Programme Management and Its Benefit to Businesses - Example

Programme Management and its benefit to businesses Introduction Business analysts believe that in order to reap benefits from long term as well as planned projects businesses need to handle their programme management framework effectively. This paper attempts to understand how programme management can benefit businesses. Further, it would understand the methodology to manage a successful programme. Also, the study would focus on the successful implementation of programme management system in various companies in Dubai. In this paper, I have also attempted to provide some best practice guidelines on how to implement a successful programme management system through effective delegation and planning of the projects and maintaining control over all the strategic decisions. The first half of the paper attempts to understand the meaning of progamme management, which is defined as the process through which various similar projects are managed to improve the performance of an organisation. This process is implemented to garner long term results for the businesses, which are generally calculated through the benefits incurred due to the implementation of the system. Through the implementation of programme management, roles of several operating functions within an organisation are integrated to create an effective business model. Such a business model helps in implementing business strategies in an effective manner. The next section of the paper focuses on the various criteria the organisation should focus on while selecting a programme management system. The most important decision the management needs to take even before implementing the system is to carefully select the programs that would provide maximum gain and help in fulfilling the business objectives of the organisation. Such a system should aim at providing a competitive edge to businesses which want to use it as an important business function in their companies. However, the study finds that to make programme management work for the company, it is essential to recruit a competent program manager who can effectively integrate of various business functions, align the business strategy with operational execution, manage the ROI (return on investment) and accelerate the goals of time-to-money to create a successful programme management system. This paper further finds that one of the greatest challenges that a program manager encounters is aligning of the business strategies within the programme management process. However, in order to achieve this, different approaches are also highlighted upon which can help in the successful implementation of the system. The manager needs to adopt different approaches and should always keep in mind that a project would only be termed successful if it provides real bottom line benefits. And projects that in spite of meeting the success metrics of the programme management fails to provide any real benefit to the business goals should be discontinued. The paper also outlines various successful principles of programme management that a program manager can implement to make this system a success. The principles discussed in this research focuses on the importance of identifying the business benefits and creating a model for the business case, preparing the PID or the project initiation document, reviewing the progress of the project against the business strategies, reviewing the business strategies against the required benefits, reviewing the required benefits against the business goals and conducting a review after the implementation of the project. These principles and their benefits for businesses are discussed in-depth later in the paper. The paper concludes that in the modern day business environment, the ways in which businesses are conducted have changed drastically and the companies are required to employ program managers with distinct programme management skills and competencies. This has made programme management not only a specialised field, but also made it mandatory to employ managers who understand not just business but also IT architecture and processes thoroughly. Understanding programme management The process of managing various similar projects to improve the performance of the company is known as programme management. Oftentimes, programme management is related in aims and practice to Systems engineering. Programme management is implemented to garner long term results for the businesses. These results are generally calculated through the benefits incurred due to the implementation of the system. Therefore, the most important aspect of this system is to carefully select the programs that would provide the maximum gain and would help in fulfilling the goal of the business even in a changing environment (Lycett 2004). Programme management is a practical discipline, and therefore the success of this system generally depends on the nature of the company wherein the program would be implemented. In most cases, the programme is usually divided into various projects according to the structure of the business. For instance, the program focusing on a design project would be assigned to the design team, whereas, the production program would be looked after by the factory. Thus, in order to decide about the structure of the program, one needs to first look at the structure and culture of the organisation (Nokes 2007). A Program is generally designed to deliver as per the strategy of a company. For instance, companies draw programs to become the largest supermarket in the region in a couple of year’s time or to become environmentally aware by planning to reduce their wastage by more than 10 per cent within two years. Further, programme management also performs the function of coordination and prioritisation of resources for different projects. The system also acts as a bridge between the projects and the pricing and risks associated with the program (Lycett 2004). However, for programme management to succeed, it is imperative to select the best group of projects and clearly define the objectives of the projects, while facilitating an environment wherein the projects can achieve success. It is also believed that the program managers running the system should let the project management system handle the projects and not micro-manage. Most companies prefer to run their businesses through one program itself, which would contain details of all their projects. However, many larger companies also run multiple programs that are designed to provide a variety of improvements to the projects (Augier 2009). Benefits to businesses The programme management system can give a competitive edge to businesses which want to use it as an important business function in their companies. The major advantages that the companies can gain through the implementation of programme management are: integration of various business functions, aligning of the business strategy with operational execution, managing the ROI (return on investment) and accelerating the goals of time-to-money (Ambrosini 2009). Through the mechanism of programme management, an effective business model is created by integrating the roles of several operating functions within an organisation. A properly thought out and executed program management aids in implementing business strategies in a better and effective manner than using an approach that is uncoordinated. Often companies have good strategies but are not able to execute it perfectly. Therefore, companies implementing programme management to execute the strategies into reality would be able to outperform their rivals that cannot translate a strategy into action. Thus, programme management is often seen as an adhesive that transforms business strategies into actions that can generate results. Programme management also focuses on various other business aspects such as development of infrastructure, products and services. In this system, the program manager focuses on to provide ROI (return on investment) for the program he or she is responsible for. Through the use of the integrated development approach, a major feature of the programme management, businesses can optimise their goals for time-to-money. Through an integrated and iterative process of development, the model of the programme management is designed to identify and manage a cross-section of projects (Augier 2009). However, to make strategy successful, the company needs to effectively translate the business goals into concrete results, which can be achieved through the implementation of programme management. In order to create a successful programme management, it is imperative to quantify and identify the business benefits which the business strategy is required to produce. Thereafter, these required benefits would provide the foundation for the business outcomes, which should then be used as the yardstick to measure the business requirements of the project (Feldman 2003). However, a gap might emerge in case the required project outcomes are not aligned with the business objectives. Therefore, it is imperative to implement the programme management in such as way that it ensures the project deliverables are according to the business strategies of the company and are achieved within the given budget and timeline. Most good project managements are the usual arrangement of hard and soft factors. They are generally based on established project management methodology such as Prince 2 or PMBOK. Mostly, programme management actions can be linked to the broad project management functions of creating a plan, coordinating, providing facilitation, administrating the plan and documenting the progress of the plan. Experts believe that although a program manager is employed to focus on meeting the required results within the allocated resource and budget, while mitigating any risk factors, the managers still may face constraints if the programme management is not aligned perfectly with the business strategies, which might change over time (Augier 2009). Therefore, a programme management process should not be thought of as a tool to achieve business results, as projects that might have been delivered on time and within the allocated budget but has not fulfilled the business requirements would not yield any results. Thus, the greatest challenge for a program manager is to align the business strategies within the programme management process. However, in order to achieve this, one need to adopt a different approach, wherein, a project is termed successful that provides real bottom line benefits. Projects that although meet the success metrics of the programme management but does not provide any real benefit to the business goals should be discontinued. Thus, in order to achieve the greatest success through a programme management process, the businesses should employ the following major programme management principles (Lycett 2004): Identifying the business benefits and creating a model for the business case: Even before the program is initiated, the program manager needs to prepare a detailed business case. This business case should provide the important outputs of the project, wherein each and every output should be linked up with to one or more perfectly defined business benefits. Further, if possible these benefits should be measurable and should also be quantified objectively. Additionally, one needs to consider the capital budgeting theory, which states that all incidental costs and benefits as well as opportunity costs and benefits should be included while sunk costs should be ignored. However, the incremental costs and benefits must be included. Preparing the PID or the project initiation document: This document defines the goals, scope, deliverable objects, timeline and budget allocated for the project. However, the program manager should clearly define and articulate the benefits identified in the above mentioned step. The project initiation document forms the backbone of any project plan and therefore, it is important to prepare a well-though out and strategic PID for the successful implementation of the programme management process. Reviewing the progress of the project against the business strategies: The program manager should review the progress of the project against the business strategies from time to time to ensure that the project is in line with the business goals of the organisation. This would also help in correcting any digression found and also in directing the project members with the right guidelines. Reviewing the business strategies against the required benefits: Furthermore, the program manager should also ensure that the business strategies are completely aligned with the required benefits from the project. While conducting this review, it is necessary to also include the upper management and apprise them of the situation, so that any corrective measure could be taken at the earliest, if needed. Reviewing the required benefits against the business goals: In order to find out whether the project is within the portfolio of the program manager, it is important to review the required benefits against the business goals from time to time. This helps in identifying the projects that might be deemed successful but might not fulfill the business requirements of the company and therefore, should be discontinued. During this stage, the Executive Committee members of the company who are not involved directly with the project should also be included for the review. Their inputs then can be recommended to the Project Management Office so that necessary changes in the programme could be initiated. Conducting a review after the implementation of the project: In order to fully gauge the success of the programme management process, the program manager should conduct a through review of the project post its implementation. This helps in addressing any gap areas or identifying newer opportunities for the project. This review also helps in developing future learning lessons and allow the company to improve their future planning and implementation process for other projects. Methodology to manage a successful programme Due to the changes in the information technology industry and the increase in competition in the market, most companies are facing strains in terms of resources, budgets, time and even human resources. However, in order to better manage these vital functions of the businesses, project management is being identified to provide various solutions that can be implemented easily. Experts believe that a successful project management is just not about completing projects within the constraints of given resources, allocated budget, objectives and timelines. Nowadays, it also means providing training, and facilitating and creating high performing project teams, which calls for developing newer application for enhancing team collaboration (Partington 2005). Further, for the programme management to survive in this ever-changing world of business and management, companies need to create clear project goals, integrating tough quality standards and high performance requirements. Also, the organisation should be cognizant about the cross-functional role of various teams and even teams working across different cultures and integrate them within the framework of the programme management (Salvato 2009). Therefore, a project management process that is being created by experts oath to bring about a structured approach towards the usage of project management tools, skills, techniques and software in a company. This especially is very potent in the modern day business environment wherein most of the project managers are required to deliver quality results faster using lesser resources and a newly created cross-functional team. Therefore, for the programme management stakeholders, the challenge is to integrate better and new programme management practices within the framework of the tried and tested guidelines. However, this integration should be done in a seamless manner, which could be understood by everyone and can also benefit in the different stages of the project implementation. Further, this should also meet the business strategies of the company and work within the constraints of resources, time and costs (Salvato 2009). Further, it is also of vital importance to control cross utilisation of resources from support functions and the business environments effectively as most of the projects utilise staff members from not just their respective business divisions but also from the technology division. Thus, project management needs to have synthesis between various business units. The ideal situation is to create a management environment wherein both the business and technical members create common business and project goals. Therefore, it is important to ensure that the required benefits of a programme management process is integrated within the company to assist in introducing, implementing and developing a dynamic, unique, people and culture oriented programme management discipline. Also, in the absence of a proper programme management strategy, it would be difficult for teams associated with the commissioning of the project, managing the project and working on the project to get the general idea about how to organise the project and how to handle the different aspects of the project to complete it within the given timeframe. This would also raise the problem of accountability as these teams would not be able to identify their responsibilities and accountabilities towards the project, which can further lead to confusion. Therefore, without a proper programme management methodology, it would not be possible to complete the projects on time and within the given resources and allocated budget (Winter 2003). Furthermore, through the implementation of a good programme management methodology, the project would be guided through a well-managed, controlled, and an accountable set of activities to attain the required results. Most good programme management methodologies implement the following principles to deliver successful projects. These principles include creating a definite start and end for the project, managing the project end-to-end properly to ensure success, and providing clear understanding about the commitment required from each stakeholder of the project. Programme management methodology through the use of resources in a controlled manner and the unique ability to supervise project and business risk effectively, also provides capitalisation and consistency benefits to not just the project managers and the project directors but also to the company. The methodology also represents proven and established best practice in programme management. Additionally, it is widely understood and recognised, as well as provides a common language for the project participants. It also provides guidelines about recognising the responsibilities of the people associated with the projects formally so that everyone is aware of what to deliver, why to deliver, when to deliver and for whom to deliver (Pellegrinelli 2007). As per a Gartner report, that studied various IT projects, it was found that 30 per cent of the projects that was started were not concluded or were aborted. Further, it found that around 51 per cent of the projects exceed their budgets by 189 per cent and deliver just 74 per cent of their original goals. The study also found that the major reasons for the lack of success of most projects are due to non-commitment on part of project sponsors, their lack of understanding about the project and their non-involvement in making the project strategies. Further, some of the projects do not fulfill the requirement of the strategic vision of an organisation. Thus, when the business needs are not defined clearly, the project would definitely not enhance the business processes or add any value to the bottom line (Ambrosini 2009). As the ways in which businesses are conducted these days have changed drastically, the companies require having distinct programme management skills and competencies. This has made programme management a specialised field, which requires companies to understand not just business but also IT architecture and processes thoroughly. Additionally, even soft skills have gained importance in the programme management due to cultural changes and incorporation of cross-sectional teams in different projects. Programme management system in Dubai companies Dubai Islamic Bank case study Identifying the need to create an effective programme management system for the implementation of its new core banking system, the Dubai Islamic Bank had recently employed Cedar Management Consulting to support the company for managing the implementation effectively. This programme management system is implemented around the bank's 300 ATMs and 50 branches in the United Arabs Emirates. This solution is not just important to the bank’s future growth goals, but also to develop strategies to launch new products, improve customer services and expand its network. In order to meet the above mentioned goals, Cedar Consulting assisted the Dubai Islamic Bank to effectively manage its program along with the bank’s Project Management Operations office. It also leveraged its experience and the tested implementation methodology for ensuring the strategic alignment of the bank’s business growth plans and framework with the implementation strategies. The contribution of Cedar towards the successful implementation of the programme management process was recognised by the bank and Cedar was awarded for excellent program management support by the management of the bank (Dubai Islamic Bank 2008). Dubai international Airport case study In order to expand and upgrade the Dubai International Airport, the Government of Dubai has recently completed a US$ 540 million implementation plan that was developed by Bechtel in 1990. For this programme, a series of expansion programmes were conceived some of which had to be run simultaneously. These included developing 42 loading bridges, 28-contact-gate satellite concourse and 221 check-in counters. It also required developing amenities such as duty free shops, a conference and a business service center, restaurants, a luxury hotel and an entertainment centre. Bechtel helped in the planning, designing and developing the management team for the projects. Further, the company planned and scheduled the construction activities in such a manner that it would have had only minor impact on the existing airport operations. The company also provided financial and technical recommendations and reviews to the government, transferred program management capabilities to the counterparts working with the government, and implemented various insurance programs. In order to achieve these, Bechtel created a master plan integrating all the project objectives with the business objectives within the allocated budget and time. The company created an independent program which was controlled by the program manager operating from the onsite, along with the worldwide technical and professional team. This global pool of technical team helped in achieving engineering excellence and creating a world-class airport (Dubai International Airport). References: Ambrosini, V. & Bowman, C., 2009, ‘What are dynamic capabilities and are they a useful construct in strategic management?’ International Journal of Management Reviews, pp. 29-49. Augier, M. & Teece, D.J., 2009, ‘Dynamic capabilities and the role of managers in business strategy and economic performance,’ Organization Science, pp. 410-421. Dubai International Airport, Bechtel Corporation, viewed on 22 January 2010, . Dubai Islamic Bank awards Cedar Consulting for core banking program management 2008, August 5, AMEinfo.com, viewed on 22 January 2010, . Feldman, M.S. & Pentland, B.T., 2003, ‘Reconceptualizing organizational routines as a source of flexibility and change,’ Administration Science Quarterly, pp. 94–118. Lycett, M., Rassau, A. & Danson, J., 2004, ‘Programme management: a critical review,’ International Journal of Project Management, pp. 289-299. Nokes, Sebastian 2007, ‘The Definitive Guide to Project Management,’ 2nd Ed. London, Financial Times / Prentice Hall. Partington, D., Pellegrinelli, S. & Young, M., 2005, ‘Attributes and levels of programme management competence: an interpretive study,’ International Journal of Project Management, pp. 87-95. Pellegrinelli, S., Partington, D., Hemingway, C., Mohdzain, Z. & Shab, M., 2007, ‘The importance of context in programme management: An empirical review of programme practices,’ International Journal of Project Management, pp. 41-55. Salvato, C., 2009, ‘Capabilities unveiled: The role of ordinary activities in the evolution of product development processes,’ Organization Science, pp. 384-409. Winter, S.G., 2003, ‘Understanding dynamic capabilities,’ Strategic Management Journal, pp. 991-995. Read More