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The Future of Project Management

Events of the last decade have changed the face of project management and as the environment in which projects find themselves in changes; project management will have to change to keep pace. Project managers who are able to accurately forecast demands for change and alter their plans to accommodate them will have an advantage over those who don’t. Before we gaze into the crystal ball, let’s take a look at the influences that have set project management on their current course.

The Great Y2K Scam

Rightly or wrongly, the IT world lost a lot of credibility when everyone turned their calendars forward to the year 2000. There were undoubtedly systems and applications out there that did require modification to accommodate the new millennium but the amount of money spent on Y2K programs could not be justified by the changes that were made. Every IT organization had some sort of Y2K program or other. Those organizations that were not large enough to afford an in-house program engaged consultants.

Every line of code in every application and every data record in every database was reviewed for "compliancy”. This despite the fact that every commercially available system at that time recorded dates with a 4 character year format. Undoubtedly there were some applications and data tables which used a 2 digit field to hold year data. The original reason for using a 2 character field to record this information was the punch card and the cost of memory. 30 or 40 years prior to the year 2000 the extra effort to punch 2 more characters onto a data card and the cost of the extra memory the 4 character field would incur were a consideration. Anyone in the 80’s and 90’s creating new date fields should not have used a 2 character field and anyone upgrading an application or database should have converted the 2 character field to a 4 character field. Those applications and databases which failed to use the 4 character field were few and far between but large, expensive, Y2K programs were spawned nonetheless.

The impact on the public was even more ridiculous. Millions of dollars were spent on stocking up on everything from cashews to cash because of a perception that come January 1, 2000 no cash register or ATM would work. People were so spooked they stocked their cellars with food and water on a scale not seen since the bomb shelters of the cold war.

When corporations found out they had spent all that money on a program which found and corrected a handful of problems they began to ask pointed questions about the ROI of the program. The result was a more cynical approach to Information Technology, programs, and projects in general. This was compounded by the feeling among the general public that they had been bamboozled by technology and had spent all that money on emergency supplies only to become the butt of a giant joke. Project managers found themselves operating in an environment of a lot less trust as a result.

The Recession/Economic Downturn

Although we’re still not quite sure what to call it, everyone recognizes that the economy is in a slump and the money to perform projects is limited. Some very large businesses have failed completely and every business has felt the pinch in some way or another. The result of tighter markets and less revenue is that businesses dropped projects that weren’t mission critical and downsized those that weren’t axed. Projects which could not show an immediate ROI or didn’t solve a critical business problem were non-starters. Surviving projects were forced to do more with less.

Project managers have been placed in an uncomfortable position by these events. The project manager of a project which was canned because it couldn’t satisfy its sponsors of its worth could find themselves looking for new projects elsewhere. The alternative was to stay with the project that didn’t improve the bottom line and ride the project and business into oblivion, then look for a new project elsewhere along with numerous colleagues.

This atmosphere requires project managers to be astute money managers. They don’t necessarily get asked to handle the actual cash but are asked to estimate costs more accurately, report on performance to budget so that sponsors know when limits are exceeded, and deliver projects for less money than they would like. These demands are being met by increased sensitivity on the part of project managers to their organization’s vulnerability and, where project sponsors don’t expect to get their entire wish lists for 50% of the budgets, they also get what they need out of the project for what they can afford to spend. This is a good thing.

The "Greening” of Project Management

There are 2 influences I include in the term "greening”, one is the demand to reduce our carbon footprint and the other is Corporate Social Responsibility (CSR). These 2 environmental elements are by no means mutually exclusive and an effort to reduce the organizations carbon footprint may be a part of a CSR initiative. Reducing the organization’s carbon footprint primarily affects project managers of construction and infrastructure projects. Those projects now have additional objectives that deal with a reduction of energy consumption. Build the building with less fuel consumption and make the building as energy efficient as possible. These objectives may or may not add costs to the project (see The Recession/Economic Downturn).

CSR requires corporations to consult more closely with the communities they do business in and to consider the needs of those communities when planning projects. Reduction of the carbon footprint is a technical issue: for example, how do I organize work so that goods are delivered to the project from the shortest distance possible? CSR can be a much more complex issue. Some CSR issues may be straightforward, such as eliminating child labor in the manufacturing process. Others are much more complex, such as mining in an area where 2 separate and distinct communities are affected, and the two are already at war because of other issues. There is also a temptation to pay lip service to a CSR initiative. Saddle the project manager with CSR goals and objectives but give them no budget or authority to deliver on them. The classic example of this is the situation where the project manager is asked to deliver a project in a society where bribery is socially acceptable and expected but the CSR policy (and possibly domestic laws) prohibits bribery. The poor project manager is given the conflicting goals and told to figure it out.

Project managers must analyze their situations and determine the feasibility of meeting all the goals and objectives of their CSR and carbon footprint reduction policies with the budgets they are given to work with. Project managers who determine that it is impossible to deliver have a dilemma. Project managers who determine delivery is possible must figure out how to deliver. This means being inventive in the approach and, sometimes, translating esoteric policy statements into planned project activities that can be executed by the team.

Going Forward

Project managers will continue to be required to do more with less even after the economy recovers. The disciplines learned during the economic downturn will become standard practices. This is a good thing, especially in the software development area. For too long software development operated like the "wild west” with few of the rules and constraints that the rest of industry took for granted. Project managers should become skilled in Earned Value Management, if they haven’t already done so.

Time is money in the software industry so performance to schedule is very tightly tied to performance to budget. Project managers in the software development business must learn to keep their teams on track and on schedule. This means a more disciplined approach to cost estimation.

Tips:

  1. Establish a knowledge base in your organization and capture the lessons from past projects. Record cost estimates for each software package – the original estimate and the actual. Examine why an estimate was blown, was the original estimate off base or did the developer encounter too many obstacles? Learn from your mistakes to hone the organization’s estimation skills. Look into acquiring a standard estimation methodology such as Function Point Analysis (FPA) by joining an FPUG (Functional Point User Group) and studying the technique.
  1. The users and sponsors of software projects must bear their responsibility for inflating software costs and you can help them do that by helping them fit their demands into a reasonable budget. Get them to prioritize their requirements for new systems. What would the impact to your business be if you could not get this feature? Would it cause a failure or merely an inconvenience? Some functions simply cannot be done without. Look for alternative ways to deliver the function if the first choice proves expensive. Look to jettison the lower priority features from the project if it appears that your project cannot deliver the full list in the existing schedule and budget. Typically you will only proceed to development with the "high” priority requirements in your list. This will require you to further prioritize these requirements against one another so jettisoning lower priorities will not be contentious.

 

Corporations will continue to pursue off-shore or outsourcing as a means of cutting costs. The reason they do this is not to negatively impact the local economy, but to cut costs. Cost cutting is the primary goal here, not off-shoring or outsourcing. It is up to you as the project manager to help your organization achieve their goal.

Tips:

  1. Doing your due diligence as a Procurement Manager will help. The exercise becomes a "buy or make” decision that should be made as directed by the PMBOK®. Frequently the project managers are confronted with a decision to outsource. Don’t be put off by this. If the contract has not already been signed, analyze the situation and recommend alternatives when outsourcing or off-shoring is not cost effective. Be careful to avoid offering non-monetary reasons for not off-shoring work such as the work will be too difficult to manage. Managing the work is what you are hired to do. Valid reasons for not off-shoring or outsourcing are that the work can be done in-house cheaper.
  1. Outsourcing work means that a Statement of Work (SOW) must be written. The way in which this document is written will go a long way in determining the success or failure of the outsourcing. The SOW must be written so that all work is clearly and concisely described and that any constraints required are included. An example of a constraint would be that the project manager for the sub-contractor be PMP® certified.
  1. Off-shoring work has its own unique set of demands. To work successfully, work off-shored must be planned to accommodate differences in time zones and cultures. Be pro-active and learn as much as possible about the culture in the country the work is being done and then plan your communications around any cultural and time zone differences.
  1. Project managing a group of workers in a country half-way around the world with a different clock and culture may add an impossible degree of effort to your work. In some cases it is reasonable to expect the sub-contractor to provide a project manager to oversee the work. You should have input into the choice of that project manager and should stipulate that certification as a PMP® be a criteria they must meet.

The PMI® (Project Management Institute) has made great strides in marketing their brand around the world. Look for that trend to continue. As PMI® becomes bigger their marketing campaign penetrates new markets. At one time they mainly depended on the software industry but now have penetrated the petro-chemical, pharmaceutical, telecommunications, and banking industries. Look for the brand to penetrate the construction industry.

PMI® and their key brand the PMP® certification began in North America but have expanded around the world. Look for expansion to happen in the Asia Pacific area in the next decade as the North American market becomes saturated. This should make it easier on North American project managers demanding a PMP® certified project manager on an off-shore project.

PMI have branched out into more certifications. There first attempt at this was the CAPM which was not particularly successful. CAPM is an intermediary step to the PMP certification. Since then they have also added certification in the areas of program management, risk management, and schedule management. Look for them to expand their certification program into the other knowledge areas such as cost management, scope management, procurement management, quality management, etc.