CREATING BUSINESS VISIBILITY THROUGH PROJECT MANAGEMENT

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CREATING BUSINESS

VISIBILITY THROUGH

PROJECT MANAGEMENT

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CREATING BUSINESS VISIBILITY

THROUGH PROJECT MANAGEMENT

EXECUTIVE SUMMARY

This paper is written for executive leaders and leaders of lines of business/functions who are seeking the next wave of enhanced operational effectiveness. It will also be of relevance to project leaders and managers, and anyone seeking to improve business efficiency. Business visibility is increasingly important, and an area of significant investment. However, businesses are potentially missing out on one significant weapon in the pursuit of greater insight into the business. This paper will explore the power and potential of applying project management (PM) principles, techniques and tools beyond projects as they are traditionally definedin most businesses, using insight drawn from two decades of working with project-centric businesses and extrapolating this into a wider enterprise landscape.

We will outline why project management methodologies and thinking are relevant to every business, how they can answer some important questions, and can potentially enable leaders to gain a much better handle on their businesses. We will explain how PM thinking can link resources to key activities, promising the potential for increased utilisation, better planning, and more informed resourcing and workflow management decisions. We outline some of the implications of not recognising the project nature of many business activities. With the right thinking, skills, platforms and processes in place that recognise the project-like nature of many activities, executive leaders can see the future of their businesses with greater confidence, and use that visibility to achieve their goals.

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CONTENTS

1 Introduction . . . 4

2 Projects: understanding the relevance . . . 5

3 Implications of ignoring project attributes . . . 6

4 Benefits of visibility . . . 9

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1. INTRODUCTION

Leaders of today’s businesses will be acutely aware that the business environment is a challenging place to be. Ongoing socioeconomic and geopolitical turbulence do not make for a particularly comfortable backdrop. Yet, it seems, business confidence is still rising slowly, markets are increasingly competitive, and companies are again seeking growth and expansion (albeit slightly more cautiously than in the past).

The issues on the table, for many leaders, will likely span a vast array of items including how to stimulate innovation, attract top talent and break into new markets, right through to the perennial challenges of becoming leaner and more efficient, satisfying customers, delivering excellence in product and service, and sustaining investor and market confidence. Compounding this will be an over-arching vision and a strategic way forward which has probably been exhaustively debated and argued.

Charged with delivering all of this are not only those in the C-suite, or stakeholders, but also the directors, managers and workers that comprise the organisation. They will be undertaking an array of different activities, programmes and work

throughout the year.

The importance of visibility

It is becoming increasingly evident that good information, insight and intelligence is key to managing a modern enterprise. Visibility today is acknowledged as vital: companies are spending vast amounts to increase their supply chain visibility, boost financial visibility, integrate business processes, consolidate and simplify their data, and deploy business intelligence and analytics systems to enable them to see into every corner of the organisation. Businesses would be lost without the ability to see, update and maintain accurate financial forecasts, for example, while anyone in retail or manufacturing would be crippled without supply chain and warehousing/logistics visibility. There is, however, one perspective on visibility that is often missed – and it is no less critical than the financial or operational insight that is deemed so critical. That is: insight into the actual activities that are carried out, and the workloads of employees and teams, during the day-to-day running of the business and achievement of goals.

The core question we must ask is: how do you ensure that all the day-to-day activity and

resources line up behind strategic vision and plan of action? Achieving long term goals is made up of the achievement of many shorter and medium term goals. You know that it is what you have directed to happen but what happens in reality may be another matter entirely. Others must turn your vision into reality, through the medium of planning and executing activities. It is all around delivery and achievement in each day; the implications of failure to deliver in one part of the business can have a cascade effect, and it can create that which is most unwelcome to any business leader: surprises.

Experienced perspective

Asta Development has been helping organisations to assure on-time, on-target and on-budget delivery, use resources efficiently, plan for change, reduce risk and fulfil customer expectations for over 20 years. It believes that project management offers untapped potential for any organisation to add an additional layer of insight into this most fundamental aspect of operations, and release myriad benefits. Project management has the sole and dedicated purpose of enabling the effective progressing of tasks towards specific objectives that are aligned to a clear schedule. It also includes the ability to plan, change, test and report along the way. Such visibility of actual operational activities is a pipedream for many companies.

Companies which embrace project management alongside their other visibility mechanisms can add a level of visibility that will enable better resource planning and utilisation and deliver smarter decisions. They can help to assure success of change initiatives and the delivery of effective internal services, such as IT support, and create more predictability in their business. Businesses that do not embrace project management could be choosing a path with a higher level of ongoing uncertainty with associated risks and practical challenges that will hinder them meeting business priorities.

Organisations today face a chasm between what they should be

doing — aligning projects to their strategy— and what they are able to accomplish. As a result, 44 percent of strategic initiatives

are unsuccessful. PM Institute

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We often think of projects as anything that has a defined start date, end date, and a job to complete in the middle. That definition is fine ‒ as far as it goes. Some industries are naturally and obviously project-based. Sectors such as construction and engineering are industrial in nature, with a defined programme of activity that delivers a clear end output in the form of items such as buildings and bridges. Large manufacturing, especially of something like shipping or machinery, has a clear physical output around which activities cluster and a timeline exists. Some management projects, such as a major IT transformation, are clearly project-like in nature with milestones and specialist resources to allocate.

However, many business activities which appear only to have process or service attributes still share many elements in common with projects, for example: Planning requirements Goals to achieve Deadlines to meet People to organise Scarce or special resources to source Tasks to schedule Value to prove

Senior executive owners to keep informed

Multiple workflows to balance

2. PROJECTS: UNDERSTANDING THE RELEVANCE

While many companies formally designate projects, and apply project management tools and

techniques in pockets, they are often immature or incomplete in their application of this expertise. Project management is a skill which is increasingly in demand for good reason yet many companies fail to invest either in this expertise or the tools to back them up.

Just 6% of organisations have project management software at the C-level1, with varying penetration at different levels. There is a clear project

management maturity scale which outlines how businesses can progressively embrace project management, increasing their management rigour in specific areas while reducing complexity and dissimilarities of approach across the organisation. In this way they can move from informal, inefficient planning and project management towards something which starts to establish enterprise-wide standards and platforms.

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3. IMPLICATIONS OF IGNORING PROJECT ATTRIBUTES

Although organisations often detail their goals and

aims to a detailed degree, this is often not followed up by rigorous enough planning to guarantee their achievement. Companies and teams alike often only find out that they are going to miss a mark or a deadline when they get perilously close to it. Sometimes panic may ensue, blame can be thrown and heads may roll as debates about insufficient resourcing or unrealistic deadlines take place– yet such a scenario is entirely avoidable with good planning. All aspects of business require proper planning to some degree. Failure to recognise the above project-like nature of many business activities leads to a deficit of such planning in which:

Activities are not linked to essential timelines or milestones

Deadlines are set without testing their achievability

Constraints are not fully considered or integrated into the plan

Planning activities and resourcing activities are not connected

Progress is never clearly detailed and visible There is no model for exploring the impact of predictable or unpredictable change

Alternatives for achieving the aims are not planned and compared to identify the most effective and efficient route to goal

Knock-on effect of assumptions

The knock-on effect of not managing planning in project terms can be particularly significant when it comes to a team taking on a workload based only on assumptions of capacity, rather than real information, and on assumptions of what it will take to get that job done. Throughout the financial year, organisational priorities shift and new demands emerge. New trends occur in the organisation’s environment which creates the need for new, unforeseen initiatives and responses. This generates a flow of requests around the organisation, and the need for people and resources to be moved around, with the consequent move away from their originally planned work. Unfortunately, such things are often handled relatively informally: “Can your team pick up the xyz order please,” or “Can Bob help us out on XYZ,” will often elicit a response that is based

on a manager’s gut feel about whether it is achievable, rather than a response based on real facts about capacity, workload plans and

implications. As a result, the impact on existing workloads is simply not known, and the impact of the move around of resources is unquantified. Decisions can have unforeseen consequences – yet, with the right tools in place, the knock-on effects would have been easy to see.

Setting clear goals and priorities can also be an issue, because they form the benchmark against which change can then be measured. This is something which is well understood in the project management community, as it pertains to managing workload, but less so in general business. “If there is a failure to clarify project priorities then it’s likely that the organisation will take on too many projects at one time, resulting in team members having more work to do than is possible in one day. This is because board level management often delegates the allocation of resources to resource managers or project managers2 .

Impacts & Implications

Resource inefficiency arising from either over- or under-capacity

Delayed income impacting cash-flow Late delivery penalties

Compliance issues

Loss of repeat client business

2http://www.projectinsight.net/white-papers/four-common-reasons-why-projects-fail

Asta Powerproject gives us a single repository of information providing an overview of current and future

workload, giving us clear visibility of utilisation. It provides the data that we can interpret and analyse to benefit the business

goals, allowing us to remain a lean and efficient operation.

Peter Jones, Canon Europe

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IT Services:

Balances scarce resources against varying demands

Requires a team with non-homogeneous skills

Skills continually re-allocated across work-streams

Deadlines and user service standards to meet

Manages project ‘packets’ of varying scale Critical enabler of all other workflows across the organisation

Has internal organisational ‘SLA’, KPIs and targets

To successfully implement organisational strategy, companies need project and programme managers

with the skills to drive and navigate change, while ensuring that those changes are strategically aligned to

business goals. PM Institute

Danger of inadequate tools

Difficulty in juggling and assigning resources based on what is available is often evident in core internal services, such as IT. These are, despite sophisticated helpdesk systems, designed to manage requests and help tickets, often left chasing their tails and constantly feeling under-resourced. This is because the solutions that support workers are not designed to help them manage the other activities they undertake which have different attributes. Such departments often have multiple types of activity, some of which display very clear project attributes. A programme of software or system upgrades is an obvious example, but it can scale right up to the

management of a major strategic transformation project. Although the flow of user requests, the flow of essential maintenance tasks, as well as these larger items could all be regarded as projects of differing scales, many juggle such tasks on inadequate tools such as spreadsheets.

Driving effective change

Change programmes are also common ‘project’ activities, especially at a time when many organisations are seeking transformation goals (which could be anything from a transition to social business to an expansion programme). These are more often managed like projects, but usually without real project management rigour. Yet driving effective change is not easy – and nearly half of change initiatives are estimated to fail3.

Organisations often undertake change initiatives which are projects and manage them informally, without project management thinking, expertise, or tools (aside, perhaps, from spreadsheets which are not designed for the task). These might include:

New product/service development Restructuring Moving Facility upgrades Expanding Process change Marketing campaigns

3PMI Pulse report: Enabling organisational change

http://www.pmi.org/~/media/PDF/Knowledge%20Center/UK/organizational-change-management-uk.ashx

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It’s important to use resources wisely; people have to be spread around.

Fortunately Asta’s software makes this a painless task… we can see exactly

which individual resources are over or under-usedand it helps us realign

resource where it is most needed. Stalis Ltd

The reality of workloads

Without the rigour of project management techniques and approaches, organisations will continue to have only partial visibility of what they are doing, and make decisions based on that. Blinkered views are dangerous, and finding out where project management fits in is vital. Without it, there is an absolute inevitability of ineffective planning, missed deadlines, disappointed customers and inflated resource costs. At a departmental or service level, there will always be some resources working in less than optimal ways, and some activities will not stay on track no matter how hard you try. Much of this will be down to people taking on more work than can be handled in reality – because there is no way to see what that reality is.

Changing perceptions of visibility

Is this only another wave of information, adding to the extra insight and intelligence that other business systems are now able to deliver? There are misconceptions about visibility too. Too much can be construed as information overload, especially if there is information flowing about multiple work-streams. We would argue that, if such insight enables better collaboration, better and safer decisions, then it can only be beneficial and should be considered business critical intelligence. Information about, and decisions about, the allocation of resources against important activities, cannot be hidden away in silos or stay as

Using Asta Powerproject meant that our planners could work on

the project in unison, regardless of their location, have the same visibility

across the programme and get

an accurate view of updates and progressto all areas.

BAM

the preserve of the expert manager who is deemed capable of making a good gut-reaction decision. It can only aid in the alignment of activities, more effective use and sharing of resources, and thus reduce the risk of making changes and adjustments.

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4. BENEFITS OF VISIBILITY

To embrace the potential of this thinking as a management tool, it is important to recognise that the visibility of progress of any initiative is the key to effectively managing everything about it. Since it is common practice for individual resources to be split across multiple priorities, it also helps to manage that too. Project management thinking can help you to answer critical questions that depend on the dynamic between resourcing and activities, and how these relate to commitments. For example:

Are we using the resources available to us effectively?

Can we, based on the commitments we have and are likely to have, predict and project the resourcing we need in future?

Is a particular initiative fully resourced or are there gaps?

If we draw in additional resourcing from other activities, what is the impact on those? Do we have the resources to meet our commitments?

How will we respond to requests to fulfil additional demands or requests and what would be the impact on our existing commitments? Are we able to predict with assurance when we can deliver on our commitments?

To what degree can we assure that we can meet particular deadlines – are they achievable, given the time-frame we have been set and the resources we have?

Better information creates better

decisions

For managers, this enables them to make better decisions. These are made from a position of knowledge not only about resources, but also about whether they can safely accept and deliver new commitments without upsetting current workloads, or sign up to timeline demands. They can see, plan and manage all their resources and people in relation to the work-streams for which they are responsible to a much higher degree of accuracy and with far greater confidence.

This directly impacts the likelihood that they will be able to manage activities successfully and meet the objectives that are set. According to a Faulk, Netterwaite, Brand study, project managers can increase the likelihood of project success by 48% when relevant and current information is regularly available.4 Having information readily to hand from a platform that is designed to hold, manage and report out of that information is a huge advantage. Locking down more accurate and robust plans for resources and activities against a specific timeframe for delivery also then enables tracking and measurement – not only in terms of progress towards specific goals for a piece of work, but against the KPIs that may span across all the activities of a line of business or organisation. When applied across the enterprise, as opposed to only in pockets, project management

methodologies can deliver enormous value from increased visibility. Different operations across the business can therefore be managed in better alignment with, and with a clear measurement of progress against, strategic objectives that are unconstrained by silos.

ISS [Information System Services] needed to be able to deliver new services in response to ever-changing requirements, but with most of our available resource already

tied up we needed a way of understanding exactly where priorities were most needed. Employing capacity

management techniques to

understand future demand and our capability to deliverwas important to enable decisions to be made based on

reliable evidence. We also needed a way of understanding the demands

on teams and individuals. Jonathan Day, Lancaster University

4http://www.ims-web.com/blog/bid/327071/Leveraging-the-Power-of-Visibility-in-Project-Management

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Board level benefits

Project management-based thinking can introduce rigour into planning which directly helps the board to carry out its function. It can underpin and inform the kinds of statements and assurances which many organisations must make to owners, shareholders, the stock market and the press. Stock markets and stakeholders value assurance and predictability above all, placing increasing value on intangible assets such as delighting customers and managing resources well (Deloitte/OpenMatters research 2014 estimates 80% of corporate value now not in the

tangible/hard assets but in the intangibles5). Making confident statements about delivery against strategic goals or the delivery of specific initiatives therefore can have a material effect on company value.

Risk recognition, management and mitigation is no less vital to an organisation’s reputation than it is to ensure smooth running of a specific line of

business or team. Unexpected cost over-runs, or damage to customer relationships from late delivery are just some of the pitfalls that need to be avoided at all costs. Unfortunately, often the board is unable to see in good time whether the company can deliver on its promises. More often than not this is because reports are divorced from reality about progress or upcoming pinch-points. A 2011 study by Pence & Wright shows that when a project provides clear communication and visibility,

common errors that cost time and money decrease by 34%6.

Project management, strategically applied at an organisational level, enables the C-suite to see how major initiatives or customer projects are being delivered and whether things are on track. This means they are equipped to take corrective action early if there is concern. They can then reprioritise accordingly because they are also able to make the macro-level resourcing and strategic decisions from a position of knowledge, rather than instinct and guesswork.

To make this work there must be C-level recognition and understanding of how critical project-based thinking and analysis is for enabling organisational processes and operations, as well as real and active engagement to sponsor key initiatives7.

Our main issue really

always was, and still is, conflict of resources. For example, you need someone to do a particular task on a project, like testing, but

that person with those skills is busy doing another job testing something else, usually the result of an overrun on another project.

What Asta Powerproject gives us is full visibility of resources and tasks across multiple projects. With Asta Powerproject we

can see what each resource has coming up, what they are working on now and next and

highlights conflicts, so we can give an accurate time of when that testing can be carried out; this just doesn’t happen with

something like MS Project. Robert Douglass Denbighshire County Council

Project Management

Institute (PMI) research shows that having

actively engaged executive sponsors is the top driver of project success. Yet this research also shows that fewer than

two-thirds of projects and programs have assigned executive sponsors, suggesting that organisations are not fully recognising

the importance of the role. PM Institute

5 http://www.openmatters.com/2014/08/cfos-embrace-digital-put-companys-future-risk/

6http://www.ims-web.com/blog/bid/327071/Leveraging-the-Power-of-Visibility-in-Project-Management 7PMI Pulse of the Profession In-Depth Report: Executive Sponsorship Engagement (October 2014)

http://www.pmi.org/~/media/PDF/Knowledge%20Center/PMI-Pulse-Executive-Sponsor-Engagement.ashx

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The demand for project management skills is on the rise as companies realise how critical they can be to corporate success. There is already an emerging talent gap which is likely to widen as demand increases8. With this in mind companies should develop strategies to ensure that more existing managers can learn core project management skills, if they are to work effectively in the future. At the most senior levels, understanding about and engagement in key initiatives must increase. This will ensure companies can grow and manage organisational change effectively, as well as unlock the vast efficiency benefits that can be released by applying project management-based thinking to a broader range of activities. Leaders can then plan strategic change not only with defined goals but real and quantified assurance that they will achieve them – with the entire company aligned behind them.

Many companies have a good foundation on which to build. Project management skills, approaches and professional tools may be in place in a few areas already. Assessing the organisation against a maturity scale will reveal many areas for

improvement, and help them to assess the level and type of investment in skills and tools that may

5. CONCLUSION

be required in order to make the right selection of a solution for the future enterprise. The reality is that managers cannot effectively manage many of their work-streams armed only with spreadsheets and ad hoc personal systems. Professional project

management platforms are required to assure consistency, effective and shared use of resources and unlock visibility through fit-for-purpose communications. Used appropriately they can introduce disciplines, commonalities and models that help ensure that the whole company is working on activities that the organisation wants and needs but can ultimately maintain.

Properly applied project management thinking, supported by enterprise-wide consistency of approach, not only helps managers plan better but, by delivering the ability to see and drill into every area, enables executive management to plan and predict their future with confidence. It also makes visible aspects of operations which are currently invisible. It really is possible to see the future, and to use PM-driven insights to gain a greater control over key resourcing and progress aspects of the business. In that way, companies can become more confident, and assured, in reaching their goals.

8PMI Skills Gap Report 2013 http://www.pmi.org/~/media/PDF/Business-Solutions/PMIProjectManagementSkillsGapReport.ashx

It really is possible to see the future, and to use PM-driven insights to gain a greater control over key

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ASTA DEVELOPMENT PLC Kingston House Goodsons Mews Wellington Street Thame Oxfordshire OX9 3BX United Kingdom E: enquiries@astadev.com T: +44 (0)1844 261700 F: +44 (0)1844 261314

www.astadev.com

including: Construction, Technology Organisations, Civil Engineering, Software Developers, Public Sector, Engineering, Manufacturing, Oil & Gas, Financial Services, Consultancy Firms and Tertiary Education. The software is suitable for use by anyone involved in the delivery of either a project or ongoing activities which depend on balancing activities, resources and timelines.

which brings 4D planning within affordable reach by combining 3D planning and scheduling in one application. Asta Development constantly updates the software according to user feedback in order to provide a solution fit for today’s and tomorrow’s industries.

Asta Development is a leading international developer of project, portfolio and resource management software which provides solutions for managing any size and any type of project. Asta Development is a part of ELECO plc, a holding company focused on software development and services for architectural, engineering and construction industries. The company is listed on the London Stock Exchange's Alternative Investment Market (AIM). More information about Asta Development and its products can be found at www.astadev.com and information about ELECO plc can be found at www.eleco.com

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