Project Management: How has it Changed after the Recent Global Financial Crises?
Changes in professions arise from a culmination of many factors, including advances in technology, responses to changing markets and the wider economic environment, alterations in demographic trends, and customer-driven demand, to name just a few. As well as industry-driven advancements, major shifts in the global economy and global events can have a profound, structural effect on a multitude of professions. Major global changes bring about a realization that “We cannot continue to do what we have always done.”
The full impact of the global financial crisis that began in 2008 on all aspects of the economy may take years, or even decades to fully understand. It is arguably true that the crisis has “left its mark” on attitudes towards the project management profession (as it has on many other professions). Some changes have been challenging at an individual level, such as the struggle for many to maintain gainful employment. Other changes have spurred positive adjustments to the way the profession operates, such as fostering a drive for advanced project management processes and a general realization of the importance of project management to controlling outcomes with scarce resources. In this article, we review what some of the post 2008 changes on the project management profession have been.
The post 2008 global economic downturn has been a catalyst for organizations to rethink their processes. The approach to project management (plus program and portfolio management) has, for many organizations, been part of this overall rethink. In many cases, the outcome has led to project management being recognized as a valuable way to provide surety and control of initiatives undertaken. This has led to opportunities and also some challenges for those of us in the profession.
We categorize the key impacts on project management brought about by the financial crisis into three areas: Changes to the Profession, Changes to Methodology, and Changes to the Professional.
Some key changes to the Profession
- The need to control risk and provide a greater certainty and control of project outcomes has led to an increase in the awareness of project (and for that matter, program and portfolio) risk management. The benefits of effective project risk management are well- documented. Organizations that were previously unfamiliar with project risk practices, or had immature processes in place, have started to explore the benefits of implementing a thorough and rigorous approach to project risk management.
- A related effect is a greater emphasis on portfolio planning of projects (for whatever industry the organisation is in – construction, oil and gas, pharmaceutical, NGO, IT, etc.). This has created a positive opportunity for those professionals skilled in portfolio management practices.
- There is an increased interest in credentials and certifications to complement experience. Competition for jobs is fierce, and experience remains as vital as ever. Many professionals are adding credentials and/or certifications to their resume to make themselves more appealing in a tight job market, and in response to more and more job advertisements asking for a minimum of credentials from interested applicants. This change is having several effects on the profession. As more professionals seek credentials and certifications, project management has become a career option open to more people. The ripple effect is providing a positive impact on the wider economy, with the “economic multiplier effect” of more employment in training, preparation and exam administration to support this up-skilling need. Several government and not-for-profit organizations offer financial assistance for job training, which provides underemployed/unemployed with educational opportunities, while further extending the benefits to the training providers.
Some changes to the Methodology of project management
- There is a greater emphasis on ensuring that projects have genuine “governance with teeth”, and Limits of Authority are being more tightly controlled for authorising expenditure, budgets, scope changes, etc. Savvy Project Managers need to leverage this because it is good for their control of projects, and, in order to do so, they must understand how to make governance effective. They must prepare governance properly and ensure it is run like clockwork.
- The approach to risk management (mentioned above) has become more sophisticated, particularly for large projects. Project Managers need to capitalise on this and ensure they know how to practice risk management in a way that involves all project stakeholders (it is not just about having a better risk register, it’s about pro-actively managing risk).
- Thresholds for change controls and performance metrics are tighter. Competent project professionals are striving; those at the lower end of the talent pool will find it a challenging environment in which to operate.
- Resources for projects are expected to do more with less, so the project manager is expected to better manage those resources to achieve success. In such tight environments, the project manager’s skills in leadership are more important than ever and the methodology chosen has a major impact on how resources are managed.
Some changes to and impacts on the Professional
- Many people are taking jobs at levels of pay that are lower than before 2008 because of what the market and employers are currently offering. With double digit unemployment prevalent in many countries, it has become a “Buyers’ Market”, leading to lower salary costs to organizations. Many professionals who are qualified for senior level roles are taking lesser roles. Underemployment, while not optimal to the professional, can yield benefits to those employers that acquire and leverage top talent.
- It is probably true that today, more contract and temporary positions in project management exist in proportion to full-time positions. Professionals that once had traditional, full-time, stable roles may be forced into contracting, which can be less secure. However, this can also provide many people the opportunity to broaden their experience and build a stronger resume, as well as gain more autonomy in their work-life balance.
- People in career transition between gainful employment probably carry out more volunteer roles as it helps to fill the employment gap in their resume.
- Social networking is growing in importance for career management – look at the increase of LinkedIn and Facebook membership.
- Faced with career challenges, some PMs are changing careers and exiting project management to do something else.
In conclusion, this article touches on a few salient points of how the global economic crisis of 2008 has led to changes in the project management profession. As has been the case for many other professions, the crisis has led to many shifts, some positive and some negative. The lessons we learn from the economic downturn can help prepare us individually as well as organizationally for the next major shifts that occur.
It is important for us all to be prepared for continued change. Louis Pasteur once said that “chance favors the prepared mind.” H.G. Wells is quoted as saying: “Adapt or perish, now as ever, is nature’s inexorable imperative.” We must prepare ourselves for continued change by constantly honing our processes, developing professionally, and being willing to adapt. Those individuals and organizations that are prepared and that embrace the opportunities presented are the ones that are set to continually strengthen their position.
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Gareth Byatt has 15+ years of experience in project, program and PMO management in IT and construction for Lend Lease. Gareth has worked in several countries and lives in Sydney, Australia. He can be contacted through LinkedIn. Gareth holds numerous degrees, certifications, and credentials in program and project management as follows: an MBA from one of the world’s leading education establishments, a 1st-class undergraduate management degree, and the PMP®, PgMP®, PMI-RMP®, PMI-SP® & PRINCE2 professional certifications. Gareth is currently a Director of the PMI Sydney Chapter, he is the APAC Region Director for the PMI’s PMO Community of Practice and he chairs several peer networking groups. He has presented on PMOs, portfolio and program and project management at international conferences in the UK, Australia, & Asia including PMI APAC in 2010.
Gary Hamilton has 16+ years of project and program management experience in IT, finance, and human resources and volunteers as the VP of Professional Development for the PMI East Tennessee chapter. Gary is a 2009 & 2010 Presidents’ Volunteer Award recipient for his charitable work with local fire services and professional groups. He has won several internal awards for results achieved from projects and programs he managed as well as being named one of the Business Journal’s Top 40 Professionals in 2007. Gary was the first person globally to obtain the five credentials PgMP®, PMP®, PMI-RMP®, PMI-SP® , CAPM® . In addition to these, Gary holds numerous other degrees and certifications in IT, management, and project management and they include: an advanced MBA degree in finance, Project+, PRINCE2, MSP, ITIL-F, MCTS (Sharepoint), MCITP (Project), and Six Sigma GB professional certifications.
Jeff Hodgkinson is a 32 year veteran of Intel Corporation, where he continues on a progressive career as a program/project manager. Jeff is an IT@Intel Expert and blogs on Intel’s Community for IT Professionals for Program/Project Management subjects and interests. He is also the Intel IT PMO PMI Credential Mentor supporting colleagues in pursuit of a new credential. Jeff received the 2010 PMI (Project Management Institute) Distinguished Contribution Award for his support of the Project Management profession from the Project Management Institute. Jeff was the 2nd place finalist for the 2011 Kerzner Award and was also the 2nd place finalist for the 2009 Kerzner International Project Manager of the Year Award TM. He lives in Mesa, Arizona, USA and is a member of Phoenix PMI Chapter. Because of his contributions to helping people achieve their goals, he is the third (3rd) most recommended person on LinkedIn with 570+ recommendations, and is ranked 55th most networked LinkedIn person. He gladly accepts all connection invite requests from PM practitioners at: www.linkedin.com/in/jeffhodgkinson. Jeff holds numerous certifications and credentials in program and project management, which are as follows: CAPM®, CCS, CDT, CPC™, CIPM™, CPPM–Level 10, CDRP, CSM™, CSQE, GPM™, IPMA-B®, ITIL-F, MPM™, PME™, PMOC, PMP®, PgMP®, PMI-RMP®, PMI-SP®, PMW, and SSGB. Jeff is an expert at program and project management principles and best practices. He enjoys sharing his experiences with audiences around the globe as a keynote speaker at various PM events.