Presenter: Richard C. de Lima, B.Tech, M.ES, PMP

1. CLOSING THE GAP CONNECTING THE LINKS The Role of Project Management Methodology in Strategic Management Presenter: Richard C. de Lima, B.Tech, M.ES, PMP Project Management Institute Southern Caribbean Chapter 6th Biennial International Project Management Conference ‘BRIDGING THE GAP: Strategic Thought Transformed through Project Management’ Hyatt Regency Trinidad, September 21-22‏, 2011

2. INTRODUCTION LINKING THINKING, PLANNING AND DOING For Sustainable Organizational Performance and Competitiveness

3. INTRODUCTION “PROJECT MANAGEMENT IS THE OPTIMUM MECHANISM FOR TRANSFORMING STRATEGIC PLANS INTO CONCRETE ACTIONS AND TANGIBLE OUTCOMES “ THE PMBOK GUIDE 4TH EDITION

4. INTRODUCTION • PRESENTATION OUTLINE • THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • THE GAP • STRATEGIC MANAGEMENT - HOLISTIC APPROACH AND INTEGRATED SYSTEM • METHODOLOGY: KEY DRIVER OF SUCCESS • SELECTION • OTHER DRIVERS OF SUCCESS • CONCLUSIONS

5. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY

6. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH STRATEGIC PLANNING • COMMITMENT • CLIMATE • ORGANIZATIONAL POLITICS • RESISTANCE TO CHANGE • BAD PRACTICES

7. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH STRATEGIC PLANNING • "DISCONNECT" BETWEEN STRATEGIC PLANNING EFFORTS AND ANY REAL WORLD ACTION • SEEN AS A SEPARATE ACTIVITY FROM MANAGEMENT’S PRIME RESPONSIBILITIES AND DUTIES • WEAK PLANNING ASSUMPTIONS – e.g. PREDICTION OF FUTURE DEVELOPMENT • FORMALIZATION FOCUS – NEGATIVE IMPACT ON CREATIVITY AND LATERAL THINKING • MOST PLANNING MODELS DO NOT CONSIDER THE IRRATIONAL BEHAVIOUR OF EMPLOYEES, GROUPS AND ORGANIZATIONS.

8. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH PROJECT MANAGEMENT • “OVERDUE AND OVER BUDGET, OVER AND OVER AGAIN – • COMPANIES ARE INCREASINGLY KEEN ON PROJECTS. • WHY, WHEN SO MANY FAIL?” • The Economist, Jun 9th, 2005

9. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH PROJECT MANAGEMENT • PROJECT MANAGEMENT IS NOT A NEW SCIENCE - SIGNIFICANT EVOLUTION OF PRACTICE OVER THE LAST SEVERAL DECADES • THE PMI - ESTABLISHED INTERNATIONAL PROFESSIONAL ASSOCIATION, • - SOME 550,000 MEMBERS IN 185 COUNTRIES, • - ALL SPECIALISTS IN MANAGING PROJECTS • PMI‘s STANDARDS AND PROFESSIONAL CERTIFICATION EXAMS TAKEN BY THOUSANDS EVERY YEAR • WIDESPREAD UNDERSTANDING OF PROJECT CONCEPTS, METHODS AND TECHNIQUES AROUND THE WORLD VIA THE PMBOK • “Why do so many projects still go so wrong?”

10. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH PROJECT MANAGEMENT • PROJECTS, SAYS THE PMI, HAVE FIVE DISTINCT PHASES: • INITIATION • PLANNING • EXECUTION • CONTROL • CLOSURE • PROBLEMS ARISE MOST FREQUENTLY WHEN … • INITIATION GETS SEPARATED FROM EXECUTION

11. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • FAILURE WITH PROJECT MANAGEMENT • OTHER SPECIFIC PROBLEMS: • Trying to Manage Every Project the Same Way • Project can’t begin on time • Vague requirements • Poor Stakeholder Management • Communication breakdowns • Staff gaps • Fear about not sticking to the tried-and-true • Lack of Strategic Alignment

12. THE PROBLEM: THE FAILURE TO IMPLEMENT SUCCESSFULLY • CONCLUSIONS ON FAILURE: • WHEN … • INITIATION GETS SEPARATED FROM EXECUTION; • THERE IS A LACK OF STRATEGIC ALIGNMENT; • PROJECTS ARE NOT IN CONFORMANCE WITH STRATEGY… • …THERE IS A GAP!

13. THE GAP

14. THE GAP • DESPITE: • THE CONSIDERABLE BODIES OF KNOWLEDGE BUILT UP OVER DECADES OF DEVELOPMENT; • THE TECHNOLOGY ASSETS MADE AVAILABLE FOR IMPROVING EFFECTIVENESS AND PRODUCTIVITY; AND • THE EXPERTISE ACQUIRED AND DEPLOYED IN INDIVIDUALS AND TEAMS • PROBLEMS AND CHALLENGES REMAIN IN LINKING THE OUTCOMES OF STRATEGIC ASSESSMENT, STRATEGY FORMULATION AND STRATEGY IMPLEMENTATION • THERE IS A GAP!

15. THE GAP • THERE IS A GAP: • Between strategy formulation and strategy implementation; • Between strategic planning and project management; • Between methodologies and processes; and • Between organizations, disciplines and people • SO IMPLEMENTATION OF VISION FALLS SHORT

16. THE GAP “It is not uncommon to find situations in different companies where projects are being implemented without a consistent and direct relationship with the company’s strategies.” “Closing the Strategic Vision/Implementation Gap” Donald E. White and John R. Patton

17. THE GAP • MISSING LINKS CAUSE THE GAP TO EXIST. THEY: • Slow down implementation; • Often cause excellent strategic direction to become dysfunctional; and • Include: • A focus on Strategic Implementation; • A Common Top-Down Understanding; • An Organization Focal Point; • Alignment Across Functions; • Executive Transition Mitigators; and • Feedback Loops

18. THE GAP CLOSING THE GAP IS ESSENTIAL TO ATTAIN AND SUSTAIN COMPETITIVE ADVANTAGE THE ISSUE OF ALIGNMENT IS CRUCIAL GIVEN THE IMPACT OF RAPID ENVIRONMENTAL AND TECHNOLOGICAL AND BUSINESS CHANGE ON THE COMPETITIVENESS, EVEN THE SURVIVAL OF FIRMS. Source: “Aligning Strategic Planning with Project Management”, Joan Knutson

19. STRATEGIC MANAGEMENT HOLISTIC APPROACH AND INTEGRATED PROCESS

20. STRATEGIC MANAGEMENT • What is the appropriate “management response” to closing the GAP? • What are the essential requirements for improving organizational performance and a consistently higher level of business success? • Can we draw answers from the respective bodies of knowledge of the disciplines involved? • Thinking, Planning & Implementing

21. STRATEGIC MANAGEMENT "Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat" Sun Tsu - Chinese Military Strategist THE ANSWER TO CLOSING THE GAP BETWEEN THE THREE PRINCIPAL PROCESSES IS A HOLISTIC APPROACH WITH AN INTEGRATED SYSTEM STRATEGIC MANAGEMENT – LINKING THINKING, PLANNING AND IMPLEMENTING

22. STRATEGIC MANAGEMENT • “Strategic management is the art and science of formulating, implementing and evaluating cross-functional decisions that will enable an organization to achieve its objectives. • It is the process of specifying the organization's objectives, developing policies and plans to achieve these objectives, and allocating resources to implement the policies and plans to achieve the organization's objectives.” • Source: http://wiki.answers.com/Q/What_are_strategic_management_processes

23. STRATEGIC MANAGEMENT “Strategic management combines the activities of the various functional areas of a business to achieve organizational objectives. It is the highest level of managerial activity, usually formulated by the BOD and performed by the organization's CEO and executive team. Strategic management provides overall direction to the enterprise.” Source: http://wiki.answers.com/Q/What_are_strategic_management_processes

24. STRATEGIC MANAGEMENT “An Integrated Management System is a single integrated system used by an organization to manage the totality of its processes, in order to meet the organization's objectives and equitably satisfy the stakeholders.” Source: CQI IMSIG – IMS Definition and Structuring Guidance – Issue 1 – 12 June 2007,

25. STRATEGIC MANAGEMENT THE STRATEGIC MANAGEMENT PROCESS (SMP) FOUR COMPONENTS OF THE SMP Source: http://www.managementstudyguide.com/strategic-management-process.htm

26. STRATEGIC MANAGEMENT STRATEGIC THINKING & PLANNING MODEL OF THE STRATEGIC THINKING & PLANNING PROCESSES

27. STRATEGIC MANAGEMENT • 6-Step • Classic Vision-Based • Strategic Planning Model

28. STRATEGIC MANAGEMENT Waterfall Model Strategic Planning Process

29. STRATEGIC MANAGEMENT THE PMI'S PMBOK 5-Step Project Management Process

30. THE GAP “…all projects should support the organization’s strategic goals. The strategic plan of the performing organization should be considered as a factor when making project selection decisions and prioritization.” Source: PMBOK Guide 4th Edition, 2008, PMI, Page 75

31. THE GAP “Projects, within programs or portfolios, are a means of achieving organizational goals and objectives, often in the context of a strategic plan. Although a group of projects within a program can have discrete benefits, they can also contribute to the benefits of the program, to the objectives of the portfolio, and to the strategic plan of the organization.” Source: PMBOK Guide 4th Edition, 2008, PMI, Page 10

32. STRATEGIC MANAGEMENT IDENTIFIED PROJECTS CORPORATE STRATEGIES PROJECT IDENTIFICATION STRATEGIC THINKING DEFINING THE COMPANY OF THE FUTURE TURNING IDEAS INTO REALITY • STRATEGIC PLANNING • PROJECT MANAGEMENT CONNECTING STRATEGIC PLANNING AND PROJECT MANAGEMENT Source: A Tide of Change in Processes of Enterprise Strategic Thinking: The Role of Project Management, Lucio Jose Diniz, LD & M ConsultoresAssociados,

33. METHODOLOGY: KEY DRIVER OF SUCCESS

34. METHODOLOGY • DEFINITION • The American Merriam-Webster Dictionary gives as its first definition of “methodology”: • “…a series of related methods or techniques.” • The Oxford English Dictionary defines it only as: • “…the study of methods.” • The Business Dictionary defines more expansively as: • “A system of broad principles or rules from which specific methods or procedures may be derived to interpret or solve different problems within the scope of a particular discipline. • Unlike an algorithm, a methodology is not a formula, but a set of practices.”

35. METHODOLOGY • DESCRIPTION • Is a set of practices widely used across an industry or scientific discipline; the techniques used in a particular research study, or the techniques used to accomplish a particular project. • Provides clearly outlined directions and procedures that tend to increase consistency, and to create work which can be repeated elsewhere. • Used in scientific research is always described, so that others can replicate the research themselves or identify errors in the methods used which may have created skewed results.

36. METHODOLOGY STRATEGIC MANAGEMENT METHODOLOGY “The strategic management methodology is the method for embedding a strategic management competency in a particular organization. The objective is a transformation brought about through a transformation process. The three stages of the methodology are: • Diagnose aspirations - define the ""end"", the next step on the journey • Stage experiences - to bring about the transformation • Follow-through - to sustain the transformation The strategic management methodology simultaneously develops an organization's strategic management process and its competency.” Source: http://createadvantage.com/glossary/strategic-management-methodology

37. METHODOLOGY STRATEGIC MANAGEMENT METHODOLOGY “Strategy Management connects goals, initiatives, and metrics, the three cornerstones necessary to help drive effective execution. Ninety percent of all organizations are unable to execute on their strategy. Unlike these organizations, businesses with alignment will show a better performance, increased productivity, and greater employee, constituent, and customer satisfaction.” SAP Business Objects Strategy Management

38. METHODOLOGY • PROJECT MANAGEMENT METHODOLOGY • “…a strictly defined combination of logically related methods and step-by-step techniques. • a scientifically-proven, systematic and disciplined approach to project development and implementation. “ • Supports control of the entire project management process. • Describes every step in depth, so that a project manager will know what he or she will need to do. • Source: http://www.mymanagementguide.com/project-management-basics/project-methodology-definition

39. METHODOLOGY

40. METHODOLOGY Source: http://www.bachelorcontrols.com/capabilities/methodology.asp

41. METHODOLOGY The Project Life Cycle Source: Chris Everett - Project Management Consultant, email: projects@spottydog.u.net.com

42. METHODOLOGY • THE NEED FOR PM METHODOLOGY • TO PROVIDE VISIBILITY AND ACCOUNTABILITY TO THE PROJECT MANAGEMENT PROCESS • TO ENSURE THAT EVERY PROJECT IS MANAGED IN THE SAME MANNER • TO DRIVE CONSISTENCY AND REGIMEN INTO THE PROCESS • TO DRIVE QUALITY INTO THE MANAGEMENT FROM REPEATABILITY OF THE MANAGEMENT PROCESS • TO PLACE RELIANCE ON THE SYSTEM AND NOT SPECIFICALLY ON THE ABILITIES OF THE PERSONNEL INVOLVED • Source: Achieving Strategic Objectives through Programme and Project Methodologies • Kenn Dolan, Director, FPMS

43. METHODOLOGY THE NEED FOR PM METHODOLOGY “Creating a workable methodology for project management is no easy task. One of the biggest mistakes made is developing a different methodology for each type of project. Another is failing to integrate the project management methodology and project management tools into a single process if possible. When companies develop project management methodologies and tools in tandem, two benefits emerge. First, the work is accomplished with fewer scope changes. Second, the processes are designed to create minimal disturbance to ongoing business operations.” Source: Kerzener, Harold (2006). Project Management Best Practices-Achieving Global Excellence. New Jersey: John Wiley & Sons Inc. P. 135

44. METHODOLOGY • Dr. Harold Kerzner identifies the following characteristics of a world-class project management methodology: • Maximum of six life cycle phases • Life cycle phases overlap • End-of-phase gate reviews (checkpoints) • Integration with other processes • Continuous improvement • Customer oriented • Company-wide acceptance • Use of templates (level 3 work breakdown structure (WBS)) • Critical path scheduling (level 3 WBS) • Simplistic, standard bar chart reporting • Minimisation of paperwork • Format for a project charter • Kerzener, Harold, Project Management Best Practices-Achieving Global Excellence, John Wiley and Sons Inc., 2006, P.144

45. METHODOLOGY • STRATEGIC MANAGEMENT METHODOLOGIES • The Balanced Scorecard • Hoshin Kanri • Managing Successful Programmes (MSP) • Strategic Management by Projects (SMBP) • The Methodology Link Model • Enterprise Project Management (EPM)

46. METHODOLOGY WHAT ARE WE SEEKING TO DO? TO LINK STRATEGIC THINKING, STRATEGIC PLANNING AND STRATEGY IMPLEMENTING

47. SELECTION

48. SELECTION “Developing a link between strategy, planning and project management is not an easy task. It requires the commitment from upper management in terms of concept sponsorship, as well as the dedication and buy-in from project management and the various operational areas of the company.” Philip Diab, The Unbeatable Advantage-A Journey Through Strategy, Planning and Project Management, Proceedings of the 30th Annual Project Management Institute 1999 Seminars & Symposium, Philadelphia, Pennsylvania, USA October 10-16, 1999

49. SELECTION The “one size fits all” approach is not appropriate in adopting a methodology. Methodologies are effective and appropriate only under certain conditions. While it is easy to accept the fact that one methodology cannot fit all projects, it is quite difficult to move beyond this fact and find the right methodology.

50. SELECTION A Methodology to Select the Most Appropriate Methodology Big and Small-M methodology to help differentiate according to characteristics such as staff size and project criticality. Big-M methodology = people, roles, skills, teams, tools, techniques, processes, activities, milestones, work products, standards, quality measures, and team values. Small-M methodologies = a few techniques and drawing notations for a few roles.