The article presents an analysis of three main trends in the development of project management in the world, noted in the PMI® HQ report ” Pulse of the Profession” for 2018: the development of active involvement in projects of sponsors – top managers, control of the boundaries of project scope, and the growth of the value of project results. The features of project management development in the conditions of the domestic market are noted. Recommendations are given for timely response to market dynamics and adaptation of project management strategies to real circumstances.
The PMI® HQ “Pulse of the Profession” report for 2018 shows the results of a survey of more than 4,500 project managers, 440 top managers and 800 project office employees from the United States, Europe and Asia, and highlights three main trends in project management development in the world /1/:
- development of active involvement of sponsors-top managers in projects (investing in actively engaged executive sponsors)
- control of project scope boundaries (controlling project scope)
- increasing the value of project results (growing value delivery capabilities)
Since 2013, organizations’ losses due to poor project management have fallen by 27 %.
Only 10% of each dollar’s investment is lost due to poor project management.
But only 58 % of the organizations surveyed understand the value of professional project management.
Only 41% of the surveyed organizations are aware of project offices’ support for achieving the company’s strategic goals.
Trend 1: Development of active involvement of sponsors-top managers in projects
The support of sponsors-top managers is invaluable for projects and allows you to:
- establish contacts between project managers and decision makers
- to improve the success of projects
- reduce the risk
In Russian practice, project sponsors are not defined in all projects, and even if they are defined, they are not always top managers (!).
The main task of the project sponsor is to provide support to the project in case of problems that the project manager cannot cope with. Often problematic situations of projects are associated with a lack of resources – monetary, temporary, human or material. The project manager cannot decide to allocate additional resources to the project. In this case, the project manager escalates the problem to the sponsor with a request to provide support in solving the problem. If the sponsor is not a top, but a middle manager, then the sponsor simply do not have the necessary level of power and authority to order the allocation the necessary additional resources to the project. The project is not supported and there is a risk in the project. The source of risk is a weak sponsor who does not have the necessary power and authority (!)
Critical problem situations may lead to the sponsor’s decision to continue, freeze, or stop the project. The decision of the sponsor to continue the project may be related to the strategic importance of the project (or the project customer) for the implementing organization, despite the loss of resources – time, money, and unsatisfactory quality of results. The sponsor’s decision to “freeze” the project may be related, for example, to the need to suspend work on the project for a while – before moving resources released from other projects to the project. The sponsor’s decision to stop the project may be due to the inability to continue working on the project due to significant losses of time, money, and quality during the intermediate stages of the project. At the same time, the reasons for the emergency closure of the project before its completion must be documented /2/.
Effective sponsors support the project using their influence in the organization.
Influence and power – do not always find a combination in the person of the sponsor.
Even a powerful sponsor who does not have sufficient influence in the organization may not be able to provide the necessary political support for the project in communication with business owners and decision makers.
Influence is an important personal quality of a project manager. Influence occurs when the project manager has personal connections with the company’s top management or business owners. A project manager who does not have such connections does not have any influence in the organization. He is not known to anyone “on top”. If this is the case, he will never be assigned as strategic project manager. He will spend his entire life doing “small things”. Therefore, an important aspect of self-improvement in the development of the project manager is his desire (or at least an attempt!) – become a well-known person in the organization and acquire certain connections and influence.
How is the Task of training effective sponsors – top managers is being solved ?
Major Projects Leadership Academy (MPLA) has been established at Oxford Business School, which provides targeted training for effective sponsors and top managers of companies.
In Russia such tasks are being solved in the following Universities MBA Programs:
- Russian Presidential Academy of National Economy and Public Administration (RANEPA)
- Moscow Scholl of Management Skolkovo
- Financial University under the Government of the Russian Federation
- State University of Management under the Government of the Russian Federation
These programs allow organizations:
- to strive to create and develop a culture of effective interaction between project managers and top managers’ sponsors
- to develop Road Maps for training top managers’ sponsors
Trend 2: Control of project scope boundaries
The effect of project “scope creep” – uncontrolled changes in the scope of project with no evaluations of the impact of changes on time, cost, resources of the project – the main cause of problems and failure of many projects.
The PMI HQ “Pulse of the Profession” report for 2018 noted that the effect of “scope creep” was observed in 52% of projects compared to 43% of projects 5 years ago. The reason is the increasing complexity of the scope of complex technological projects. The share of complex projects has increased from 35 % to 41 % over the past 5 years /1/.
In Russian practice, insufficient and erroneous analysis of the requirements of the project customer and the expectations of the end users of the product is a common reason for “scope creep” effect. Another reason for this effect is a change in the company’s strategic goals and priorities and project goals.
The main reason for the sliding scope of innovative projects is the high dynamics of changes in customer requirements and project content.
The PMI PMBOK 6th Edition Standard provides recommendations for managing dynamic changes in project scope /3/:
- Refusal of detailed planning of the project scope at its early stages, followed by continuous examination and refinement of the scope (ongoing scope discovery and refinement)
- Continuous refinement of the rapidly changing requirements of the project
- In projects with a high degree of uncertainty and frequently changing content, detailed cost planning on the initial phase does not make sense. Instead the behavior is used to quickly approximate the cost of the required resources and then refine the cost in response to emerging changes in the requirements and scope of the project
- The uncertainty of the project scope and high dynamics of events dictate the need for frequent, short and fast communications between team members and key stakeholders (Agile daily meetings for 15 minutes)
- There is a need to ensure maximum co-location of team members (colocation) for frequent face-to-face meetings
- Direct horizontal regular interactions, contacts and communications between key stakeholders (customers, sponsors, developers) replace vertical reporting between management and management levels
In Russian practice, replacing horizontal regular interactions with vertical subordination and reporting is often painful. The chiefs just can’t lose the levers of control and cease to command the subordinates vertically top-down and getting subordinates reports “from the bottom up”. The hierarchical command and control system remains unshakeable…
Trend 3: Increasing the value of project results
Organizations ensure that the value of project results increases by minimizing risks, controlling costs, and increasing project benefits. Predictive, iterative, and flexible incremental approaches to project product development can be used.
The benefits of the project outcome must exceed the formal project output.
Maximization of the final result of the project is provided by /4/:
- detailing the customer’s requirements and expectations
- reducing feedback data analysis
- monitoring progress in achieving project results
Projects allow you to create value for your business. Business value is defined as the net, quantifiable benefit derived from project implementation. However, the benefit can be either tangible or intangible, or both. In business analysis, the value of a business is considered a return in the form of items such as time, money, goods, or intangible assets. Commercial value in projects refers to the benefit that the results of a particular project provide to its stakeholders.
Examples of material benefits:
- Share capital
- Engineering networks
- Fixed assets
- Market share
Examples of intangible benefits include:
- Goodwill (business reputation and commercial experience),
- Brand awareness,
- Public good,
- Strategy compliance (strategic alignment)
- The company’s reputation in the market.
To increase the value of project results, the PMI PMBOK 6th Edition standard proposes the development of a project Benefit Management Plan (Project Benefit Management Plan), which includes a documented explanation that defines the processes for creating, maximizing and supporting the benefits provided by the project during the operation of its results /3/.
Project management is one of the areas on which the success of modern business depends. Different elements of business strategies can be improved and improved by themselves, but without high-quality project management, they will be unsystematic and disjointed.
Therefore, any project manager and his team should “keep their finger on the pulse” of project management trends. This will allow you to respond to market dynamics in a timely manner and adapt your strategies to real circumstances. Based on the trends that are relevant now, you can make forecasts for the near future.
List of sources used:
- PMI Pulse of the Profession. 10th Global Project Management Survey. Project Management Institute. 2018.
- Павлов А. Н. Эффективное управление проектами на основе стандарта PMI PMBOK 6th Edition. Лаборатория Знаний, 2017, 4-е Издание.
- A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Ed.6th, 2017.
- Barry O`Reilly. Lean Enterprise: How High Performance Organizations Innovate at Scale. 2018.
Dr. Alexander N. Pavlov
PhD, PMP®, CPM®
Project Management School
Founder and Head
Russian Presidential Academy of National Economy and Public Administration (RANEPA)