MANAGEMENT
By Dennis Comninos & Enzo Frigenti
Synopsis
This article addresses the concepts and issues of business project management. It aims to assist
organizations in making the shift from a narrow, strong, technical focus on project management to
a broader, more business-oriented focus. The authors introduce the reader to three important
concepts and components that underpin the philosophy of the business of project management.
These components combine to form an approach that allows projects to make things happen, and
to be the engines of growth for organizations.
portfolio management
Organisations that do not adequately address these issues or do not formalise the linkages
between strategies and projects find that projects seem to pop up across the organisation in an
uncontrolled manner. This results in confusion and resultant failure to achieve the desired project
results.
Confusion and failure arises from:
a lack of clarity as to how projects align and link to the organisations strategy.
upper managements apparent lack of awareness of the number, scope and benefits of the
projects being undertaken
project participants feeling that they are working not only on many unnecessary projects
but also at cross-purposes with other areas of the business.
projects being seen as black holes into which money and people disappear and from
which, with a bit of luck, something may emerge.
organisations attempting too many projects outside of their capacity and capability.
a general weariness with projects and a lack of motivation to complete them (project
fatigue)
doing the wrong things, right instead of doing the right things, right.
doing less with more rather than doing more with less.
Linking projects and strategy gives projects a strategic and business focus that goes a long way
towards resolving many of these problems. Combining a strategic focus with a business process
for selecting and prioritising projects is an important step in creating an environment for successful
projects.
The authors have developed an approach, Business Focused Project Management (BFPM), to
achieve effective management of corporate projects from their conceptualisation through to the
delivery of the desired business outcomes. BFPM takes an organisation-wide view of project
management focusing on the needs of the project owners, while integrating closely with the
requirements of executives and upper managers.
The dynamism of the organisation is facilitated through the provision of the means to
adjust project strategies to changing scenarios through project selection and prioritisation.
Allows all levels of management and the core project team to contribute to the
achievement of the organisations strategies.
Allows for the measurement of both project performance and progress towards achieving
strategic goals.
The following table highlights the major differences between BFPM and traditional Project
Management:
BFPM
Project Management
Strategic
Tactical
projects (Plural)
Organisation-wide and cross-functional
A discipline
A business philosophy
A specialist function
BFPM takes an organization-wide view of project management by focusing on the needs of project
Tel: 011 447 7470 Fax: 086 686 8425
Website: w ww.a lusa ni.co.za Po st: PO Box 2844, Sa xonwold, 2132
owners, while integrating closely with the requirements of executives, upper managers, and the
project management environment. It is based around the two major components, the Wrappers
Model and Objective Directed Project Management (ODPM). These two components fit together
to provide the philosophies, processes, concepts, and tools used to enable Business Focused
Project Management.
Strategy
Strategic effectiveness is achieved by setting the right objectives or goals and implementing them.
Some form of strategic planning of this nature is done at all levels of organisations. For clarity and
simplicity, the authors have adopted the following terminology in this article.
Business strategies are in turn carried out through projects whose strategy is the project
approach or plan.
Organisation and business strategies are essential to BFPM. If they are not present or well
defined, then there cannot be projects focused on the business.
Project Portfolio
The project portfolio represents those projects that best meet the strategic/business needs of an
organisation. The projects contained in the portfolio arise from the Project Selection and
Prioritisation processes. The portfolio is managed in a manner similar to that of an investment
Tel: 011 447 7470 Fax: 086 686 8425
Website: w ww.a lusa ni.co.za Po st: PO Box 2844, Sa xonwold, 2132
portfolio; projects are added, invested in, replaced, and terminated in accordance to the value or
expected business impact the portfolio delivers to the organisation. The Project Portfolio is
continuously monitored and evaluated as well as continuously being passed through the Project
and Selection and Prioritisation processes.
shows the path to be taken for the effective and fast transformation of strategies to
business outcomes and project outputs.
indicates what metrics must be in place to effectively measure the delivery of results and
achievement of goals.
provides a discipline for the delivery of strategic objectives through the execution of
projects.
when populated with processes, templates, tools, techniques, dashboards, and systems, it
forms a complete methodology for Business Focused Project Management.
The Strategic Wrapper further defines the relationship between the organisation and its
environment, identifying the organisations strengths, weaknesses, opportunities, and threats
(SWOT). The context includes social, technical, economic, and environmental issues,
political/public perceptions and operational and legal aspects of the organisations functions
(STEEPOL). The SWOT and STEEPOL analysis forms an integral part of organisational strategic
planning.
In the absence of organisational strategic planning, projects will deliver results that are not aligned
with desired business outcomes. Portfolio and project performance measures will exist in a
vacuum created by the lack of strategic direction.
project is derived partly from the sponsor and partly from interpersonal influences.
An essential component of the BFPM approach is a project planning process that focuses on
measurable results and not on detailed planning, which belongs at team level. These results are
objective directed and link to the performance measures to give direction to team-level planning.
Project managers and team members expand these results to the next level the task
deliverables. Team members can now focus on the work required to achieve the deliverables.
Team members take on the responsibility for planning the work to achieve the deliverables. These
deliverables lead to project results, which in turn contribute to the intended business outcomes.
From this planning will flow an understanding of what each individual contributes towards a
deliverable, and how their individual performance is measured.
management wrapper enveloping the ODPM process and the ODPM process itself are the
most relevant to contracting organisations. Other organisations need to apply all the levels of the
model, as they strive to convert strategies into projects into outcomes.
The conceptualisation, selection, prioritisation, and initiation of projects move from the outside of
the sphere inwards, as do the control mechanisms. The results delivered by the ODPM process
are assimilated into the business by moving from the core of the sphere outwards. Likewise,
monitoring and reporting move outward from the core. These flows ensure that upper management
and the executive are kept informed. Such reporting enables the organisation to assess project
progress against business cases, ultimately leading towards the achievement of strategy.
Through the progressive elaboration nature of the Wrappers concept, which is also the basis of
the ODPM process, BFPM is capable of delivering business-focused results from projects in a
fuzzy to clear manner.
timeliness of deliverables;
Project business performance measures include outcome focused measures such as:
Technical project managers tend to focus more on process, while business project managers are
Tel: 011 447 7470 Fax: 086 686 8425
Website: w ww.a lusa ni.co.za Po st: PO Box 2844, Sa xonwold, 2132
more concerned with business results. Ideally, a balance between the two is required, determined
by the project type, organisation culture, and systems.
Upper management, and specifically sponsors, must ask for project measures that are wider than
the usual process measures. Measuring business results will ensure that both the project core
team and functional managers focus on what is important to the organisation. Reporting to key
stakeholders will become more meaningful and build a positive perception.
An approach to the measurement of both business and process-focused attributes is the use of a
Project Balanced Scorecard. This could consist of the following measurements:
1. Financial measures such as growth, economic value-add, return on capital employed, cost
savings, etc.
2. Project process measures such as cost/time performance, quality, use of resources, etc.
3. Client measures such as satisfaction, use of product, new clients, retention, market share,
etc.
4. Learning and development measures such as motivation, empowerment, training, team
satisfaction, productivity, etc.
The project core team should guard against accepting responsibility for delivering results that they
cannot achieve. This is often the case where only operations are in a position to achieve the
business results. However, it is the responsibility of the project team to deliver to operations the
products that will enable them to achieve the business results. There are exceptions, particularly
where a project creates a new product or service, and the project team becomes a new operations
section. In this case, the project team effectively hands over to themselves.
Summary
Strategies and projects go hand-in-hand. Projects achieve strategies but do not create them.
Projects can only be initiated as a result of business needs and strategies. Many organisations
devote much time and effort to formulating strategies and business plans, but relatively little to their
implementation through projects. Strategies need to be rapidly translated into daily work if they are
to have any effect. The ability to execute strategic initiatives quickly and effectively is fast
becoming a critical business attribute as companies respond to a rapid pace of change.
Building an environment that supports project management is essential for organisations that are
serious about converting their strategies into reality. The business focused project management
processes represented by the Wrappers model are vital and should not be ignored if an
environment conducive to successful project management is to be created. The Wrappers model
cannot effectively operate in an organisation that does not value and support project management
as a key managerial competency. As a model, Wrappers lives through the sincere and honest
actions of upper management and the committed support of project and functional managers.
Tel: 011 447 7470 Fax: 086 686 8425
Website: w ww.a lusa ni.co.za Po st: PO Box 2844, Sa xonwold, 2132
Reference:
Frigenti E and Comninos; 2002
The Practice of Project Management a guide to the business-focused approach
Kogan Page
Denzo Limited 1989-2006