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2007 International Institute for Learning, Inc.

2007 Dr. Harold Kerzner

Version 1.1

ByDr. Harold Kerzner


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Most of the material in this presentation has been takenfrom two sources; Advanced Project Management: BestPractices on Implementation, 2nd Edition, 2004, andProject Management Best Practices: Achieving GlobalExcellence, 3rd Edition, 2006, both by Harold Kerzner,

John Wiley & Sons Publishers.

2007 by Dr. Harold Kerzner. All rights reserved.Material and slides cannot be copied or transmitted in

any electronic format without written permission ofDr. Harold Kerzner.

Copyright


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Todays View of Project Management

Today we are managing our business byprojects.

Project management has evolved into a

business process rather than a projectmanagement process.

The project management enterprise

methodology contains businessprocesses.

Capturing best practices is a necessity.


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Benefits of Project Management (1 of 6)

Project management

will require more

people and add to the

overhead costs.

Profitability maydecrease.

Project management

allows us to perform

more work in less time

and with less people.

Profitability will

increase.

Present ViewPast View


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Project management

will increase the

amount of scope

changes.

Project management

creates organizational

instability and

increases conflicts.

Project management

will provide better

control of scope

changes.

Project management

makes the organization

more efficient and

effective.



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Project management

is really eye wash

for the customers

benefit.

Project management

will create problems.

Project management

will allow us to work

closer with our

customers.

Project management

provides a means for

problem solving.



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Only large projects

need project

management.

Project management

will increase quality

problems.

All projects will benefit

from project

management.

Project management

improves quality.



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Project management

will create power and

authority problems.

Project management

focuses on

suboptimization by

looking at only the

project.

Project management

will reduce the majority

of the power struggles.

Project management

allows people to make

good company

decisions.



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Supporting Processes for Best Practices

As project management evolved, thereappeared supporting processes aligningthemselves with project management.

Each of these supporting processeshave allowed us to capture additionalbest practices related to both projectmanagement and the supportingprocesses.


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Processes Supporting Project Management

1960-1985 1985 1990

1991-1992 1993 1994

NoAllies

Total

QualityManage-

ment

ConcurrentEngineer-

ing

Empower-

ment andSelf-

directed

Teams

Re-engineering

LifeCycle

Costing

Increasing Support

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1995 1996 1997-

1998 1999 2000

ScopeChange

Control

RiskManagement

Project

Officesand

COEs

Co-LocatedTeams Multi-NationalTeams

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Increasing Support

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2002 2003 2005 2006

Maturity

Models

Strategic

Planning

for Project

Management

IntranetStatus

Reports

CapacityPlanning

Models

Six

Sigma

Project

Mgt.

VirtualProject

Teams

2001 2004

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Increasing Support

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2008 2009 2011 2012

Enter.Project

Mgt.

Knowledge

Librariesfor Project

Management

Internal

Certificationas well as

by PMI

2007 2010

??? ??? ???

13

Microsoft 2007 International Institute for Learning, Inc.


Increasing Support

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Best Practices Questions

DEFINITION VALIDATION

IMPLEMENTATION

PUBLICATION

UTILIZATION

MANAGEMENT

REVALIDATION

DISCOVERY

CLASSIFICATION

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Question #1

What is the

definition of a

best practice in

projectmanagement?

(Past view vs.

present view)

DEFINITION

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Question #2

How do we

discover best

practices? Where

should we lookfirst? Who is

responsible for

the discovery?

DISCOVERY

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Question #3

How do we

validate that

something

actually is a bestpractice? Who

should perform

the validation?

VALIDATION

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Question #4

Are there levels or

categories of best

practices? If so,

who is ultimatelyresponsible for

determining the

levels?

CLASSIFICATION

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Question #5

Who has the

responsibility for

the ultimate

management /administration of

the best practice

once it isidentified?

MANAGEMENT

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Question #6

Who has the

responsibility for

revalidation of

current bestpractices? How is

this accomplished

and how often?

REVALIDATION

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Q i #7


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Question #7

How are best

practices

commonly used by

companies oncethey are validated

and / or

revalidated?

UTILIZATION

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Q i #8


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Question #8

What techniquesare available by

which best

practices can beeffectively

communicated to

the employees

within a company?

PUBLICATION

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Q i #9


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Question #9

How do we get

employees to use

a best practice?

How do wevalidate that it is

used properly?

IMPLEMENTATION

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Evaluation of a Best Practice (1 of 2)

Best Practice Characteristics Yes No

Measurable Metric

Measurable Efficiency

Measurable EffectivenessAdds Value to the Company

Adds Value to Our Customers

Transferability to Other Projects

Has Potential for Longevity

Applicability to Multiple Users

Differentiates Us from Competitors

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Evaluation of a Best Practice (2 of 2)

Best PracticeIdentification

TrainingRequired

GovernanceRequired

ProprietaryKnowledge

1.

2.

3.

4.

5.

6.

7.

8.

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Levels of Best Practices

Three levels of best practice maturityhave been defined with minimumrequirements for an associate best

practice, best practice, and masterybest practice.

(EDS)

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Levels of Best Practices

___________ ___________ ___________ ___________ ___________ ___________

___________ ___________ ___________ ___________ ___________ ___________

Characteristicsor Drivers ofthe Ideal Best

Practice

Wish List

Level 4: > 60%

Note: Each level contains a percentageof the ideal characteristics or drivers.

Level 3: 40 % - 60%Level 2: 20 % - 40%Level 1: 0 % - 20%

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Project Management and Sales (1 of 2)

When asked about his vision forEricsson into the 21st century, RobertShepherd believes that there will be:

a stronger tie to sales where the project

manager supports the sales phase to ensure

successful proposal generation and project

implementation to meet the customers

contractual requirements, which leads to

customer satisfaction.

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Project Management and Sales (2 of 2)

According to Jim Triompo, GroupSenior Vice President at ABB:

Project management is being introduced intoareas that traditionally havent used project

managers. Project management in a sales

organization has proven to be critical and

should be made a central part of the salesprocess.

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Best Practices and the Sales Force

How do we get salespeople to discussbest practices with the clients? (bothinternal and external clients)

The salespeople must know the bestpractice and what value / benefit canbe achieved with it.

The salespeople must make the bestpractice easy for the customer tounderstand.

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Need for a Best Practices Library

Every new project should directly buildon the learning from any similar project

undertaken anywhere else in theworld.

Bill Gates in Business @ the Speed of Thought

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Best Practices Library

Effectiveness andEfficiency

Satisfaction

Future Business

TechnologyAdvances

Project Management

CONTINUOUS IMPROVEMENTS

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Version 1.1

(3)

(32)

(6)

(136)

Computer Associates (Before 2005 Update)

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Growth of Knowledge Management

PM BestPractices

PM BestPractices

Libraries

KnowledgeRepositories

(PM andBusiness

Knowledge)

Integration of BusinessProcesses into the EPMMethodology

TimeQuantity

ofInform

ation

Project KnowledgeBase or TechnologyKnowledge Base(PKB or TKB)

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Growth of Enterprise Project Management

Functional Project Management (Products)

Enterprise Project Management (Solutions)

Extended Enterprise Project Mgt. (Partnerships)

Suppliers Customers

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Engagement Project Management

Engagement project managementdescribes the steps that must beaccomplished to successfully leverageyour project management skills(including best practices) to attract newcustomers and receive follow-on workfrom existing customers.

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What are you selling?

Solutions generated by your EPM system

Sharing of best practices and lessons learned

including Six Sigma expertiseContinuous flow of information from the EPM

system to the customer (perhaps EPM to EPMsystems)

In exchange for this, you want the customerto treat you as a long-term partner, not just acontractor

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Project Focus Project Completion Long-Term

Relationships

Approach Single Sale Follow-On Work

Customer Contact When Required Continuous /Structured

Selling Emphasis Product Features Customer Value

Deliverables Products / Services Solutions

Time Horizon Short-Term Long-Term

Customer Service Low Importance High Importance

Quality Concern Product Quality Solution Quality

Conventional Selling Engagement Selling


Factors



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The Hexagon of Excellence

Behavioral

ExcellenceCulture

InformalProject

Mgmt. Trainingand

Education

ManagementSupport

IntegratedProcesses

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Integrated

Processes

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Integrated Processes for the 21st Century

Project Management

ConcurrentEngineering

Total QualityManagement

And SixSigma

RiskManagement

ChangeManagement

Integrated Processes (Past Present and42


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Integrated Processes (Past, Present, andFuture)

Yrs: 1990-2000

IntegratedProcesses

Project

management

Total qualitymanagement

Concurrentengineering

Scope changemanagement

Risk management

CurrentIntegratedProcesses

Yrs: 2001-2010

Integrated

Processes

Supply chain

management

Business

processes

Feasibility studies

Cost-benefit

analyses (ROI)

Capital budgeting



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Culture

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ManagementSupport

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The Executive Interface

Executive is activelyinvolved in projects

Executive acts as the projectchampion

Executive questions theproject managers decisions

Priority shifting occursfrequently

Executive views projectmanagement as a necessaryevil

Very little projectmanagement support

Executive involvement ispassive

Executive acts as the projectsponsor

Executive trusts the projectmanagers decisions

Priority shifting is avoided(if possible!!)

Executives view projectmanagement as beneficial(for the company)

Visible, ongoing support

MM TUR TY M TUR TY

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The Project-Line Interface

Project manager is vestedwith power/authority overthe line managers

Project manager negotiates

for best peopleProject manager worksdirectly with functionalemployees

Project manager has no

input into employeeperformance evaluations

Project manager-centeredleadership

Project and line managersshare authority and power

Project manager negotiates

for deliverablesProject manager worksthrough line managers

Project manager makes

recommendations to the linemanagers

Team-centered leadership

MM TUR TY M TUR TY

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Trainingand

Education

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Informal

ProjectMgmt.

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BehavioralExcellence

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The Five Levels of Maturity

Feedback

Level 1

Common

Language

Level 2

CommonProcess

Level 3

Singular

Methodology

Level 4

Benchmarking

Level 5Continuous

Improvement

Version 1.1 2007 International Institute for Learning, Inc.



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The Project Office (PO) or the ProjectManagement Office (PMO)

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Governance Issues

Poor alignment between projectobjectives and broader business goals

Poor business case development

resulting in the go-ahead of projectsthat provide limited or no value

Badly specified project outcomes

measured in real business terms

(QA)

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The Project Office (COE) (1 of 6)

An organizationdedicated to

benchmarking forproject management

Organizationalmentorship for

inexperienced projectmanagers

BenefitsBenefits

A strategic planningfocal point for the

project managementprocess

An organizationdedicated to continuous

improvement and costreduction

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Centralized lessons

learned files on

completed projects

A hot line for

problems without

involvement seniormanagement

An organization for

sharing ideas and

experiences

An organization for

creating project

management standards

BenefitsBenefits

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Assist Human Resources

in the creation of a

project managementcurriculum and course

content

Centralized cost controland reporting

BenefitsBenefits

Assist Human Resources

in the creation of a

project managementcareer path ladder or

competency model

Centralized projectplanning and scheduling

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Development of

project management

templates

Assessing risks

Identification of best

practices, internal and

external

Planning for disaster

recovery

BenefitsBenefits

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2007 International Institute for Learning, Inc. 2007 Dr. Harold Kerzner

Version 1.1


Globalization and

training on EPM

Establishing metrics

Customer relations

management

Multilingual tools

especially for

networked PMOs

BenefitsBenefits

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Development of a

corporate capacity

planning model

Stakeholder

management

Maintain project

management

information systems

The guardian of project

management

intellectual property

BenefitsBenefits

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The Project Office (COE)

Companies are now struggling withthe organizational reporting locationfor the Project Office/COE.

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Types of Project Offices

Functional Project Office: ResourceManagement

Corporate Project Office: Strategic and

Operational Issues

Customer Focus Project Office:Customer Management

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Project Office Growth

According to Jim Triompo, Group Senior VicePresident at ABB:

The project office does not deliver projects.

The projects managed by the projectmanagement office are limited to process/

tools development, implementation, and

training. The project management office is

sometimes requested to perform reviews,

participate in division-level risk reviews, and

operational reviews in various countries.

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CEOAmericas

Senior Director

Solution Design

EPM

PMO Mexico PMO Brazil PMO UK/Europe PMO Asia

CEOAmericas

Senior Director

Solution Design

EPM

PMO Mexico PMO Brazil PMO UK / Europe PMO Asia

Exels Networking PMOs

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R l f h PMO i P f li M


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Role of the PMO in Portfolio Management

Planning Recommendations

Are we working on the right projects?

Are we working on enough of the right projects?

Evaluation Recommendations

Are we doing the right projects right?

Are there projects that should be terminated so thatthe resources can be applied elsewhere?

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Ideas are generatedthroughout the entireorganization

Evaluateprojects

Opportunity options

Resource requirements

Refined project costs

Refined savings

Benefits (financial,strategic, payback)

Project metrics

Benefits realization

Risks

Exit strategies

Refined people, process,technology impacts

Schedule / milestones

Complexity

Standard technology?

Business

Case

then evaluated using astandard business case

NON-VALUE ADDEDBUSINESS CASES

non-value added opportunities & projectsare eliminated

Filter

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Cost Savings Due to Software

Typical cost per meeting = $550

As a result of the new software, meetingseliminated per week = 4

Total annual savings = ($550/meeting) x(4 meetings/week) x ( 52 weeks/year) =$114,400 per year.

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Cost Savings Due to Software

Current average number of meetings required perproject schedule approval = 10

Expected average number after organizationbegins using software = 5

Average number of attendees/meeting = 10Average duration of a meeting = 1.25 hours

Fully burdened labor rate = $70/hour

Total annual savings = (204 projects) x(5 meetings/project) x (10 people) x(1.25 hours/meeting) x ($70/hr.) = $892,500

P j t M t S ft


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Project Management Software

INITIATION PLANNING EXECUTION CONTROLLING CLOSURE

95 % of Todays Software

Portfolio management Benefit-cost analyses Feasibility studies Criteria definition Assumptions defined Evaluation criteria Risk management

Portfolio Management Lessons learned Best practices library Failure analyses

Areas of Deficiency

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