Enhancing PMP with Business Process Excellence
Part II (of an III Part Series)
Validating Project Timelines against Expected Changes in Customer Requirements
Dr. Shree Nanguneri and Mr. Gustav Toppenberg
Background for “Changes in Customer Requirement:”
In Part I we initiated discussions on how the KPI needs to link with the business goals and objectives. In this part, we dwell on changing customer requirement (CCR) which is itself a customer expectations in this decade, as technology is rapidly creating value over a shorter period in time. Customers have different reasons for changes demanded either pre- during or post-production stages in a project. As a PMP leader, our ability to respond to such changes is subject to several factors as shown below:
- Leader’s position of veto power in budget approval, management and control
- With career progress PMP leaders ownership and decision making power, go hand-in-hand
- Influence of peers and project stakeholders in the overall effort with the customer
- Peer evaluation and stakeholder’s interests play a vital role in project management decisions
- State of the Enterprises’ Economy
- Organization’s performance in bringing home the bacon as expected by their account managers
Each of these points is a general observation applicable to several industries regardless of project nature. The enterprise and team’s resilience to such “Living CCRs” will eventually determine the success of the former as well as the ability of the PMP leader to succeed with the project. Insensitivity to the team’s inputs while dealing with inaccurate and/or inconsistent KPI evaluation systems can cause members to opt out of the team and its enterprise. Other eyeing groups or organizations are more than ready to take them into their fold which can only make things worse for PMP leaders. Based on the skills and years of experience of the team member, the lower is the skill the higher is the probability of opting out of the enterprise. The higher the skills and experience will result in opting out of the team within the enterprise. On the other hand there are also CCR traps to avoid frustration and failure while the CCRs become a nagging pain for the enterprise.
An overall factor driving how enterprises respond to CCR is the universal truth on the state of their enterprise’s economy. Where are they now?
- Is their sales (demand for new projects) to capacity (also related to operating rate) ratio (SCR):
- Is it > 1.0 or
- Here, the probability of ignoring CCRs and adopt a “kiss or kill approach” increases
- Organizational complacence and/or arrogance creeps in and can wipe out organizations
- Or in a customer centric culture, the resilience to CCR increases leading to a higher SCR
- When the SCR decreases to 1.0, a wake-up call and response can go in either direction
- This tight rope situation is risky and doesn’t last long as it is either growth or decay
- Customer criticality and repeat business opportunity influence resilience to CCRs
- However, when SCR is < 1.0, enterprise’s natural business instinct increases its resiliency to CCRs
- A “save our soul” or “sink or swim” situation humbles the organization
- Any KPI evaluation errors discussed in Part I can cause high frustration and turnover
- Is it > 1.0 or
So when PMP leaders are working in their cocooned environments, they need to be cognizant of what is going on with the customer account management leaders. Trying to operate and execute project success without lending a ear to such dynamics will only increase the risk of failure. End of the day, the senior bean counters are making critical decisions on how to respond to customer’s CCRs at the macro project level.
Validation Process of Project Timelines
The 3 Ds in any project led by PMP leaders need to be in control to deliver customer delight, let alone satisfaction. The proactive validation of project requirements, let alone responding to CCRs, will directly impact project timelines. Project timelines are set by the customer and to some extent by the team and its leadership based on where their SCR is at that point in time. On many occasions, competitive bidding combined by enterprises’ SCR also gives rise to ghost (unrealistic) project timelines.
PMP leaders are effective in environments where SCRs are tending toward > 1.0 even if it is below 1.0 to begin with. This is how startup enterprises succeed and grow sustainably. If they try to implement logical timelines with a customer amid competitive project bidding, the principles of PMP and LSS will most likely cause failure and regret. Logic neither kicks in, nor does process excellence (LSS) help organizations succeed, when the internal processes or policies are broken or unstable. Just like doctors stabilize their patients prior to monitoring their body temperature and blood pressure, it is vital for PMP leaders to be aware of the stability of the enterprise culture at the executive levels. A blurred vision from the top management as in “talking the talk” but not “walking the walk,” only weakens the PMP leader’s ability to validate project timelines as well as respond to CCRs.
Coming out of a teleconference with several high profile members of a particular food industry, an American Icon on the east coast, I realized that the product design team wished to increase cost effectiveness for their customers. Their SCRs were so high (being in business for more than a century) that budget availability for their product design teams is virtually unlimited, even in 2012. This high SCR state of the enterprise paves the culture for the design team’s capability to innovate at exponential levels.
When PMP leaders have to set and validate project timelines, they have to bear a sense of the enterprise culture, on how the executive leadership can impact through their decision making practices that can trickle down. If PMP and LSS leaders are efficient as certified by their institutions, why are they tending to depart with their teams’ midway or even exit from their enterprises? Primary cause for low time to retain effective PMP and LSS professionals is, high variation in thought process leadership between the former and their immediate management. The root cause for such variation is unwillingness, more than lack of PMP and LSS thought leadership, either in the sales or senior executive culture of the enterprise toward either achieving a high SCR or even envisioning the same for their organization.
Although the authors have highlighted how the project timeline validation process can be in a broken state, the good news is there is plenty of hope. With the old 7-to-1 rule (customer speaking of negative product or process experience almost 7 times as opposed to sharing the positive ones, in these days with technologies helping a rapid dissemination of information such as via YouTube, face book, twitter or other, this ratio has only become nastier). All it takes is one customer sharing a true negative experience that goes viral on the internet is more than sufficient even for an American icon type business with high SCRs to take action (if not suffer from the consequences) to delight their customers. Look at what Apple is doing with its supply chain while it is in a much better shape SCR >> 1.0 to address it effectively and controlling the damage.
Deploying PMP and LSS methodologies in isolated pockets of the organization or enterprises that are not constraints to business growth is itself a recipe for failed project timelines or a weak resilience to CCRs. Applying the PMP and LSS process methodologies to validating project timelines can become a pipedream for PMP or LSS leaders, if the culture at the executive level is ignored. The right culture from top to bottom and vice versa will only increase the effectiveness of the KPI defined and maintained while all team members tend to increase chances of project success with customers, despite the irritant CCRs.
In Part III, our final publication, the authors will delve into solutions to this problem by turning them into opportunities and help with how executive sponsorship toward high SCRs in the near and long term future of the enterprise can be achieved by PMP and LSS professionals.
Validating project timelines, let alone responding to and integrating CCRs is a major challenge for PMP and LSS project leaders worldwide. Corporations and enterprises that feel the impact of poor SCRs have strategies laid out on how they should move forward. PMP, LSS and other meaningful change initiatives with high ROIs within the sales and executive teams can only lead to higher and more importantly sustainable SCRs.
In our final publication in Part III, we will provide some solutions on how to navigate the “shark infested waters” type organizations toward a better capability to understand, expect and integrate CCRs thus delivering with an obsession for customer success.
About the Authors
Gustav Toppenberg is a Sr. PMO Manager in Cisco’s Communication & Collaboration IT group. Gustav is currently responsible for leading the PMO and driving project and operational excellence in his team. During his career at Cisco, Gustav has led several projects in change leadership, acquisition integration, and globalization strategy. He is also part of Cisco IT’s transition to a services-oriented organization (technology, process, and culture), enabling a client-focused, value-driven, cost-effective alignment between IT and business. Gustav is a native of Denmark and serves on the board of directors at the Danish-American Chamber of Commerce in San Francisco and the NorCal chapter of ASP (Association for Strategic Planning). He has a background in strategy consulting, program/project management, and global change management. Gustav has an interest and passion for the convergence of business and technology; he is a natural change leader and constant disruptor. He continuously seeks to occupy the gap between business and technology, thereby leveraging technology solutions to strengthen competitive advantages in business. Gustav is an MBA graduate of the Thunderbird School of Global Management, ranked the #1 U.S. Business School for International Business by the Wall Street Journal and U.S. News and World Report. You can contact Gustav at [email protected] “Some of the individuals posting to this site work for Cisco Systems, Inc. Opinions expressed here and in any corresponding comments are the personal opinions of the original authors, not those of Cisco.”
I am a business process improvement coach and consultant and have worked with several corporations in different continents over the last two decades. After having a successful 6-year work experience at GE, I started my own consulting company in 2000. I have been fortunate to successfully deliver across a variety of industries that include the fields of manufacturing, transactional as well as service type environments. I have published a few articles, authored patents and releasing a book in mid 2011. Although not an expert, I can converse reasonably well in Dutch, and Spanish, skills I acquired while working there. To date, the total annualized direct customer benefits from my services have accrued to several hundreds of millions of dollars. I enjoy outdoor activity, meeting people on a global level to mutually benefit each other. I am also thankful to my mentor as well as network members without which some of the achievement listed here would have been impossible.