Wednesday, 14 October 2009 00:00

Total Project Management in a Project-Based Culture

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The Concept of TPM

The premise behind the concept of Total Project Management (TPM) is that an enterprise-wide approach to developing a successful project management system is best supported in a project-thinking organization. In a project-based culture, projects are aligned with an organization's corporate strategy and thus receive support from managers at all levels. People, process and technology are the key drivers in this environment. Excellent communication and collaboration must be developed as norms within the organization. This style of management will drive accountability into the process and create a platform for continuous corporate and individual performance improvement.

The model shown below illustrates the macro elements that provide an infrastructure for this enterprise-wide management system.

When the model is set in motion along with the best practice standards such as communication protocols, organizational and competency assessments, portfolio analysis, project methodology development, project planning, application-based work management systems, as well as coaching/mentoring, it will produce an efficient approach to achieving world-class project management attributes.

Why Implement TPM?

The evolution of project management from a competency into an industry parallels the evolution of the global marketplace and the world economy. This transformation has created the marketplace we know today as the new economy. The old school perceptions of business have changed, allowing the emergence of a new breed of customer focused, quality driven, and ultimately more profitable companies.

Organizations such as these are not driven by, but are oiled with the lubrication of technology - e-solutions, technical competence and, most importantly, a belief that collaborating all we knew with what we know results in time tested experience and optimum results.

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Total Project Management (TPM) Implementation Model

TPM will help to stabilize your business process during growth and begin to move the organizational norm to one of refined efficiency and accountability. The following are some considerations around why organizations are embracing the concepts of TPM:

Yesterday's Environment: Today's Environment:
 Make it, it sells  Rabid competition
 Certainty  Uncertainty
 Reasonable cost  Lowest possible cost
 Large budgets  Optimizing budgets
 Stable technology  Rapidly changing technology
 Waste: many resources  Conservation: limited resources
 Quality is supplier-driven  Quality is customer-driven
 Reasonable time to market  Accelerated time to market

Source: Customer-Driven Project Management, Bruce Barkley and James Saylor, McGraw Hill, 1994.

Successful businesses in all segments have restructured and retooled to respond to the dynamics of a competitive market place and rapid technological advances. In doing so, they have changed the perceptions and guise associated with old school business. TPM and the system of management that it deploys will help guide you through the changes.

Driving Change

Change is productive when implemented correctly, destructive when not. The methods that comprise TPM will help to drive the process of change in a productive way. In fact, the concept of this system is built on the ideal that change equals improvement. The following will help illustrate the difference between bad and good change:

Bad Change: Good Change:
 If it is not broken, don't fix it  Continuous improvement
 Functional orientation  Systems view
 Inspection of defects  Prevention of defects
 Quality not important  Quality is critical
 Accept current processes  Reengineer processes
 Development  Innovation
 Rigid organizational structure  Flexible organizational structure
 Many organizational layers  Few organizational layers
 Hierarchy  Collaboration
 Individual performance  Team performance
 Strong management  Strong management and leadership
 Leadership only at the top  Leadership everywhere in the organization
 Individual merit reward system  Team performance reward system
 Focus on profit  Driven by total customer satisfaction

Source: Customer-Driven Project Management, Bruce Barkley and James Saylor, McGraw Hill, 1994.

The implementation of TPM can save substantial cost associated with poorly executed planning activities, as you will see illustrated in the scenarios below.

Scenario One

Your project team consists of three full-time equivalences (FTE). The estimated duration of the project is six months. The graphic below illustrates cost overrun and savings against the estimated mean. The average annual wage for this model is $65,000.

Project Duration (Months) Resource Cost Cost Variance
4.5 $73,124.91 - $24,374.97
5 $81,249.90 - $16,249.98
5.5 $89,374.89 - $8,124.99
6 $97,499.88 $0
6.5 $105,624.87 + $8,124.99
7 $113,749.86 + $16,249.98
7.5 121,874.85 + $24,374.97

The difference in finishing the project one and a half months early as opposed to one and a half months late is a savings of $48,749.94.

Scenario Two

Your project team consists of six full-time equivalences. The estimated duration of the project is three months. The graphic below illustrates cost overrun and savings against the estimated mean. The average annual wage for this model is $65,000.

Project Duration (Months) Resource Cost Cost Variance
1.5 $48,749.94 -$48,749.94
2 $64,999.92 -$32,499.96
2.5 $81,249.90 -$16,249.98
3 $97,499.88 $0
3.5 $113,749.86 +$16,249.98
4 $129,999.84 +$32,499.96
4.5 $146,249.82 +$48,749.94

The difference in finishing the project one and a half months early as opposed to one and a half months late is a savings of $97,499.88.

These scenarios reflect only wage cost. Other cost savings on your project may be higher depending on the ancillary cost impact.

In addition to resource cost, a well-designed project support infrastructure and efficiently structured processes have multiple other benefits, including:

  • Clarified client expectations
  • Measurable processes for both the implementation of project work and continuous support
  • Performance measurement allowing for cross-functional consistency around reasonable expectations
  • Human Resources becoming integral in resource availability and competency issues, thus allowing the project manager to focus on the work at hand
  • Project portfolio which is guided more directly by the organization's strategic initiatives
  • More accurate management of cost factors
  • More effective management of change

All the aforementioned attributes are relevant to project success. In addition, they are also relevant to organizational success in our rapidly changing global economy.

TPM encompasses all of the useful elements of time-tested management processes and practices and merges them with forward-thinking solutions. This merger will incorporate collaborative thinking, tools, methods and appropriate technology to create a synchronized and highly productive company

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Phil Ventresca is Founder, CEO and President of Advanced Management Services, Inc. (AMS), a full service management consultancy servicing an international client base. Since founding AMS nearly two decades ago Phil has lead the organization to becoming an internationally recognized provider of Consulting, Training and Assessment services. AMS's client base is comprised of Fortune 100/500 companies, medium-sized businesses and Government agencies that Phil has personally assisted in the creation of organizational and performance based solutions.

© Advanced Management Services, Inc. (AMS)

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