Supply and Demand Chain Executive’s

“In the early days of enabled spend analysis, around 2000-2001, segments of PPG believed that the project was a waste of capital and that there were no leveraged savings to be had.”

Polak made inroads into this area where he knew great savings existed by:

1. Forming purchasing teams that included factory and other non-purchasing members to leverage spend analysis beyond commodities.

2. Setting an arbitrary spend reduction target of 10% in 90 days.

The results were not only millions of dollars of spend reductions (up to 32%!) but a culture change that professionalized purchasing within PPG.

As they increased their spend analysis capability they technology enabled it further with a large, now justifiable, software and business process change project.

Another fascinating development is Jim’s personal evolution as a recognized spend analysis expert who uses his skills to reveal opportunities to buyers and managers:

“The message has become, “If Jim has time to look at my commodity and spot opportunities, then certainly I have the time to do the same.”"

Projects related to spend analysis can be high impact but many times lack the management skills required to kick them off. Jim’s experience reveals that value-based team projects driven by short-term targets can result in the justification needed for large scale technology projects.

Have you used the technique of a short-term (less than 90 day) project to prove savings in an area? Did you use it to justify a larger technology enablement project? Do you view Jim’s experience an example of great change management?

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Post from: EveryJoe

Short-Term Value Based Projects Can Justify Larger Technology Projects

My post on the PMO relieving pain prompted a response by ActiveEngine about pain being crucial to gain people’s attention. Pain and uncovering it can be a multi-layered process seemingly without end- i.e., dealing with one problem inevitably leads to having to deal with others which can get discouraging. This is probably because the “swamp is being drained”. Read my response below:

Pain is an interesting phenomenon. One of the analogies used for improvement is “draining the swamp”. When you drain the swamp you start seeing a bunch of ugly rocks. In project management this means getting rid of the projects you don’t need by doing a project inventory and then getting rid of some more by eliminating those that don’t align with strategies. What this does is focuses resources on the remaining projects and the problems they have which now beg to be solved. Same thing when you do a lean manufacturing program and eliminate wasteful processes- the real problems (pain) start to emerge; you are now on the road to solving real problems and root causes, not just symptoms. Back to software development- do you find that excessive documentation can hide problems in the process? I’ve heard that documentation is the “excess inventory” of software development.

Do you have situations where dealing with one problem led to several others? Did you give up on a project because of this? Do you think it was because you were involved in the “draining the swamp” process and simply uncovering more, but better, rocks (problems)? I KNOW you’ve been there! Tell us about it. What you say could make the difference in someone completing or stopping their project.

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Post from: EveryJoe

Projectmanagement411 on Draining the Swamp to Get at Root Causes

Following up on Margaret Rouse’s post on my Choosing the Right PMO Vision Series, today we deal with the mythical queue:

Margaret: You really got me thinking. I think what REALLY blew me away was when you said that 74% of all projects fail — and that the number could be even higher for IT projects. I’m interested in any concrete strategies you can offer for avoiding getting small projects lost in what we used to call the mythical queue.

Bob: The PMO or, for smaller firms, some type of project control function, succeeds with excellent business processes for project visibility, strategy alignment, and prioritization. My guess is that the “mythical” queue is bloated because a project inventory isn’t done regularly and many projects are not aligned with strategies. These two things would decrease the amount of, and increase focus on, projects. Lack of prioritization criteria, and working the priorities as strategies change, contributes to “bad” muti-tasking (stop, restart, relearn). You end up with a mess that allows people to move from project to project without accountability and very bad estimating.

The PMO should be doing the type of support to standardize visibility, strategy alignment, and prioritization processes plus does everything it can to help projects accelerate. All of this is largely “outside” whatever software development process is used, as it should be.

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Do you suffer from the mythical queue? Tell me about it!

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Post from: EveryJoe

Projectmanagement411 Engages: The PMO and The Mythical Project Queue

Margaret Rouse blogs at IT Knowledge Exchange on an amazing variety of topics. Read it and be informed! I find some of the most interesting blog commentors are IT people who engage with me about innovative project management processes- clearly they are making an effort to bring IT and the user together. Her post about my Choosing the Right PMO Vision Series led to a very nice conversation, edited for brevity, and repeated here today and tomorrow:

Margaret: The line that stuck in my head from [your] post was: Usually something painful drives the creation, or reevaluation, of a Project Management Office (PMO). Amen.

Bob: That same pain that drives creation of a PMO can be it’s undoing: PMOs are often eliminated after the pain goes away. The pain also tends to create a PMO that is monitoring/cost based instead of value based- i.e., focusing on the value that can be created by projects vs. merely working to a budget. The value based PMOs tend to spur innovation and have projects aligned with strategies.

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What pain created your PMO? Is the pain gone? How about the PMO? Contribute your thoughts to the conversation!

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Post from: EveryJoe

Projectmanagement411 Engages: The PMO Relieves Pain

Recently a good friend told me that if you are not a man of your word that you can’t make, let alone keep, commitments. The corollary is that if you make a commitment you should keep it or risk degrading your “word”. A simple example is picking up a friend for work. You make the commitment but the night before you decide that you are not going to work the next day. You could justify not picking up your friend. But what would the impact be? What positive things could result from keeping your commitment? Your friend would upgrade their thinking about you and possibly make decisions about how they will react to needs that you might have.

Continuing my commitment to write projectmanagement411.com has required adjustment. I’ve adjusted what I write about, the reasons for continuing writing, and what benefits I personally receive. I look at this experience as a project that must be continued for my benefit as well as others. Keeping this commitment has resulted in learning things I never thought possible and establishing relationships that I would not have otherwise established. The personal reasons for considering breaking my commitment didn’t really matter to my “customers”. What matters is that I made the adjustments and continued.

One of the tough things to deal with in project management is resource allocation. Resources, like yourself, are asked to make commitments to multiple projects. Consider how you make and how you break commitments. Your integrity and word are at stake.

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FREE eBOOK for EMAIL Subscribers!

If you subscribe by email I’ll send you my eBook for free! Here’s how: subscribe by email in the right hand column PLUS send an email post that you receive to bob.turek@b5media.com. (Sorry for the extra step- we don’t have this automated yet.)

To preview the book, or to order a hardcopy, go to my publishing web site by clicking the book cover.

Post from: EveryJoe

Commitment Makes a Better Projectmanagement411

Commitment. It’s a word that creates more questions than answers because of the changes and distractions that follow commitments we make. I started this blog in October 2007 while working for a consulting firm specializing in project management software implementations. My rationale for the commitment was 1) it fit with my current position, 2) I wanted to learn about blogging and it’s potential for marketing and communication, plus 3) I like to write. I left the project management consulting firm soon after and had to make a decision. Do I stop blogging?

Stopping so soon after starting, although justifiable by most people’s standards, was not an option because I felt my word was on the line. I could not be a person of my word if I stopped doing something that quickly. People that I made a commitment to would “understand” but my actions would still result in impacting many and my reputation. So, I decided to continue.

Have you committed to do something that you later could justify not doing? Have you considered the impact of your decision? What will happen to the project you are involved with if you or others decide they can’t continue? Do the reasons have to be understood by all or just you? What happens to your “word” and integrity if you do not fulfill the commitment?

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FREE eBOOK for EMAIL Subscribers!

If you subscribe by email I’ll send you my eBook for free! Here’s how: subscribe by email in the right hand column PLUS send an email post that you receive to bob.turek@b5media.com. (Sorry for the extra step- we don’t have this automated yet.)

To preview the book, or to order a hardcopy, go to my publishing web site by clicking the book cover.

Post from: EveryJoe

Projectmanagement411 Examines Commitment

A great article in Strategy+Business, “A Blueprint for Strategic Leadership”, concentrates on how to lead innovation. In it the authors emphasize that the best leaders pay a great deal of attention to the design of the elements around them. Seemingly basic, but powerful, things to do are:

1. Articulate purpose,
2. Create effective teams,
3. Prioritize and sequence initiatives, and
4. Redesign the organization to make execution easier.

Apart from revealing the importance of doing the right projects, the article is full of fascinating examples of the deployment of these principles by the best executives; two from the experiences of A.G. Lafley, chief executive of Procter and Gamble, stood out:

1. Moved the divisional presidents’ offices nearer their staffs, converting the old executive space into an employee learning center. This is not only practical but sends a message that they are serious about creating an environment for innovation.

2. Plans careers of top 500 people by reviewing assignments, capabilities, and how he can help them grow. This goes beyond periodic performance reviews to showing a genuine interest in how the organization can help develop the careers of people.

You don’t have to be a CEO to pay attention to the design of the elements around you. How can you incorporate the four “things to do” into your management style?

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Post from: EveryJoe

How to Make An Organization Fly

A Booz Allen Hamilton survey and report in Strategy+Business (register for free) found NO correlation existed between R&D spend and innovation. It turns out that higher innovation performers spent less but made sure that innovation projects aligned with corporate strategy and paid careful attention to customers. This idea that a company can spend less and innovate more makes sense. Throwing money at innovation processes that are not well organized and/or measured and not serving the customer doesn’t work.

Black and Decker revealed the two key factors related to their innovation success:

1. Strategy alignment- align innovation strategies to corporate strategy.
2. Customer focus- processes are in place to pay close attention to customers from idea generation to product development to marketing.

Although this article tended to focus on product innovation and R&D spending, Black and Decker’s customer focus reveals that business process innovation is often required to coincide with product changes. One example is a strategy project I worked on for a metals distributor where we segmented the customer base a variety of ways to discover which segments were willing to pay for inventory management services. The change in what was being sold and provided affected sales processes, how inventory was managed, frequency of delivery, and ultimately how raw material and components were purchased. This clearly reveals how market based projects can affect internal business processes.

Excellent project management was a key success factor for these high innovators. The authors revealed the “one R&D tactic” used by all high-growth innovators:

“insistence on managing the innovation process from start to finish as tightly as possible…a disciplined stage-by-stage approval process combined with regular measurement of every critical factor, from time and money spent in product development to the success of new products in the market…combined with a strong portfolio management program…”

Sounds like strong project management and project portfolio management are basic preprequisites for successful innovation. What do you think? Does all this apply to a small company?

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Post from: EveryJoe

Spend Less While Innovating More? Yes!

Sometimes you get unexpected insights. My post “What’s Harder? Project Management or Management” elicited a wonderfully simple “boxes” analogy from Ren Garcia at Accounting Solver. In it he said:

“In a standard hierarchical corporate organization, you have specializations through boxes (i.e., departments, divisions, sections, etc) identifying finance, marketing, production, human resources, etc. Frequently, the specializations become rigid over time and the boxes neglect to communicate with each other (The managers or heads of boxes are supposed to be doing this, but often neglect).

Consequently, integration of all the functions / tasks / responsibilities within the corporation becomes a difficult process. The entire organization needs to be on the same page and move towards the same goal. What you don’t want to happen is one box (function / task / responsibility) undoing what another box is trying to put together. A classic example is the finance department trying to bring down accounts receivable and the marketing department keeps giving credit…

Projects & Project Management bring together managers and technical / professional staff and is a potent form of integrating an organization that has become too specialized. Without any extra effort at all, boxes (departments / divisions / sections) talk to each other more frequently and productively and get to understand what the other boxes are all about. In a project team, the talk is not all about the project and there can be a lively exchange about non-project issues, including relevant corporate-wide issues.”

Ren’s insights elicited my (mildly edited) response:

“Ren- nice analysis. The boxes analogy helps. I’ve been referring to the divisions as “silos” but “boxes” better aligns with some current thinking about “getting outside the box” related to innovation. Also, I appreciate your view that project management facilitates breaking down the barriers between departments.

One of the first things that one strategy consulting firm does is to simply have all executives present to each other about what all the other departments are doing. This enables executives to do a better job of determining strategies and creates the cooperation necessary to later execute them.”

As I recall Ren had some hesitancy to comment on my blog because he felt a little intimidated by the subject matter. I, of course, knew better and encouraged him to offer his views. Now I need to comment on his because he obviously has a lot to say.

What’s holding you back? I’m sure you have something to offer.

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Post from: EveryJoe

Organizations as “Boxes” Analogy Reveals Power of Projects

 

Fascinating conversation with an executive of an agile software development firm about transformation projects as they compare to lean manufacturing initiatives. Lean transformations have settled into starting with training heavily laced with practical activities. The reason that this is so important is that the approach is NOT intuitive.

Lean requires a person to experience how the concepts can change and increase the value of a process, whether it be software development or manufacturing products. One of the most valuable exercises is the traditional lean manufacturing simulation consisting of 4-5 iterations of improvement to clearly reveal how each lean concept influences results. Many times an executive level version of this simulation kicks off a lean project because of it’s powerful way of revealing the value of lean principles. For more on lean look at the excellent web site www.leanexecutive.com.

The paradigm shift is the most difficult barrier to overcome in both lean and agile. The agile company used to have a client strategy of doing an agile project first followed by a transformation project. The current approach flips the order to start with transformation efforts with “practical” training. It’s remarkable how similar the lean and agile approaches have evolved AND there is much to learn from being a student of both. For example, my post on agile estimating serves the lean community well. As techniques and approaches are proven out in each area, innovative application to the other area should be considered. This is a great example of looking outside the four walls for business process innovation.  

Let me know what you think about how lean and agile compare to each other.

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Post from: EveryJoe

Agile Transformation Strategy Is A Lot Like Lean