Creating a project culture in an international organization
The Impact of Project Management
During most of the previous century, the market was dominated by geographically concentrated, hierarchical organizations. They were structured into functional units, and characterized by their tangible assets and a stable interface to their clients, owners, suppliers, partners, and competitors.
However, during the last decades of the twentieth century, a new type of companies and organizations appeared as an answer to the demands of the new economy. They were nationally or globally distributed organizations, with mobile employees and intangible assets in terms of products, trademarks, customer relations and processes. They performed in a constantly changing business environment of global customers, suppliers, partners and competitors. Competence and relationship management, reorganization, outsourcing, and mergers became as important as product development and day-to-day operations.
An organization that did not look outside its current market and portfolio of services and products, and that did not look for new and smarter ways of working, would soon see itself passed by other companies, public or private, that took better advantage of the new opportunities that turned up. To be able to compete, improvement work had to be replaced by change management. This required new ways of working and new managerial skills.
The answer to these demands was project management.
The benefits of project management are obvious. By allowing people to focus on short-term goals, they become focused and productive, and experience the satisfaction of producing a very clear and visible result before they move on to new tasks—in many cases a new project. Project management also means that the company in a flexible manner can explore and benefit from a new idea or innovation. The project working form is a way of making creativity productive.
Gradually, project management has become a natural part in most organizations, and is sometimes even the dominating working form applied in almost all areas of operations. The traditional company culture has been replaced by a project culture, and the traditional functional hierarchies have been replaced by temporary project teams. Instead of being exceptions, projects now dominate the companies.
A Shared Project Culture
Establishment of a common culture in a world wide, rapidly growing and successful company is a delicate and challenging task. In the multiproject organization, the company culture is strongly dependent on the projects, which constitute the common denominator for all parts of the organization. Even though the project managers constitute the pillars of the project culture, all employees in a company must be aware of their roles in projects and their contribution to this culture.
• The most important bearer of the project culture is of course all the individual employees. If they are not embraced by this culture, and if they feel that their effort and contribution to it is not fully recognized, it will soon die out.
• In most multiproject organizations, it is a known fact that a prerequisites for project success is the active involvement of upper management. Senior managers’ role in the project must be clearly defined, and management of the total project portfolio should be one of their most important responsibilities. This means that the role of the project sponsor is crucial in the project, that is, the manager who owns the business case related to the project, and who is authorized to make decisions related to the direction and continuation of the project.
• Middle management will act as resource owners, providing the project with the resources—human resources, but also other resources like tools, equipment, premises, methods and processes. They must ensure that all these resource are developed and ready to serve the needs of the projects.
• Another important management task is to be receiver of the outcome of the project. If the project outcome is not properly handed over to an authority that is ready to take over the responsibility for its maintenance and support, the value added by the actual project is soon lost.
Project Management in Ericsson
Project Management in the Ericsson Organization
Ericsson is a successful, global telecom supplier, active on an extremely demanding and rapidly changing market. Ericsson is highly depending on business efficiency and flexible working methods and organizations. The two major operative processes are Time-To-Market (TTM) and Time-To-Customer (TTC), and all operative work can be classified in those two categories. The two process flows are visible in Ericsson's organization, which is a matrix organization. One hierarchy in the matrix is based on Product Units, responsible for product provisioning and for profitability and maintenance of our products, while the other is based on Market Units, responsible for the contact with Ericsson’s customers all over the world.
Functions responsible for finance, legal aspects, human resources, IT/IS, etc can be found both at the corporate and the local level. Continuously, Ericsson aims at improving its processes and organization to better achieve its business goals. This improvement work can be initiated in local companies as well as at the corporate level.
This means that project management in Ericsson can be found in all parts of the organization:
• Research and development are decentralized and carried out in product provisioning projects in which resources from all over the world are involved.
• Projects are also established to implement customer orders for tailored telecom solutions.
• Finally, the need for continuous improvement of processes and working methods is met through internal projects.
Taken all these areas into account—R&D, customer order implementation and management of internal changes—it is easily understood, that project managers in Ericsson are responsible for handling a large portion of the company’s turn-over. And that efficient and professional project managers represents a strategic competence for the company.
Ericsson’s Corporate Project Culture
Ericsson provides a success story related to its project management model PROPS, which has been spread, used and continuously improved over the years. PROPS has become a vital part of the common culture within Ericsson, and an important key factor contributing to Ericsson’s successes.
The project working form is now clearly established within Ericsson. PROPS has helped to highlight the role of the project manager and the need for a well-planned strategy for developing project management competence. Much still remains to be done, but the professionalism of Ericsson’s project managers have undoubtedly been strengthened.
PROPS provides Ericsson’s project managers with a firm platform on which they manage their projects. But even though a shared model for project management with structured ways of working is important, it cannot solve every problem. Projects must be coordinated, routines must be created which guarantee that the resources are used effectively, processes must be developed which support projects, etc.
By moving the focus away from the individual project to a higher management level, PROPS has shown the demands that the company must meet if it is to manage its business efficiently and successfully in project form.
PROPS—A Model for Project Management in a Multiproject Organization
PROPS is a model for project management and management of projects that supports managers at all levels in a multiproject organization. In the late 80s, PROPS was developed within Ericsson as a means to successfully use the project work form for development competitive products and for introducing these products on the market. PROPS is now used in all types of projects and in different Ericsson companies all over the world.
Years of experience from project work are compiled in the model. It has been improved and developed to ensure that it will give full support to project managers and to ensure that Ericsson remains competitive in a hardening business climate.
PROPS Four Perspectives
By describing projects from four complementing perspectives, PROPS provides a multifaceted picture of project work in the multiproject organization:
• The Business Perspective
The business perspective in PROPS is about aligning all efforts in the organization into the same business direction, focusing on customer satisfaction and securing profitability through an efficient use of resources. The key elements needed for this is professional project management and an aware and business-oriented management of the project portfolio.
• The Human Perspective
The human perspective in PROPS is about recognizing the individual employee as one of the organization’s most important assets. A common project culture based on shared attitudes to teamwork and leadership is a means for benefiting from the total competence and capacity of the individuals involved.
• The Project Organizational Perspective
The project organizational perspective in PROPS is about identifying project stakeholders and their responsibilities in and demands on the project.
PROPS provides a model for a project organization, defining who is responsible for doing what in a project. In the model, three different functions are defined, the project steering function, the project management function and the operative, project execution function. The key roles in these functions in the project organization are defined and so are the responsibilities for the roles.
• The Single Project Flow Perspective
The single project flow perspective in PROPS is about integrating all project efforts to reaching the project goal and successfully concluding the project. A general model for project work is included, depicted as a U in three colors, defining what should be done in the project and when it should be done. The phases of the project, and the steering and management activities needed for integrating and controlling the project work and coaching the project members, are described in the model. The activities related to the project management function comprise all nine project management knowledge areas, as defined in the PMBOK® Guide, and international project management models.
The PROPS Documentation
PROPS is a model for project management in the multi-project environment. This means that it is not a process description and it is not a method. Detailed work instructions for how to perform a task can be added when needed. The reason for not including methods and tools into PROPS is that methods and tools changes, and are soon being replaced by new ones. In most cases, they are also depending on the business and technology that is related to the project.
The PROPS documentation (the printed version) contains a number of guides for different target users. Describing a general model, the guides should be perceived as conceptual descriptions and guidelines.
More hands-on support is given in the web-based online documentation, available on Ericsson’s intranet. Besides the information found in the printed guides, the web-version also includes links to good practices. These links can be dealing with tools, methods, good examples of documents and work models applied in the projects.
By allowing this hands-on body of knowledge to change over the time, and letting good practices reflect the current state-of-the-art in Ericsson and outside the company, PROPS online will ensure support to its users, when and where it is needed.
PROPS Symbols and Colors
The various aspects of PROPS are illustrated by graphics. The symbols and colors used have a specific meaning and are used in a very consistent way. In order to understand the graphics in PROPS, an explanation of the symbols and the colors is needed. The following color scheme is applied:
• Red Color for Business Authority
The red color is used for the arrow representing long-term business direction in the organization. In the graphics, managers in the project steering function and the project sponsor, who is commercially responsible for the project wear red caps, as an indication of their authority and area of responsibility. The tollgate decision is represented by a red rhomb.
• Blue Color for Project Management
In PROPS, the blue color represents the project management function. The project management part of the PROPS U, in which all project management activities and documents are described, is blue. The knowledge areas are represented by blue arrows, covering the entire project lifetime, and the project manager wears a blue cap.
• Yellow Color for Operative Work and Responsibilities
The yellow color is used for the project work model representing the operative work that is performed in the project. Yellow caps are worn by all project team members, by their line managers in organization, the resource owners, as well as by the receiver, who is a manager of a unit that will take on the responsibility for the project outcome after the project has been concluded.
• Green Color for Project Outcome
Finally, the green color in PROPS is used for describing the project outcome, symbolized by a hexagon. Since PROPS is general, and intended for all types of projects, the hexagon may a product, a service, a system delivered and installed at a customer, or an organizational change within the organization. The green color is also used for project milestones, representing intermediate objectives in the project.
The Organization Supporting PROPS
A Brief History
From the very start, there has been an organization established for PROPS, responsible for development and maintenance of the model, and for supporting its users. The organization has grown in size and competence, in pace with PROPS becoming more and more successful and having increased in strategic importance.
In the late 1980s, a unit consisting of four people within a business area for development of digital switches in Ericsson was responsible for the development of PROPS. Among other activities, the unit trained around 50 project managers per year.
In 1994, the ownership of PROPS, together with the consultants in the support unit was transferred to more independent company in the Ericsson Group. It soon expanded, and had 50 employees based at two sites in Sweden. Most of the staff worked either as trainers or as course administrators. But the group also provided consulting services to the projects and the different Ericsson companies.
As the interest for PROPS grow also outside Ericsson, the staff became more and more involved in selling PROPS on the external market (mostly in Scandinavia), and in supporting these companies when implementing PROPS.
The PROPS support unit was found to be profitable, and management attention was once again turned to the unit and to PROPS. If so many companies were interested in PROPS, it certainly must be of strategic interest for Ericsson!
Ericsson Project Management Institute, EPMI
The unit changed name to Ericsson Project Management Institute, EPMI, and was transferred into a more central position in Ericsson. Today, EPMI consists of about 75 consultants offering a total concept for management of projects based on PROPS, aiming at increasing project management skills and efficiency throughout Ericsson.
The visible proof of top management’s understanding of project management as a strategic weapon in the tough competition for the telecom customers is reflected in the fact that two of the executive vice presidents of Ericsson management team are members of EPMI’s steering committee.
EPMI offers training for project managers at different levels of knowledge and experience, but also consultancy services aimed at management of individual projects as well as management of projects within the local companies within the Ericsson group. Every year, more than 4,000 Ericsson employees are attending EPMI’s training courses and programs.
EPMI also contributes to efficient knowledge management within Ericsson, by offering a virtual project room application, where each project can create its own web page. This means that the projects are structured and reported in a similar way, which increases the organization’s ability to re-use information and learn from project experience.
By acting as consultants supporting the projects and the companies, and not as an internal police force that controls how the model is used, the consultants in EPMI have been kept up-to-date with new initiatives taken in the field of project management, within and outside Ericsson. EPMI has established contacts with international experts and researches, and PROPS as well as project performance in Ericsson have been bench-marked against the best players in the area. It has been a tough competition, but also a very rewarding work.
From the start, project practitioners all over Ericsson has been involved in the development of PROPS. They have ensured that the model is based on experience, and that it will provide efficient, hands-on support when it is needed. This network of practitioners have been active also between the working periods when PROPS was revised. Through the network EPMI have had access to information on what in PROPS that works well and what doesn’t and been able to adapt it to support new ways of working.
Today, PROPS is seen as the basis for Ericsson’s project culture, and the foundation of the support that EPMI offers to projects and companies within the Ericsson Group. The focus has shifted from training into supporting this culture by creating common meeting places for project managers and other project stakeholders, where they can meet and exchange experiences.
People meet to get inspiration from initiatives taken in different parts of the organization, and to share their experiences. Instead of closing their doors and trying to figure it out all by themselves, they meet, collect ideas and allow themselves to try out new things. This is a climate needed in a company that depends on creativity.
Today EPMI maintains a network of about 3,000 members. EPMI’s website provides discussion groups and mail list services so that the members can meet and exchange experiences “virtually.” An electronic magazine publishes articles over different topics that are interesting for the members.
To expand the members’ personal network and to ensure competence development of project managers, three or four conferences are arranged every year, where these topics are discussed.
PROPS—A Success Story
A model for project management might be a world beater, but if it is not accepted and used it will never do anything to improve operations and make them more efficient.
Within Ericsson, with the full support of management, a well-structured model for project management has been developed. PROPS is based on operations, and packaged in a way that is easily accessible. Through successful implementation followed by successful training and, just as important, a determination to see the model fully established, a platform has been built for Ericsson’s continued success. A success based on efficiency and focus on business in every project.
In this chapter we will take a closer look at the reasons for the success of PROPS.
Strong support and commitment from top management have been vital preconditions for the acceptance of PROPS throughout Ericsson. The project working form has become more common and more important in terms of reducing lead-times, raising efficiency and improving quality.
Ericsson’s management has seen PROPS as an investment in increased project efficiency and an important means for business efficiency in the entire organization. PROPS is recommended as the shared corporate model for project management, and considerable resources are channeled into further development and implementation of it.
A Structured Model Based on Operations
PROPS provides support for Ericsson’s working methods that are themselves based on modern industrial processes.
A process-oriented operations system provides a good overall picture of the company and a clear description of operations. The processes clarify roles and areas of responsibility in all stages of the product life cycle and explain how these roles are coordinated, internally and externally in relationships with customers and suppliers.
A process-oriented operations system requires high levels of participation and clearly defined roles. Everyone within the company must understand their importance for the company as a whole. Through PROPS, conflicts of interest between the line and the project organizations can be avoided, since in it the project roles are clearly defined, roles that can be matched to the roles and positions in the line organization.
Introducing a model like PROPS means changing the way people work. Inevitably, this takes time, especially in a global organization with many independent units.
Works on PROPS has been carried out systematically and over the long term, with a great deal of humility and patience. The result has been a common model, with a common view on project work.
There have been several alternative project models within Ericsson, mainly ones that were tailored to certain operations. These models have had strong supporters, both among users and the people who developed them. It was not thought necessary to push PROPS into these instances. However, attitudes have changed, and people have seen the benefit of using shared terminology and a shared project culture—the terminology and culture defined in PROPS.
By creating positive expectations and motivation in the organization, instead of imposing ready-made regulative directives into it, people will become receptive to, and curious about, what is new. The information will be the answer to a need. It will be discussed and used, instead of disappearing in the general information flow.
The road towards this end has often been long and troublesome. Great patience has been required. Large changes are not achieved over night.
When the first test-version of PROPS binder was released in 1988, it was strongly criticized and it was clear that the documentation needed significant improvement. The basic guideline from the reviewers was to give everyone the right information at the right time.
Therefore, PROPS documentation in the form of handbooks, templates and online support has been made as user-friendly as possible. To ensure that different target groups were identified and that they understood their area of responsibility in a project, a lot of effort has been put into structuring the information, and creating and refining the color-code used in PROPS.
The next step toward increased user support is to build in PROPS in applications and working environments, to ensure that you learn, not only by, but also while doing. PROPS Virtual Project Room has a lot of built in functionality, that ensures that you will have all the support needed while setting up your project environment.
Experience from PROPS shows that working guidelines—processes, methods or tools—must be documented in an accessible and user-friendly manner, otherwise they will be of no use at all—no matter how good they are.
Implementation by Marketing and Networking
With the support of management, a well-documented project model and user-friendly materials, the ground had been laid for the most important thing of all—getting the model widely known, deployed and used. The implementation of PROPS was based on three important preconditions:
• Implementing PROPS (just like developing it) must be customer-oriented. Like any other product or service, it must be marketed, launched and deployed if it was to yield results. Conventional marketing and sales methods were used to plan the work, and to produce the presentation material.
• Resources in terms of people and money must be put into the implementation. The first version of PROPS cost about three times as much to implement as to develop. This has since become a guideline for the introduction of new working methods within Ericsson.
• Implementation efforts were based on ambassadors in the organization. Practitioners were involved already in the development, and when it was time for implementation, there was already a network of PROPS supporters in the organization, who had created positive expectations and a need for information.
Implementation was planned in parallel with development of PROPS. It was important to solve preparatory questions at an early stage, questions such as who the target groups were, what sort of media should be used for different type of information, layout, phasing out of existing material, communication plans, etc.
Clear and simple symbols were chosen for their recognition value. The PROPS U became well known throughout the Ericsson Group.
Training and Sharing
One of the most efficient and reliable ways of supporting and maintaining a new way of working is training—on-the-job training as well as traditional training.
In-house PROPS training started at a large scale as soon as the second version of PROPS was released. The training was developed in parallel with the model. A lot of hard work went into defining the content of the courses and the educational material used. The quality of the courses was assured by the introduction of an authorization program for trainers.
Every year, more than 4,000 people within Ericsson participate in EPMI’s training courses and programs, and the demand for the courses remain high. The success of the courses shows that both PROPS, and the training methods function well in an international environment. Today, EPMI can offer a comprehensive competence development program in the field of project management, covering everything from basic introduction courses to a program for senior project managers.
The basic concept in all training provided in EPMI has been an active involvement of all participants. A training session should never be the traditional “teacher meets students,” but rather “professionals meet peers.” The trainer is the person that makes things happen and provide the environment and the background information needed, while the participants provide their experience. The motto is: Learning by sharing!
Proceedings of the Project Management Institute Annual Seminars & Symposium
November 1–10, 2001 • Nashville, Tenn., USA
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