Project Management Institute

Toward corporate project management

beefing up the bottom line with MOBP

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UP & DOWN THE ORGANIZATION

Paul C. Dinsmore

A step-by-step plan to implementing a new mindset.

In the March PM Network column, I outlined the concept of MOBP—Managing Organizations by Projects—and highlighted trends that boost project management toward a more significant role in the management of organizations. In this column, I lay out steps to implement MOBP.

Managing Organizations By Projects is an organizational mindset. It's a way of thinking about business. It means the company is project-driven, that corporate goals are targeted and achieved by managing a web of simultaneous projects, including operational improvement and organizational transformation programs as well as traditional development projects.

In this setting, the members of the organization perceive their work as that of managing and successfully completing projects, as opposed to occupying a slot on a static corporate structure. The question “What do you do in your company?” no longer gets answers like “I am Manager of the Finance Department,” or “I head up the Parts Warehouse.” Responses tend to be more like: “I'm part of the Quality Team charged with increasing productivity by year's end,” or “I work on three projects now, and start coordinating a fourth one in June.”

MOBP offers big-time advantages to companies that aim to beef-up their bottom lines. For example, MOBP:

  • Puts the organization in a strong goal-oriented mindframe
  • Provides structure and practical methods for planning
  • Complements and reinforces other organizational-change methodologies
  • Facilitates adjustment of plans to changing scenarios
  • Permits easy monitoring of progress toward goals
  • Accelerates implementation of corporate strategies
  • Provides effective techniques for meeting annual targets.

From the MOBP view, organizations are “portfolios of projects.” Therefore, the aggregate result of an organization's projects becomes the company's bottom line. Missions, visions, strategies, objectives and goals are transformed into company-wide programs that translate corporate intentions into actions. Those programs are, in turn, broken into projects to be managed by corporate staff or professional project management personnel.

There Are Companies and There Are Companies

Some organizations require major steps to get them into an MOBP mindset. Since traditional operations-oriented management was adequate for the times that preceded today's fast-paced business setting, these organizations were not originally project-driven. In these companies, a substantial cultural swing is required to turn the organization as a whole to thinking project-wise. Some notable multinational companies come to mind.

Citibank, under John Reed's leadership since 1984, changed from its traditional structure to that of a fast-tracking, project-based organization, aimed at meeting emerging needs. Unilever's chairman Morris Tabaksblat emphasizes the need for organizational re-structuring projects as an ongoing effort to mold the company to the changing times. This Anglo-Dutch consumer-product giant also uses project management in technology, marketing and product development. Proctor and Gamble president John Pepper sees a constant array of projects under way in his organization, including “constant reengineering,” launching new and better products as well as upgrading technology.

In other companies the transition to MOBP is a question of fine-tuning; not much is needed to make the shift, since the company is already “project literate” in given areas. The steps for implementing MOBP are still required, yet speed of implementation is enhanced by the already existing culture.

An example is ABB, the manufacturing conglomerate that makes robots, energy-generation equipment and high-speed trains. The two staid European-based companies that merged to form ABB (Asea of Sweden and Brown Boveri of Switzerland) already had traditional structures oriented toward manufacturing projects. When Percy Barnevik revolutionized the companies in 1988, he orchestrated a decentralizing program that would later earn him international renown (he made the cover of Fortune in 1992). Through decentralization and big-time delegation to smaller units, he set the groundwork for a “multi-domestic” federation of companies that manages projects both globally and locally. ABB moved naturally and smoothly toward an MOBP mentality as a consequence of external market pressures and major organizational adjustments.

How Do You Go About It?

Companies evolve toward a MOBP philosophy in different ways based on their cultures and the peculiarities of their markets. Here is a generic model that can be adapted by organizations that want to improve their bottom lines by strengthening project management skills corporate-wide. The following checklist summarizes the steps required to move an organization project-ward and make the organization's team members think and breathe “managing by projects.”

Figure 1. Organization Seen as a Portfolio of Projects

Organization Seen as a Portfolio of Projects

Figure 2. Figure 2. Steps for Implementing MOBP

Figure 2. Steps for Implementing MOBP

1. Situation Size-Up. How do current practices measure up to the “state of the art” of project management? This question is the cornerstone for kicking off a MOBP effort. The answer comes through a combination of one-on-one interviews, questionnaires, reviews of project procedures and past practices. Comparative benchmarking data that highlights industry “best practices,” such as the industry Benchmarking Project coordinated by Ray Powers of US West, is also included in this phase. Based on the information gathered in this survey, an MOBP project design is developed.

2. MOBP Design. Here is where the project is tailored to fit the organization's characteristics. The design takes into account the company's origin, ongoing practices, technical and managerial competence, corporate goals, resistance-to-change, politics, industry practices, and values, preferences and opinions of major corporate players.

3. Executive Briefings. Once the design has been okayed, upper-management sponsorship is guaranteed through executive briefings. The briefing features:

  • Project sponsorship
  • Stakeholder management
  • Overview of project control tools
  • Strategic project planning: technical vs. managerial
  • Kickoff workshop methodology
  • Concepts from PMI's A Guide to the Project Management Body of Knowledge
  • Modern trends in project management.

4. Middle-Management Workshops. These sessions are designed to bring managers up to date on project management concepts and tools. The workshop covers, in more detail, the topics presented in the executive briefing, plus a walk-through of planning sequences, conflict management, team-building techniques and leadership tips for the project manager.

5. Workshops for Project Managers and Team Members. These are interactive events aimed at those who do the work: the people who manage and carry out projects. The participants include professionals who fully dedicate themselves to projects, those who herd along a number of projects simultaneously, and those who coordinate projects “on the side” as they carry out other duties. A hands-on approach is used in these workshops, which usually follow the format:

  • First workshop: Content identical to the middle-management seminar, but more focused on real-life project situations brought to the event by the participants.
  • Second workshop: Includes a detailed walk-through of the PMBOK Guide sections and cases brought in by the participants as well as cases from other companies.

6. PMP Certification Program. This optional program helps enhance the degree of professionalism and project management culture within the organization. Special efforts are required to prepare candidates for the Project Management Professional exam. In many situations, supplementary classroom instruction is necessary; in others, home study and exam simulations will suffice. The PMP Certification Program is tailor-made, based on the situation survey, the company's intentions regarding certification, and participants' progress during previous training sessions. The basis for the training is PMI's “Review Package” for the Certification exam. Various schools, including George Washington University and Boston University, offer programs leading to certification, as do numerous private consulting companies.

7. Support for Specific Projects. The implementation of MOBP includes on-the-job support for ongoing projects. This support consists of:

  • Facilitation of project start-up workshops
  • Orientation in setting up a project office
  • Implementing planning and control systems
  • Project management audits
  • Coaching of upper-management and sponsors in project management matters.

Some Drawbacks

The road to MOBP is not without bumps, however. Managers responsible for making organizations more project-oriented face potential challenges:

1. Personal Adaptation from Position-Based to Project-Based Management. Not everyone readily makes the shift from position-based management to a project approach. For those linked to hierarchical status and power, the adjustment tends to be, at the least, painful. Some do not adjust at all and either opt out, or are ushered out of the organization.

2. Looser, Less-Structured Organization. Multi-project settings are challenging for those accustomed to clear lines of function. When organizations take on a matrix form, the ambiguities and “fuzziness of things” creates insecurity in professionals new to the setting. Those who do not adapt readily to the scene need to be trained or transferred to other spots.

3. Challenge of Stakeholder Management. A project approach requires taking on full responsibility for the success of the projects. This means that all factors affecting the projects must be managed by the project team, including the project stakeholders. Specific training in stakeholder management is called for in many cases.

4. Task of Developing Competent Project Personnel. Project management requires a special team-member mindset, one that differs sharply from a traditional operating mentality. The effort to make this shift may be underestimated by optimistic change agents, resulting in either slow or ineffective change.

5. Overall Integration of Projects. Managing a portfolio of projects calls for strong interface management to ensure coherence and direction of the multitude of ongoing undertakings. This task requires high-level attention and a “project interfacing culture” throughout the organization for the MOBP program to be effective.

Conclusions

There is no standard process for moving an organization into a “projectized” posture. Some companies begin to lean in that direction as a result of project champions already existing in the organization “spreading of the word.” Other organizations require a company-wide campaign similar to that outlined in this article.

The competitive times are spotlighting management techniques that boost organizations' bottom lines. The overlap of project management and corporate management techniques increases as the number of projects needed to meet company targets keeps growing. Project approaches continue to creep upward in organizations as higher management tunes into the power of managing organizations by projects.

Paul C. Dinsmore, PMP, is president of Dins-more Associates, affiliated with Management Consultants International Group, based in Rio de Janeiro. He is a Fellow of PMI and author of six books, including the AMA Handbook of Project Management (Amacom, 1993).

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.

PM Network • June 1996

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