Project management evolution from a single project manager to global virtual enterprise project management office
how did we get here--where do we go?
From the early days when there was a single person handling all the aspects of creating, managing, and controlling the project details to today's world which global organizations rely on enterprise solutions, project management methods, tools, and techniques has evolved dramatically and will continue to progress. Though there are numerous innovations in techniques and methods, enabling computer technologies has advanced most quickly in the past 30 years. Learn how organizations throughout the world are utilizing these technical advances and taking advantage of the latest technologies without the lead-time and hefty financial investment that was required in the past.
Throughout the evolution of project management, numerous aspects contributed to how technologies were applied. Variables such as timing, methods, users, available computing power, and expectations at their various stages are identified and paralleled in the quest to harness technology to its fullest. As more companies are relying on the advanced computing functionality that is becoming more intricate to implement and support, the financial investment in resources, especially in hardware, software, and competent technical specialists increases and can be a roadblock for many companies.
The alternative utilized today and in the future, which allows companies of all sizes throughout the world to take advantage of the latest technologies without the large investment, is the virtual enterprise project management solution. This solution allows you to focus on the implementation of project management and have access to the supporting technologies immediately rather than months.
Prior to the formal definition of Project Management, there were individuals responsible for the creation of colossal structures such as the pyramids in Egypt (2560 BC), the Great Wall of China (206 BC), and the Suez Canal (1869). We may not know the terms they used to describe the management of erecting these marvels or even the exact processes those individuals responsible used, but can only admire their successful achievements and acknowledge their contributions important in the development of project management as a discipline even if it were the case that they may not have been so efficient.
Today, it is a different world. The concept of a project has clearly been defined. Though various individuals may have nuances in their perspective of what the definition of a project is, many would agree it is simply ‘meeting an objective by completing tasks starting and ending at a specified time’. This simplification is not meant to take away from the complexity of projects that are in progress or even completed, but a foundation for what a project is.
With the clear definition of the project, the field of managing projects has also evolved and formalized as a whole. Project Management Institute's (PMI) standardization with the Project Management Body of Knowledge (PMBOK®) is a leap forward for the industry. Its comprehensiveness provides a base as a common platform and language for all involved in the management of projects. There are many sub-areas within the project management arena that have also been identified and defined to enable organizations and individuals to successfully accomplish project ‘objectives’. Various organizations have been established on different levels to address this discipline and are continually discovering ways to address the numerous aspects of projects and the management field itself.
Most notable in the field of project management is the advent of computer technology. Though various methods, techniques, and tools have been created to streamline project management efforts prior to the first computer, manual application of these discoveries were still tedious and time consuming. Computers enabled these advanced developments to be applied while simultaneously reducing the overall time to complete projects. With the continual advancement of computing power, the demands and expectations of project management capabilities increase exponentially. Today, we rely heavily on the formal practice of project management and acknowledge it is a critical aspect for the success of many organizations, but it would not be possible without the combination of the computing power available and the computer applications developed specifically for the field.
Development of Project Management
As a result of the industrial revolution, at the end of the century, Frederick Taylor began his detailed studies of work. He applied scientific reasoning to work by showing that labor can be analyzed and improved by focusing on its elementary parts. He applied his thinking to tasks found in steel mills, such as shoveling sand and lifting, and moving parts. Before then, the only way to improve productivity was to demand harder and longer hours from workers.
Taylor's associate, Henry Gantt, studied in great detail the order of operations in work. His studies of management focused on Navy ship construction during World War I. His charts, complete with task bars and milestone markers, outlined the sequence and duration of all tasks in a process. Gantt chart diagrams proved to be such a powerful analytical tool for managers that they remained virtually unchanged for nearly a hundred years. It was not until the early 1990s that link lines were added to these task bars depicting more precise dependencies between tasks.
During World War I and World War II, in order to survive people were force to produce results under very difficult conditions with time, cost, and scope constraints. They needed to produce products or services, within very well defined time schedules, and under stick specifications. For example, the survival of England was in great partly due to the creation of RADAR, which allowed an early warning detection in preparation for their defense against enemy air attacks. After World War II, the complexities of projects and a shrinking wartime labor supply also demanded new organizational structures.
In 1947 and later in 1950, Edwards Deming was invited by the Japanese Union of Scientists and Engineers (JUSE) Japan, to provide training for two months. Deming's lectures focus on three key areas the use of PDCA (Plan-Do-Check-Action) cycle, understand the cause of variation and process control. In 1954, JUSE invited Joseph Juran to lecture on managements' role in promoting quality control activities. Juran's visit marked the turning point in Japan's quality maturity. It shifted from primarily dealing with technology to an overall concern for total quality management.
About the same time as Juran's visit, Peter Drucker's book, The Practice of Management, which described the concepts of Management By Objectives (MBO), was published in Japanese. The Japanese blended Deming and Juran's teachings with the concept of MBO and began their first attempts at strategic quality planning.
Project management was not used as an isolated concept before the Sputnik crisis of the Cold War. The Soviet Union's 1957 launching of Sputnik I touched off a space race between the Soviet Union and the United States which, fueled by the two nations' Cold War rivalry led to the world's first manned space flight, missions to the moon, and the development of the space shuttle.
After this crisis, the United States Department of Defense needed to speed up the military project process and new tools (models) for achieving this goal were invented. In 1958, the Program Evaluation and Review Technique (PERT) was invented as part of the Polaris missile submarine program. PERT was later extended into what is known as Work Breakdown Structure (WBS). At the same time, the Dupont Corporation invented a similar model called the Critical Path Method (CPM). These techniques gave managers greater control over massively engineered and extremely complex projects, such as military weapon systems with their huge variety of tasks and numerous interactions at many points in time. The process flow and structure of the military undertakings quickly spread into many private enterprises.
Aggressive pace of Project Management field
The beginnings of project management may have initiated thousands of years ago, but the progress in the last 40 years is the most significant. At the start of the 1960s, executives recognized the benefits of the project model. Organizations began to apply the concept of projects in the workplace including the need to communicate and integrate work that spanned multiple departments and even professions. Soon these techniques spread to all types of industries as business leaders sought new management strategies and tools to handle their growth in a quickly changing and competitive world.
Also in the early 1960s, general system theories of science began to be applied to business interactions. Richard Johnson, Fremont Kast, and James Rosenzweig described in their book, The Theory and Management of Systems how a modern business is like a human organism, with a skeletal system, a muscular system, circulatory system, nervous system, and so on.
Though there were advances in the industry up and until the mid-1980s, project management still had hurdles to overcome. Many businesses saw the benefits of project management, but were not totally committed to implementing it. Kerzner indicates, “There were no allies or alternative management techniques that were promoting the use of project management.” Executives wanted to get more out of their organizations and various processes were initiated. Kerzner describes these initiatives: “The allies for project management began surfacing in 1985 and continued throughout the recession of 1989-1993…”. He identified the following list as “New Processes supporting project management:
- 1985: Companies recognize that competition must be on quality as well as cost. There exists a new appreciation for total quality management (TQM). Companies begin using the principles of project management for the implementation of TQM. The first ally for project management surfaces with the “marriage” of project management and TQM.
- 1990: During the recession of 1989-1993, companies recognize the importance of schedule compression and being the first to market. Advocates of concurrent engineering begin promoting the use of project management to obtain better scheduling techniques. Another ally for project management is born.
- 1991-1992: Executives realize that project management works best if decision-making and authority are decentralized. Executives recognize that control can still be achieved at the top by functioning as project sponsors.
- 1993: As the recession of 1989-1993 comes to an end, companies begin “reengineering” the organization, which really amounts to elimination of organizational “fat.” The organization is now a “lean and mean” machine. People are asked to do more work in less time and with fewer people; executives recognize that being able to do this is a benefit of project management.
- 1994: Companies recognize that a good project cost control system (i.e., horizontal accounting) allows for improved estimating and a firmer grasp of the real cost of doing work and developing products.
- 1995: Companies recognize that very few projects are completed within the framework of the original objectives without scope changes. Methodologies are created for effective change management.
- 1996: Companies recognize that risk management is more than padding an estimate or a schedule. Risk management plans are now included in the project plans.
- 1997-1998: The recognition of project management as a professional career path mandates the consolidation of project management knowledge and a centrally located project management group. Benchmarking for best practices forces the creation of COEs in project management.
- 1999: Companies that recognize the importance of concurrent engineering and rapid product development find that it is best to have dedicated resources for the duration of the project. The cost of over-management may be negligible compared to risks of under-management. More and more organizations can be expected to use co-located teams all housed together.
- 2000: Mergers and acquisitions are creating more multinational companies. Multinational project management will become the major challenge for the next decade.
- 2001: Corporations are under pressure to achieve maturity as quickly as possible. Project management maturity models help companies reach this goal.
- 2002: The maturity models for project management provide corporations with a basis to perform strategic planning for project management. Project management is now viewed as a strategic competency for the corporation.
- 2003: Intranet status reporting comes of age. This is particularly important for multinational corporations that must exchange information quickly.
- 2004: Intranet reporting provides corporations with information on how resources are being committed and utilized. Corporations develop capacity planning models to learn how much additional work the organization can take on.”
In this span, PMI identified the need for standards in the field of project management and published the Special Report on Ethics, Standards, and Accreditations (ESA) in 1983. PMI then followed up and published the Project Management Body of Knowledge (PMBOK®) in 1987, which is now in its third edition. In 2003, PMI released OPM3, a standard for measuring the project management maturity of an organization. Other significant events that played role in the formalization of project management included:
- 1987: Six Sigma crusade begins at Motorola.
- 1991: Software Engineering Institute (SEI) of Carnegie Mellon University releases the Capability Maturity Model version 1.0.
- 1997: The International Standards Organization creates ISO 10006, Guidelines to Quality in Project Management.
Project management was directly and indirectly validated to be a critical element for success in the business world. Kerzner states “Try to name one company, just one that has given up on project management after implementing it. Probably you could not. Every company that has adopted project management is still using it. Why? Because it works. Once a company has gone over to project management, the only question becomes: When will we achieve the full benefits of the system?”
Specific Technological Benefits
Initially, computer applications for the PC were mainstream business-oriented with programs for word processing, accounting and spreadsheets, and databases. Project management was still a specialized profession held by unique individuals who were keepers of all project related information. Microsoft's Project 1.0, introduced in 1990, allowed individuals a way to create and manage project plans eliminating the manual labor of paper-based systems. It provided managers the ability to create and track project information basics such as Work Breakdown Structure, Gantt charts, Resources, and even more. It was a major milestone in the world of project management technological advances.
During the time of Local Area Networks (LAN) being implemented in the workplace, project management and the associated software was becoming an important business necessity. The application of project management starts to spread across groups within organizations. Project management computer applications were being designed by multiple vendors to incorporate functionality for workgroups in order share and manage project information. Moving from running an application on a single PC to storing project information in a centralized location became an important function. Additional server hardware and software became the norm for installations.
The advances came with a price though. More spending in Information Technology (I.T.) was necessary. Organizations needed to not only purchase hardware and software, but also invest in human resources to plan, deploy, and support these new infrastructures, as well as incur costs to physically hold and maintain the equipment. Other technologies that served other parts of the business grew also. With this, technology infrastructures became ‘bloated’ and in many cases required a large amount of work force to keep it up and running. The management of managing the project management and other required technologies started to get out of control. I.T. management systems to alleviate these problems were also expensive and hard to implement successfully.
With the Internet being entrenched as the new medium, project management software vendors started to develop platforms that utilized these Internet technologies as another stepping-stone to streamline the project management processes. Many of the same companies providing these technological solutions gravitated to using Internet technologies at the desktop as the minimum requirement to utilize their systems. The web browser can be all that is required to utilize these technological tools, moving the technology away from a de-centralized model that existed for years. This helped I.T. management since it centralized the work of the experienced I.T. professionals in deploying some of these project management technologies. Now businesses able to retrieve and manage information/communication not only within their organizations, but also from partners, competitors, vendors, customers, and everyone else without adversely affecting implementation time.
Enterprise Project Management
Throughout the business and technological developments over the past few decades, project management has evolved from just a specialty managed by a select few in organizations to a strategic component for the entire enterprise. Kerzner echoes, “As companies begin to recognize the favorable effects that project management has on profitability, emphasis is placed upon achieving professionalism in project management using the project office concept. The concept of a project office (PO) or project management office (PMO) could very well be the most important project management activity this decade.”
Beginning in the 1950s, POs/PMOs were usually organizations within organizations implemented to support large projects such as contracts for military development. It was not uncommon to see large projects last multiple years and the responsibilities of the PO/PMO personnel to provide specific project management capabilities to the overall project management team as well as fill in for other PO/PMO personnel as necessary. It was normally the case that the PO/PMO consisted of individuals experienced with managing projects and those specifically working on the projects did not have the project management experience. Budgets for the additional personnel for POs/PMOs was not of major concern since the technology and schedules were the priority and contracts were large enough to cover the additional costs. This shifted in the 1980s when government agencies and the military became more cost-conscious. The PO/PMO was trimmed down, as personnel who worked directly on projects were directly trained in project management as well as line managers, so accountability for project success would be shared.
Executives wanted their businesses to become more efficient and effective by deploying project management in the workplace especially in the non-project driven sectors. Once benefits were seen to maximize the organizations' performance and its financial bottom line, project management integration was high. This paved way for the PO/PMO concept to be implemented among many organizations. PMI's standardization of project management for the individual as a professional career also helped move forward the wide acceptance of the PO/PMO. Multiple areas within the organizations were affected by these standards, including:
- Standardizing the complete project management estimating, planning, managing and reporting process
- Clearly defining roles and responsibilities of project managers and other personnel
- Establishing baselines and continually benchmark
- Capturing lessons learned
- Developing organizational project management methodologies and associated templates
- Implementing best practices
- Performing strategic planning for project management initiatives
- Providing resources for project management problem-solving
- Training, mentoring, and coaching in project management
- Identify and assessing issues/risks
- Preparing for disaster recovery/business continuity
As reported by CIO Magazine, July 1, 2003, during a survey conducted by CIO Magazine and PMI, out of 450 people surveyed, 303, or 67 percent, said their companies have a PMO. Of those with a PMO, half said the PMO has improved project success rate. There is also a strong link between the length of time a PMO has been operating and project success rates. The longer the better. While 37 percent of those who had a PMO for less than one-year report increase success rates, those with a PMO operating for more than four years reported a 65 percent success rate increase. The top two reasons to establish a PMO, according to the survey: improving project success rates and implementing standard practices.
While the PMO varies in type, size, and structure, they share these common functions, as defined by Gerald I. Kendall, PMP and Steven C. Rollins, PMP in their book, Advance Project Portfolio Management and the PMO:
- Drive project cycle times down
- Facilitate choosing the right project mix
- Develop and maintain an executive cockpit, through key portfolios
- Track and report progress (high level)
- Help Desk
- Corrective action
- Facilitate the Governance board
- Prioritization of the project portfolio
- Help projects in trouble
- Project management training
- Marketing and communication
In the 2000s, management began moving project management into a strategic role. They understood that there was critical information learned and held by the PO/PMO, which became an integral part for organizations to do business. The scope of the PO/PMO continually increased within the organization and as a result, other entities that developed were the Project Management Center of Excellence (PMCoE) and Enterprise Project Management Office (EPMO).
The role of the Project Management Center of Excellence is to achieve world-class proficiency in the consistent application of project management practices, process, procedures, tools and techniques. The goal is to inculcate project management as a core capability discipline that is part of the fabric of the work that is performed. Not only were these centers responsible for reporting information to senior management, they would provide resources to ensure projects were properly executed.
Enterprise Project Management Solutions
With the drive for the EPMO to touch upon more aspects of organizations' resources and processes, the appropriate technological tools were being developed to centralize all these aspects, including:
- Consistency for Deploying Projects through the Organization
- Easy update and access for project information
- Centralize project related documents
- Manage resources for projects
- Plan and optimize resources for the entire enterprise
- Analyze project information in real-time
From various levels of the organization, individuals are able to perform all the above functions without additional work. Inputs from various project participants, such as project data, can be entered while the project managers can see this information and adjust projects accordingly. Senior management can simultaneously get summarized information in the form of a dashboard, indicating overall status of their portfolio of projects. This is all possible from a web browser with the available Enterprise Project Management (EPM) Solutions from various technology vendors.
This centralized model of managing project information ensures projects are aligned with strategic objectives, quicker more informed decisions can be made based on the information at hand, improved collaboration and coordination, effective management of resources, identification of required human resources, and overall decreased technology costs and improved productivity.
Though EPM Solutions are complex and time consuming to implement, there are firms known as Application Service Providers (ASPs) that provide these services via the Internet. Since a web browser is all that is needed in these implementations, organizations can focus on core competencies and the implementation of project management rather than on the I.T. portion that tends to consume a large amount of internal resources. These EPM technologies now are virtual since the availability is based on an Internet connection. Global enterprises can share and manage information on all levels without the constraints faced previously.
Major benefits of the Virtual EPMO Solution, enables team members and authorized stakeholders to:
- Manage projects and resources, collaborated, analyze and report on projects across the entire portfolio.
- Web-based portfolio management tools help executives align people and projects with business objectives, quickly identify problems and take corrective action.
- Team members easily update project information, collaborate and stay informed through email and Webaccess tools.
- Support Best Practices and Organization–wide standards.
Project management has evolved not just as a discipline; it has become a business function. It is no longer a business benefit, instead a necessity determined by some of the following circumstances:
- Losing market share due to increase global competition
- Poor cost versus profits ratios resulting in falling or stagnant stock value
- Competition with faster time-to-market
- Chasing economic conditions that force downsizing
- Effective use of fewer resources caused by downsizing.
Today technology allows enterprises to leverage the virtual environment for project management; no longer has the I.T. infrastructure need to be deployed and supported at the enterprises' facilities, as well the team members including stakeholders can be located anywhere in the word. The only constraint is to have access to the Internet. This opens the door for team members who work remotely, including dangerous, or hostile environments such as battlefields, deserts, jungles, or even the artic.
Overall, the field of project management has evolved greatly and continues to grow on multiple fronts: project management itself, the business demands, and the technological advances. We have seen how each has played a critical role in the evolution of project management from a single project manager managing all the details of a project to the global organizations that rely on enterprise solutions.
Kerzner, Harold, Ph.D. (2004) Advanced Project Management: Best Practices on Implementation (2nd Edition). Hoboken, NJ: John Wiley & Sons, Inc.
Microsoft (2003) Microsoft Office Enterprise Project Management Solution. Retrieved 9/1/04 from Microsoft's Web site: http://www.microsoft.com/office/project. The Business Value of Microsoft Office. Retrieved 9/1/04 from Microsoft's Web site: http://www.microsoft.com/office/project. Enterprise Project Management Solution. Retrieved 9/1/04 from Microsoft's Web site: http://www.microsoft.com/office/project.
Gerard I. Kendall, PMP and Steven C. Rollins, PMP (2003) Advance Project Portfolio Management and the PMO. Ross Publishing, Inc.
Bolles, Dennis, PMP (2002). Building Project Management Center of Excellence. New York, NY: American Management Associates
Project Management Institute a Guide to Project Management Body of Knowledge (PMBOK®) Guide 2000 Edition. Newton Square, PA. (2003) Organizational Project Management Maturity Model.
© 2004, Mauricio Mulé and Erwin Susara
Originally published as part of 2004 PMI Global Congress Proceedings – Buenos Aries, Argentina