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The article is based on material in the white paper “From 0–100 kph in Under Six Seconds:
Rapidly Building Project Management Capability in a Complex Organization,” presented by Rod
Gozzard and Michael Knapp at PMI's Global Congress 2006—EMEA, held in Madrid, Spain.

The technology operations (TOps) unit at National Australia Bank (NAB) seemed to be doing just fine.

Responsible for all of NAB's non-application IT and communications infrastructure for the Australian arm of the business, the unit was performing well on cost management and operational-level performance. However, internal customer satisfaction rates with TOps services left much to be desired.

Looking to change that, the unit deployed a massive overhaul to integrate its project, program and portfolio management. Six months after it was completed, those satisfaction rates shot up above 80 percent, according to Rod Gozzard, Melbourne, Australia-based manager of portfolio management services for the TOps unit.

“Our key customers are saying they're really happy with our project services,” he says. In addition, for the year ending September 2005, demand for project services increased a whopping 275 percent, with the average time to produce estimates slashed from 13 weeks to four weeks.




That transformation didn't come about easily, though. In October 2003, Michael Knapp, director at Sydney-based Knapp and Moore Pty Ltd., had assessed TOps project management capability. “At the time, TOps was one or two levels below the maturity level needed for an organization of its type and size of projects,” he says.

The unit was plagued by accountability issues as well as a disconnect between the TOps group and project governance and management elsewhere in the organization. “Project managers were frustrated that verbal commitments weren't being honored,” Mr. Knapp says.

When Mr. Gozzard joined NAB in mid-2004 to help improve TOps' performance, there were “challenges in executing individual projects,” he says. “A more fundamental problem was the focus on managing individual projects versus the management of all projects. It was clear we had work to do. We understood that in order to improve project performance we needed to develop a solution that integrated project, program and portfolio management supported by a strong governance framework.”

The Overhaul Begins

“The problem was more than just project management. We had to look at projects as components of programs and an overall portfolio,” Mr. Gozzard says.

Toward the end of 2004, the revamp began, with the deadline set for September 2005. “It was clear that a big-bang approach would not work, as the organization wouldn't be able to absorb such a change,” he recalls. “We needed to organically build capability and fortunately, we had a culture that was open to change, learning and risk-taking.”

Mr. Knapp was brought back to review TOps' plan and agreed the transformation had to inculcate the organization to improved project management by way of the bigger picture of program and portfolio management.

TOps shed its structure of a decentralized cadre of project managers who tended to work in isolation and replaced it with a project management organization working in an integrated, centralized fashion.

A central component in TOps' transformation was a program management life cycle model. Created by program management expert and PM Network columnist Michel Thiry, the FOrDAD life cycle uses five phases:

1. Formulation: Ensure all benefits are valid for all stakeholders.

2. Organization: Prioritize delivery strategy to optimize realization of benefits.

3. Deployment: Be nimble, expect and manage change, and focus on benefits.

4. Appraisal: Make sure your efforts are aligned with priorities.

5. Dissolution: Upon program completion, ensure you are well-positioned to continually deliver benefits.

“This program approach expects change whereas a project approach tends to resist change,” Mr. Knapp says.

Currently, 60 professionals in project management constitute the TOps portfolio management services team. Each of the individuals is charged with accountability in one of the following functions:

  • Governance
  • Demand management
  • Portfolio office
  • Program management
  • Project management
  • Estimation.


To build its project management capability, the technology operations unit at National Australia Bank (NAB) deployed a process dubbed P5. “It's integrating the domains of people, process, portfolio, program and project management,” says the NAB's Rod Gozzard. Here are some of his lessons learned:

1. Processes, methods and technology are part of the game, but change happens because people want it to happen.
2. Be prepared to learn and take risks.
3. Change actions must be taken within an organizational and cultural context.
4. Engage key stakeholders at all levels of the organization.
5. For complex organizations, a program-based approach using a value-oriented life cycle works well.

“There is no silver bullet,” Mr. Gozzard says. “Improved project management maturity and performance is built organically one step at a time.”

Managing the Pipeline

For the transformation to succeed, leadership at the executive level and effective communications were mandatory, Mr. Knapp says. “Project champions were explicitly sought out for their opinions and input, and they were kept involved throughout.”

Buy-in from project managers was secured by involving them in the formulation, organization and deployment of the program. “Making project management work is everyone's job,” Mr. Gozzard says.

“It worked because everyone involved in the transformation had a voice,” he says. For example, one team member recommended TOps incorporate demand management. “Now we have a core team of about five people that works with others in the organization to get a core view of what's in the pipeline. We have the added benefit of establishing an end-to-end view of all projects across the portfolio, which brings resource management efficiency and allows earlier identification of constraints.”

This form of demand management helps TOps stay agile. “We work with each business unit technology group to understand their project priorities,” Mr. Gozzard says.

Every month, a TOps portfolio management forum of about a dozen senior people from project management and executive management examines the demand pipeline to understand the number, scale, resourcing needs and priorities of new projects. The group then works to ensure the demand and supply sides of the portfolio are balanced.

“As is the case in most organizations, we often find there is more to do than we are able, so we use program management as the linkage between strategy and projects to build our own demand portfolio that is integrated in the overall environment of the organization,” Mr. Gozzard says. “This is driving improved throughput and project delivery.”

Integrated KPIs

TOps transformation depended on more actively engaging stakeholders in formulating benefits and ensuring involved parties carry out their agreed accountabilities. To that end, integrated key performance indicators (KPIs) were developed for all areas of the portfolio, program and project environment. “The KPIs all support each other rather than compete with each other. Performance score-cards within TOps were also adjusted to reflect the increasing importance of project management,” Mr. Gozzard says.

“Everyone can see how their work translates from a strategy or a business need to the activities they conduct daily and the knowledge to assist in choosing relative priorities,” he says.

TOps spreads the word by educating nonproject management professionals. “We've trained 70 executives, senior managers and managers in the FOrDAD life cycle and our methodologies and processes. This has been very well-received and is viewed as a transformational change by leadership and management teams,” Mr. Gozzard says. “Project managers actually like change. We spend our lives working on projects that create change, but the new program at NAB works because it flows bottom up and top down.”

The Results Are In

TOps met its September 2005 deadline, and by the end of the year, a reassessment of the unit's project management maturity by Mr. Knapp found a 55 percent improvement. That ranking placed TOps among the leading 30 percent of its peers.

For the 2006 fiscal year, the goal is to improve efficiency. In September 2005, NAB announced a $1.8 billion investment over the next three years to rebuild the Australian regional business, with most monies dedicated to infrastructure and IT improvements. “We expect the number and breadth of projects to increase as NAB undertakes this transformation program,” Mr. Gozzard says.

And thanks to the unit's own transformation, it's ready to take on all those projects. PM

Marcia Jedd is a Minneapolis, Minn., USA-based supply chain and business writer.

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.




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