Project managing global business transformation projects
tips and tricks
As organizations become more global in today's inter-connected world, the reach and impact of projects they undertake have turned global as well. Global projects are great opportunities for organizations to plan and implement high-impact ventures that help them achieve their strategic objectives. On the other hand, such projects tend to be complex and pose several challenges related to planning, executing, communications management, change management, risk management and overall governance. This paper draws upon the experience of the author in effectively delivering information technology enabled global business transformation projects. It enumerates key considerations and critical success factors for global projects from initiation through closing, and outlines the strategies that organizations can employ in order to help orchestrate and deliver projects that have a transnational footprint. The paper recommends that project managers should be aware of the potential pitfalls they could face with global projects and proactively equip themselves with winning strategies to address such challenges.
Global Projects – Setting the Context
Organizations all over the world undertake hundreds, if not thousands, of projects each year. Over the years, such projects have become more wide-ranging in their scope, complexity, and impact. However, research shows that success in projects is not a given and is not consistent. Project success is generally defined by organizations as (a) being within budget, (b) meeting the schedule, and (c) achieving the project's goals. Project Management Institute's research, which is consistent with other studies, shows that less than two-thirds of projects meet their goals and business intent, and about 17% fail outright. Since 2008, the percentage of projects that project managers say have met their original goals and business intent has declined 10 percentage points (from 72% in 2008 to 62% in 2012). Failed projects waste an organization's money – for every US$1 billion spent on a failed project, US$135 million is lost forever (PMI, 2013b, p 2). So it is critical for organizations to achieve the desired outcomes consistently in projects they undertake.
As organizations become more global in our increasingly inter-connected world, the reach and impact of projects they undertake has turned global as well. Global projects are, on the one hand, great opportunities for organizations to plan and implement high-impact ventures that help them achieve their strategic objectives, while on the other, such projects tend to bring in several new dimensions of complexity and pose major challenges in the management of project risk and quality.
Let us start by understanding the nature and characteristics of global projects so we can appreciate the particular challenges they pose to organizations and project managers alike. Typically, global projects involve:
- Providing business and financial impact for business units worldwide
- Multiple business units spread across several countries (e.g., the company headquartered in the United States has units in the Americas and has branches and operations in Europe, Middle East and Asia)
- Several legal jurisdictions and currencies
- Teams speaking a variety of languages, located in multiple geographical locations and time zones
Some examples of global projects include strategic business transformation initiatives in finance, human resources, supply chain and other business processes, projects that result out of mergers and acquisitions, implementation of large-scale Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), trading and investment management systems, and so on. They involve designing and rolling out a complex set of business processes along with, generally, implementation of a computer-based information system as well. Such initiatives directly impact hundreds, if not thousands, of their stakeholders, who include the project sponsor, core project team, global process owners, steering committee/executives, product vendors, system integrators, and end users that are the direct beneficiaries of the project's outcome. Each of these elements adds additional dimensions and contributes to complexity in project planning and execution.
Key Considerations for Global Projects
PMI's A Guide to the Project Management Body of Knowledge (PMBOK® Guide) provides a reference framework for project managers to analyze, plan, and implement global projects. The PMBOK® Guide divides the overall activities of the project into five Process Groups (i.e., Initiating, Planning, Executing, Monitoring and Controlling, and Closing). Let us consider the characteristics of global projects against the Process Group framework and understand key considerations for such projects against each Process Group.
The Initiating Process Group consists of those processes performed to define a new project or a new phase of an existing project by obtaining authorization to start the project or phase (PMI, 2013a, p 54). Significant tasks performed in this Process Group include developing project charter and identifying stakeholders.
Some key considerations for project managers while initiating global projects are:
- Synergy with project portfolio. Given the magnitude of their scope and size, global projects tend to be planned and executed in multiple phases and over a multi-year period. It is very likely that the organization will be simultaneously undertaking multiple other initiatives during this time horizon. These initiatives could have an impact on the global project and vice versa. Hence it is important for project managers to understand the synergy and impact of the organization's other initiatives on their project.
- Measurable success criteria. Project effectiveness should not just be in the “eye of the beholder”; rather, it should be based on definite and measurable criteria. Success criteria should be established on schedule, budget/cost and the project objectives/goals that are critical to be achieved. Global projects commit significant amounts of financial and human resources and are, to borrow an expression from the recent global financial crisis, simply “too big to fail.” This makes it imperative for project managers to be clear on how the project's effectiveness is defined at the outset and to understand the criteria for continuous evaluation during the rest of the project.
- Iterative initiation. Being large and complex, global projects should be divided into multiple phases of implementation. For such projects, the initiating processes should be carried out at project initiation to draw up a roadmap, which is updated through subsequent phases to keep the project focused on the business goals that the project seeks to address. As depicted in Exhibit 1, the iterative initiation phase serves as a checkpoint to validate the design decisions made during the initial phase, reconfirm continued buy-in from its stakeholders, and to measure the ongoing benefits of the project.
Exhibit 1 – Iterative Nature of Large and Complex Projects
“The Planning Process Group consists of those processes performed to establish the total scope of the effort, define and refine the objectives, and develop the course of action required to attain those objectives” (PMI, 2013a, p 55). Significant tasks performed in this Process Group are developing the project management plan and planning other aspects enumerated by the PMBOK® Guide in this Process Group (e.g., scope, time, cost, communications, and risk management plans).
Some key considerations for project managers to keep in mind for global projects are:
- Long-term risk identification. Over the long duration of global projects, it is possible that risks originate from a variety of sources (e.g., changes to management priorities, regional/global economic downturns, changes to financial fortunes of the organization, employee movement, and talent flight). Hence, it is critical that project managers comprehensively identify risks and plan responses proactively to reduce adverse impact to the project and the organization as a whole. Risks should be documented and tracked in a project risk register, and probability of occurrence, severity of impact and ability to control should be estimated for each of the risks. These dimensions may then be used to arrive at a “risk severity score” that project managers may use to rank the risks in order of their severity and implement risk mitigation measures. Although this list is developed during planning, it should be kept up-to-date through the rest of the project.
- Active complexity management. Global projects tend to have a lot of “moving parts” — design, rollout, and user adoption of changes to end-to-end business processes; design, testing and implementation of a computer-based system, and coordination with multiple vendors are some examples. Project managers should understand these facets and work with stakeholders to effectively manage complexity. Phasing the project into multiple rollouts, prototyping the solution design, building a proof of concept, and putting in place repeatable processes for design, testing and implementation are some of the mechanisms project managers may utilize.
- Optimal global design. Another planning consideration involves determining how standardized the solution will be across business units or geographies, and how much variability is permitted between business units or between countries in core business processes. Standardizing the design and allowing very little variation of the solution has the advantages that (a), the process is uniform making implementation, user training and process support easier and (b) it makes later rollout cycles easier and quicker. Too much standardization, however, leads to (a) prolonged debates to get consensus, resulting in political turf battles and prolonged design cycles and (b) little flexibility for regional/country-specific needs, forcing users to go around the defined process to meet their particular circumstances. Project managers should work closely with stakeholders to influence this debate in favor of the overall good of the project and the organization.
“The Executing Process Group consists of those processes performed to complete the work defined in the project management plan to satisfy the project specifications” (PMI, 2013a, p 56).
Some key considerations for project managers for global projects are:
- Active stakeholder involvement. The project manager needs to understand and proactively manage stakeholder expectations through the life cycle of the project by regularly engaging stakeholders, addressing their concerns, and confirming that they continue to actively support the project. The level of engagement will vary but will be at its highest levels during the initial stages of the project when project objectives, scope, and requirements are being gathered and finalized.
- Engaged virtual teams. Virtual teams, project resources who work from widespread geographical locations, are inevitable in global projects. These resources bring in several benefits (e.g., of being close to locations of stakeholders, having subject matter knowledge in local laws and processes, reducing travel costs, and providing coverage for local time zones). However, since they are not co-located with the rest of the project team, virtual team members may feel isolated or frustrated, if they are not provided appropriate mechanisms to get involved in and contribute to mainstream project activities. Add to this additional challenges brought in by cultural and language barriers of a transnational team. Global project managers should consciously implement communication strategies to overcome the distance barriers with virtual team members and make them feel part of the same team. Team building activities, virtual web-based meetings, video conferences, project summits at beginning of project phases and at key milestones are some of the strategies project managers may use to get virtual teams involved and be more effective.
- Objective quality checks. Team members of projects with a global footprint typically have their hands full with tactical activities geared towards achieving near-term goals. While being focused on “doing things right,” it is usually hard for project managers to take themselves away from the detail and evaluate whether the team is engaged in “doing the right things.” Hence, it will help to have an objective pair of eyes review and independently assess the project's overall processes, design and delivery approach, resource usage, skill set match, risk management approach, level of stakeholder alignment and so on. These quality checks provide feedback and valuable insight to the project manager and core project leadership team into the state of the project and help identify potential risks well ahead of time. However, executive leadership authorizing such an inspection should exercise caution to have the review carried out by an experienced team as impartially as possible. Otherwise, the inspection may get so marred by organizational politics and power plays that it turns into a political witch hunting exercise.
Monitoring and Controlling
“The Monitoring and Controlling Process Group consists of those processes required to track, review, and orchestrate the progress and performance of the project; identify any areas in which changes to the plan are required; and initiate the corresponding changes” (PMI, 2013a, p 57).
Some key considerations for project managers for global projects are:
- Diligent change control. Performing integrated change control (which considers the overall impact of a proposed change to scope, schedule, cost, and project risk) is a key activity in this Process Group. In global projects, given their large footprint, scope changes can commonly occur due to (e.g., functionality moving in and out of project phases, application boundaries being redrawn, and changes to the implementation schedule). Scope often drives schedule, and as such, project managers should pay careful attention to managing scope. Change governance is critical since changes can have a cascading impact to subsequent project phases, and project managers should be diligent about documenting and communicating the impact of the changes. They should clearly lay out change control procedures right at the beginning of the project (and update them at the beginning of each phase, as required) and enforce them consistently and without fear or favor.
- Data-driven status reporting. Projects of the scale and magnitude of global implementations tend to have their work organized and broken down into several work streams, teams, and sub-teams. In order to get a realistic view of the project's health, status should be collected at individual task level and progressively rolled up at sub-team, team and work stream levels, tying back potentially to the “control account” of the Work Breakdown Structure (WBS). As an example, technical report creation (sub-team) tasks roll up to application development (team) tasks, which in turn roll up to technology (work stream) level tasks. One particular model that the author has seen work well is where individual task dates flow through directly from the project work plan into the status trackers of sub-teams, teams, and work streams. Task slippages are easily spotted with this mechanism and are linked to project Issue Log references, as applicable. Each work stream discusses delayed tasks and related Issue Log entries during periodic status meetings.
“The Closing Process Group consists of those processes performed to conclude all activities across all Project Management Process Groups to formally complete the project, phase, or contractual obligations.” (PMI, 2013a, p 57).
Some key considerations for project managers for global projects are:
- Leverage lessons learned. Given their eagerness and anxiety to meet their timelines, project teams may have the temptation to complete one phase or rollout of a global project and sail right into the next. However, project managers should educate the team to take a pause to reflect upon what went right and what did not quite go right in the just completed phase/project. When they are performed diligently, such “lessons learned” sessions can provide a forum for the project team and other stakeholders to provide feedback and yield valuable insight that can be used for process improvement in subsequent phases or future projects. Each sub-team, team, and work stream should be encouraged to provide their frank feedback on strengths to carry forward as well as “areas for improvement.” Each “area for improvement” should correspondingly have a constructive suggestion on what should change in order to do achieve improvement in the next iteration and a follow-up owner assigned for next action.
Critical Success Factors for Global Projects
So what makes megaprojects carried out at a global level succeed? What are some of the differentiating factors that are present in successful projects? What can organizations and project managers do to influence project outcomes to be successful? In the author's experience, there are five critical success factors that project managers should pay attention to, in order to increase their chances for project success:
- Strong leadership alignment and support
- Proactive organizational change management
- Effective 360-degree communications
- Practical project governance
- Collective team commitment
Let us briefly look at each of these differentiators and understand why these are levers that project managers can exercise to make themselves and their stakeholders effective.
Critical Success Factor #1: Strong Leadership Alignment and Support
Organizations with active project sponsors are more likely to have better project outcomes (PMI, 2013b, p 9). As shown in Exhibit 2, organizations that have active project sponsors on at least 80% of their projects have a higher success rate than those with less than 50% of their projects with active sponsors. This measure holds true whichever way project success is interpreted (i.e., meeting goals, being within budget and time, having less scope creep, or being perceived as failed projects).
Exhibit 2 – Organizations with a higher percentage of active project sponsors enjoy higher project success rates than those with a lower percentage of active project sponsors.
The principal challenges organizations face during a large-scale global project implementation are people-related. Along with project sponsors, the organization's leaders play a critical role in minimizing these challenges and enabling the organizational readiness and adoption process. Leadership engagement plans serve as a guide and checklist of the activities that are needed from key leaders to support and enable the success of the project.
Exhibit 3 (Deloitte Consulting LLP, 2012) captures the select reasons to engage leaders and the benefits that can accrue from that investment.
Exhibit 3 – Key Reasons to Engage Leaders and the Resultant Benefits
Given that projects of this scale and size are multi-phase, multi-year efforts, one of the specific messages that need reinforcement with leadership is how the project continues to provide benefit realization throughout its life cycle. Benefits should be clearly defined, tangible, measurable and tied to change management and check points set up at end of each phase in order to confirm continued benefit streams from the project.
Critical Success Factor #2: Proactive Organizational Change Management
Organizational Change Management (OCM) refers to the set of activities designed to address organizational and people challenges associated with adopting project-related changes. The OCM team's overarching goal is to help stakeholders understand what is changing and prepare end users to follow new processes and use new systems. OCM is a three-step process comprising (a) Change Impact Analysis which captures major changes to the systems and processes associated with the project to the organization and its employees; (b) Change Readiness Assessment that develops an approach for measuring organizational readiness for change, including survey dimensions, survey questions, target audiences, and distribution timelines; and (c) Employee Readiness Adoption that creates a network strategy to establish cyclical, two-way communication channels between OCM, credible/visible change agents, and end users. OCM identifies focus areas (e.g., project management) and change agents to own each focus area; it creates and delivers support materials, and continuously monitors change adoption effectiveness.
Change adoption is a multi-stage process and evolves over time. As shown in Exhibit 4 (Deloitte Consulting LLP, 2012), stakeholders make a journey starting with building awareness about the change through to change ownership, when they make changes on their own and create new ways to use and improve the new processes.
Exhibit 4 – Stakeholders go through a multi-stage process in change adoption
In addition, global project managers should be cognizant that change impact and adoption rate in different regions/countries may be different. The change strategy needs to take into consideration cultural and regional factors and subtleties in how change resistance manifests itself in various regions and cultures.
The good news is that an increasingly larger percentage of projects are adopting change management processes, as shown in Exhibit 5 by recent research (PMI, 2012 p 5)
Exhibit 5 – A larger proportion of projects are adopting change management processes
Critical Success Factor #3: Effective 360-degree Communications
Executives and project managers alike recognize that poor communications contributes to project failure. The Forbes Insights 2010 Strategic Initiatives Study found that “nine out of ten CEOs believe that communications is critical to the success of their strategic initiatives, and nearly half of respondents cite communications as an integral and active component of their strategic planning and execution process” (PMI, 2013c p 6).
As shown in Exhibit 6 (PMI, 2013c, p 6), the same study further notes that high-performing organizations:
- Are better at communicating specific project topic areas, including objectives, budget, schedule, scope, outcomes and the project's business benefit
- Are notably better at delivering project communications in a timely manner, providing sufficient clarity and detail, using non-technical language, and choosing appropriate settings or media for the delivery.
Exhibit 6 – High performing organizations communicate more frequently across many topics and in many ways of delivering communications
While preparing and implementing the communication plan, project managers should keep the following in mind:
- Identify stakeholder groups impacted by the project and segment audiences based on common profiles in order to send targeted messages
- Identify communication vehicles comprehensively and leverage both conventional and contemporary channels (e.g., select leadership meetings, newsletters, global voicemail, town hall meetings, road shows and other company events, company portal, and company social media sites)
- Communicate early with increasing frequency and specificity leading up to deployment
- Make the message relevant to the recipients by answering questions, such as: ‘How will this affect me?’ ‘What does this mean to me?' and ‘How will my work change?’
- Involve the extended project team and have leaders and executives take an active role in communications
- Provide feedback channels and actively seek input from the field
- Assess communications effectiveness at several different times during the project in order to refresh approach, plans and tactics
Virtual teams located halfway around the globe, with different cultural sensitivities, speaking several tongues and working in different time zones are a reality for these projects. Global project managers should recognize these added complexities and mitigate them in order to make project communications effective.
Critical Success Factor #4: Practical Project Governance
“Project governance framework provides the project manager and team with structure, processes, decision-making models and tools for managing the project” (PMI, 2013a, p 34). A robust and stable governance model contributes to clarity of direction, cohesiveness of the team and alignment. An effective governance structure includes decision making authority as well as an escalation path for issues that require attention from sponsors, leadership team, and quality and risk management teams. In addition, it provides a framework for transferring knowledge and building organizational capabilities to manage future complex projects.
Some of the elements that a project governance model should address include scope definition and management, resources, risk management, issue management and escalation. In order to achieve these goals, typically, a governance model with the following organizational structures and enabling mechanisms is set up as shown in Exhibit 7 (Deloitte Consulting LLP, 2013).
Exhibit 7 – Project Governance Structures and Enabling Mechanisms
A key tenet of program governance is to provide a framework that enables effective, impactful and timely decision making. Please refer to Exhibit 8 (Deloitte Consulting LLP, 2013) that highlights typical proportion of decisions that are made at various levels of the program structure:
Exhibit 8 – Decision Making by Levels
Other select factors in achieving effective project governance include:
- Defining a set of governance guiding principles at the onset of the project, to be used throughout the design, and implementation of the project
- Putting in place an effective stage gate/phase gate review and change control processes
- Managing stakeholder alignment and expectations proactively
- Implementing an integrated set of collaborative tools for risk/issue logging, monitoring and resolution, status monitoring/reporting, and escalation processes
Critical Success Factor #5: Collective Team Commitment
The task of building and leading a cohesive project team is perhaps a very challenging and yet rewarding task for global project managers. Here are some practical steps that project managers can take to get their global teams to buy-in and put in their sincere efforts for personal and project success:
- Develop and communicate the project's core beliefs A team that understands and believes in the common goal of the project and the organization, and puts in their sincere effort, delivers high levels of quality. Exhibit 9 provides an example of a project's mission statement, vision statement, and guiding principles.
Exhibit 9 – Sample Project Mission, Vision and Guiding Principles
- Employ and adopt a strong methodology. A well-defined, standard process that describes the way the team plans and executes their activities and produces deliverables and other artifacts is critical for a global team to succeed. A methodology provides a structure/framework, common processes, and lingo that a virtual team can use to collaborate. It also provides a jump start for the project via templates and samples/models that can be leveraged by the team.
- Create and publicize a strong project brand. Create an identifiable name (or an acronym) and attractive logo for the project, and brand written project communications (e.g., presentation templates, training material and so on with the project logo/acronym). From the author's experience, it just takes a short period of time before project stakeholders start developing an affinity to the project's “brand” and a sense of identity and belonging to what the project stands for.
- Applaud success. Celebrate all mini-milestones, milestones, and accomplishments of the project team. This positive reinforcement is particularly beneficial in a multi-year, multi-phase effort such as a global project. It is helpful also to remind the team that this is a marathon, not a sprint, and the project team needs to keep their efforts focused and spirits high throughout the life cycle of the mega effort.
Global projects are great opportunities for organizations to plan and execute high-impact ventures that help them achieve their strategic goals. While they have characteristics similar to smaller scale projects, global projects are more complex and pose several particular challenges in tasks related to initiating, planning, executing, monitoring/controlling, and closing. The paper outlines several key considerations and critical success factors; namely, strong leadership alignment and support, proactive organizational change management, effective 360-degree communications, practical project governance, and collective team commitment that will go a long way in making global projects achieve their goals. The paper recommends that project managers should be aware of the potential pitfalls they could face with global projects and proactively equip themselves with winning strategies to address such challenges.
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© 2013, Bala Gopalakrishnan
Originally published as a part of 2013 PMI Global Congress Proceedings – New Orleans, Louisiana