Readers of this blog will know that I talk about behaviors of PMO project managers, team members, stakeholders, and others in the project community. These are real behaviors that I have seen in my experiences working in and setting up several PMOs.
Much has been written in recent years about strategic partnerships in project management. The idea is for parties to collaborate to ensure success of an organization such as a PMO long-term as projects are executed in support of strategic directions.
Consider the following scenario. A PMO initiates a systems project in support of a major business/functional group in the organization known as the Commercial Group. The Commercial Group is engaged in activities ancillary to the firm’s core businesses, and in order to achieve its returns, it operates in markets focusing on short-term, day-to-day operations. The PMO systems project is designed to use a vendor-developed application, and its supporting systems, to provide the Commercial Group’s day-to-day operational and transactional focus. The Commercial Group identifies a number of potential vendors and evaluates which vendor could supply the systems requirements on an on ongoing basis. It then selects a vendor and development work proceeds until the system is in production.
Over the next several years the Commercial Group’s activities and returns flourish, and the vendor makes a number of requested improvements. Every time a new and updated system and application requirement was identified by the Commercial Group in response to the market, the vendor delivered.
Switch gears for a moment….
A number of years ago while working for Atlantic Richfield Company (ARCO) in California, I had the opportunity to serve on the Board of Advisors for the University of California–Irvine Science Education Advisory Board. The Board advised the professors and administrators in the School of Physical Sciences on their K-12 development programs for students and teachers. Funding for the work was provided through contributions from local corporations to the Board. Each year the professors and administrators solicited the corporations for funding based on the premise that the K-12 programs would remain the same quality and scope as in previous years. After a few years, it was almost a foregone conclusion that the budget would be the same or perhaps increased slightly from the previous year because additional corporate contributors were identified. An annual report of the Board to the contributing corporations provided details of the K-12 programs and the breadth of participation among K-12 teachers and students.
After serving on the Board for several years, I was summoned one day by two professors who were instrumental as leaders of the program. Since I had background in strategic planning and analysis, they asked if I would take on a small project in support of the Board activities. They were concerned that funding for the program seemed to be on the decline. Over the past three years the funding had decreased by $20,000 each year so that the quality of the programs was in jeopardy. They were at a loss to explain why the sudden decrease in funding over the three year period, and asked if I would undertake some analysis to assist in their planning.
I was glad to assist in this effort and studied the scenario from various perspectives for a month or so. I interviewed corporate contributors, the teachers involved in the K-12 programs, the professors and other community groups. I looked at other University groups who approached their funding in a similar way and others who approached funding from alternative means.
Here were my findings:
1. The business climate in California had changed over the last three years. Whereas aerospace and petroleum companies dominated the corporate giving scene three years earlier, biotech and medical device companies were beginning to emerge to take their place.
2. An individual corporate contributor had many more choices in making contributions because many other groups in that California community were doing similar work with schools.
3. Other University groups had emerged as new curricula developed and these groups increased the number of total University groups seeking corporate contributions.
4. The methods of solicitation of corporate funding were changing. Many groups partnered with the stakeholders in the K-12 schools who received the benefits of the programs to provide a brochure to corporate contributors that tied real benefits to both the provider and the receiver. This method was unlike the solicitation method of the School of Physical Sciences, which relied on its past work to carry the story.
The real themes from this analysis were:
1. Don’t rely on “static” data to tell a “dynamic” story. Look at the dynamics of the situation rather than a point in time.
2. Don’t consider yourself to be the “Center of the Universe” when it comes to activity. Look at the Corporate contributors as the “Center of the Universe” and map the interactions they have with the groups requesting funding. This tells two things. There are more requests than in previous years and many of the requests tell a story that clearly ties in the end result with the level of contribution.
So the real story of the fall-off in corporate contributions was in the dynamics of the business climate and the solicitation model. Never look statically when you should be looking dynamically. Never consider yourself to be the “Center of the Universe” around which other activities revolve. It is a recipe for disaster.
Now, what does this have to do with our scenario of the PMO group and the systems application supporting the Commercial Group? Over time, as the Commercial Group grew and its business grew, more and more was asked of the vendor who supplied and supported the systems application which facilitated the transactions enabling the Commercial Group to flourish.
But, there came a time when a new business requirement relayed to the vendor was met with the response “We don’t have any more resources to do this enhancement. All our resources are fully employed to support the day-to-day operations.”
The PMO was incredulous. It had created a strategic partner without really trying. But it had failed to plan for the development of its partner to support new development work. Why? The PMO focused on the static scenario, rather than on the dynamic scenario. They felt they were the “Center of the Universe” when it came to that vendor’s support. In actuality, the vendor’s business had grown to support other major companies as well.
This is a good example of how companies can put strategic vendors in place without really trying. It sounds rather farfetched. But it really happened to a major PMO organization. Is your PMO ready to define the capabilities it needs both internally and with external vendors to support the growth that it desires? Is your PMO looking at static conditions rather than on dynamic conditions for its decision making framework? Does your PMO consider itself the “Center of the Universe” when it comes to dealing with other key groups and vendors?
I would be interested in your feedback. Thanks for your time.