A Practical Project-based Model of the Enterprise

A Practical Project-based Model of the Enterprise

The Enterprise-level Project Management Model (EPMM) dispels the assumption that project management existence occurs with little discussion of where that project comes from.  The business validation and expected business value; why there is even a project and how to manage it within the constraints of the enterprise. In effect projects are treated as if they were islands independent of external constraints and factors. Nothing could be farther from the truth! Imbedding the project into an enterprise context introduces a number of factors external to the project that impact the project management life cycle (PMLC). Many of those factors are related to resource capacity and schedule availability.

The origins of the EPMM date from the 1960s. The Objective/Strategy/Tactic Process was in its embryonic stage at that time and in use at Texas Instruments in its Corporate Research & Development Division in Dallas, Texas.

The Business Environment

The Business Environment is fickle, somewhat unpredictable and continuously changing. In the past 60 years it has been heavily influenced by the relentless march of technology and the intrusion of the internet into all aspects of our economic and social lives.

Business is global

Outsourcing dominates the support service businesses (call centers and help desks, for example) and software development . The US is trending towards becoming a knowledge-based economy and suffered the loss of many jobs that will never return. The number of displaced workers continues to grow as businesses struggle to recoup their market positions. You may not sell in the international markets but your competitors sell in your markets and your business decisions are forced to take on an international perspective.

Success goes to the creative and courageous

Those who can envision products and services put themselves at great risk. The early entrants into social media applications are testimonials to that success. But the secret is more than a matter of creativity. The business idea must include barriers to entry or an unknown software developer will replicate your idea from another part of the world, set themselves up as a competitor and your business will be in harm’s way. So the business environment is one of high speed and high change with technology and the internet as the driving force. On the positive side, the world is your market. Place has no place in the marketing mix! It is obvious that an EPMM is a critical success factor (CSF) in the 21st century marketplace.

The Business Environment

The Business Environment is fickle, somewhat unpredictable and continuously changing. In the past 60 years it has been heavily influenced by the relentless march of technology and the intrusion of the internet into all aspects of our economic and social lives.

Enterprise Capacity

Clearly Enterprise Capacity is the driver of any strategic model. So any Tactic that relates to the creation or maintenance of Enterprise Capacity will be a strategic project. Capacity is defined at the resource level and was first discussed in EPM1e. When we elevate the discussion to the enterprise level, resources take on a different perspective and become an enabling factor and a constraining factor. Management decisions regarding Resource Capacity are complex and challenging due to the number of dependent factors.

Market Opportunities can only be exploited within the capacity of the Enterprise to support them. The Business Environment is in a constant state of flux so Market Opportunities will come and go. Any of those opportunities can be exploited if and only if Enterprise Capacity adjusts to align with those opportunities. One of the big questions for senior management is how to spend enterprise resources and how to adjust that allocation as Strategy Portfolio performance occurs.

The reference here is to the resources that are available for allocation to projects. In a multi-year planning horizon resource capacity might be upgraded or increased through projects, programs or portfolios designed for the purpose of expanding or enhancing enterprise capacity to more effectively align to and to support attainment of the Objectives defined in the Strategic Plan.

As stated above resource capacity, availability and the interdependencies among those resources are both a constraining factor and an enabling factor. As a constraining factor what the enterprise should do is limited by what the enterprise can do and finally leads to what the enterprise will do. As a counter measure to the constraining factor the enterprise needs to assure the alignment of not only resource supply but also resource availability against the business demands for those resources. So resource capacity is a dynamic tool that can be adjusted as a deliverable from the planning exercises. Expanding or enhancing resources will reduce the schedule contention between resources but that is a business decision that arises during the fulfilment of the Strategic Plan.

As an enabling factor resource managers collaborate with functional business managers and LOB managers to creatively solve problems and enable the exploitation of new business opportunities. These collaborative efforts result in the commissioning of projects, programs and portfolios to project managers who function as the enablers.

Objectives

The integration of Objectives/Strategies/Tactics (OST) into a system is an embodiment of the Strategic Planning Process (SPP). OST has its roots in the emerging product planning processes developed and used by Texas Instruments in its Corporate Research & Engineering Division in the early 1960s. TI/OST required one quarter each year for the development of the strategic plan.

Objectives are generated at the highest levels of enterprise management as a direction-setting guide for those who will suggest Tactics for reaching the Objectives of the enterprise. In effect, the enterprise knows where it is (its current state) and knows where it would like to be (its desired end state). The missing ingredient is how to get there? Strategies and their aligned Tactics describe that journey. As Figure 1-1 clearly shows, those Tactics are defined through a collection of projects, programs and portfolios.

projects, programs and portfolios.

Strategies

Strategies are the guide for proposing Tactics and are the short-term variables in the SPP.

Each Strategy has a Strategy Manager. They are assigned as part of the SPP and manage their Strategy until all projects in their Strategy Portfolio are completed. The responsibilities of a Strategy Manager include:

  • Strategy Portfolio planning and management
  • Monitor portfolio performance and content in order to maximum expected business value contributions from their portfolio
  • Adjusting project scope and schedules to accommodate resource capacity and availability
  • Monitor portfolio performance and adjust resource allocation to assure maximal business value to the enterprise.
  • Negotiating resource requirements and utilization among all Strategy Managers

The relationship between Objectives, Strategies and Tactics can be complex and create interdependencies due to resource capacities and dependencies among and between resources.

Tactics

These will be offered in the form of potential project, program or portfolio ideas to be carried out within the planning horizon (3 or 5 years is common). Tactics are ideas for products, services or processes submitted to the EPMM in the form of one page documents called Project Overview Statements (POS). (The POS was first introduced in 1995 in EPM1e and has matured to its present form.). The extent to which a Tactic aligns with the Strategies of the enterprise is an important factor in any prioritization exercise of the proposed Tactics. The strength of that alignment and other factors (like risk and expected incremental business value) are the basis for decisions on which Tactics will be prioritized and approved. These projects, programs and portfolios represent the Tactics that convert available resources into incremental business value.

Leave a Reply

Your email address will not be published. Required fields are marked *