Are Sponsors over worked and under effective?

December 16, 2014

Sleepy-Sponsor1The Institute of Project Management (Ireland)  has published a  survey is based on self-reported information from their course based on nine major position descriptions/levels in reporting the data comparing the expected number of hours to be worked based on their terms of employment and the actual number of hours typically worked. The averaged data from senior management positions is worrying:

  • Director of PMO; expected: 39.0 Hrs, actual: 60.0 Hrs
  • Portfolio Manager; expected: 37.0 Hrs, actual: 50.0 Hrs
  • Project Manager (Senior); expected: 37.9 Hrs, actual: 50.3 Hrs.

Combine these findings with data from PMI on the hours worked by Sponsors (download the PMI report on ‘Executive Sponsor Engagement’) with many reporting working weeks of 50 to 60 hours on their ‘day job’ before taking on the additional responsibilities of sponsoring a project or a program; and, that effective sponsors report that typically they are working on three projects at a time, spending an average of 13 hours per week on each, the problem of over extension of key executives becomes obvious.

Combine these findings with the demonstrated correlation between effective sponsorship and achieving project success, the over extension of senior managers has serious consequences:

  • Sponsors have inadequate time to understand the project’s requirements and support the project manager leading to an increased probability of failure;
  • Tired managers make poor decisions, and tiredness affects ethical standards (see: Tired workers lose their ethics);
  • There is frequently not enough time to train the sponsor in his/her role further reducing their effectiveness; and
  • These pressures often lead to a lack of continuity in the sponsorship role, which is another identified source of project failure.

The evidence is clear, organisations that fail to effectively sponsor their projects and programs are making an overt commitment to wasting the organisation’s time, money and resources – there is an 80% greater probability of failure and no amount of effort at the ‘project management’ level can overcome executive management failures.

Sleepy-Sponsor2One simple way to stop the waste is for an organisation to defer any project where it is unable to find a committed, trained sponsor, with adequate time, energy and skills to properly fulfil their role. No sponsor – no project! (See more on the role of a sponsor)  This may sound extreme, but if the executive management team do not see the project as being sufficiently important to the organisation they manage, to reorganise the disposition of executive resources to properly support the work, then the project is probably not that important anyway. The organisation will be better off not spending the money and wasting its resources.

The governance challenge is creating a management culture that on one hand, actively encourages the deferment of projects that are inadequately supported (eg, don’t have a sponsor); and on the other actively encourages the development of the organisation’s capability to excel at the ‘the management of projects’ (see more on the strategic management of projects).

Sleepy-Sponsor3Creating this culture is a critical governance issue (see more on the governance of project management).  If an organisation cannot implement projects and programs efficiently, it cannot adapt and change to meet the challenges of a rapidly changing world which will inevitably lead to the organisation becoming obsolete. However, achieving the necessary changes won’t happen if the executive team are already overextended – the situation highlighted in both of the reports referenced in this post! Building the organisational capability to efficiently its projects and programs is itself a major change initiative that needs resourcing and sponsoring at the highest levels.


Lessons from manufacturing

December 6, 2014

In much of the developed world, and particularly Australia, small to medium sized manufacturing businesses are in decline.  However, the manufacturing landscape is not all ‘doom and gloom’ there are always a few organisations that are developing and performing well above the trend. This blog will suggest the ‘high performance work practices’ used in many of these high performance manufacturing businesses are directly transferrable to project teams.

Research has shown a correlation between High Performance Work Practices (HPWPs) and ways high performing manufacturing SMEs tend to operate.  HPWPs are a set of management tools and practices that help get the best out of an organisation and its employees, creating business success. The practices are divided into three broad areas, developing and encouraging:

  • Knowledge, skills and abilities;
  • Motivation and effort; and
  • Opportunities to contribute.

HPWPs manifest in five interlinked organisational outcomes:

  1. Self-managed work teams.
  2. Employee involvement, participation and empowerment.
  3. Total quality management.
  4. Integrated production technologies.
  5. The learning organisation.

hilst some of the specific tools are unlikely to be directly translatable to many project teams, the key practices are.  High performance organisations are focused on motivating their team members (employees), building their knowledge and giving them opportunities to contribute to the success of the organisation.  If your team is happy, safe and efficient, you maximise the opportunity for success (see more on team motivation) .

HPWPs are not ‘rocket science’; most of the individual concepts are well established in management theory, what’s new is a clear demonstration of the advantages gained by integrating the elements in a coordinated and planned way to drive high performance. (See more on HPWPs).

Achieving this is partially governance, partially organisational management, ensuring the team has the tools and skills to succeed, and that the work environment allows then to work efficiently.  The rest is attitudinal, ensuring the team are happy and feel valued, and employing team members that have a positive, collaborative and supportive attitude; leadership is the key, but so is ensuring you have ‘the right people on the bus’ (see more on leadership). It is much easier to teach a person new skills than it is to change their attitude.

Achieving a ‘high performance’ culture is a journey that needs planning; successful manufactures built their HPWP structure incrementally starting small and adding to the practices over time, ensuring all of the elements work together; a similar approach should work for project teams.

The trigger for this post was a recent survey by the University of Melbourne’s Centre for Workplace Leadership that has clearly demonstrated the value of HPWPs in SME manufacturing sector (see: http://www.workplaceleadership.com.au/projects/high-performance-manufacturing-workplaces-study/), and as the title suggests, we believe translating these concepts into practical project team management should drive similar successes.


PMI’s Voices on Project Management Blog has moved

November 18, 2014

PMI Voices BlogI’ve been a regular contributor to PMI’s Voices on Project Management blog for many years.  Its old home was hidden in the depths of www.pmi.org.  Following PMI’s purchase of www.projectmanagement.com (the old ‘Gantt Head’), the ‘voices’ have moved to join a number of other themed blogs on the site.

The site is open to everyone, you need to register to post comments and download, but reading is free and unrestricted.

 

My first post in this new location is Influence Without Authority. You can read the post at http://www.projectmanagement.com/blog/Voices-on-Project-Management/11149/  and then explore the rest of the site.


The Functions of Governance

November 15, 2014

We have published 3 papers recently that clarify and differentiate the functions of management and the functions of governance.

The widely accepted ‘functions of management’ developed by Henri Fayol and published in his 1916 book Administration Industrielle et Generale, are summarised in: WP1094 The Functions of Management. Fayol’s ‘functions of management are:

  • M1 – To forecast and plan,
  • M2 – To organise
  • M3 – To command or direct (lead)
  • M4 – To coordinate
  • M5 – To control (French: contrôller: in the sense that a manager must receive feedback about a process in order to make necessary adjustments and must analyse the deviations.).

These functions are to be contrasted with my Six Functions of Governance:

  • G1 – Determining the objectives of the organisation
  • G2 – Determining the ethics of the organisation
  • G3 – Creating the culture of the organisation
  • G4 – Designing and implementing the governance framework for the organisation
  • G5 – Ensuring accountability by management
  • G6 – Ensuring compliance by the organisation

The mapping of the relationship between the functions of management and the functions of governance are set out below:

Mapping of the functions

Management functions are assumed to be hierarchal with the governance inputs cascading down to lower level functions.

Management functions are assumed to be hierarchal with the governance inputs cascading down to lower level functions.

These functions of governance were initially proposed in my ‘advisory article’: The Six Functions of Governance. Published in PM World Journal Vol. III, Issue XI – November 2014; download from here.

A more focused discussion paper has been published today in WP1096 The Functions of Governance.

Conclusion

Governance is the action of governing an organisation by using and regulating influence to direct and control the actions and affairs of management and others. It is the exclusive responsibility of the ‘governing body’, the person, or group accountable for the performance and conformance of the organisation (in a commercial organisation, the Board of Directors).

But in many situations, particularly associated with the governance of project and programs, the governing of organisations is far from effective. The amount of time and effort devoted by the ‘governing body’ to compliance and accountability, and the amount of resources wasted by ineffective and ‘competing’ management groups, can be significantly reduced if the organisation’s objectives, ethics and culture are sound.

Six core functions of governance are defined to bridge the gap between the ‘objectives of governance’ defined by Cadbury and others and the practices of governance defined by organisations such as the AICD. Hopefully discussion around the core functions of governance sparked by these papers will encourage improved governance performance.


Sources of Power

November 4, 2014

powerNo sooner had we published WP1095  Power and Authority than one of our regular correspondent pointed out we had missed the concept of ‘structural power’.  Whilst originally seen as being relevant to the discussion of power differences between sovereign nations, the concepts also apply to organisations where the characteristics of a situation can affect or determine power. Important structural sources of power include knowledge, resources, decision making and networks.

Knowledge as Power: Organisations are information processors that must use knowledge to produce goods and services. Intellectual capital represents the knowledge, know-how, and competency that exist in the organisation which can provide an organisation with a competitive edge in the marketplace. Within an organisation, the concept of knowledge as power means that individuals, teams, groups, or departments that possess knowledge that is crucial in attaining the organisation’s goals have power, but only if they use the power to advance the interested of their organisation – hording knowledge to the detriment of the organisation is destructive and self defeating. Outside the organisation, the situation is reversed; protecting the organisations intellectual property is vital to maintaining its competitive power in the market.

Control of Resources as Power: Organisations need a variety of resources, including money, human resources, equipment, materials, and customers to survive. The importance of specific resources to an organisation’s success and the difficulty in obtaining them vary from situation to situation. The departments, groups, or individuals who can provide essential or difficult-to-obtain resources acquire more power in the organisation than others, as do external suppliers in a market where the particular resource is scarce.

Decision making as Power: The decision making process in an organisation creates more or less power differences among individuals or groups. Managers exercise considerable power in an organisation simply because of their decision making ability. Although decision making is an important aspect of power in every organisation, cultural differences make for some interesting differences in the relationship.

Networks as Power: The existence of structural and situational power depends not only on access to information, resources and decision making, but also on the ability to get cooperation in carrying out tasks. Managers and individuals that have connecting links with other individuals and managers in the organisation and beyond will be more powerful than those who don’t. The power generated by social media networks is a phenomena that is still emerging and is not well understood.

An additional ‘power source’ is ‘peer pressure’ – the power held by a group over its individual members.

The White Paper has been updated to include these concepts and can be downloaded from: WP1095  Power and Authority


Stakeholders generate profits for shareholders

October 29, 2014

A few months ago I posted on the concept of Understanding stakeholder theory and suggested organisations that focus on providing value to stakeholders do better than those focused on short term rewards for shareholders and the associated benefits flowing to executive bonuses.

A new report: From the stockholder to the stakeholder by Arabseque Asset Management and Oxford University supports this contention.

From the Stockholder to the Stakeholder reviews existing research on environmental, social and governance (ESG) issues. It is a meta-study of over 190 different sources the authors have demonstrated a strong correlation between organizations that take ESG seriously and economic performance. For example:

  • 90% of relevant studies show that sound sustainability standards lower the cost of capital;
  • 88% of relevant studies show a positive correlation between sustainability and operational performance;
  • 80% of relevant studies show a positive correlation between sustainability and financial market performance.

However, to translate superior ESG quality into competitive advantage, sustainability must be deeply rooted in an organisation’s culture and values. The consequences of failing to take ESG seriously continues to be demonstrated by another of my regular topics, BP. The report contains a plot of oil company share prices from 2009 (pre the Deepwater horizon disaster) through to 2014. BP’s share price continues to suffer the consequences of the short sighted cost cutting that precipitated the Gulf of Mexico disaster:

BP-Price

The report concludes that it is in the best economic interests of corporate managers and investors to incorporate ESG considerations into decision-making processes starting at the governance level right down the organisation hierarchy.

The full report can be downloaded from http://www.smithschool.ox.ac.uk/research/library/SSEE_Arabesque_Paper_16Sept14.pdf .


Understanding management

October 26, 2014

Two new White Papers look at the function of management and the sources of power and authority used by managers and leaders.

WP1094 The Functions of Management describes the five functions of management, the supporting principles and the challenges of managing in a post bureaucratic organisation. Download the White Paper.

WP1095 Understanding Power and Authority looks at the sources of power and authority used by management and leaders.  Different sources of personal power underpin different types of authority.

WP1095 Power Autority

Download the White Paper.

Whilst both White Papers are based on general management theory, project managers are by definition managers and are increasingly expected to be effective leaders, so an appreciation of both subjects is useful.


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