knowledge areas presented in the PMBOK® Guide and shown in the Exhibit 3. The other topic is the professional responsibility.
Exhibit 3 – Project knowledge areas (PMI 2000, p8).
The objectives of the program are:
- Extend the project management culture inside Siemens Mercosur;
- Expand the theoretical project management knowledge inside Siemens Mercosur;
- To get more PMP®s in Siemens Mercosur.
The pre requisites for participating are:
- Fluent English;
- Experience in project management;
- Department indication;
- Evaluation and validation from the Human Resources department;
- Availability for study time;
- Dedication to the program.
The course consists of 280 hours, 140 in-class and 140 for self-study, distributed in 6 workshops, one per month, including: presentation, studies, simulation and experience exchange. The dedication between the workshops consists of lectures, studies and simulation. The instructors are project managers from Siemens with experience in project management and certified as PMPs.
Two great differences in the program are the discussions generated during the workshops, which enhances the understanding of the project management methodologies in the company environment; and the simulations made during the course. More than 1,000 questions are made and analyzed during the whole course and others 3,000 questions are delivered to the participants to be made in a self-study mode.
The Courses Results
The Siemens PMP preparation course, begun in 2001, and 8 study groups were already concluded in Brazil: 4 in Sao Paulo, 3 in Curitiba and 1 in Recife. Three other groups are occurring in Brazil: 2 in Curitiba and 1 in Sao Paulo. The total amount invested in training and certification in project management in the period 2001-2004 by Siemens Mercosur is R$ 1,200,000.00 or US$ 400,000.00.
The results already obtained are:
- 204 workers already trained or in training;
- 41 project managers certified as PMPs;
- 1 project manager certified as SPM (Senior Project Manager by Siemens AG).
How This Course is Changing Siemens Culture
After the beginning of the courses in 2001, a project management improvement program was started in the following years. As presented in “The PM@Siemens Program” section of this work, the main objectives of this program are to have a systematic best practice sharing and standards in project management, to have sufficient number of qualified project managers, to uniform project culture throughout the company an to achieve sustained profitability.
Today there are 17 different business units participating in the implementation of the program. Monthly workshops are conducted with the representation of the departments. By February, eleven workshops were performed with activities such as assessments, roadmaps, discussion of mandatory requirements, best practice activities and information exchange. In March two workshops were conducted in Buenos Aires, Argentina and in Santiago, Chile.
There was a need for creation of a single project management methodology for the company in Mercosur, with the aim to equalize the various methodologies existent as well the knowledge and to clearly define all process steps. All the 17 areas were involved in the creation of this methodology.
For disclosure of the program a report called PM@Express was introduced, which publishes monthly, for the company, the result of the workshops and the progress of the program. In the near future, presentations into the areas and different localities, with the aim to disclose the program and create the management culture that is one of the goals of the program, will be introduced.
The non-monetary benefits for the company are clear for the 17 areas. Some of them are:
- Better control in projects, such as cost and claims controls;
- Clear analysis of the project management maturity of the company;
- Better communication inside the company;
- The integration of different areas in a common objective;
- New projects obtained from the better methodology in project management.
The investment in the program also seems to have a very high economic return to the company. In fiscal year 2003/2004 it is calculated that the program will provide an economy of R$ 10,000,000.00 or US$ 3,300,000.00. By December, 2003, R$ 1,000,000.00 or US$ 330,000.00 were already obtained.
The Analyses of the Criterions that Are Leading to a Successful Change in the Siemens Project Management Culture
Some of the criterions that are leading the company to a successful change are:
- Systematic diffusion of best practices;
- Standardization of the project management;
- A sufficient number of qualified project managers;
- A uniform project management culture;
- Improvement of the customer satisfaction;
- Improvement in the security project planning;
- Improvement in the project control;
- Improvement in the business managed through projects.
Another way to analyze the success of the company program is to look at the functions of the company's program:
- Establishment of recommendations to the main topics in project management, as presented in “The PM@Siemens Program” of this work;
- Establishment and implementation of a project management carrier;
- Establishment and maintenance of training programs in project management;
- Control of the program implementation in the departments;
- Control of the more important projects;
- Assessment of the company's project managers, analysis of their capacities and their training necessities.
From the process of the initiative implementation for the analyzed company, the following lessons learned can be presented:
- High commitment of the company's top management;
- Definition of the holes of all the people involved in the implementation process;
- Clear communication process;
- Measurements of the activities roll-out process in the scorecards format;
- Coaching and support in all levels;
- Alignment of the implementation activities toward the project results improvement.
Simply to improve the way the work is done is not enough. This enormous change means walk over the obvious, reaching a second logical level and examining the situation through a different pair of lenses. In management, this means to adjust the philosophy top-down, to secure that the proposed improvements in efficiency are corresponded with a project management strategic approach in the whole organization (Dinsmore 1998).
Though the analysis of the PM@Siemens program and its process of implementation in Siemens Mercosur, together with the preparation courses for the PMP certification; it is possible to confirm that the model and the results obtained from these activities are essential to obtain success in trying to change a company culture.
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© 2004, Leandro Alves Patah
Originally published as a part of 2004 PMI Global Congress Proceedings – Prague