Project Management Institute

Transformation time

THE BUSINESS OF PROJECTS

A changing project management landscape demands new skills. Do you have what it takes? BY GARY R. HEERKENS, MBA, CBM, PMP

Project managers who understand the connection between the world of projects and the world of business will be extremely valuable in the future. In fact, they have the power to actually transform the project management landscape. As project management guru Harold Kerzner, Ph.D., noted in his closing keynote address at PMI’s 2009 Global Congress—North America, a world full of business-savvy project managers represents the future of project management.

There are two key drivers of this movement. First, more companies are coming to realize that projects are, in fact, financial investments and should be treated as such. And second, more people who care about the project management profession are seeking ways to elevate its stature and increase the level of respect for project management practitioners.

That triggers two critical questions:

Question 1: What does it mean to be a business-savvy project manager?

At a high level, it means the project manager understands how and why to apply a business perspective to every decision he or she makes. It describes a project manager who exploits every opportunity to optimize a combination of positive financial and strategic outcomes throughout the entire project investment life cycle— both before and after the classic project execution life cycle we typically focus on.

In more specific terms, a business-savvy project manager must possess:

  • Business Knowledge: This requires understanding which business concepts and principles have relevance to projects and to the practice of project management. Project managers must know what the weighted average cost of capital is, for example, and how it applies to the financial justification of projects.
  • Business Skills: Project managers can't just know about things related to business and projects—they must be able to actually do things. Case in point: They should be able to lead the effort to prepare a clear, concise and comprehensive project business case document.
  • Business Acumen:This means knowing when and how to apply business knowledge and skill to a given project situation. If a risk surfaces, project managers should be able to base their response on a broad range of factors, including financial or economic impact, cost versus benefit, value optimization and so on.

Question 2: Why would you want to become a business-savvy project manager?

Whether we care to admit it or not, many project managers are viewed (and treated!) as little more than task managers. Many of us are simply handed a project solution, a budget and a deadline (none of which we have a hand in developing) and are told to “go forth and execute.” Adding business knowledge, skills and acumen to our skill set gives us a way out of this scenario, allowing us to achieve both personal satisfaction through job enrichment and professional satisfaction by advancing the field.

The Transformation Begins

Thankfully, some organizations have begun to recognize the value in leveraging the talents of business-savvy project practitioners. As a result, those people are now being invited to participate in a variety of higher-level functions, such as strategic planning, project evaluation and selection, project financial analysis and portfolio management.

This is a positive movement, representing a win for the organization—and for us as professionals.

Yes, the project management landscape is beginning to change. PM

Gary R. Heerkens, MBA, CBM, PMP, president of Management Solutions Group Inc., is a consultant, trainer, speaker and author, and has 25 years of project management experience. His latest book is The Business-Savvy Project Manager.

img
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.

DECEMBER 2009 PM NETWORK

Advertisement

Advertisement

Related Content

  • Why Great Ideas Fail and How to Make Sure They Don't

    By Vargas, Ricardo Viana | Conforto, Edivandro Carlos | Oumarou, Tahirou Assane To reduce failure rates and successfully deliver strategies in 2020 and beyond, organizations must overcome disruptive forces and flip posing challenges to opportunities and advantages. It all…

  • Pulse of the Profession

    Tomorrow's Teams Today

    By PMI PMI research reveals that it’s the organizations with creative, collaborative and agile teams that will thrive in The Project Economy.

  • PM Network

    All Access

    By Fister Gale, Sarah No more limits. That's the battle cry on everything from construction sites to next-gen digital design as teams look for ways to ensure projects accommodate people with disabilities related to…

  • PM Network

    Vital Signs

    Transforming horizon-focused strategic visions into here-and-now reality can't happen in a vacuum. Instead, project leaders must cultivate a deep understanding of the business, technological,…

  • PM Network

    Power to Change

    By Tayel, Jess Many organizations are undergoing (or will soon undergo) a business transformation program geared toward growth and creating a competitive advantage. When successful, these programs bring about a…

Advertisement