Project management training pays for itself...and I can prove it!

Abstract

You know project management training improves business performance, but can you prove it to your executives? In this interactive session, you will be guided through a five-step process measuring project management competency and the effect it can have on business performance. The results of a recent research study on the State of Project Management Training are woven into the presentation outlining the key findings. A hands-on breakout session helps you understand how to get started on measuring competency and where you can expect to see some overall benefit to your organization's bottom line.

An Overview of Project Management Competency

By definition, competency encompasses knowledge, skills, attitudes, and behaviors that are causally related to superior job performance (Boyatzis, 1982). Competency is accompanied by a command of language and concepts of a given profession; is demonstrated by behaviors in the workplace; can be measured against well-accepted standards; and, can be increased via training and development. The ultimate goal in developing project management competency is to have sustainable performance when managing projects. Sustainable performance can be accomplished by creating a well-trained workforce.

Why has competency become such a buzz word within organizations? Why are 25% of the 262 organizations surveyed in the recent The State of Project Management Training: A PM Solutions Research Report (May 2011) forecasting the performance of competency assessments in 2012? The answer is simple. Well-trained project management professionals perform better. Results from the research study noted above demonstrated that organizations, on average, saw a 26% improvement in eight measures of performance due to their project management training initiatives (PM Solutions, 2011).

Specifically, this research showed:

•     Improved Stakeholder Satisfaction – 29%
•     Improved Schedule Performance – 27%
•     Decrease in Project Failures – 26%
•     Improved Budget Performance – 25%
•     Improved Requirements Performance – 25%
•     Improved Quality – 25%
•     Improved Productivity – 25%
•     Improved Time to Market – 24%

This is a big deal! Even organizations like Gartner and CIO.com are heralding the value of training, and recent quotes demonstrate this:

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•     Gartner: “…training in project management is essential to improving performance.” Matt Light, Research Vice President (PM Solutions, May 25, 2011))
•     CIO.com: “The study [The State of Project Management Training: A PM Solutions Research Report] corroborates research that IDC (a sister company to CIO.com) published in 2006.” (Levinson, 2011)

Forty percent of organizations in the research study have forecasted “implementing and enhancing their training” as a priority in 2012. But, in order to see the most effective results, you want to do it right. There will be challenges; it will take time and commitment; however, you can move past these challenges and follow a suggested five-step process to success.

Moving Past the Challenges

When attempting to implement a competency program and then a measurement program in your organization, it's important to recognize that there will be barriers. Some of the barriers we have found basically revolve around a lack of understanding of the goals and objectives of a competency or measurement program; on the stakeholder needs; and on a lack of understanding of the key business processes.

When undertaking a competency assessment for your project management team, it is important to communicate the purpose. This will be viewed negatively unless a strong communication plan is put in place to state the purpose, which should ultimately be to improve the bottom line performance of the organization. With the results of the competency program, an organization can start closing the knowledge and performance gaps that exist with proactive mentoring, targeted training, and potentially reshuffling of personnel to match the right project managers with the right projects. But, what if there are no standard role descriptions? What if there is cultural resistance? These are more of the challenges you will need to be aware of and move past. Step 3 of our process will be discussed later in this paper and will help you with some of these.

Once the competency assessment is completed, the next challenge is going to be to prepare for a measurement program. Although Measurement is actually Step 5 in our process, you will need to start thinking about what you want to measure and why. The things you measured should be those things that have a direct impact on the bottom line performance of the organization. For the purpose of this paper, which is to prove that training is worth it, you'll want to evaluate the effectiveness of the training you are implementing as a result of Step 2 (Assessing the Competencies). For example, if the results of the competency showed that your project managers needed more rigor in basic fundamentals, such as utilizing project charters and developing strong scope statements, you would want to baseline some core statistics at this time. You might look at how many projects actually have project charters and how many scope changes occur per project. Your measurement goal might be to have 100% of the projects utilizing project charters and to start reducing the number of scope changes within a project; however, your organization may be low in project management maturity, so you need to consider this. There may be no baselines, so you may have to use anecdotal information. Before you even initiate, you need to secure senior management buy-in. The challenges we have found with regard to implementing a measurement program include a lack of senior management involvement; a lack of employee involvement; no accountability for the measures; and a lack of resources to help implement the program. Create a program that recognizes and overcomes these challenges and fits the maturity of your organization.

Keeping It Real

As you start to think of the challenges you may encounter within your organization and how you can move past them, always remember to “keep it real.” Understand what is realistic for you to do given the maturity of your organization, the level of sponsorship involved, and the funds and resources allocated to doing it.

PM Solutions Research interviewed five of its training clients to see what their issues were…and how they overcame them.

Examples of real issues within organizations:

1. A major manufacturer of processed and packaged goods had no baseline numbers and no standard role descriptions for project managers in place
2. One of the world's largest professional services firms was reactive when it came to project management training
3. A global staffing company couldn't get its people to take assessments
4. Executives from an international industrial company in the construction industry originally thought efforts to improve project management competency were overkill
5. Three clients (out of the five interviewed) never linked business impacts with improved competency and are just now starting to measure.

How did they resolve them?

1. Found basic job descriptions and customized them to fit their organization
2. Became proactive by linking project management training to strategic objectives of the organization
3. Initiated a communication program and involved senior management
4. Piloted projects with those who had been trained and showed value
5. Started choosing the easiest and most practical things to measure

The majority of organizations are still using anecdotal evidence as the most common way to measuring their improvements…and that's okay. It is a start. Organizations interviewed recently stated they measured the impacts of their project management training by:

• Observing language/attitudes/behaviors of personnel changing in a way that they agree benefits projects
• Putting an “Expectations Memo” on the project manager's personal evaluation after training: Performance is measured against these expectations then correlated to corresponding business outcomes.
• Observing a “Domino Effect,” resulting in an increase in the number of personnel in classes. Managers in other units are seeing benefits in those units that have gone through project management classes and are enrolling their employees in them, thus increasing the number of students in classes (PM College, 2011).

The purpose of using these organizations as an example is to illustrate just how simple a measurement program can be to start. However, if you want to have the most effective program possible, you need a roadmap to create a well-trained workforce capable of maximizing employee potential in the various roles required in project management. The results will be higher job satisfaction, higher customer satisfaction, and improved project performance—all ultimately reflected in organizational financial performance.

Let's start the roadmap!

The Five-Step Process

In STEP 1, your organization should identify the required roles to implement project management. These roles generally include project team members, estimators, schedulers, controllers, project managers, project executives, and/or project specialists. By actually defining the role, you hire the right people with the right skills, and you have skills that can be trained against so that they can be immediately applied. Each job description should define the competencies needed to fulfill each role. A standard job description lists the major task of the job; competencies list the abilities needed to conduct those tasks. These competency-based job descriptions also need to have specific performance expectations for each major task. Exhibit 1 shows a framework identifying the competencies as well as the levels of competency needed to successfully perform the specific project management role.

Exhibit 1: Matrix Establishing Competency Levels for Various Roles

STEP 2 of the process for building project manager competency to improve business outcomes is to actually Assess the Defined Competencies. This can be a tricky area. It is important that those being assessed don't perceive the assessment negatively and are often threatened by it. The focus of the assessment needs to be on building strengths…not eliminating staff.

There are three components to a Competency Assessment: Knowledge, Behavior, and Performance. Knowledge is our first measurable component. Because Project Management Institute's A Guide to the Project Management Body of Knowledge (PMBOK^® Guide) is recognized as the international standard on project management knowledge, any assessment should be geared toward this standard. The following table (Exhibit 2) is an example of results from a completed knowledge assessment.

Exhibit 2: Knowledge Assessment Report

The second assessment area is workplace performance. As mentioned earlier, the ideal assessment involves the candidate, as well as a person or persons who have first-hand knowledge of the candidate's performance in the workplace. This can be a peer, subordinate, supervisor, or a client. The assessment has the candidate and the rater(s) apply scores to a number of key performance indicators across the project management process areas. There is a dual focus to this assessment: confirmation of performance and analysis of competency. The analysis of this assessment looks for significant gaps between the candidate and rater. These gaps are created either by the candidate rating hi or herself higher than the rater or by the candidate rating him or herself lower than the rater. When there is little or no gap found, the important thing to review is the level of agreement. Both the candidate and rater could agree on the level of performance, but in reality, that level may be less than the desired level. In that case, the organization has an opportunity for developmental actions, if required. Exhibit 3 is an example of the results of a Multi-Rater evaluation.

Exhibit 3: Performance Report

The final area of assessment is the most difficult and sensitive to determine: the behaviors necessary to being successful in the stressful role of a project manager. There are identifiable traits that have been shown to contribute to the success of an individual in this role. Traits such as flexibility, adaptability, assertiveness, empathy, ego strength, and resilience, and attitude toward risk-taking can be measured to determine an individual's ability to be successful in the project manager role. Because projects come in many sizes and complexities, some individuals may thrive in an environment where they have the autonomy to run small, standard projects yet struggle when given a larger, more complex project. For an organization to effectively manage all its projects, it needs to know which project managers thrive under which conditions and to develop an array of personnel suited to all situations. A Project Manager Competency Assessment Program provides a multi-dimensional view of an individual's current project management knowledge, performance, and attributes to effectively fill a project manager role. The assessment results also help organizations target training only where deficiencies are recognized, thus eliminating unnecessary training programs and ensuring more productive results from their training investment.

The real value of these assessments is learned by integrating the results of all three assessment components (knowledge, performance, and behavior), and using the output reports to develop a comprehensive view of the project manager population. Building a professional development plan for the organization based on both the individual and aggregated team results of the competency assessment will help strengthen project management skills for the individual as well as the organization and lead to better overall project performance.

Then, we move on to STEP 3, Establish a Professional Development Program with Career Paths – This is the step that needs the support of the organization to carry it beyond the classroom and into the work environment. Executives and managers must communicate to employees that their performance in the workplace is expected to contribute to improved project and organizational performance. The only proven way to do this is to base individual performance evaluations on whether project outcomes (linked to overall strategy) have been achieved. No doubt, this is why an increasing number of PMOs (60%) now carry out performance evaluations for project managers. (PM Solutions, 2010).

In addition, to attract or keep the best project managers and to serve as a motivator for up-and-coming personnel, the organization must consider creating a project management career path to show individuals how they can move from entry-level positions to higher levels in the organization as a project professional. This career path must include at least three elements to be valuable: experiential requirements, education/training requirements (knowledge acquisition), and documentation and tracking mechanisms.

Experiential requirements detail the types of on-the-job activities that have to be accomplished for each level in the career path. Education and training requirements detail the types of knowledge needed to be successful at each level of the career path. At the lower levels, these tend to be fulfilled by taking basic courses designed to provide exposure and practice to the rudimentary skills required of that level. Upper-level positions require more advanced education and training. This may include topics that go beyond project management— business strategy, finance, leadership, and so forth. Documentation mechanisms include recording the attainment of certificates, degrees, or other credentials that substantiate the acquisition of the desired skills.

For full details on the development of career paths in the PMO, see J. Kent Crawford's Optimizing Human Capital with a Strategic Project Office (Auerbach Publications, 2005). Once a career path is in place, the next step is to ensure that the necessary experiential and educational opportunities are available. Experiential opportunities should be coordinated with the appropriate resource manager and the human resources department. Information collected from the competency assessment is used to create a targeted training program. The training program should be designed to enable candidates to fulfill the requirements identified in the career path. It should also be progressive; that is, the training requirements to become a project team member should be prerequisites for becoming a project manager, and so on.

STEP 4, Executing the Training Program is where the” rubber meets the road.” This is where an organization looks at the gaps and deficiencies in the defined roles and existing skill sets of its personnel and begins to conduct training and mentoring sessions. It's important that the program allows for experiential and educational opportunities. The training program should allow employees to fulfill the requirements identified in their career paths. Execution of the training should be progressive; that is, the training requirements to becoming a competent project team member should be prerequisites for becoming a competent project manager, and so on.

The execution of training will be largely based on the organization's culture, current project management maturity level, and need. It is a critical component of success. Speed of execution will also be dependent on need and priority within the organization.

For sustaining the momentum for this whole program STEP 5, Measure Competency and Project Delivery Outcomes Before and After Training, becomes an overarching critical success factor. At the inception of a professional development program, the organization should measure the current project management performance—of individuals and the organization as a whole. This baseline serves as a benchmark against which they can measure the progress toward improved performance.

This means that measurements of performance need to go beyond the traditional self-assessment of the classroom experience. They need to include individual measures such as project management knowledge, but also things like frequency of use of standard methodology artifacts and processes. They must also include project management performance measures such as cost performance, schedule performance, customer satisfaction, cycle-time, and others.

Ideally, a baseline is determined for each performance measure before the professional development program is implemented. At an appropriate time after the program has been completed, performance should be measured again to determine whether there are changes in behavior and improvements in project delivery outcomes. This may seem obvious, but, in fact, few companies match training investment to changes in work behavior or improvement in project delivery. This is changing. Five out of five of the companies interviewed for our study were in the early stages of implementing a measurement program of this type and expected to have hard data on the business impacts of the training within the year. Specifically, they stated they are implementing:

• 360-degree evaluations to compare whether training participants’ self- assessment of knowledge gain translated to observable behavior changes on the project.
• A questionnaire designed to solicit feedback from key stakeholders with 30 questions about project performance factors, each one rated from A to D. The results will be aggregated and analyzed in roundtable discussions.
• Benefits tracking of the project portfolio, so that budget and schedule compliance (or slippage) can be correlated to portfolio value.
• Focus groups, using key stakeholders to gauge internal customer satisfaction.
• Measured mentoring, where project managers with troubled projects receive one-on-one coaching, and project results are evaluated after a set number of mentoring hours.
• Cost allocation back to the business side, so that project management improvement can be measured in dollars saved over time.

In Conclusion

Increasingly, successful organizations are optimizing their human capital with project management competency assessment and training. At the same time, they have the opportunity to demonstrate the business impact and value of project management by developing a measurement strategy to link competency improvements to project delivery improvements, and project delivery to the execution of strategic initiatives.