Project management key to IT efficiency, says LSE survey – Stephen Pritchard, ComputerWeekly.com, Nov. 17, 2009

A study undertaken by the London School of Economics (LSE) suggests that IT organizations should reduce costs by investing in better project management and the standardization of processes. The study involved CIOs in China, France, Germany, India, Japan, the UK, and the US and was undertaken jointly by Dell and LSE. 50% of the CIOs interviewed felt they could reduce their budgets by more than 5% by improving IT efficiency and reducing waste. Other interesting points revealed by the survey:

• 30% of the CIOs said they couldn’t quantify the value their organizations added to the business
• 1/3 felt that standardization could improve their organization’s effectiveness
• 40% believed that better project management would make technology use more efficient

When the CIOs got down to specifics 25% of them cited the following as areas of improvement:

• Better application integration
• Better IT training
• Better alignment between business objectives and IT objectives

The CIOs would divert the money saved by better project management and standardization to product improvement, customer service, and staff resources. They were not seeking to reduce overall budgets and head counts but wanted to more closely align their projects to organizational objectives. They would like to divert effort from routine IT work and focus it on work more closely aligned with organizational strategic objectives.

Most analysts consider 70%-80% of IT spending to be devoted to day-to-day operations. Improving project management effectiveness and standardizing processes would be effective in reducing the money spent on these day to day operations and free it up to spend on innovative projects which help the business.

"The challenge for businesses is how to spend the money they do have," said Patrick Karrberg, a researcher at the London School of Economics and joint author of the research. "IT waste is something CIOs can do something about, and using that money to invest in innovation was a clear trend from the survey."

"CIOs should stop worrying about the overall size of their budget, and make sure they are delivering efficiencies," said Steve Schuckenbrock, president of large enterprise at Dell. "Taking 30 to 40 per cent out of operating costs is the table stake for getting investment money."

Project managers can help their CIOs to realize the goal of standardization this study captured in two ways: by improving their effectiveness and by standardizing the processes they use to manage IT projects. Both these objectives are furthered by upgrading your project management education. Experienced project managers can investigate certification by the PMI, that globally recognized leader in the area of project manager certification. PMI certifies project managers as Project Management Professionals upon passing their certification exam. They go further by requiring their applicants to acquire 35 hours of project management training before sitting the exam. The PMP course or other PMP exam preparation training that project managers take will teach them the accepted best practices in the project management discipline. These best practices are what the project management processes in your IT organization should be standardized on.

Standardization was simply a means to an end. The end goal is the reduction of money spent on day to day operations to devote to projects more closely aligned with their company’s strategic objectives. Experienced, trained, project managers will be able to help their CIOs succeed in this goal. The business case for your project should state the strategic objective the project will support. This objective should also be stated in the Project Charter so that it becomes the focus of the project. Not all projects can be innovative and enable strategic objectives there are still lots of operational projects that must be done to keep the lights on. You can help your CIO by managing these projects as efficiently as possible, with your focus on doing more with less. You can do this by controlling the projects scope to ensure it is as narrow as possible while still delivering the key deliverables and services. This web site also provides tips on how to manage projects in the recession which will be helpful.