Project Management Institute

Rise to greatness

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---------BY NATALIE BAUER

----------EXECUTIVE SUMMARY

  • img Process improvement initiatives have failed to gain the full, undivided attention of the executive suite despite positive returns on investment.
  • img Maturity most likely is gained with the guidance of a model. Effective models must adapt easily to a variety of environments.
  • img Continuous models provide a greater degree of flexibility and can fit across many types of industry.
  • img Level gauges provide a clearer snapshot of an organization's progress.

SANCHEZ COMPUTER ASSOCIATES SAVED $2 MILLION IN SIX MONTHS.

Boeing cut its release turnaround time in half. Bosch Gasoline Systems improved delivery times by 15 percent.

These three enterprises are as diverse as they come, yet they all share an important distinction: They recognized the value of project management maturity, sculpted a strategy for procedural growth and saw return on investment (ROI) soar.

img The concept of maturity, or adopting and modifying proven management procedures, is thought to have taken root in the global business arena, but maturity models and process improvement initiatives have failed to gain the full, undivided attention of the executive suite.

As a result, most enterprises remain at the lowest rungs of the project management maturity ladder. A new study by the Center for Business Practices, Havertown, Pa., USA, shows that 88.9 percent of organizations are at the lowest level of maturity, while less than 1 percent of enterprises have reached the highest maturity stage.

“They're at the bottom because [executives] haven't yet seen the value of building project management maturity,” says J. Kent Crawford, PMP, PMI Fellow, chief executive officer (CEO) of PM Solutions, Havertown, Pa., USA.

Make the Argument

Executive support is critical to an enterprisewide process improvement initiative; however, C-level attention often is divided. Without an executive sponsor's complete buy-in, it is nearly impossible to keep the ball rolling. “It's always a challenge for project managers to convince executives of the value of project management maturity,” Crawford says. “To convince them, we have to put the discussion of maturity into measurable business value terms.”

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PHOTO OF JAY DOUGLASS BY MATT BULVONY

ALL ORGANIZATIONS HAVE GOT TO CONTINUALLY LOOK FOR WAYS TO IMPROVE—THAT'S JUST A LAW OF ECONOMICS, A MATTER OF COMPETITIVE SURVIVAL.

----------JAY DOUGLASS, MANAGER, BUSINESS DEVELOPMENT, CARNEGIE MELLON SOFTWARE ENGINEERING INSTITUTE, PITTSBURGH, PA., USA

For Jay Douglass, manager of business development at Carnegie Mellon Software Engineering Institute, the Pittsburgh, Pa., USA-based institute that develops the Capability Maturity Model, the value is clear. “It provides a roadmap for strategic improvement. To me, it's just that simple,” Douglass says. “All organizations have got to continually look for ways to improve—that's just a law of economics, a matter of competitive survival.”

Numbers and projections always fuel a strong argument, but framing the discussion beyond a database may tip the scales. Douglass says project management maturity is a matter of life and death for an organization. “It is impossible to be innovative and creative if you do not have a solid foundation of the basics that are being handled in a predictable, quality fashion,” he says. “This is at the concrete base of what you do so you can be really creative. [Mature project management] enables creativity.”

Touch Your Toes

img Maturity most likely is gained with the guidance of a model, ostensibly structural maps with objective scoring to track and measure progress. Think of the models as corporate stethoscopes that can assess and diagnose a company's health.

Because each enterprise is different, effective models must adapt easily to a variety of environments. The organization should not have to change according to the roadmap; the roadmap simply should illuminate several possible routes. “A strong model naturally is a flexible one,” says Steve VanArsdale, principal of VanArsdale & Associates, Mount Prospect, Ill., USA. “That is the model that continues to provide framework and measurable, continuous improvement while the model is tuned, changed and even circumvented.”

    BREAKING OUT --------BY YAN BELLOW MENDEZ

On 18 December 2003, CAJA MADRID, one of Spain's largest savings banks, became the first organization in the country to achieve a certified level 2 maturity level on the Software Engineering Institute's latest assessment model.

The milestone was the result of nearly two years of careful planning and implementing a strategic plan that would bolster CAJA MADRID's project management culture.

The contract, valued at more than €600,000, was kicked off officially on 17 July 2002, after several months of preliminary project definition, by CAJA MADRID's staff and a team of consultants from PROFit Gestión Informática, based in Madrid.

As with most projects that involve culture change, the organization's senior management support was a critical resource. “As a result of this project, our people will be more motivated by working with improved methods and tools, higher quality of our software and higher productivity as rework costs are cut,” says Ricardo Morado, CAJA MADRID's chief information officer and main project sponsor. “Projects will be more predictable.”

The starting point on the maturity improvement journey was establishing or consolidating a basic project management capability in the organization, which allowed later improvements to other process areas. In CAJA MADRID's project, the team planned to benefit from the continuous representation and establish an intermediate milestone with the criteria of certifying project planning, project monitoring and control process areas at capability level 2.

This partial but important milestone was successfully achieved on 29 April 2003, when the assessment team led by Gartner's Lead Appraiser Robert Smith completed and reported to CAJA MADRID's management team the results of a progress assessment.

The team leadership's wisdom and knowledge of the organizational culture also aided success. “Getting the pulse of the organization is key to smoothly and successfully rolling out these new procedures and getting the people to use them,” says Ester Sánchez, technological planning department director for CAJA MADRID. “Early identification of problems and opportunities, and reacting quickly to them, has been a crucial ability of the project team and a major ingredient of implementation success.”

A common challenge was coping with scarce resources. Having part of the team based in Barcelona and part in Madrid posed potential problems, so team members were collocated in Madrid.

CAJA MADRID achieved an important milestone, but software process improvement is a continuous endeavor. Ahead wait other process areas, maturity levels and more improvement opportunities that now become accessible from the solid foundation of repeat-able “managed” software projects and better prepared project managers.

Yan Bellow Mendez is a senior consultant and project manager. He was the project director for CAJA MADRID's improvement initiative for PROFit, and he is the vice president of the PMI Barcelona Chapter.

----RICARDO MORADO, CHIEF INFORMATION OFFICER, CAJA MADRID, MADRID, SPAIN

----RICARDO MORADO, CHIEF INFORMATION OFFICER, CAJA MADRID, MADRID, SPAIN

NOT EASY BEING GREEN

As one of three telecom operators to serve Switzerland's nearly 7 million citizens, Orange Communications SA, a Swiss subsidiary of France Telecom Group, Lausanne, France, experiences intense competition.

As the company has grown and the mobile phone market has matured, sponsors couldn't ensure exactly when their products would be delivered, financial controllers wanted a better way to maximize profits and project managers needed clarification on roles and responsibilities.

By 2003, the company had founded a project management office (PMO) to unify processes and establish deliverable- or decision-based milestones, which were mapped to A Guide to the Project Management Body of Knowledge (PMBOK® Guide). But Orange leaders wanted to go further.

They opted to implement a maturity model assessment and use those results to establish a tailored, holistic approach to improvement. Officers selected PMI's Organizational Project Management Maturity Model (OPM3™) because its PMBOK® Guide-based knowledge integrated easily into the company's project management culture. Other models, they found, were expensive, inflexible and impractical. In addition, OPM3 gave a multidimensional perspective and provided learning path support.

“We could see a certain integrated approach that suited our internal needs,” says Alexander Matthey, PMP, PMO manager of Orange Communications SA and vice president of special projects for PMI's Switzerland Chapter. “The model allowed us to design a practical learning curve and boost the organization toward a higher maturity.”

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----------ALEXANDER MATTHEY, PMP, PMO MANAGER OF ORANGE COMMUNICATIONS SA AND VICE PRESIDENT OF SPECIAL PROJECTS, PMI SWITZERLAND CHAPTER

Orange hired specialized consultants for OPM3 as internal assessors. The assessment looked at the maturity of Orange's five process groups and across each division at both the project and program levels. Lacking a common approach, divisions showed definite variances. Overall maturity was revealed as slightly below 20 percent.

The assessment also illuminated a link between needs and real educational requirements, which were necessary to convince executive management to approve further improvement initiatives.

With a clear roadmap, the team implemented a strategic education program to add high visibility to early improvements and introduced a formalized project manager career path. The education program is based on a three-year scale to move project management practices from individual initiatives to a structured approach within the various divisions and eventually to a company-wide level. PMO leaders also continue to develop umbrella processes, adapting them to new capabilities. They're also focusing on supporting trainers' efforts.

Orange leaders intend to repeat the project. The OPM3 self-assessment can be repeated at regular intervals, about every six months, because now there is an internal knowledge and experience of the procedure.

“There is no doubt that by improving the way the projects are managed and controlled, the benefits will be felt and collected by the entire business,” Matthey says.

At the lowest gauge of any model, maturity means consistent, repeatable processes that eliminate as many unknown variables as possible. As enterprises progress along maturity scales, strategy becomes an inherent part of growth. Procedures and thus projects become more easily aligned with corporate aims.

Underscoring the importance of top-level support, only enterprises with clear goals will succeed. “You need to understand what you're really trying to accomplish,” Douglass says. “You need to use these models to achieve specific business goals, and you need to put a significant amount of time into understanding what this model is going to do for you in the context of your business needs and goals.”

It took the U.S. Internal Revenue Service, for example, more than a decade to modernize its information technology infrastructure. Only when its project management office (PMO) realized the necessity of an integrated project management discipline did the project truly come to life. The PMO created a three-year improvement plan, cleared it with executive sponsors, and then subdivided the overall strategy into finite goals and plans broken down annually. Within three years, the project team's clear vision resulted in less rework, greater training capabilities and more accurate planning.

Winnowing scope down to exactly what needs to be done will help illuminate benefits and gains later on in the improvement initiative. “No organization exactly maps to the model,” VanArsdale says. “It's hard to tell where a change to the model might preclude a specific benefit. A model must be flexible enough to provide its benefits in a variety of ways.”

OPM3: PROVEN RESULTS

The Project Management Institute now gives organizations a holistic view of its maturity, much as it has done for individual practitioners over the last three decades.

Known as the Organizational Project Management Maturity Model (OPM3™), this industry standard allows organizations to assess their overall project management maturity and provides a clear strategy for improvement. The model also enables internal benchmarking over time or in comparison to similar organizations.

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Beginning in 1998, nearly 800 volunteers from virtually all industries and disciplines and representing 35 countries analyzed 27 contemporary models for strengths and weaknesses.

Through a brainstorming process, OPM3 volunteers identified 170 best practices. To assess an organization's capability, outcomes must be identified and confirmed by at least one associated key performance indicator (KPI). This strategy is aligned to a process map consistent with A Guide to the Project Management Body of Knowledge (PMBOK® Guide).

Having been on the market for six months, OPM3 users are beginning to produce positive results across their enterprises. Designed for ease of use and flexibility, the model has proven its merit at across a variety of industries.

For more information, please contact Lisa Kruszewski, PMI standards project specialist, at lisa.kruszewski@pmi.org.

The process improvement program initiated by Lockheed Martin M&DS, Philadelphia, Pa., USA, in 1993 evolved into a very different program by 1996. After three years of improvement, had its model not evolved with the program, it would have rendered the initiative null. Instead, the flexible model enabled the project team to continue to enlist positive results. By 2002, the organization had reached nearly the highest level of maturity, and it showed: Software productivity had increased 30 percent, software costs dropped 20 percent, and defect find-and-fixes dropped 15 percent.

Comparing Notes

Two camps dominate the maturity models mindset: continuous rating systems and levels. Continuous rating systems monitor progress on an ongoing basis, while levels-based models organize progress by tiers. Both have their pluses and minuses. “The best model out there is one that you can easily connect to real needs within an organization,” Douglass says.

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They're at the bottom because [executives] haven't yet seen the value of building project management maturity.

J. Kent Crawford, PMP,
PMI Fellow, Chief Executive Officer, PM Solutions,
Havertown, Pa., USA

img Continuous models provide a greater degree of flexibility across many types of industry. Both Douglass and Crawford agree that models in the continuous camp are a “softer sell.” “[They] might achieve higher levels of acceptability because there's not as specific a measurement,” Crawford says.

Ironically, he says, the model's lack of measurability also is its downside. “You can't measure where you are, and you can't compare your progression against business metrics. It has a tendency to create a challenging environment for development.”

img Level gauges provide a clearer snapshot of an organization's progress at any one time. “Project maturity process improvements can take a long time,” VanArsdale says. “It's hard to keep focus and sometimes hard to maintain motivation. For organization-wide project management initiatives to be successful, there must be clear milestones. Continuous rating systems, while they provide good evidence of minor change, are not as effective as level measuring models in helping organizations achieve meaningful plateaus. It's difficult to say in the continuous rating systems when major achievement finally occurs, and the organization loses interest.”

Levels answer to the challenge of putting the initiative into business-speak and showing clear correlation between cost and value of such efforts. “You can match levels against business performance,” Crawford says. “You can also compare the cost of achieving that level against the value of arriving.”

However, be prepared to see something you might not like. Crawford says a downside to level-based models is that they can reflect an ugly state of reality, which may discourage deployment managers given the amount of effort required. “Organizations may be unwilling to recognize or advertise that they're deficient,” he says. “Organizations might feel that the full maturity is a challenge to reach at its highest level. It's such a reach that it's not worth going there.”

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It's hard to tell where a change to the model might preclude a specific benefit. A model must be flexible enough to provide its benefits in a variety of ways.

Steve VanArsdale,
Principal, VanArsdale & Associates,
Mount Prospect, Ill., USA

Baby Steps

Maturity is all-encompassing, so when setting about an improvement initiative, leaders must keep it simple from the start. Appointing a trained internal assessor or hiring an expert to lead the process will ensure the initiative's livelihood.

Beware of going too fast. Prematurely mandating an aggressive schedule without that internal review likely will lead to trouble. Research by the Software Engineering Institute shows that setting a realistic schedule for improvement leads to the greatest odds for success. “And don't pick the hardest thing to do first,” Douglass says. “Set goals for yourself that you can achieve.”

THE BEST MODEL OUT THERE IS ONE THAT YOU CAN EASILY CONNECT TO REAL NEEDS WITHIN AN ORGANIZATION.

----JAY DOUGLASS

Douglass adds that the self-awareness required to engage in an improvement initiative already means the enterprise has reached a new level. “I always like to ask what's keeping the [executives] up at night? You need to be relatively self-aware to make these decisions in the first place. Figure out what it is that makes you nuts. Get a handle on it, figure out where the gaps are.”

Once you know what needs fixing, determine how it should fit into your organization's culture. “The holy grail of this business is adoption issues,” Douglass says. “You need to understand what motivates your organization. Every culture is different. Recognize what's different about your organization and understand how to capitalize on that—how to relate this from top to bottom of the organization.

“Executives, middle managers, corporate steering committees, people down in the trenches—they're all going to have a different idea about what success means. Report it accordingly. You have to keep people interested. You've got to come back with ideas for them that will make them a lot more excited,” he says.

Keeping Tabs

In the end, selling process improvement initiatives comes down to results. With clear goals, a model mapped to fit your organization's culture and a motivated team, all that remains is the proper metric. “One of the first critical steps is to set the critical business metrics of project management culture and then to periodically remeasure against those metrics to determine the value,” Crawford says. “An organization should demonstrate positive impacts within a 12-month period.”

But change should not be expected overnight. Douglass says just getting started can provide more value than most executives ever could imagine. “The simple fact that you've recognized your key issues is huge,” he says. “You cannot debate the importance of that. Establishing a common vocabulary and priorities within an organization—now how often does that happen?” PM

To participate in an online discussion on maturity models with your colleagues, visit communities.pmi.org and go to the PMI Member Community.

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.

PM NETWORK | JULY 2004 | WWW.PMI.ORG
JULY 2004 | PM NETWORK

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