Tuesday, January 17, 2012
Project Management - A Necessity Not A Nice-To-Have
Project management is one of the most sought after skillsets in businesses worldwide today. These skills are required at all levels of an organization from new graduates in their first job, to executive managers who have been in the business for decades. Lack of this valuable skillset at the top can have a detrimental affect on the efficiencies and profitability of the company. High level managers who don’t understand the importance of following consistent and effective processes to meet business goals are failing to meet their management responsibilities. It is not necessary for every manager in an organization to possess senior project management skills, but every one of them should have a basic understanding of project management, and be willing to defer to, or at the very least, consider, senior project managers’ recommendations regarding approval, continued funding, and cancelling of projects.
One of the biggest failures in an organization is allowing its senior managers to make business decisions based purely on "gut feel". They start and stop projects on a whim with no real business reason for doing so. Gut feel decisions are not bad if they can be backed up with good quality market data. Visionaries are often inspired to pursue ideas based on gut feel but the next step after coming up with the idea is to gather and analyze business data, not to start the project!
I have seen first-hand the devastating problems that can occur when business decisions are made based purely on the opinions of employees. Whether the employee is an expert in their field, or an executive manager, an opinion is not a good foundation for an investment in a new project. I have seen projects started with no real plan for what the project needs to accomplish to be successful. Projects with no plan and no set budget where engineers are writing code with no specification created first, defining what it is they should be building. I have witnessed situations where months after a project was started, it was discovered that another department or division within the organization was developing an almost identical product. The worst scenario was where one team member spent a year working on a specification for a project that was kept top secret by his manager, and it turned out that his “product” was very similar to one that had been sunsetted (retired) two years earlier as it had been unsuccessful! All these situations wasted a lot of money and time. The ensuing problems would have been completely avoidable with good project approval and management processes.
Many traditionally successful companies are starting to fall behind their start-up competitors because the newcomers in the market space are using good quality market data to make decisions. They base funding decisions on analytical data and not on the opinion of the CEO’s 15 year old grandson! These organizations are making good decisions the first time and more projects are succeeding. They are able to market and sell their products because they know the market segment they are targeting and they tailor their offerings appropriately. Development teams are building solutions with just the right amount of features without a lot of redundant functionality. This keeps the development costs low and the company is able to price the product more competitively.
Meanwhile, the traditional market leaders are developing feature heavy, expensive white elephants that their prospective customers cannot afford to buy. Why pay for 20 expensive features when all you really need is 2 of them? Over time these feature heavy products remain expensive to maintain, the company has to sell them cheaper and cheaper to compete. To try to recoup their investment they decide to add more features to increase the value of the offering so they can charge a higher price. The problem is that if those feature sets are not based on market needs and value to the customer, the organization ends up with an even more expensive white elephant to maintain.
Good quality project and product management with flexible and effective processes and procedures is what separates the winners from the losers in today's fast moving business environment. Highly skilled project managers are in high demand and those skills will remain valuable from the day you start work as a junior project manager right up until the day that you become CEO and chairman of the board.