Project management--a journey to excellence
Project Management has become the buzzword of the new millennium. Project Management and Project Managers have never been more important to the accomplishment of corporate work scopes. An increased emphasis on performance, accountability, and cost-effectiveness is driving both industry and the government to reassess work scope planning and execution. Indeed, the most efficient companies are using Project Management as “the tool” for effective streamlining. This change, however, requires planning. No longer can workforce size, resources, training, or experience alone help your company achieve its goals. Accomplishment begins with a total synthesis of resources, a shift in corporate culture, and the full commitment of management. It is a journey to excellence.
Criticism still exists however, some valid, some not. This is particularly true within the U.S. Department of Energy (DOE) where outside criticism from such well-known bodies as the National Academy of Science and the National Research Council have questioned DOE’s Project Management Program. The message is clear; results must be cheaper, faster, and of higher quality than ever before. Westinghouse, as one of the oldest and largest providers of services to the DOE, surveyed the landscape three years ago and determined that we could and should do more to raise the standards of Project Management. As a result, we decided to move it solely out of the engineering disciplines. This effort resulted in the documentation of industry best practices and raised it to an acknowledged career path intended to be the career track of choice to top management in the Westinghouse Government Services Group.
This paper reviews the issues, challenges, solutions, and improvement plan development that were the result of this endeavor.
Project Management Rationale
Project Management is not new to government; it has always been a key factor in their method of achieving major goals. Accomplishments such as contributing to our national defense, landing on the moon, and working to harness natural forces have all required the key elements of Project Management. Its use is ideally suited to government projects as Project Management is specifically designed to manage the rather unique and unknown. Project Management was the key to construction of such ancient projects as the Egyptian Pyramids and the Great Wall of China. Today, as in the past, these types of major projects continue to be plagued by delays, cost overruns, and performance problems. This is particularly true in government where many projects are one-of-a-kind, of higher risk, larger in cost and size, and usually beyond the capabilities of a single company. Never has this been truer than in the DOE Complex today where huge, multi-million dollar efforts are required to reach new levels of scientific endeavor such as safely remediating past hazardous activities and ensuring our national defense advantage.
In the DOE’s arena of high-profile projects, Westinghouse has been a long-term, successful contractor. These projects range from going to sea with the first nuclear submarine, supporting the first launch of nuclear isotope-powered electrical supplies aboard the space shuttle, to bringing online the first two American production plants that convert high-level radioactive waste to glass under the highest production and safety standards in the world.
Just as we have enjoyed some of the greatest project successes, we have also experienced some difficulties: unfinished projects, projects that were over budget and late, and projects that did not perform as well as planned. True, there were mitigating circumstances: budgets, politics, changing stakeholder desires, changing international conditions, or changing priorities. Difficulties in this area of Project Management included: baselines established too early or too low, technical requirements that had to be modified, requirements not fully accounted for, or low stakeholder acceptance. In addition, weaknesses in the DOE Project Management Program (our customer) have been identified by an external audit performed by the National Research Council (National Research Council, 1999). While these do not apply to the Westinghouse organization, we have taken a look at these findings to ensure that we stay on track (see Exhibit 1). In today’s complex and demanding environment, Westinghouse assessed our Project Management capability, customer acceptance, and competitors’ positions, and determined that our standard had to be raised, while still maintaining our world-class safety, operations, and management capabilities.
A Changing Business Environment
Westinghouse determined that the business environment was changing and that work scopes were becoming increasingly more complex, requiring much more planning to successfully deliver results. In order to remain competitive, the Westinghouse Government Services Group solicited input from a variety of sources, including customers and outside consultants, and began a review of individual company performance indicators such as the contract bid-to-award ratio and overall profit margins. This review identified an immediate need for a more results-oriented method of doing business. It also unveiled a need for Westinghouse to change its management style. The results indicated that we were competing with an increasingly outdated management and operations style in an expanding project/execution environment. Furthermore, it was determined that those companies winning the most contracts were selected based upon the expectation of results accomplishment. This was especially true for selected contractors with an established reputation for performance; principally construction-oriented companies who did their job well and moved on. This method has not worked in all environments. There have been some failures and a backlash has resulted from some attempts to be too quick or too cheap, e.g., numerous NASA failures, weapon systems that did not function as expected, and cleanups that were not completed as contracted. The Westinghouse view is that for projects to be successful we must always have all three components of Project Management included: thoroughness (quality, safety, and lifetime ownership), technical excellence, and proper execution (completion on schedule, staying within budget, and meeting the contract’s specifications). World Class to us means that these three standards are met for every project.
Exhibit 1. NRC Findings
The Commitment to Project Management
Westinghouse realized they must improve their business practices. We reviewed the techniques that other successful companies were using to achieve their goals. A common thread uncovered in these companies was their focus and successful use of Project Management techniques, e.g., completing projects on time, within budget, and according to specifications. During this study, we knew that in order for this process to succeed, it must first receive commitment from the highest levels of management. It required a complete change in our corporate culture. After our evaluation, we determined that work on the Project Management challenge was a low priority for years. We also realized it had to be moved right to the top. The highest levels of management in the corporation became committed to this long-term, high-intensity improvement effort. As a result, we developed a Plan of Action and a Project Management vision—“To be Recognized as a Leader in Project Management by Delivering the Highest Level of Project Performance to Our Customers.” This Plan of Action required our senior management to allocate the resources to apply Project Management techniques throughout the company, select members for a Steering Committee that would set the policies to achieve the company’s vision, and define the Steering Committee charter. A Project Management Plan was drafted, reviewed, and budgeted that provided for representation of all areas of the company.
Westinghouse has always been recognized for its excellence in safety, operations, and technical innovation. We realized, however, that in order for Project Management to become a core value in the corporation at this same level, it had to have its own identity, distinct from engineering. This was achieved by establishing the vision, committing resources, creating a uniform system, and developing a career path that is understood by senior employees as one of the most desirable pathways for contribution to the corporation and individual success. The company was committed to providing training to both experienced and inexperienced Project Managers to bring them to a common level of understanding. Key indicators of successful training and the demonstration of Project Management competence are PMI certification and proven Project Management performance.
Raising the Standard
Westinghouse’s response to raising Project Management standards required a transformation; it began with senior management. After evaluation, we found that the keys to successful implementation requires the support of well-trained, dedicated, competent people; the commitment of management at the highest levels, and accountability for individual areas of responsibility. Project Management must be inculcated into the corporate culture so that the focus on projects can be on results, while still maintaining the highest levels of safety, technical excellence, quality assurance, and cost-effectiveness. In order to accomplish this reorientation, a Steering Committee was formed to promulgate a corporate vision and provide guidance in applying these concepts.
The Steering Committee
The Steering Committee took a multi-prong approach to implementing the Plan of Action: performing benchmarking to define industry best practices, creating a Project Management Manual, developing a career path to senior management, and providing training to support it.
Benchmarking was performed in order to confirm that our developing Project Management system was World Class. Contemporary experience in industry has shown that ideas for major innovations often come from outside the organization. Through personal and professional contacts, Westinghouse obtained information that other companies, our customers, and our competitors used to develop their plans. By benchmarking these best industry practices, Westinghouse was able to develop guidelines for comparing and, if necessary, improving its own performance. The end result was confirmation that our guidelines and specific improvements relating to our existing methods of evaluating risk, safety, and technology management met PMI® standards. Risk benchmarking resulted in the formalization of and a stronger commitment to the use of risk management to ensure that project risks are identified, documented, accepted, and mitigation plans in place before baselines are set. The company has reinforced and strengthened its commitment to safety by designing it into the project and instituting earlier involvement of and increased input from key performers such as operators, craftspeople, and others involved in the project. Previously, these personnel were often left out of the planning/design/work instruction development phases even though they are key to safe practices. Changes in technology grew out of the benchmarked lessons learned. These exercises confirmed that the high-technology work we perform was all too often plagued by unanticipated technology improvements that were underestimated or resolved too late in the project lifecycle to be accurately estimated or planned for. To overcome these obstacles, a “gate” approach was instituted that requires the establishment of specific checkpoints to be met before moving forward in the project. This gate approach ensures early evaluation and a thoroughness that provides a smooth, direct flow toward the completion of the project. Without this preplanned, coordinated effort, parallel paths could develop that might result in failed projects and/or underperformed, late projects.
Exhibit 2. Examples/Templates From the Manual
Westinghouse intends to use Project Management, with its focus on results, combined with benchmarking, with its focus on best practices, to deliver our vision for our customers. Benchmarking, a flexible discipline that requires minimal resources, provides the input necessary to strive for a “World Class” program, builds senior management support, maximizes the ability to avoid mistakes, and helps prevent the “not invented here” mentality.
The Project Management Manual
The manual is designed to capture and share, in a single reference source, the best practices and tools to guide the effective application of the fundamentals. In this manual, Westinghouse, as a government contractor, has consolidated and standardized both the DOE and DoD requirements. Using the PMBOK® as a guide, Westinghouse developed its own unique manual that utilizes examples to demonstrate the effective application of the fundamental principles in real-life situations, and is designed to ensure that safety, quality, and design are integral to all project activities. It recognizes that each project is unique and the guidance provided can be tailored to the individual preparation and implementation of project-specific activities. The concepts in the manual can be applied to a project of any size or complexity. Major areas covered include management of program, projects, and process; integration and risk management; scope, time, and cost management; safety and quality assurance management; Human Resources and technology development; communications and procurement management; and overall performance management. As the manual was designed to be all-inclusive, the key was to provide guidance that was quickly understandable and helpful in planning and understanding projects. Specific tools developed include training materials, report templates, application of risk management analysis, forms/checklists/reports, cost estimating and scheduling tools, and integrated project system applications (see Exhibit 2).
Exhibit 3. Generic Career Path Structure
Career Path to Success
To demonstrate Westinghouse’s commitment to the program, it has developed a specific track to the highest levels of management for successful Project Managers. The corporate structure was reengineered to include Project Managers and the projectization of work scopes. This effort involved an analysis of the entire Human Resources system since the new alignment under projects required not only determining the precise Project Management career path, but also included the creation of position codes, handling of potential layoffs, and the impacts on the current incentive, award, and grading systems. In short, it required a long-term Human Resources approach that took into account each site’s project goals, personnel experience, and training requirements (see Exhibit 3).
To begin the implementation process, each site was responsible for identifying candidates with the potential to qualify as Project Managers. These candidates would first be screened by both an independent committee and outside experts, and then voted on for selection. The selected candidates would receive initial training toward certification as a Project Management Professional, then be trained in advanced techniques so they could apply the specifics of Project Management in their work scopes.
Throughout this process, every effort has been made to define and standardize the training of upper-level management for the Project Manager career progression. The goal is to not only to completely integrate the Human Resources approach into the way we do business, but also to enable Westinghouse, through mentoring and career rotational assignments, to develop and retain the best talent from inside the organization, as well as attract candidates from outside industry. This would reinforce and ensure a cadre of Project Management resources of great depth and variety.
Progress and Implementation
Implementing Project Management has proven to be a major challenge, given our diverse roster of projects and responsibilities. As it is with all organizations, internal resistance to change is an obstacle to the implementation of the Westinghouse Project Management Plan. As a step to overcome this challenge, we have successfully developed a single company manual that is extremely user-friendly and applicable to all ranges of projects. We have set goals, both near- and long-term, that will ensure the consistent application of Project Management principles. We have also made the commitment toward certification, which, as a result, drove the development of training that would specifically address the diverse nature of our projects. Training is the key element in this improvement process.
Exhibit 4. Elements of World-Class Project Managers
To begin, Westinghouse found that the initial training in the “A to Zs” of Project Management was fairly easy to find. We determined early on that customized training was not required at this stage and, therefore, utilized PMI-specific training packages for the initial training to certification. Advanced, site-specific training on actual Project Management implementation was more difficult to locate, as our projects tend to be one-of-a-kind and fairly high risk. Therefore, a customized advanced course was developed that includes the most cutting edge techniques and provides specific tools (risk management, critical chain, technology, and safety), as well as real-life case studies. Simulation training provided real-life experience as teams were created to work toward results or solve actual problems. In short, the Westinghouse program, which includes over 1,500 hours of training, was designed to provide a more complete solution to fit the wide range of projects at our sites. One measure of its overall success is in the number of Westinghouse senior managers achieving PMI certification to date—over 75.
While Westinghouse has been successful in its initial implementation of Project Management, we continue to work on building a more complete package. This begins with management. The corporate Project Management vision, priorities, and core values must be defined very clearly to prevent debate. In doing so, many areas of resistance can be solved right from the start. Confusion breeds resistance. Also, management must walk the talk. Just saying it, but not doing it, continues to foster resistance. Key to this process is sufficient critical mass—having enough management support throughout the process.
Certification was and continues to be the biggest challenge to management. The Steering Committee believes that two-step certification is essential, but this challenges established management, since they generally are not certified and do not see the value of certification. Newer management has not had this problem. The good news is that slowly, most members of senior management are becoming certified. The most successful Project Managers require not only experience and knowledge/expertise, but also continual training to keep Project Management skills up-to-date (see Exhibit 4).
Shifting the culture toward Project Management has been ongoing. To achieve a more complete transition, it’s important to begin by empowering all levels of management. Westinghouse was slow in using more levels of management in the beginning, which in turn, diluted acceptance of the change. Involving all levels of management immediately sends the message of total commitment, and continued work toward institutionalizing the process strengthens this effort. Pushing change requires widespread, committed involvement. It keeps things moving
Westinghouse found that real value was added to the process by utilizing experienced PMBOK® trainers, who gave management a common base and eliminated potential debate over what is “really necessary” and what is right. It adds undeniable credibility to the change process. Important too, is not understating the resistance of a few senior managers, who can undermine the effort. Change is difficult, especially after years of doing things a certain way. Westinghouse found that having our most senior Project Managers lead and also participate in the improvement work has been the key to quality and improving overall success. Time commitment has also been a factor since, in general, senior managers do not have the time for these kinds of improvements. It is important to note that if Project Managers are not “hands on,” the result is slower acceptance of change and increased resistance.
Finally, the near-term goals that can be met must be planned into the process; they provide early success to the effort. The long-term goals, such as certification, can be set and worked on over time.
The keys to successful implementation of Project Management is the support of well-trained, dedicated, competent people; support at the highest levels of management; and accountability for individual areas of responsibility. Project Management must be inculcated into the corporate culture so that project focus can be on results, while still maintaining the highest levels of safety, quality assurance and cost-effectiveness. This transition toward Project Management is still ongoing. As our internal process continues to evolve, it is important to keep in mind that the final goal at Westinghouse has always remained the same; cost-effectiveness, safety, and customer satisfaction—in short, results. The only difference is how we get there.
National Research Council. (1999). Improving Project Management in the Department of Energy, 3–8.
Proceedings of the Project Management Institute Annual Seminars & Symposium
September 7–16, 2000 • Houston, Texas, USA