It isn't the Project Manager

In my previous post I responded to an article in PM Network about the use of strategic business alignment, or what I refer to as business value, as a project variable.  In this article the author called upon the project manager to be more business-aware and consider the project's affect on the organization's strategies.  While I completely agree with the need for increased viability of business value and the use of business value as a project management variable, I think the author is not correct in calling out the project manager to make this change.  It is not the project manager that must move towards a business-value centered project but rather the entire organization; or at least the project management office.

First of all, project management is an operational position.  This individual is tasked with planning, executing, controlling, and evaluating a project.  This means the project manager is focused on a single project and working towards its completion.  Secondly, business value needs to be aligned with the organization's strategies and these strategies should determine those projects that are funded.  Proper business alignment means that each project is associated with a strategic objective or goal.  As a result, the existence of the project should imply some form of strategic value.

The strategic value should be articulated in the project charter and, therefore, should become a success measure for the project.  The sponsors and strategic leaders of the organization should have already established the strategic value for the project.  The project manager should shift her/his perspective to consider this strategic value but the project manager it not in a position to move the organization to a business value-centered project management practice.

While I appreciate the points the author made in the article.  I believe this article should be targeted toward a different audience; strategic managers and directors of project management offices.

The Fourth (and most important) Variable of Project Management

Project management has long been associated with managing the three project variables: budget, time, and functionality.  These variables have traditionally defined a project success.  A project delivering all desired functionality on time and within budget is considered a success.  However, I consider this the operational perspective of project management.  In this perspective the project is a success when the project is executed as planned.

However, there exists a strategic perspective for project management where these variables do not define success.  A project must create the type of change needed in the organization to realize the desired business value.  Delivering business value is the true strategic measure for the strategic view of project management.  Although budget, functionality, and timeliness are important in the strategic view, these factors do not entirely affect the influence the project has on the organization.

Consider an IT project that is operationally successful.  The new system is delivered as expected, within budget, and on time; it is a successful project.  However, what if the organization does not adopt the new system or what if the new system does not provide the information or improvements needed to realize the benefits (or value) to the organization?  The project is an operational success but a strategic failure.

Business value is the strategic variable of project management.  A recent article in PM Network describes this new dimension.  However, the article takes the approach that it is the project manager that must adopt this new dimension.  I disagree with this approach and in my next post I'll explain why.

Systems Thinking View of Failure

Today I read an article about the rebirth of business process re-engineering (BPR).  In this article the author described the large BPR projects of the 1990s as expensive and producing disappointing results.  Looking at the immediate return on investments for these projects I would have to agree with the author.  However, looking at a long-term and systems thinking view of these BPR projects; I completely disagree with the author.

The driving force behind the 1990s BPR projects was the emergence of large enterprise systems (like SAP).  These software packages replaced the silos of information systems supporting each of the business units in the organization.  The new enterprise systems enabled data to flow from one area of the firm to other areas of the firm to produce a more complete view of the organization's processes and information.  These systems and corresponding BPR projects removed the silos within the organization and enabled new information and knowledge to be formulated from multiple units across the organization.

We are now benefiting from the application of data warehousing and other forms of business intelligence technologies and processes.  If our organizations had continued to operate in the silos that existed in the pre-BPR era, we would not be able to accomplish our goals with business intelligence since the data would not be in a form that would support integration and business process perspectives.

My point is that while the immediate benefits of BPR may have not lived up to expectations, the results of BPR have enabled organizations to make better use of information and knowledge and also supported the emergence of business intelligence.  In order to better evaluate innovation we need to be able to view and evaluate our projects from a more global and systems perspective.

Now Hiring

Last spring our undergraduate CS/CIS department received approval for a new tenure track faculty position.  This fall we hope to interview and hire a new faculty member to start either the Spring 2013 or Fall 2013 semester.  The information about this new position is posted on our jobs site.

Evernote is PKM

This month's copy of KMWorld included an article about Evernote as a PKM tool.  In the article, the author described Evernote users as either individuals using specific functions within the service or those who us it as a one-stop personal knowledge repository.  I certainly fall in the latter category; those that use it for everything.

In my Evernote account I maintain notebooks for my research, courses, college-related items, projects, and personal items.  I am then able to search across notebooks to find anything or use the tagging function to select a group of related times.  For instance, today I added an Evernote note about a BI article I read that relates to my BI course.  I included a hyperlink to the article in this note, tagged it with tags of BI and the course number, and described how the article could be useful.  This note is now added to my collection of BI articles, and other notes related to either BI or my BI course.

This example and the functionality in the tool represents an ideal environment for a personal knowledge management repository.  This PKM environment will continue to grow.  With all of the new functionality being added to Evernote (Skitch, Clearly, and a whole catalog of third party integrated applications in the Trunk store) it is quickly becoming a PKM platform.

Communicating Business Value in BI

Today was our first day of classes for the new academic year.  My day started with an 8:00 AM Business Intelligence class.  This is a new class and I'm really excited to teach it this year.  The class size is smaller than I typically teach but creates some great opportunities to interact with a smaller group of students.

Anyway, during class today we tried to define business intelligence.  Along the way I referenced some examples of the type of business problems BI can be used to address.  One of our textbooks for the class provided some great examples of business problems addressed by BI: customer market segment identification, promotion response, lifetime customer profitability, fraud detection, customer churn risk, and customer channel optimization.

These examples provided a great segue into a discussion about business value and IT investments.  Fortunately, the textbook provided several examples of problems related to CRM data that can be directly tied to increased sales or decreased losses.  Using these examples we were able to see how effective BI practices can be quantified into business value.

I really want these students to understand value as a type of metric for their future projects.  In addition to the common triple constraint, IT professionals need to evaluate project outcomes in terms of business value.  Hopefully, having an early start to considering business value in their studies will make value metrics easier to apply once they graduate.