Geof Leigh, Principal Consultant and Director, Goaldart Ltd., Bolton, U.K.
PHOTOGRAPHY BY IAN CARTWRIGHT
STRATEGIC PROGRAM METHODS REDESIGN BUSINESS PROCESSES FROM THE TOP DOWN TO REALIGN OPERATIONS AND PUT CUSTOMERS FIRST.
EXECUTIVE SUMMARY
Analyze from the top down to assure that every operation supports the core business strategy.
As the largest news agency in the United Kingdom, The Press Association Ltd. appeared to have it all: an extensive readership, an outstanding reputation and a dominant place in the industry.
So when the London, U.K.-based company noticed its profit margins slide as operating costs rose, executives hired program manager Geof Leigh, principal consultant and director, Goaldart Ltd., Bolton, U.K., to investigate.
As he worked to align business objectives with projects that would change the media firm's operating practices, Leigh found that while the organization was providing up-to-date news and sports information, it was jeopardizing its core business with redundant operations.
In plain terms, The Press Association's tremendous growth rate fulfilled its core mission of extending its reach to the corners of the United Kingdom with the acquisition of several news organizations. But the bottom line was jeopardized when these disparate organizations were not assimilated into overall operations. Though there was a lot of good cooperation to share news and information across the organizations, the processes and systems to support this sharing were not optimal.
“It was a very expensive process,” Leigh says. “The operating costs were too high. There were lots of opportunities for sharing things like technology that people weren't doing.”
Down to Business
Most projects fail to target overall business goals. Rather, they attempt to solve departmental issues without consideration for how they impact the business as a whole, according to Harold Ainsworth, principal of Strategic Project Solutions Pty Ltd., Grosvenor Place, New South Wales, Australia. “Many projects have very little alignment with corporate strategy,” he says. “We have to have a top-down strategy, but most projects get initiated from the bottom up.”
Without focused portfolio management and project management, a company can flounder in good projects that don't boost the bottom line. “Many projects share the business perspective but are not done from the top down. They can get off the ground and support a business case,” Ainsworth says. “But when you try to link it back to strategy, it's tentative to say the least. You can get things done, but they may not be the right things.”
Getting the right support can prove challenging. “These people are very busy executives,” Ainsworth says. “They don't tend to see projects as strategic. You need to tell them to think differently. I ask them, ‘Are you getting the value of the strategic initiatives you plan to do, and if not, why not?’”
Many projects have very little alignment with corporate strategy. We have to have a top-down strategy, but most projects get initiated from the bottom up.
Harold Ainsworth,
Principal, Strategic Project Solutions Pty Ltd.,
Grosvenor Place, New South Wales, Australia
BREAKING NEWS
COMPANY: The Press Association, a London, U.K.-based media outlet
PROBLEM: Low profit, high operating expenses, misaligned resources
SOLUTION: Realigning the organizational structure to boost performance and profit margins. Senior management's support proved crucial in requiring employees to change fundamental work processes and share resources.
A program management office (PMO) integrated and streamlined operations to boost operations and morale simultaneously. For example, additional training and cross-functional cooperation helped staffers enhance their ability to obtain and deliver breaking news.
During the next few years, the PMO redesigned work processes across the board to unify efforts and eliminate overlap. It also integrated information technology resources, which reduced costs and helped employees work smarter by sharing resources.
RESULT: Substantial time and money savings
Paving the Way
Sometimes companies grow so fast or diversify so much that they lose focus of core strategies. Other times, departments adopt policies that support individual objectives but inadvertently harm the bottom line.
“If you use the wrong measures, you drive value the wrong way,” says Richard Stoneham, principal for Stratege Consulting, Sydney, Australia. “So you have to do everything you can to build processes that support the customer and get everyone to understand and start working together.”
Successful programs often tap various resources and require complex schedules that require a holistic view. “If you approach everything from systems thinking, you see everything as connected,” Stoneham says. “You think about how every element can be impacted by what you're doing. If you involve people in the planning process, they will make it happen. They will collaborate to make sure everything works. If you only work at a functional or small group level, you do not take account of the impact of change activities in other parts of the organization. This results in frustration and failure as ‘kick-back’ occurs. Successful change has to be planned and managed at the organizational level so the whole system is taken into account.”
The program executive must ensure that the people assume roles best suited for the business goals and not force-fit them into the program. Someone who thrives as a functional manager may not have skill set and perspective to implement program objectives on a larger strategic scale.
Overcoming Barriers
Once they get off the ground, programs must be examined regularly to ensure they fulfill short-term objectives and remain poised to achieve business benefits. Managers must consider external variables, such as evolving market factors, competition, technologies and legislation. Often projects within the program, if not the whole program, must change in scope to support changing conditions and remain competitive.
As founder and former managing director of Bayleigh Business Services, Leigh knows the value of measuring progress against budget requirements. “I learned firsthand how every decision impacted the bottom line, especially because I was investing my own money. I learned how to develop a lean operation.”
You think about how every element can be impacted by what you're doing. If you involve people in the planning process, they will make it happen.
Richard Stoneham,
Principal, Stratege Consulting,
Sydney, Australia
Programs should deliver incremental results that prove their value to fuel their momentum and keep employees on board. “The worst thing you can do is to try to deliver the whole program in one chunk with no proof of concept,” Leigh says. “Then you get two years down the line, the organization doesn't see results after spending a lot of money.”
Networking with other program managers also can uncover potential problems, solutions and a ballpark figure on their cost to resources and budget. “If problems threaten program success, bring in stakeholders to collaborate and mitigate risks,” says Sharon Sikes, an independent project manager in Bloomington, Ill., USA. “You can bring 10 brilliant minds into a room. Somebody looks at the problem in a different way and comes up with a viable solution.”
I LEARNED FIRSTHAND HOW EVERY DECISION IMPACTED THE BOTTOM LINE, ESPECIALLY BECAUSE I WAS INVESTING MY OWN MONEY. I LEARNED HOW TO DEVELOP A LEAN OPERATION.
—GEOF LEIGH
Calling it Quits
Regular evaluations also can identify points when projects should be downsized or eliminated. “We try to implement a gating process, where you review at points in the process if you still want to go ahead,” Ainsworth says.
The program can encompass too many “good” projects that may be valuable, valid opportunities but are not directly aligned with the program goals or are not the “best” ideas compared with others for the organization as a whole. Mark Mullaly, president of Interthink Consulting Inc., Edmonton, Alberta, Canada, follows the 80/20 rule: 20 percent of the program produces 80 percent of the benefits. He therefore builds as much of the 20 percent as possible into the early stages of the program.
THE BIGGEST CHALLENGE IS THE ORGANIZATION'S WILLINGNESS TO RECOGNIZE THAT WHAT THEY ARE DOING NOW IS NOT WORKING FOR THEM AND THAT THEY MUST STEP INTO ANOTHER OPERATION. IT'S REALLY HARD FOR A MORE MATURE ORGANIZATION TO RECOGNIZE THIS.
—MARK MULLALY, PRESIDENT, INTERTHINK CONSULTING INC., EDMONTON, ALBERTA, CANADA
“The biggest challenge is the organization's willingness to recognize that what they are doing now is not working for them and that they must step into another operation,” Mullaly says. “It's really hard for a more mature organization to recognize this. After they've been successful for a long time, there is a certain denial that what was successful in the past won't be successful in the future.”
If a program isn't as good as initially thought, variance will exceed tolerance. R. Max Wideman, a consultant based in Vancouver, British Columbia, Canada, suggests that there should be more focus on the logical progression of the project through its life span with emphasis on effective control of cost and schedule by means of phase or stage “gates.” This provides the necessary degree of executive control while providing the authority for the teams doing the work with the freedom to move forward effectively, he says.
At the stage gate, the executive has the opportunity to direct, redirect or cancel based on the latest projections and what is now at stake. However, “most companies are afraid to abandon a project even when it is obviously a dead duck because of having to explain the need to write off the investment to date,” Wideman says. “Proactive companies look at the benefits still possible, given the cost still to be invested. If that does not meet their investment criteria, then they are justified in canceling it.” PM
Lynne Jackson is a freelance writer with more than 15 years of experience writing for publications including TechWeb, InternetWeek, CNN.com and for The Gartner Group.