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Project Management - The New Corporate Mantra

Project Management - The New Corporate Mantra

Lucent Technologies staff spend their days designing, building, and delivering a comprehensive range of public and private networks, communications systems and software, data networking systems and microelectronic components. It's all highly specialised and high-tech. However, when it comes to implementing solutions for Australian customers, project manager Craig Harrison says Lucent would as rather recruit project managers with a background in construction or process control as in IT&T.

What can IT project management, renowned for its high levels of sophistication, take from those other industries? Not all that much, it seems.

Nevertheless, Harrison says with IT projects increasingly moving to a larger scale and often involving multiple parties, there are real benefits in recruiting project managers used to interfacing with large numbers of players. "Project managers from the construction and process control areas are used to multidiscipline projects where they're putting in power and water and doing construction and such, and they have had a longer period of experience as far as project management goes," he says. "It's a way of importing best practices into the IT arena."

Years of movement towards flatter management structures and increased focus on the maximising of resources has seen corporate Australia adopt "management by projects" as its new mantra. IT project management is - second only to the construction industry - leading the charge. Companies are placing so much emphasis on project management right now that at least one project management expert is convinced it will be the hottest job ticket for every industry within 10 years. Executive director of Australian Institute of Project Management (AIPM) Leigh Cunningham says management by projects is now a facet of many businesses.

Australian project managers are also setting the international standard, slaying the competition to secure international projects. Lend Lease recently beat European companies to win the contract to redevelop Wembley Stadium in London, while Australian project managers are in huge demand in the Asia Pacific region and especially Hong Kong.

Get Me Some Accreditation

As the profession of project management continues to grow, with top-level project managers in demand, the need for accreditation has become a priority for employers. Cunningham says the Australian accreditation program is the most rigorous in the world and has become the international benchmark, giving Australian companies a cutting edge in competing for international projects.

They're not doing badly here, either.

AIPM's latest survey indicates good Australian project managers can earn up to $160,000 a year, that 32 per cent now earn more than $120,000 a year, and that the second biggest industry for project managers is IT. "There's been a vast increase," says Cunningham, "not only in the number of project management positions but also in the number of positions in obscure industry groups that actually have as a prerequisite project management skills or experience. The construction industry is still in the lead, because predominantly everything they do has been a project; however, IT is coming a close second, being a growth industry of today where they do everything by project."

Companies are increasingly measuring their bottom lines according to the success or failure of a vast range of projects: from mergers and acquisition through the outsourcing of core functions to launching into "e-space". The Queensland Department of Main Roads has restructured the organisation to reflect this approach, Cunningham says. The department joins other bodies, including blue-chip companies like Qantas, BHP and Coles Myer, that are benchmarking their progress in transforming their organisations to a project management culture.

"Some of the larger companies are viewing the majority of their work as ‘project-based'," agrees Candle Corporation global project director Leigh Coutie, "and more so in the IT arena than anywhere else."

Technical Nous Not Required

There has been a lot of academic discussion on whether a project manager requires the technical expertise for a particular project. In the past, it was thought that to be a good project manager, you also had to be a technical specialist. Not only is the IT industry disproving this assumption at almost every turn, Cunningham says there are times when having a technical skill carries a baggage of preconceived ideas that can sometimes cloud a project manager's judgement when it comes to making decisions.

"You don't have to be the smartest, most technically knowledgeable person on the project to be the project manager," she says. "You do, however, have to have the knowledge, skills and experience to be able to recognise when problems surface or potential problems are looming.

"Technical expertise is less important than project management expertise; the best expertise a project manager can have is finding the right expert at the right time!"

The IT discipline of project management evolved later than some other disciplines, mainly thanks to the relative immaturity of the industry. That means there just aren't sufficient IT project managers around with experience on the ground in dealing with multiple players and huge levels of complexity.

Coutie says the most effective large IT companies tend to be US-based and have well defined project management methodologies, training programs and career paths. "The Australian companies are recognising the need for good project management but may not have the same support and development budgets. It is common for project managers within Australian companies to have been trained by the larger US-based IT organisations," he says.

Coutie's own introduction to project management came in the petrochemical industry around 20 years ago. He served as director of two engineering consulting companies before switching to IT.

On the other hand, since the principles of good project management can be applied across every industry, from running a farm to building a bridge or consulting with the community, IT leaders feel increasingly free to source project managers from other areas. For instance, at Lucent, Harrison, who himself joined the IT industry after a background in biomedical engineering and process control, says the industry still has things it can learn from the construction industry.

"Where IT projects were once primarily focused around a single building or the linking of a couple of buildings in a suburb, they now increasingly involve an Australia-wide or global focus," he says. "IT project management can learn from those other industries about interfacing with sub-contractors, consortiums or business entities. I think the industry identified this as a weakness in the past, and that's one of the reasons why they're hiring people from outside the industry - people who think more program management than project management."

Scott Coleman and business partner Craig Dennis recently founded Australian Project and Consulting Services, a company focused on IT-based project management and consulting. Between them, they have more than 30 years IT experience, most of it focused on project management of IT integration work. Coleman says IT project management has matured enormously over the last dozen years, as organisations have come to terms with the high cost of failure to manage projects.

"One of the reasons project management has matured is because there's been so many companies that have lost money or haven't got their systems up in time so have lost customers. So they've got burnt over the years and really learned that without project management their projects aren't going to come in on time, on budget and to the satisfaction of users."

Project management is a funny thing, Coleman says. It doesn't matter what the project involves, 80 to 90 per cent of the project management work is always the same. Those fundamentals help explain why project managers from other industries can fit so readily into the IT&T arena. "The change in the technology or the type of project you're doing is really the only fundamental change," he says.

And the Winner Is . . .

To showcase outstanding examples of project management, AIPM held inaugural awards as part of World Project Management Week in Cairns in October. The awards followed on from state competitions recognising best practice project management in each of Australia's seven chapters. While the national award went to project manager Gutteridge Haskins and Davey for the Maralinga Rehabilitation Project, IT&T projects featured in many of the state-based awards. For instance, in New South Wales, the Qantas Network Redesign Project was highly commended by the judges.

The Qantas project involved creating a new worldwide Y2K-compliant fibre-optic network over an 18-month period covering nearly 180 sites across Australia and overseas and roping in more than 200 staff from Qantas, Telstra and Sita. Under the project, Qantas acquired a new, worldwide fault-tolerant and Y2K-compliant fibre-optic network suitable for integrating voice, fax and data including the Internet and intranet.

Judges found an immovable completion date - the Y2K deadline - the size and complexity of the project and the involvement of Qantas, Telstra and Sita had forced Qantas to adopt numbers of innovative practices. Under the leadership of Qantas' Paul Payne, the project team adopted a flexible approach where workshops were used to help forge players from the three corporate cultures into a single cohesive project team.

In keeping with Qantas' focus on high standards and high levels for service and performance, benchmarking standards were adopted at the outset of the project. All sites had to achieve milestones before handing over to the next group of contractors or engineers. A series of "roadshow" audio-visual presentations kept all departments informed of the project's progress. Qantas claimed this was particularly helpful in explaining the impact of the project and managing people's expectations.

Meanwhile, Stage 4 of Education Queensland's School LAN project was highly commended in that state's awards, also in part because of the project manager's ability to pull multiple players into a single team.

Education Queensland is moving towards a greater emphasis on school-based management as part of its strategic plan. In support of the philosophy, the department is establishing a common local area network (LAN) infrastructure in all state schools throughout Queensland. The infrastructure work is being undertaken as part of the School Local Area Network Project (SLANP), established in 1997, which provides the active equipment, structured cabling and other components within each school. These LANs will enable schools to access the Internet and the department's intranet in classrooms and administration areas.

It's no small task. Education Queensland's schools are located across the state, including far corners such as Birdsville (15km from the South Australian border), Camooweal (20 kilometres from the Northern Territory border) and Dauan Island (3 kilometres from New Guinea). Installation on Dauan Island required three separate plane flights and two days travel from Brisbane.

Other impediments included the need to minimise classroom disruption when installation was planned during normal school hours; the need to react to cyclones, floods, fires, material losses, quarantine issues, staff changes and contractual disputes; and a change in government during the SLANP life cycle.

As if those weren't difficulties enough, project funding was only made available on a year-to-year basis, while annual funding meant that funds became available in November to be spent by June the following year.

Jeff Cowan, the unit manager for the School LAN Project, says with so many complexities first-rate project management was "absolutely paramount" to the success of the project. "Good project management really does allow you to monitor your performance at any one time - not only so you can be critical but so you can react and bring issues back up quickly, and monitor and modify so you can minimise the impact on the time line."

He says with so many diverse parties involved in the School LAN effort, team building was a vital component of the project management work.

"We have many people working within the project: other government agencies, external materials providers, an external project management team, and a whole pile of installers and contractors located around the state whom we really have to have on our side to achieve the project outcome," he says. "Team building means even the cabling teams who are working in remote parts of the state - and Queensland has some pretty remote parts - feel an integral part of the project."

To ensure a team approach, the Senior Management Group (SMG) structured an environment that encouraged a high level of open communications. From this open structure a synergy emerged for the SMG to provide support to all project participants and stakeholders, and the efforts of the various project managers for all stages of the project were recognised.

Working on the Railroad

While Australian project managers have become vastly more sophisticated over recent times, and methodologies more useful, project management software is also advancing.

Peter Katz, one of the judges of the national awards, is project manager for a consortium of NSW government departments including the Department of Transport, State Rail Authority and Rail Access Corporation. Together they are working to build a railway from Parramatta, west of Sydney to Chatswood on Sydney's North Shore. Eventually they plan to build 27 kilometres of railway, 20 of them in tunnel, with a completion date of 2006. However, with approvals needed from so many parties, and early work focused around the environmental, design and tendering processes, Katz says last year the consortium spent $25 million without turning a sod.

He says the SRA, the Rail Access Corporation and Department of Transport have combined to set up a specific management-by-project team for the project to allow them to draw on the expertise of each of the three different organisations and work as a combined team. "We have the State Rail authority building the stations and the Rail Access Corporation building the tracks and DoT providing some of the money and the other organisations providing bits and pieces. Without a structure you would get a totally uncoordinated approach to building something like this because it does go across so many disciplines, so many areas of the government."

Katz says the advantages of a good project management software package are twofold. First it forces project managers to sit down and think about how the project will be delivered - a discipline which can help avoid an outbreak of unanticipated problems. Once that process is complete you are a long way towards project delivery, Katz says.

However, project management software also gives the project manager a set of milestones to be reached as soon as possible along the road. Katz says this can help people avoid becoming overly focused on the detail.

Project Management E-volves

Meanwhile, the discipline of IT project management is in a constant state of evolution. In the past, telstra.com project director Nalim Prasad got plenty of experience project managing traditional IT-type projects in the mainframe and systems development areas. Now most of his work concentrates on the Internet space, which he says has very different success factors attached to it.

"In the IT world of traditional projects, you could build something, get it out there, and you had opportunities to refine and enhance it as you went through. But in the Internet space what we're finding is you build something, you put it out onto the Web site, and if customers or users go to it and they don't have a good experience they don't come back, so the project is not successful in that sense."

With the criteria and success factors proving so different in the e-space, Prasad says the focus is very much on getting it right and getting it right first time. In the Internet space that means getting it right fast. Above all, he says, you have to be very clear on your requirements - and that means being totally realistic. "You can't have a wish list of highly desirable things you'd like to do, which you used to do in traditional projects."

Prasad says these days the interdependencies and relationships between systems are so complex it's not enough to worry about changes to the project you're currently working on. You also have to consider how those changes will have an impact on a whole range of external factors. It makes a dramatic difference, he says.

"For instance, Telstra.com has a Web site and we have a lot of functionality on the Web site - different applications. When we introduce change on telstra.com, we don't just focus purely on the change that we're introducing but the impact of that change on everything else around us. I think the focus is very much on the user experience and how the end users are going to interact with whatever you are building."

Nonetheless, Prasad agrees with Cunningham and others in recognising that while the IT demand for project management is sophisticated, the fundamentals of project management remain the same.

"Even though I work in such a large organisation and certain things like budgets are controlled differently within Telstra, as project managers we have to look at all aspects of project management now; I think the project management book of knowledge is still very valid. It's just that IT is writing a new chapter or two," he says.

NASA:Project Managers with the right stuffEd Hoffman, director of NASA's project management college, was a guest speaker at the inaugural awards that were part of World Project Management Week in Cairns in October. Hoffman says project management and NASA are inseparable. "NASA has a long history as a project organisation," he says. "In a sense all of the work that NASA does is conducted in project mode."

For him, Hoffman says, the critical factors are customer focus, results orientation and talent. "NASA has always been a very visible organisation - by the nature of the mission. Customers (for NASA they include the public, universities, science organisations, industry and politicians) always want a leader responsible for their work. Someone who can discuss the desired outcome, costs, schedules and other factors related to a specific body of work. Therefore, the project mode allows all customers to have one voice - that of the project manager."

In fact, Hoffman says he believes the reason projects are spreading is because of the increased power of the customer and their demand for someone to talk to and understand the goal.

The work of NASA has always been clearly connected to results. Hoffman says the project mode requires discipline and the courage to forecast the outcomes of the project, as well as a willingness to indicate the time and cost for the work. With society becoming more focused on results (quality of work, schedule, what it costs), he says the project mode provides the disciplined management necessary to provide the context.

He also argues talent is another critical variable.

"As work has become more complex, the key variable becomes people - people who are talented, have critical expertise and the tacit knowledge necessary to satisfy the customer," Hoffman says. "The project mode puts at the forefront talented and passionate people who want to make their project the best. The days of management command and control and limiting the creative freedom of talented people is over. People now form creative teams to make incredible things happen."

Hoffman says where the organisational system isn't flexible enough to give the best people the freedom to excel, those best people can now form their own networks of talent to take on the world. Look at the way Napster reinvented the world, he says.

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