Introduction
How do you market the value of project management to the senior management team who have previously had no visibility of effort or costs, expected delivery without any requirement to document their needs or justify business benefits sought?
With a desire to provide more focus on the each business unit with Contact Energy, the role of Information Management Programme Manager (IMP), who primarily works with the business unit General Managers (GM) and their direct reports, was introduced. The concept of an opportunity lifecycle has also been implemented and incorporates a more disciplined PM method and structured approach.
The IMP role represents the business in the Information Management (IM) unit and represents IM to the business; it is responsible for the programme of IM work they identified jointly with the business; and acts as a champion for opportunity lifecycle methods. In other words, the IMP promotes the benefits and value of project management to the business unit, not only by selling, but through demonstrating through successful delivery of projects and ultimately their programme.
This paper outlines the role and responsibilities of the Contact Energy IMP and relates the journey that IM and IMPs have taken with the GM's, senior management and their direct reports – in other words “the IMP'ish way”.
Background
Contact Energy was established in 1995 from a State Owned Enterprise and by the following year it was operating with generation assets purchased from ECNZ. Following the Electricity Reform Act in 1998 when ownership of network and retail business were separated, Contact acquired nine retail businesses. It is now the second largest public company listed on the NZ Stock Exchange, the majority share holder is now Origin Energy (51%). This is New Zealand's leading gas and electricity supplier with 600,000 business and domestic customers. Contact generates 30% of the country's electricity via the 9 power plants (hydro, gas and geothermal) that it owns.
No one really believed that the industry would survive once the monopoly was removed. However, at startup, Contact decided that they needed to have good information that covered all their plants and support a spot price environment, and so established the Information Management (IM) group.
There was “nothing to loose, but everything to gain” at the start, so the focus was on speed of delivery and implementation at as low a cost as possible. A practical and pragmatic solution approach was taken, resulting in point solutions. This meant that growth in the business was reflected by a growth in the number of applications and databases. People were “doing stuff” to respond to what the business wanted and not all of the solutions or applications were supplied through the IM group. A variety of infrastructure or platforms were required. Delivery was not consistent. The organisation did not have visibility of the costs or resources applied to the solutions.
In 2004, Contact Energy established a new Australian company, which it later sold, and the Chief Information Officer (CIO) took on the Chief Executive Officer (CEO) role. Contact Energy now has a new CIO, who has introduced a number changes to the IM unit to support the IM's Mission, which is to:
- Support cost-effective, non-disruptive operation of the business
- Facilitate structured business transformation
- Create innovation and deliver business value
The changes include a new structure (organisational model), a defined process (opportunity lifecycle), separation of BAU services from projects and management framework (portfolio management tool).
Organisational Model
All IM personnel belong to either, the Management Team, PMO or a capability group: Business IT Consulting; Architecture; Project Management; Applications; or Service Delivery. The Applications capability covers the business analysts, developers, test team, BI team, and the application support team. The Service Delivery capability is responsible for the security and infrastructure.
Exhibit 1. Capability Alignment
Business alignment is achieved by application of a matrix layer across these capability groups. The business has been grouped into four areas: Trading; Operations; Retail; and Legal, Corporate and Finance. An IM Programme Manager role (see below) has been established for each of these four groups and the programme of work draws from the capability areas for both projects and on going application support.
Exhibit 2. Business Alignment
Opportunity Life Cycle
Historically, there have been expectations of project delivery and support from IM that have not been satisfied. There has been a lack of clarity over the respective roles and responsibilities of the Business Units and IM and the status of projects. The quality of governance and sponsorship by the business for IM projects has varied. Risk Management and Project Acceptance has not been consistently adopted across IM projects.
IM has implemented a project management framework titled the Opportunity Life Cycle, to strengthen project and risk management practices in IM.. The framework determines the core process for IM project and application initiation, execution and operation. Contact has incorporated IBM's World Wide Project Management Method (WWPMM) into this framework.
The key components of the Framework can be described as: Propose; Plan; Build; Run; and Refresh. These are supported by the business principles and architectures as in Exhibit 3.
The phases of the life cycle also map with Contact's Project Authorisation and Sanctioning (PAAS) Policy, which outlines the business case process and authorisation process (both business and IM). There are two types of PAAS
- Initial (required to from the prioritised opportunity into the scoping and benefits work (Proposal)
- Full (required to initiate the project Plan phase and confirmed at the check point prior to the Build phase)
Application support during the Run phase has three mechanisms to initiate a change: Service Request (SR); Enhancement Request (ER); Production Release Request (PRR).
Exhibit 3. Opportunity Life Cycle
Services and Projects
A project discipline is taken to all work. Work that is deemed to take less than two weeks effort is conducted as a service by the Application Support team, as is the desktop support. Anything of a greater level of effort is treated as a project, prioritised within a programme or work and requires the oversight of a project manager.
Management Framework
Contact has had limited access to operational information in the past. Therefore IM has implemented a portfolio management tool (Rational Portfolio Management) to assist gaining viability of the programmes, especially with the management of projects, assignments and costs. Initially this is providing improve visibility of project reporting, status, resources and costs. The next phase will be to improve the programme view of resource and cost forecasting and planning, as well as creating the KPI dashboard.
IM Programme Management Role
At Contact Energy, the IM Programme Management role has five key functions, which are:
- A single focal point of liaison between the Business Unit and IM
- Manage the IM Programme of work for the Business Unit
- First point of escalation and assistance
- Lead the IM Business team
- Add value to the Business Unit
As the single focal point of liaison between the Business Unit and IM, the IMP represents the IM unit into their assigned business area and also the business unit back into the IM. Keeping the business unit informed about changes in IM (process, resources, timing), the programme of work, and impacts of other business programmes and projects are key. On the other hand, understanding the business unit's strategy, priorities and objectives, the business functions, and the system (process and application) required to support these functions and communicating this back into the IM team and facilitating the response is also a key responsibility. In other words the role could be described an account management or customer relationship management.
To manage the IM programme of work for the Business Unit includes working with the business at all stages of the opportunity life cycle. During strategic planning and annual budgeting, the IMP works with the Business to determine the initiatives that will be required to assist them in reaching their goals, which are then prioritised, estimated and scheduled to form the programme of work for the next year. Of course initiatives arise during the course of the year due to industry or regulatory changes or fall out of other business needs. During the development of the initial business case (PAAS), the IMP facilitates the business in the definition of the proposed benefits and identification of possible risks to realising these benefits, which are then confirmed or adjusted during the full PAAS development.
The IMP maintains the plan of record for the programme, manages and reports health of the capital projects and reports on all IM spend (at all stages of the opportunity life cycle) that relates to the business unit.
In addition to being the focal point of liaison, the IMP is also the first point of escalation and assistance. The IMP is embedded in the Business Unit in part by being co-located close to the GM and where possible also his/her direct reports. The IMP encourages the business team to use the correct channels to raise requests for IM support and follows agreed process and methods. However, for urgent matters, the staff often approaches the IMP, who facilitates the process by alerting or giving an early warning to appropriate IM staff that will be assigned for the resolution. As part of the daily routine, an IMP will provide advice and deal with questions and issues that may relate to either the BAU services or projects.
An IMP leads the IM Business team, which consists of the IM staff, from any IM competency area, which is assigned to work on the projects or programme. This includes making certain that process and methods of the opportunity life cycle are followed for the IM programme of work, ensuring that proper project governance is applied, that all check points happen and that peer reviews are conducted. In some cases, the IMP will also be the mentor (formal or informally) to project managers within the programme.
Adding value to the Business Unit come from a variety of sources, such as facilitating the initial thinking about the initiatives, providing insight into how benefit from leveraging solutions in existing systems and other projects or programmes, bringing existing intellectual property (IP) or capital (IC) to bear, leveraging the IM ecosystem (Exhibit 4), or assisting with the prioritisation of initiatives.
Exhibit 4. IM Ecosystem
Prioritisation of initiatives is one of the most important, as this can be both within a business functional area and across areas of the supply chain. It can also be between the programme and ongoing support, especially where an application replacement project is in progress. Prior to the introduction of the IMP role, business expected to have all their “wants” delivered. However, GMs are becoming more aware that what they want isn't always what they actually need. Now there is a realisation that the IMP facilitates the IM team to provide valuable advice to take a wish list and turn it into real needs that can then be selected as appropriate to meet business objectives and strategies. Additionally, initiatives that have limited value, benefits or return on the investment or may be too high a risk can be eliminated from the programme.
Effective Programme Management
The CIO defines effective programme management as developing a better context for IM to perform, managing the interfaces with the business and IT, and achieving business alignment and integration.
Developing a better context for IM to perform includes the opportunity life cycle and associated methods, the organisational structure, services and projects, and the management framework.
Managing the interfaces with the business and IM includes everything mentioned above under being the “focal point of liaison”, as well as managing and delivering to expectations. Managing expectations includes both the setting, such as distinguishing between wants and needs (see “adding value to the business unit”) and the day to day management of the business varying expectations, including the resetting of expectations as the environment, situations, and priorities change.
Achieving business alignment and integration covers all aspects of the role, and especially includes the development of the prioritised programme of work within the overall IM portfolio and the management and reporting on the health of that programme.
Selling the Benefits and Value
At Contact Energy, selling the benefits and value of project and programme management is not through telling or marketing, rather it is through achieving customer (the business) satisfaction for the programme outcomes, as well as their experiences in that journey. This is being achieved through the consistent application of project management method and disciplines across the IM Portfolio, and setting the value proposition (business benefits / risks) and establishing expectations with stakeholders for projects and their outcomes. Helping the business identify potential benefits that could be realised from project outcomes and then their realisation of those anticipated business benefits adds to the satisfaction.
Challenges and Lessons Learnt
Each IM Programme Manager has had a different experience depending on the personalities in their area of the business, which has at times been frustrating or immensely satisfying. This has meant that slightly different approaches have been taken in the interactions with the business, but their have also been some common challenges.
These challenges have included, but are not limited to:
- Proactive engagement
- Understanding the business needs
- Operational failures
- Births, deaths and marriages
- Discipline
- Cross functional collaboration
- Influence verses authority
Proactive engagement of the business has taken time. Building the relationships has not been easy. Some areas of the business have taken a while to understand the IMP role. One IMP has had to deal with the geographically dispersed generation sites and the belief that a central IM service and programme would not be beneficial. All have found or had confirmed that the business functions within silos, where each has a different approach. Therefore the IMPs have been the facilitators within and across the business units.
Understanding the Business needs has been a challenge to all IMPs. This is probably more so for those responsible for the Operations (generation sites) and for Trading Group. The generation sites are each quite different because they are effectively run as individual businesses, are geographically distant, and have differing requirements dependant ion whether they are a gas, thermal or geothermal plant. The Trading group covers virtually the whole of the Contact Energy supply chain, ranging from gas trading and electricity trading, pricing strategies, sales and marketing, and networks and reconciliation. It has been a challenge to come to grips with the different parts of the business, the impacts of industry changes, and the business wants verses needs.
Operational failures have directly impacted the Retail Operations and resulted in resources being pulled of the Retail Programme to work on recovery of the operational systems and stalling the programme. As the Retail systems also support both Sales and Marketing and Network and Reconciliation, the Trading Group has also been affected, as has any new initiatives that are in progress.
Births, deaths and marriages are not normally considered a major challenge. However, this year in particular two deaths in the IM team have had a dramatic impact on the ability to support existing applications and resource projects. This has in part been due to IM previously allowing sole individuals to support an application (rather than having the knowledge spread over more than one person), as well as application support and project resources have been mixed. Attention is now focussed on having the support spread amongst two or more individuals.
Discipline is required in the new IM culture. Some of the IM team have had difficulty adjusting to the changing culture, while others have actively resisted the new processes and method. Likewise the business has also had to slowly adjust to the new disciplined process and method.
Cross functional collaboration has been facilitated by the IMPs and their programmes. This has been particularly noticeable between the Retail Programme and the Trading Programme, as well as between the Trading Programme and the Operations (generation) Programme. For instance, the Retail IMP and Trading IMP have collaborated on the Retail Prioritisation Group in an attempt to ensure that work carried out under the Retail Programme has an agreed priority order of work.
Influence verses authority has been an issue for some of the IMPs. Lack of authority to manage the programme of work was raised for one programme, whereas the issue of authority was in reality over the operational services and support. Another IMP feels that without the authority, they are only co-ordinating projects. However, an IMP has a significant influence over the programme of work, the definition, prioritisation, selection and change management. Under the matrix organisation structure, an IMP does not have authority to resource work without making the request through an appropriate team leader. Where this is less effective than desirable, is when there is no suitable resource available or the team leader does not respond in a timely manner. Once the resource is assigned to the programme, there is every chance to move them between projects as required and appropriate, as long as the timeframes are clearly communicated back to the team leaders.
Conclusion
In conclusion, the IMP'ish way at Contact Energy has been to demonstrate the value of project and programme management through building the relationships between IM and the business, the successful delivery of projects and the benefits from the project outcomes being realised.