Assessing and improving project management in public agencies

Introduction

Project management has been recognized as a key practice of successful organizations. Every organization, whether government, commercial, or military, undertakes projects in the course of satisfying customers, changing procedures, or incorporating new tools or technology. Projects create something new, and constant change in the business environment demands that organizations develop new processes and products to remain viable, and in business. For government agencies this is even more critical as a continuing stream of initiatives (US Government, Office of Management and Budget 1999) ask agencies to outsource, commercialize, or resign from performing their traditional roles. Ironically, one of the key processes within these organizations is the process of project management itself. This brings us to the point of this paper. The project management process within public agencies must be at least on a par with their counterparts in industry. No longer is the designation as a public agency sufficient to ensure their viability in the future. As a minimum every public agency must continuously show legislative bodies and the general public that the agency's practices are equal or better than any alternative provider, and that a shift of function to the private sector would not yield better results.

What tools can you use in determining a project management capability? How do you interview the workforce and determine areas for improvement? What modifications to PMBOK® Guide are needed to fit project management in the public sector? This paper will focus on the composition and processes used by a team retained to improve project management in a public sector capitol project agency. The findings of the team and the process to implement their recommendations will be highly summarized.

Like the common elements between commercial and government, the tools and techniques apply to both equally well.

The Client

Overview

The client was the Engineering Division of the Orange County (California) Sanitation District (OCSD). The OCSD is the third largest wastewater treatment system west of the Mississippi River. The District meets the needs 2.4 million residents within 471 square miles. Over 240 gallons of wastewater are treated daily while satisfying multiple levels of regulatory requirements and 26 customer cities. Their systems consist of 475 miles of large collection lines (inceptors and trunklines), 175 miles of smaller local collection lines, and 21 off-site pumping stations.

In addition to basic water treatment for discharge into the ocean, OCSD also recycles all biosolids produced for use by the agriculture industry and reclaims up to 10 million gallons of treated wastewater every day used for landscape irrigation. The District also generates a daily average of 13,300 kilowatts of energy from byproducts of the wastewater treatment process. OCSD has an award-winning Ocean Monitoring Program that monitors and evaluates water quality, sediment quality, and sea life from Seal Beach to Corona Del Mar.

The annual budget for OCSD approximated $190M of which $80M is for capital projects. OCSD has approximately 500 Employees. A 25-member Board of Directors representing each city governs the Orange County Sanitation District (OCSD).

The Engineering Division and its Customer

The Engineering Division employs approximately 70 personnel divided into two major groups—Design Engineering and Construction Management. Design engineering oversees consultants hired to design the capital projects. Similarly Construction Management provides oversight to contractors completing the capital projects. In addition, OCSD has departments and divisions such as Operation and Maintenance, Finance, Purchasing, HR, and other common organizations found in industry. The Engineering Department within generally follows the “Weak matrix Organization” description (PMBOK® Guide).

Our study was conducted for the Engineering Department. It is important to establish who is their customer. Their customer is primarily the OCSD Operations and Maintenance Department who, in turn, provide services to the surrounding cities and agencies. Thus, the Engineering Department's customer is internal to OCSD.

The Perceived Problem

The agency desired to improve their management of public sector civil works projects. OCSD management knew that although their track record for past projects was acceptable, there could be improvement. Furthermore it was also felt that the District should be keeping up with “best commercial” practices in project management to demonstrate fiscal responsibility to the community.

Previously the OCSD staff had become familiar with the PMBOK® Guide through onsite training. The goal was to move more toward PMBOK® Guide principles. They felt that aligning themselves with the PMBOK® Guide would be applying best commercial practices. The client also realized that as a public agency some industry project management practices might not be feasible in a government entity. The general purpose of the study was to provide “recommendations that can increase the overall effectiveness of the District's capital project management process (CPMP) within applicable laws, regulations and the practices of professional engineering.”

Our Scope of Work

The OCSD solicited proposals from consultants for “… developing policies and procedures to more effectively manage the District's capital projects, based upon the [PMI] Body of Knowledge (PMBOK) Guide”. (OCSD RFQ No 9900-18, March 24, 2000, Attachment A). Thus, the client had concluded that a revision to their policies and procedures was needed to bring them into alignment with the PMBOK® Guide principles. The client divided the scope of work into four non-overlapping Tasks.

• Task 1. Assess current “as-is” project management procedures (Baseline)

• Task 2. Define the new project management requirements (Goal)

• Task 3. Identify the changes to the existing policies and procedures (Gap Analysis)

• Task 4. Review and recommendations for project management software (Tools)

(Two other tasks included the management of the effort and production of the final report.) From the list of tasks it was clear that the client's attention was focused on policies and procedures. Task 4 will not be addressed in this paper due to space limitations.

The Consulting Team

The team that was awarded the consulting contract was formed specifically to address OCSD‘S need. The team had not worked together previously. The Lewis Group (El Segundo, CA) and Management Technologies (Brea, CA) met (at a PMI chapter meeting!) and began collaborating on their response the OCSDs request for proposal for project management consulting. The Lewis Group's core competencies applicable to this project were: organization diagnosis and development, process analysis, and team building. Management Technologies brought understanding and experience with PMBOK® Guide principles, including planning and scheduling, risk management, Earned Value, and other project management “hard skills.” Marsha Peterson Scheduling (Yorba Linda, CA) was added to the team to review and make recommendations for use of their current scheduling tools and commercially available replacements (Task 4).

Kickoff

Once the team had been selected a kickoff meeting was held with senior Engineering management. To their credit the client's management recognized that other changes may be needed and opened the door to any other areas where possible improvement could be made. We were told, “There are no sacred cows.” It would be determined later that the consultant would also make recommendations for changes in the organizational structure.

Confidentially

The team was introduced to the entire Engineering Division during a monthly “all hands.” The group was told why we had been retained and the goals of our effort. We used this first opportunity to announce that individual and group interviews would be a part of our effort, and that confidentially would be absolute. “Confidentially” would be mentioned again at the beginning of each individual and group interview. When conducting group interviews we asked that “what you hear here, stays here” hoping we would get honest, core issues and data. We believe we did since the data from interview to interview was generally consistent.

Collecting Information

The team and OCSD‘s resource constraints meant data collection needed to be efficiently gathered. We planned two passes through the workforce for data collection. Task one required we obtain data to understand the current processes. Task two required we solicit ideas and improvements from the employee point of view.

Any consultant collecting information disrupts the day-to-day business of the client. For this reason we used both individual and group interview sessions. Individual sessions were used with senior management so they could confide about interdepartmental working relationships. Group sessions were held with department members to collect diverse opinions and observations from a crosscut of employees within certain departments. Groups were further segregated as supervisors and non-supervisors. Groups were generally four to eight people.

Questions and surveys were distributed prior to the interviews so interviewees could review, reflect, and note their thoughts. The completed surveys were collected at the start of the interview to focus the discussion. The surveys were subsequently analyzed and helped form the recommendations.

Also, we knew the questions that we asked would be analyzed by the workforce as hints of things to come. We were particularly cautious to avoid sending any signals even though some conclusions were reached quickly.

Understanding the “As-Is” Process

We interviewed senior management and groups to understand the “as-is” process to form a benchmark for improvement. Projects generally fall into one of four combined categories and classes:

• Categories

Collection (piping leading to the processing plants)

Treatment (processing plants)

• Classes

New Facilities

Refurbishment

Project Scope

Investigation and Data Collection

We asked interviewees what event starts and what event ends a project. The question was carefully worded to solicit when the project became “real,” and when was it “behind us.” Projects move though the District from first identification as part of a 20 year Plan, to a 10 year Budget Plan, to an Annual Budget, then to a Job Plan. Table 1 shows each of these documents, their purpose, contents, and revision cycle.

Findings

The range of answers and the resulting differing time spans surprised us. The answers we received included:

• Project Initiation

• Listed in the 10-year plan

• Listed in the annual budget

• When a project manager is assigned

• When a “job plan” is approved

• Project closeout

• When the customer accepts it

• When the customer takes responsibility for operation.

Project Planning and Control

We also asked senior managers about their current oversight roles, what high level milestones summarize project activities, what metrics are used, and what recovery actions are taken when needed. Metrics included staff utilization, milestones met, and budget spent. (One of the metrics is spending [obligating] 80% of the annual budget. Budget obligation is a measure of work accomplished.)

Published Project Procedures

As stated previously, the OCSD also asked for a review of over 30 project management procedures covering administrative, design, and construction processes. We considered each procedure as a project activity. The existing OCSD procedures had been written within the previous two years. They were categorized by the District into three areas: Administrative, Design, and Construction. In most cases the procedures documented the existing processes for the benefit of new employees, and others, rather than deploying a new process to be followed.

To help understand their procedures with respect to the PMBOK® Guide the team categorized each to the PMBOK® Guide chapters. The Orange County Sanitation District procedures addressed all of the PMBOK® Guide areas to some degree.

A questionnaire was distributed listing each of these Procedures and asked if they participated in executing the procedure. If yes, they were asked to identify their role using a coding scheme to identify their level of involvement and responsibility. We also asked participants to comment about “inputs” and “outputs” to/from the Procedures (process), and the exit criteria, whether formal or informal. Lastly, hinting at areas for change, we asked if the written procedure matched the real, executed procedure.

Project Execution Processes

Projects begin in the Design Engineering Division and move to the Construction Engineering Division once the design is complete and a contractor selected. It is significant to note that the Design Engineering project manager hands off the project to the Construction Engineering project manager once the contractor is selected. Further, design is not done in house but contracted to civil design firms. Thus, there is significant change of participants throughout the lifetime of the project.

Observations

We noted that the published procedures were generally followed. In some cases they were extremely detailed, in other cases less so. We also noted that guidance, in the nine PMBOK® Guide areas was spread among many procedures, with the largest being intercommunication (19) and resources and cost (14).

In discussions with the project managers, their supervisors, and support task, we concluded that they performed more as project coordinators. This is exactly predicted by the PMBOK for a week matrix organization where “the project manager role is more that of a coordinator … than of a manager.”

Defining the Vision

Task one provided us the framework to understand the present published process and the executed process (not necessarily the same.) We also received many comments regarding what wasn't working and the frustrations of the individuals and groups. Since the goal of the project was to move toward PMBOK® Guide, and since those familiar with PMBOK® Guide were eager for evidence of change, we structured one of the Task two questionnaires around PMBOK® Guide.

Exhibit 1

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We polled the Engineering Department on their effectiveness in nine PMBOK® Guide areas. For each of the nine areas we asked respondents to rate the organization from Excellent (1), Improvement possible (3), and Improvement required (5). Values of two or four provided room for intermediate answers. Because most of the staff was unfamiliar with PMBOK® Guide contents we provide some questions under each area to help them focus their thoughts.

The second task two questionnaire was based on the existing Orange County Sanitation District procedures so we could compare this data to the PMBOK® Guide based questionnaire. This basic format of this questionnaire listed each of the existing procedures. Respondents were asked to select only one of the following statements: No Opinion, No Change, Implement More Consistently, Increase Project Manager Authority, Streamline, Correct Inaccuracies, Automate. Seldom did we get far into the questionnaire interview before we heard individuals and groups tell us of general and specific problems and frustrations that they had experienced. Some of this we anticipated. As noted, the OCSD was a weak matrix organization so the project managers had the title and accountability, but do not have the required authority or power to act in their project's interest.

In our analysis of the questionnaires and interviews we concluded that although some of the procedures needed modification, and new ones authored, the primary focus would be to address the imbalance between the project manager responsibility, accountability, authority, and power. Of course, this imbalance is infamous throughout project management regardless of industry or agency. One of our recommendations to address this is the establishment of a Project Management Office and a distinct project manager career path within the Project Management Office.

Conclusions

General Strengths

The team met several times to formulate their recommendations to the OCSD. We wanted to recognize and retain the current strength of the organization while providing meaningful recommendations. We found the District embodied the following strengths:

• Current project management methodology and discipline contained a series of process steps for working within a generally understood project life cycle. It is a repeatable process with consistent planning and control mechanisms that are used across all projects.

• Executive management supports capital project management policies

• Appropriate individuals agree to capital project requirements

• A team-based approach is used to manage capital projects

• There are standard tools that facilitate most capital project management activities

• A schedule and budget is established for every capital project

• Inspections and audits are used to identify nonconformance

• A system of regular capital project reports and reviews is implemented

• Capital project records are maintained in an organized fashion

• Supplier and subcontractor performance is managed in an organized fashion.

Key Recommendations

Our recommendations were categorized into the PMBOK® Guide areas to provide the pathway toward the stated goal of “… developing policies and procedures to more effectively manage the District's capital projects, based upon the [PMI] Body of Knowledge (PMBOK) Guide.” The following were the major recommendations resulting from the study, by PMBOK® Guide area.

Follow-On Phases

At this time the implementation of selected recommendations is expected to be undertaken in subsequent phases. Phase two will provide training, process planning, and organizational planning. Phase three will deploy processes and establish a Project Management Office within OCSD as the center of excellence in PROJECT management.

Acknowledgments

I want to acknowledge Peter Lewis who managed our Phase I effort, and teammate Marsha Peterson, both of whom reviewed this paper and provided valuable comments. I also wish to thank Dave Ludwin and Jim Herberg who had the courage to entrust our team with this effort without which this paper would not be possible. I also wish to thank the staff of OCSD who, in spite of their heavy workload found the time to answer our questions and provided us insight in to OCSD project management. As an Orange County resident I am so pleased that these people were able to keep the Sanitation District's systems functioning even as we took them away from their daily work to address our questionnaires and interviews.

References

US Government, Office of Management and Budget. 1999. Circular No.A-76.

Project Management Institute. 1996. A Guide to the Project Management Body of Knowledge (PMBOK® Guide). Upper Darby, PA: Project Management Institute.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

Proceedings of the Project Management Institute Annual Seminars & Symposium
November 1–10, 2001 • Nashville, Tenn., USA

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