For those of you who need a little summary of what WE blogged about in January 2008, here is a month-end sum up of projectmanagement411. There are many excellent comments/points of view on these topics- check THEM out and add to the conversation! (The topics are arranged to be sung, with appropriate breathing- first three words very slow and the rest “rapid fire”):

We… wrote…. about….. living standards, innovation, carbon trading, collaboration…..(breath), strategy mapping, tech trends, role of commitment and preparation…..(breath), social security, business leaders, statesmen, project queues…..(breath), language barriers, PMOs, BI drivers, and swamp draining.

Just click on the topic and see what we discussed- be forewarned, many times it’s not what you think.

Of the topics covered, which ones are of greatest interest to you and why? Let me know.

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Post from: EveryJoe

January 2008 Projectmanagement411 Was Fascinating!

The composition of the spending patterns reveals the trend toward expecting to be paid more:

“…discretionary outlays (such as mobile phones) occupy more of India’s shopping basket, even as the absolute sums devoted to necessities, such as food, continue to rise. Above all, consumers will increase the amounts they spend to improve their economic prospects and quality of life—for better health, education, transport, and communications.”

For those who argue that the relatively “unskilled” jobs aren’t affected:

“This shift has begun at lower income levels than it did elsewhere, so multinationals that compete in the country must keep costs low enough to avoid being squeezed between the desire of so many Indians for a middle-class lifestyle and the realities of their limited budgets.”

What business processes has your company outsourced? How is the change in India’s living standard expectations affecting your company?

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Post from: EveryJoe

“Better Life” Desires in India Will Affect Projects

Innovation. Seemingly a magical, creative art where ideas pop into the mind of relaxed and receiving brain cells (the hilarious “ideation” commercials come to mind where an incredulous manager says, “What are you doing?”, and the existential group leader responds, “Ideating”). Actually, there are NOT many NEW ideas and the “innovation” comes with successful market penetration, as it applies to new products, and with successful implementation, as it applies to new business processes. I tend to focus on innovative business processes.

Once more an innovation article failed to mention business process innovation. Times OnLine, a British publication, treated the subject with unusual intuitiveness however: they dealt with innovation itself as a standardized process quoting Harry Davis, professor of creative management at the University of Chicago Graduate School of Business:

“I help MBAs to use innovation tools in a meaningful way; provide opportunities for students to experience what the innovation process feels like; create a culture and environment where there is minimal fear of expression, that allows creativity and innovation to flourish.”

I commented:

“As with most “innovation” pieces you forget the value of innovation of business processes. I enjoyed the discussion of innovation as a standardized process. For example, the best PMOs are causing business process innovation by being researchers of innovations outside their company and industry. It could be argued that this is not innovation, but it certainly is from the company’s point of view. My blog www.projectmanagement411.com deals with innovation and executing strategies through projects. We have regular discussions on innovation as it applies to business processes.”

My point was to simply emphasize that most “innovation” is really applying ideas already applied in a different setting. Therefore, “innovation” CAN be researched and further standardized through an organization like a PMO.

How do you view innovation? Is it product based and/or business process based? Which type, product or process, tends to be more valuable to a company? Why? Share your examples!

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Post from: EveryJoe

Innovation: Product or Process?

With global warming firmly pointed at the US wealth generating industrial machine, federal schemes for regulating carbon producing industries and an emerging carbon trading system impact all companies. CFO magazine lays out the pros and cons of all of this in it’s article on “Carbon Trading“. The message is clearly to be aware and start understanding this area or be left behind having to purchase expensive carbon offsets combined with costly carbon-reducing improvements.

The mind-numbing uncertainty of this area, combined with a need for action, is leaving many confused. On one hand CFO says:

“When federal legislation hits, the clutch of credits could be turned into a source of windfall profits”

…but on the other….

“The potential for purchasing worthless credits explains why a few finance chiefs are already getting into the carbon issue.”

This seems to be driven by potential federal action within the next three years. “Carbon legislation” will probably place carbon restrictions on corporations- whether or not certain carbon credits or offsets will be included is not clear. The potential for profit is already driving some ridiculous activity:

“Stories have already appeared in the Financial Times about manufacturers in India purposely building factories with excessive greenhouse-gas emissions so they can sell the reduction credits.”

This is not going to be simple and promises to involve massive governmental regulation of both manufacturing and financial industries.

Have you experienced the impact of carbon trading and/or carbon emission regulation? What steps are you taking prepare for the inevitable, but now unclear, federal legislation? To what extent is this simply a public relations issue?

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Post from: EveryJoe

Carbon Trading Heats Up with Global Warming

Collaboration reaps many benefits but there are still many frustrations with the process and with the technology. Manufacturing Business Technology magazine reports on a survey of just over 400 (about 1/2 design engineers and 1/2 production/project managers) about collaboration as it relates to design and manufacturing improvements.

Only 20% were “satisfied” with current collaboration efforts citing two key areas of frustration:

1. Slow responses from those to whom communications are sent.

2. Clarity of communication.

90% regularly collaborate with internal to company people with only 30% going outside to customers and suppliers on a regular basis. This surprised the reviewers but seems to make sense given intellectual property concerns. These types of realities also create caution when sending design files to production because of difficulties protecting files from changes and making sure the right version is out there.

In spite of the frustrations there is general agreement that collaboration is improving and that there are many benefits to doing it- key among them being:

1. Reduced design and manufacturing errors.

2. Increased product quality.

All of this seems to point more to the value of standardizing processes and the technology that enables them. In fact the article reveals that engineering and production/project management tend to use different systems and processes. This is an age old “siloing” issue borne out of the “need” to hoard information until it is useful to reveal it. In other words, it is NOT a technology problem, it is a people problem.

Once again, centralizing projects related to multiple departments under the guidance of a PMO-like organization could clearly benefit companies collaboration efforts. Leaving it to IT alone to sort out the mess is not a solution- a channel from projects to tactics to strategies that involves an executive level board fed by a supportive PMO can attack the two key issues of slow response and lack of clarity in communications.

How do you view collaboration? Is it more of a people problem or a technology problem? Have you solved the collaboration issue with an innovative business model? Share it!

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Post from: EveryJoe

Collaboration Update: Engineers and Production

“Companies should devote R&D to new business models just as they do to new products. A new CEO today will need to preside over a changed business model three or four times in his career, but no one really knows how to do it. It’s not taught in business schools, and there is much to learn about how to manage a workforce that is no longer just within the four walls of an organization”.

AMEN!…and AMEN! This quote by Saul Kaplan, executive director of the Rhode Island Economic Development Corporation, from CFO magazine’s “Gaming the System” article, is fascinating because of the dearth of information in the media about innovation of business models. Almost always, innovation refers to products. My last post dealt with how TopCoder uses freelance competition to code software for it’s clients. Kaplan’s quote was raised in the context of applying the “competitive freelance” concept to other services- in this case freelance “C-level” types who have been through a few business cycles and business model changes.

I see it already in my own work. The idea of going from project to project for seasoned people is nothing new. But it is growing largely because more jobs are becoming information based because of technology that enables them. The question that the article raises is how other services, besides software development, can become competition-based, meaning you complete the assignment before knowing if you “win” the project.

I don’t think the kind of consulting provided by former C-level executives could fit the competitive model used by TopCoder. But I do think that business model innovation can be drastically increased by use of an outsourcing model- in fact, I think that the value of business model innovation is far higher than the value of product innovation. The key is unlocking the ability of the company to look outside of itself and it’s industry for the innovations. A PMO-like organization can facilitate this (refer to my “Choosing the Right PMO Vision Series“), and tapping into the multi-business cycle experience in the marketplace can further enhance it.

How do you manage business model innovation? Do you have a PMO and/or outsourced C-level expertise to assist? What is an example of where your company either increased it’s competitiveness through business model innovation or lost out to a competitor’s innovation?

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Post from: EveryJoe

Business Model Innovation is A Key to Surviving in Shaky Economic Climate

Think of a business model where a firm provides services with a global freelance resource base: is it writing? editing? software development? CFO magazine’s article on “Gaming the System” introduces TopCoder, not only as a global freelance software development operation, but one that has participants compete on providing the best code for it’s application work. This is business competition where you have to finish before knowing whether you will be paid or not, because you have to win.

It seems that TopCoder’s success and growth is based on the fact that they were more of a non-business community in the first place where attraction to their “model” was proven out- i.e., coders like to compete and would do it for free. The addition of a monetized-win competitive approach seemed a natural. Also, they actively flesh out their projects with previously built modules and specify “small enough” new modules that they say result in high quality code. They claim that their software development model results in more savings as applications get more complex- interestingly, I didn’t see any client statements to that effect.

CFO asks whether or not this model would work for other types of services that solve organizational problems as economic conditions tighten. More on that in my next post.

What do you think about the quality of work done in an outsourcing, competitive (finish work) environment? Have you seen this business model work in software development? What about other areas?

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Post from: EveryJoe

Innovating Through Competition as the Economy Tightens

Miki- it’s fascinating to observe what “hard times” do to relationships, from marraige to business partnerships. The JIT relationships are often formed based on who is in the power seat vs. “how can we best work together”. The lean culture approach, done properly, focuses on a relationship in order to best communicate issues and challenges between “partners” whether it be two manufacturing depts feeding each other or a supplier providing raw materials to a manufacturer. This approach usually finds innovative approaches to solving problems in “hard times” vs. abusing the power. One of the most telling periods of time was the tech boom, followed by bust, of the late 90s into 2001. Many industries were very excited about setting up industry “marketplaces” where supposedly thankful suppliers were supposed to flock for business. The problem was that those suppliers knew they would be squeezed by most of the customers/companies in that marketplace and avoided it. Most of the promise of marketplaces failed miserably and a lot of money was wasted on projects setting up the technology- basically because of poor relationships.

Do you remember the tech boom and bust? How did it affect your relationships with suppliers? If you maintained a good working relationship with another company through hard times, what made it successful? How did innovation and relationships play a role?

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Post from: EveryJoe

Relationships Matter in Hard Economic Times