FOCUS: LEADERSHIP IN HEALTHCARE IT
Is Your
Organization Project
Management Savvy?
A B S T R A C T
As corporations struggle to gain better control and use of organizational resources in a
rapidly changing business environment, they’re finding that project management is an
efficacious discipline for supporting strategic initiatives and achieving business goals.
Successful project management requires an understanding of the business drivers, the
organizational structure, the benefits of centralizing project management, and the factors
that could impact performance.
Pam Wolff, PMP, FHIMSS
roject management was developed as a
response to the corporate need to bring
complex products and/or services to market
as quickly as possible and in accordance
with time, cost, feature, and quality specifications. The focus
of project management is, of course, the project, which,
according to A Guide to the Project Management Body of
Knowledge, 2000 Edition, is “a temporary endeavor
undertaken to create a unique product or service.”1
P
Project Management Terms and Concepts
The Project. A project is a series of tasks and activities,
which support the unique strategic position of an
organization. Characteristics of a project may include
creation of a new or different product or service, funding
constraints, and defined start and end dates. Due to the fact
that a project consumes resources for the establishment of a
product or service, a project can dramatically affect the
financial health of an organization as well as the corporate
reputation within the business community.
The Project Manager. The practitioners of project
management are project managers, professionals who are
well versed in the operations of a company’s line
organizations and the application and use of quantitative
methods. Importantly, they understand and manage
organizational behavior for the achievement of project goals
and objectives. Project managers possess the knowledge,
tools, and skills necessary to plan, manage, and control the
flow of project work, both horizontally and vertically,
within any organizational structure.
The Project Office. Supporting the project manager in
the execution of his or her responsibilities is the project
office. The project office also serves as the center of project
management expertise and, unless established to serve only
K E Y W O R D S
Project management
Formative matrix
Strategic planning
Organizational culture
Business drivers
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FOCUS: LEADERSHIP IN HEALTHCARE IT
and organizational structure within which the PO takes form
and operates. In the creation of a PO, business trends,
regulatory agencies, organizational resources, benchmarking,
company hierarchy, organizational culture, and business
practice and policy are the influences and building materials
for a PO and are reflected in the PO that emerges.
Awareness of the matrix and its components allows
identification of those components that are “hard-wired”
and those that are subject to being influenced and
managed. For example, you wouldn’t expect a functionally
structured company to behave in a project-driven
manner, nor would you expect to change
this company’s behavior without a lot of
intervention starting at the top of the
efore
hierarchy with a mandate for
change and permeating the
drafting plans for a project office,
organization. The remainder of
this article defines optimal
Creating a Project Office
understanding one’s business and the
performance and examines a
Why Create a Project
few of the matrix components
Office? The decision to create
business need driving the development of a
that cause the most PO
a project office (PO) must be
ailments (that is, prohibit
based on business need. This
PO is crucial to how well the PO will
optimal performance) if not
need can:
properly addressed during the
• Be strategic in nature, (i.e.,
perform the tasks eventually assigned to it
initiating and planning stages
a need for standardized
and how well it will help
of a PO.
project management services
Defining Optimal
across the enterprise)
the organization achieve its
Performance. Before an
• Reflect a special focus (such as
organization can recognize the
the management of IT projects)
business goals.”
benefits of optimal PO performance,
• Require a tactical approach as in
it must first define that performance.
the development and implementation
Performance measurements and goals
of large-scale construction or R&D
should be established so that determination can
projects2
be made as to whether or not the PO is performing as
desired. In his 1998 article, “Drawing Lessons from the
Of course, this effort is undertaken with a sincere desire
Evidence,” Terry Cooke Davies concluded that three kinds
for the PO to fulfill business need and serve the
of measurements are useful in identifying project success:3
organization as a competent and reliable partner.
The Importance of an In-House PO. Having an in• Achievement of project goals and objectives
house PO is especially important in an organization that is
(specifications, user satisfaction)
continuously bringing new and different products/services
• Achievement of project management goals and objectives
to market and/or reengineering internal processes. A stable
(time, cost, quality)
of experienced project managers knowledgeable of the
• Materialization of intended benefits to organization
business environment and the organization’s operations is
(profits increase, costs decrease, throughput improves)
invaluable to the efficient and effective execution,
management, and implementation of projects.
In addition to these measurement classifications,
What You Should Know. What does one need to know
traditional financial and productivity measures are also
before undertaking the creation of a PO? One should
helpful in determining achievement of optimal performance
understand the conditions that affect its development and
targets for the PO.
its ability to provide envisioned services and outcomes.
Several factors — including the formative matrix (not to be
Business Drivers for PO Development
confused with the organizational structure) within which
What Business Are You In? According to Paul C.
the project office is created — and functions have been
Dinsmore, “Enterprise project management is based on the
identified that facilitate optimal performance of project
view that companies can be organized as portfolios of
management within an organization.
projects, and thus project management is applicable across
the organization.”4 This, of course, assumes that most of an
Factors Impacting Performance of an Emerging PO
organization’s business can be managed as projects. Not
The Formative Matrix. The formative matrix is the
every aspect of business qualifies as a project, which, as
economy, industry, company business, company culture,
you’ll remember, is a temporary endeavor undertaken to
one project (i.e., as is frequently done for large-scale
construction projects or some R&D projects), is the focal
point for projects within the organization. Services provided
by the project office (PO) include:
• Imparting project management knowledge and skills
throughout the organization so that they become a “way
of doing business”
• Monitoring and controlling communications with
stakeholders (those who have a share of or interest in
certain projects)
• Ensuring that all project work is authorized and
funded by contractual documentation
• Ensuring that the projects are meeting
their time, cost, and performance
specifications as outlined in
contractual requirements
“B
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FOCUS: LEADERSHIP IN HEALTHCARE IT
a PO in the achievement of its mission and the execution
create a unique product or service. Before drafting the
of its duties. Obviously, organizations that value efficiency
plans for a PO, understanding one’s business and the
and professionalism outperform organizations that struggle
business need driving the development of a PO is crucial to
with unnecessary bureaucracy and territorial fierceness. Mr.
how well the PO will perform the tasks eventually assigned
J. Kent Crawford, PMP, CEO, PM Solutions, believes:
to it and how well the PO will help the organization
achieve its business goals.
“To be effective as a PO, you must work to change
Stumbling Block. A common mistake made by
the culture of the organization and that takes time.
organizations wanting to use project management is that
You may have the administrative aspects in place in a
they acquire the accouterments of the profession (work
few months but culture change takes years. The kind
templates, software, and methods) before understanding
of culture I’m referring to includes project
what is demanded by, and possible within, their businesses.
management as a recognized profession with a career
Under enterprise project management, for example, after
path; measurable deliverables, a requirement in all
the perspectives and needs of the PO sponsor and
project planning; establishing and enforcing
stakeholders are understood, the PO can be a vehicle of
accountability; and senior leadership guidance,
change, offering companies a most effective and efficient
direction, and decision making on resource issues and
way of getting project work done within the organization.
on major project decisions.”6
In his book, Liberation Management, Tom Peters
indicates that POs are the deciding factor in
organizational well-being and success,
This certainly is a departure from the
especially during turbulent times.
school of thought that insists a project
Becoming a Value-Adding
can be run by anyone with
Partner. A PO supported by senior
business/technical knowledge and a
rganizations that
management can help the
tough attitude. Crawford’s statement
organization achieve its business
implicates the entire organization in
value efficiency and
goals by (1) linking the
project success. Not only must
organization’s projects to the
executive leadership clearly
professionalism
outperform
organization’s strategic plan and
communicate and be guided by
(2) through the use of project
the organizational vision and
organizations that struggle with
management (PM) knowledge,
mission, it must also make
processes, and procedures, which
decisions and direct the
unnecessary bureaucracy and
constitute the professional PM
organization in accordance with
territorial fierceness.”
method for project success. Some of
strategic values (long-term) and tactics
the spin-off benefits of an internal PO
(short-term.)
include improved business
Leadership Focus and Action. Harold
communications and documentation as a
Kerzner, PhD, observes, “Any project can be
result of employee familiarity with project
driven to success through formal authority and
standards and a focus on and heightened understanding of
strong executive meddling. But in order for a continuous
business priorities through project selection, and use of
stream of successful projects to occur, there must exist a
project performance measurements.
strong corporate commitment to project management, and
In fact, careful thought must be given to the
this commitment must be visible.”7
identification and establishment of PO performance
Clearly, the focus and actions of an organization’s
measures that accurately reflect achievement of business
leadership define organizational culture, and a successful
goals. Ill-defined and poorly developed measures only
PO is the product of an organization with a strong,
serve as a basis for misdirected decision making, which
supportive leadership informed about the benefits, role,
could prove disastrous for the PO and, more importantly,
and needs of project management. This leadership values
the organization. Merlene C. Hilley, author of the 1999
the skills and knowledge of its project managers and is
paper, “Getting the Most from Your Project Office,”
committed to using the expertise of the PO in the planning
acknowledges, “When project office performance measures
and management of its projects.
are tied to the business needs of the organization, the PO
Organizational Structure and the PO’s Position
becomes a value-adding partner.”5
Structure: Typically, in the management of projects,
authority is shared by functional and project managers. The
degree to which a project manager has authority appears to
Organizational Culture
be a reflection of the project structure used. Of the five
According to Merriam-Webster, culture is “the set of
organizational structures studied (functional, functionally
shared attitudes, values, goals, and practices that
dominated matrix, balanced matrix, project-dominated
characterizes a company or corporation.” Culture, then,
matrix, and full project), the project-dominated matrix and
drives the organization and its behavior. So what does this
the full project structure significantly increase the chance of
have to do with optimal performance of a PO?
project success.8 One of the reasons for this is that, under
PO Effectiveness. Culture can either hinder or support
“O
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FOCUS: LEADERSHIP IN HEALTHCARE IT
are not under the direction of a central PO. As a matter of
these two structures, the project manager has maximum
necessity, each classification entails a different focus and a
authority. Another organizational consideration for the PO
different way of responding to projects.
is its placement within the organization.
These differences are predicated on the need for
Position: Paul C. Dinsmore claims, “Strategic positioning
specialized professional knowledge, which enhances a
of project offices strongly affects a company’s
project manager’s ability to make good project decisions,
performance. Perhaps more important than the decision
thus reducing the possibility of errors in judgment.
itself is top management’s steadfast support of the chosen
Additionally, different classifications of project management
option.”9 Keep in mind that project managers are
emphasize expertise in certain knowledge areas (i.e., scope,
responsible and accountable for the success of projects
time, cost, quality, communications, risk, and procurement),
that often require the participation of various functions,
as in IT project management, which relies heavily on risk
divisions, and even companies.
management embodying special practices.
The position of a PO within an organization, then,
Unfortunately, among these pockets of activity, there
predicts success or failure for the managers and their
is little, if any, communication concerning the
projects, and a failed project is a liability for the
practice of project management within the
organization and its shareholders. Does
organization. Not only is there a missed
executive leadership, then, need any
opportunity for project managers to
other reason for fostering a keen
s project
share “lessons learned,” there is a
interest in PO performance? Jean
possibility for confusing the
Miller, in her 1998 paper, “Project
managers venture beyond their
organization about the services
Office: One of the Fastest
provided by project managers.
Growing Segments in
classifications to address the common
Continuous Learning and
Information Systems,” asserts,
elements in their work, opportunities are
Organizational
“The project office should be
Improvement. A project is a
positioned at the top of the
created for internal networking and the
project is a project. As project
organizational structure where
managers venture beyond
it crosses functional
establishment of an organization-wide
their classifications to address
boundaries and has the
the
common elements in their
visibility necessary to
database of project experiences, allowing
work, opportunities are created
influence.”10
for internal networking and the
Depending on the type of PO
these project managers to learn
establishment of an organizationan organization has founded
from one another.”
wide database of project
(enterprise, special focus, or largeexperiences, allowing these project
scale), PO leadership ideally should
managers to learn from one another. First,
report directly to a COO, CIO, or
though, communication among the different
principal. In this way, the PO has timely
classifications must be established. Without a
access to executive leadership, the benefits of
centralized PO, this effort can be facilitated and
formal authority, and the ability to easily manage crosssubsequently supported by senior management. Once the
functional issues.
communication and, subsequently, the community are
established, the project managers themselves can do the
The Project Management Community
following:
Project Management Synergies. In his article, “A
• Identify the commonalities and differences in their work
Community of Project Managers — the Key to World-Class
• Learn from one another and apply this learning to their
Project Management Practice?”11 Terry Cooke-Davies
work
presents the concept of a “project management
• Strengthen the organization’s understanding of project
community,” in which project managers, scattered
management as well as each classification’s specialization
throughout an organization, work together to ensure “that
and function
their common goals are aligned with the business strategy
• Improve the ability of the organization to plan, execute,
and that effective support mechanisms are in place.”
and support successful projects
This concept is important because it opens the door to
project management synergies that would otherwise be lost
A Journey, Not a Destination
and thus creates additional opportunities for project
A mature PO takes time to develop, and the full
management success and, ultimately, organizational success.
spectrum of project management benefits won’t be realized
Closing Communication Gaps and Improving
until the PO has been in existence for a number of years.
Performance. Within an organization, there may be
According to Provant’s “Project Management Maturity
several pockets of project management activity that may not
Levels” grid, a PO at Level 1 reflects knowledge gained in a
be under the direction of a centralized PO. For example, in
sporadic manner; lacks formal standards, technologies,
healthcare, one can find several classifications of project
portfolio and resource management, professional
management, including IT, clinical, and construction, which
“A
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FOCUS: LEADERSHIP IN HEALTHCARE IT
development, continuous process improvement; and relies
on informal decision support, whereas a PO at Level 5, the
highest level, is at the pinnacle of achievement and
sophistication in all these areas. Regardless of the PO’s
maturity level, Tom Block, PMP, believes, “The project
office’s long-term vision is to transfer project management
knowledge throughout the organization so that it becomes
part of the culture.”12
As the leadership of an organization considers the
creation and performance of a PO, it must consider both
the long and short views. Immediately, business need
drives the type of PO to be created, whereas the formative
References
1
Project Management Institute. A Guide to the Project Management Body
of Knowledge (PMBOK Guide). Newtown Square, PA: Project
Management Institute, Inc., 2001.
2
Dinsmore, P. C. “Positioning the Project Office: What’s Your Opinion?”
PM Network, 2000, 14(8), 28.
3
Cooke-Davies, T. “Drawing Lessons from the Evidence.” Project
Manager Today, 1998. Available at:
http://www.humansystems.co.uk/downloads.htm. Accessed
September 14, 2001.
4
Dinsmore, P. C. (2000). “Managing Projects on an Enterprisewide
Basis.” PM Network, 2000, 14(2), 25.
5
West, J. L., ed. “Best Practices in Project Office Implementation.” In:
Project Management Best Practices Report, 2000, 1(8), 5. Available
at: http://www.cbponline.com/publications/
BestPracticesReport.htm. Accessed October 17, 2001.
6
Ibid.
matrix components determine the performance level that
can be achieved by the emergent PO. All factors must be
properly and continuously addressed in order for the PO to
function at its best, now and into the years ahead.
About the Author
Pamela A. Wolff, FHIMSS, PMP, is a senior IS project
manager in the Information Technology Project
Management Office (ITPMO) at Presbyterian Health Plan in
Albuquerque, New Mexico. Pam also serves as vice
president of membership for the Rio Grande Chapter of the
Project Management Institute.
Kerzner, H. Project Management; A Systems Approach to Planning,
Scheduling, and Controlling. New York, NY: John Wiley & Sons,
Inc., 1998.
8
Baker, B. “Proving the Profits.” PM Network, 2000, 14(12), 19.
9
Dinsmore, P. C. “Positioning the Project Office: What’s Your Opinion?”
PM Network, 2000, 14(8), 29.
10
West, J. L., ed. “Best Practices in Project Office Implementation.” In:
Project Management Best Practices Report, 2000, 1(8), 3. Available
at: http://www.cbponline.com/publications/
BestPracticesReport.htm. Accessed October 17, 2001.
11
Cooke-Davies, T. “A Community of Project Managers - the Key to
World-Class Project Management Practice?” Project Manager Today.
Available at: http://www.humansystems.co.uk/downloads.htm.
Accessed September 14, 2001.
12
Block, T. The Seven Secrets of a Successful Project Office. 1998.
Available at: http://www.systemcorp.com/framesite/
downloads/block_sevensecrets.html. Accessed October 25, 2001.
7
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54
Journal of Healthcare Information Management — Vol. 17, No. 1