John Schlichter
Founder| OPM Experts LLC http://opmexperts.com
Atlanta, Ga, United States
The following case describes how to bring control to the project initiation process, and may be of interest to readers of this forum. A process was modelled and simulated, and we discovered how to reduce the duration of the project initiation process on average by one whole month. This is an example of how small actions can have large consequences.
OPM Experts designed a Project Initiation Process (PIP) to help a client make decisions about starting new technology projects in a controlled way. Originally, it was impossible to understand which projects were being worked on within the company, what the intended result of any existing project was, or what the plan for delivering any existing project was. As a result, it was impossible to determine what the status of any given project was compared to an original baseline plan or what the relative priority of one project was compared to another. Customers were continually displeased with the results of projects delivered to them, but the Information Technology department received new project requests continually. At the root of these problems was the fact that there was no coordinated way to make cross-functional decisions about new project requests. The Project Initiation Process addressed this problem.
Project initiation is in part a governance issue, and any process must fit with the organizational design. In this particular organization, the Project Management Office facilitates PIP, owns and enforces process standards, and reports of the performance of the initiation process. Two committees are involved: the Information Technology Project Steering Committee (ITPSC) and the Enterprise Project Steering Committee (EPSC). The ITPSC is composed of the Vice Presidents within the Information Technology department. The EPSC is composed of members of the Executive Committee, including the President, Chief Information Officer, Chief Financial Officer, and Executive Vice Presidents. These committees work together to evaluate and launch new projects.
Project requests must be written by a project manager using a standard "charter" template, which has two sections. The first section identifies the Project ID, customer, author, date, version of the document, alignment to the Company’s strategic priorities, business need, and the scope of the project or products and services that would result from the project, assumptions, constraints, general dependencies, and success criteria. Once section one is written, section two is written. Often there is a delay necessary to develop section two. Section two describes the strategy for delivering the project, summary tasks and major milestones, decision gates, major dependencies, resource needs, total costs, and major risks.
New project requests are evaluated first by the ITPSC. If the request is not approved, the project manager may make changes to the charter and re-submit it again. If the request is approved, it is submitted to the EPSC. If the EPSC does not approve it, the project manager may make changes and re-submit it to the ITPSC. If the EPSC approves it, then an Executive Sponsor is assigned, and the project is chartered to a project manager to deliver the project. New project requests (which are written in the charter template, which has two sections), may be submitted to the ITPSC after the first section is written and before the second section is written. In fact, this was the original design of the process: complete section 1, get it approved, complete section 2, get it approved. However, many project managers wait until the whole charter is written before submitting it for approval by the steering committees for the first time.
The ITPSC meets once per month to make decisions regarding new project requests, and the EPSC usually meets within one week of the ITPSC’s meeting to review those project requests that are forwarded by the previous ITPSC meeting. When PIP was originally launched, there was a long backlog of project requests (which sounds similar to your own situation), and new requests continued to be made. Because the project selection/initiation process took longer than it should, by the time a project was selected, unapproved work had often already begun on it. This was the situation our client was experiencing soon after the process was implemented.
Our client was interested in reducing the amount of time required to "charter" new projects using this Project Initiation Process. The steering committee members would prefer not to evaluate any charters in which both sections 1 and 2 were not completed, because they believed that this constraint would reduce the average amount of time required to charter a project. Specifically our client was interested in whether it is faster to write section 1 and to submit it immediately (thereby pushing the charter into the system as soon as possible) or it is faster to let the project manager take longer initially to write both section 1 and 2 before submitting it.
OPM Experts modelled the Project Initiation Process and discovered the following: if all project managers write sections 1 and 2 together before submitting their charters, on average the chartering process will take about one month longer.
Following this analysis, a new policy was adopted: if section 1 is written before the ITPSC meeting, it will be submitted to the ITPSC. This is a process improvement.
This exercise resulted in changes our client's operating procedures.
The particular model we created will inform you of changes in the time required to approve a charter. We could enhance the model by adding constraining resources (for example: only x number of charters can be evaluated in a meeting or limit the number of project managers available). Such a model would be able to determine bottlenecks and predict throughput.
The bottom line is that a repeatable Project Initiation Process is essential in order to achieve control within a multi-project environment, and how one designs such a process will have a significant impact on how effectively and efficiently decisions are made regarding starting new projects. For more information, contact [email protected]
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