Archive for category Business Process Management

Resource Planning for the Small and Mid-Sized Service Organizations

by Mike McRae, CMA, Vice President of Professional Services, Tenrox

If you’re like most SMB Professional Services Organizations (PSOs), you’ve probably got a good handle on things like utilization rates, average billing rate, profit per project, and revenue per resource. These metrics are widely used across all PSOs and are relatively easy to capture with any Professional Services software tool. The problem with only focusing on these metrics is that they only provide you with insight into how well you’ve done – past tense. They don’t provide you with any insight into how many resources you’ll need next month or next quarter, or more specifically, the number of Project Managers, Database Administrators, and Consultants you’ll need in the US, Europe, and Asia.

More importantly, these metrics will not alert you to upturns and downturns in the sales pipeline. This blind spot limits your ability to ramp up and threatens the new business you’ve just acquired.
Similarly, in a downtrend environment this reduces the amount of time you have to scramble before having to layoff quality personnel. In this regard the SMB organization is greatly disadvantaged over larger competitors. With formalized recruitment and on-boarding processes, larger organizations have an easier time attracting and training new talent and have a much greater ability to withstand lulls in the market, thus making them tougher to compete against.

With so much on the line, why do SMBs spend so little time on Resource Planning?

Read more on PSVillage.com, where Mike McRae is a featured author.

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Talent Factory: Feeding the Project Workforce

Computerworld has published a great interview with Douglas A. Ready, co-author of a recent article in the Harvard Business Review about "talent factories." While these pieces are specifically addressing the need to cultivate talent for management positions, their findings have implications for the project workforce as well.

The Computerworld interview is here: "How To Build a Talent Factory."

The abstract for the HBR article is here: "Make Your Company a Talent Factory," by Douglas A. Ready and Jay Conger.

In the HBR, Ready and Conger describe two case studies: Procter & Gamble and HSBC Group. Each of these companies has very different processes in place for attracting and cultivating talent, but they share these fundamental principles in common:

  • Functionality–rigorously-followed business processes for recruiting, training, and succession management that are designed to align with real strategic objectives
  • Vitality (a wonderful concept!)–a commitment to the emotional side of the equation, addressing how leadership’s daily actions foster passion and engagement.

What does this mean for line of business and project managers who have to recruit talent for project-based work? Douglas A. Ready states in the Computerworld interview that the principles of functionality and vitality can apply at any level:

By all means, start with the areas that you can control and influence. There are lots of lessons from talent factories that you can duplicate. Start with your function or region. Then talk up the successes you’ve had: stronger retention, better accept-to-offers ratios, stronger engagement scores — those can give you confidence that talent initiatives are starting to bring about results. Then colleagues may follow your lead.

Project managers, PMOs, HR, services organizations, and anyone who regularly manages and staffs project teams need also to be aware of Functionality and Vitality. Without talent to feed their project workforce, companies will lack or lose their competitive advantage. This applies not only to management positions but also to contractors or employees who are hired for contract work on or assigned to specific projects.

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A Secret of Project Management: POTS

POTS = Plain Old Telephone System

I have been concerned about our team’s ability to respond to customer inquiries, so I followed up with some of our staff to see why some issues were still outstanding. They tell me:

"I sent an email no one replied."
…or…
"I created a workflow request and no one replied."

I love technology as much as the next guy. But human interaction beats any technology in existence today. So I’m encouraging our staff to try an old fashioned remedy: pick up the phone and call.

In our market–and I’m sure in many others as well–our company can show some real leadership just by being responsive to our customers in a timely manner, plain and simple. It’s a plain and simple problem with a plain and simple solution: POTS.

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Printing Loads of Paper for Project Management

I had to work on an RFP because all our pre-sales guys were too busy with other projects. The RFP had 50+ questions, which is typical. What realy bothered me was the printing!

The RFP was issued by a university looking for a project management solution. Yet they had asked for 5 copies of the material printed and Fedex’ed to them by the deadline. What I do not understand is this: why is a university, which is supposed to represent the future, asking for so much printed paper?

Printing hundreds and hundreds of pages, including the supporting material they asked for, took so much of our assistants’ time. And some of the screenshots did not look so good on paper anyway! But what the hell!

So we spent 2 to 3 hours printing, binding and packaging—5 copies, no less—and then we paid Fedex to deliver this large bulk of paper, which probably no one will read in its entirety.

We could have just emailed the same content; it would have taken 2 to 3 hours less work, and we would have been able to invest an extra day on responding to the questions instead of printing, packing and shipping.

This is a university for heaven’s sake!

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PPM Needs the Project-Centric Approach

We received interesting comments from Philip McGuin of Atlantic Global in response to our recent series from David Hofferberth about the Project-Centric Approach.

We enjoy the debate. McGuin says Project Portfolio Management (PPM) empowers the business, but he assumes that project-centric approach is old news. Hofferberth says that taking a project-centric approach is a key stepping stone to successful PPM, and that it has not been adopted as much as we may think.

PPM and a project-centric view of the business go hand–in-hand. Unless a project centric approach is adopted, standardized and perfected, then projects will most likely fail—we have all seen the research and statistics on the percentage of projects that fail or go over budget. Granted, some projects fail because they might not have been the right projects in the first place, but more often than not, execution and management of resources are the problems.

If standardizing project management techniques and methodology is unsuccessful, then moving up to the next level of managing portfolios of projects could mean that organizations are getting ahead of themselves, and not getting to the root of the problem.

There are several associations and communities in the project management arena that continue to educate and introduce new methodologies, standards, and best practices. These groups continue to grow. Clearly, a lot of people are still working hard to perfect project management—and therefore the project-centric approach. And they must reach a certain level of maturity in the adoption of a project-centric approach before they can even entertain PPM.

PPM is a great goal for the more mature project-centric organizations, where empowerment is at the level of the business (top-down), but the first step in empowering the “top” is making sure the right approach is adopted at the bottom— in the trenches, at the foundation. Empowering the project-driven workforce with the tools, methods and best practices is paramount for executing projects successfully and for providing the “top” with the information needed to make better decisions faster.

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The Management Information Mess

ITWorldCanada has reported on an Accenture study, which reveals that managers spend inordinate amounts of time searching for the information they need to do their jobs — and they often come up with the wrong information.

In this day and age of information technology, searches, and online collaboration, how can this still be such a problem?

Here are some interesting statistics from the study [emphasis mine]:

Managers often face additional challenges because they don’t save important data in a collaborative place.

The majority of the managers surveyed said they store their most valuable information on their computers or individual e-mail accounts, where others can’t access it, Accenture said. Only 16 per cent of managers said they store valuable data in a collaborative workplace, like an intranet portal.

Just less than half (42 per cent) of those surveyed said that they accidentally use the wrong information at least once a week.

Of all the managers surveyed, IT workers are the least likely to say the information they find is valuable and they spend the most time trying to find it. They dedicate nearly 30 per cent of their time trying to find information.

The entire article on the ITWorldCanada site is here: http://www.itworldcanada.com/V.aspx?i=2d15749973db4f2daf12 (Access is free at the time of this writing, but may be limited in the future.)

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What is the difference between workflow and Business Process Management (BPM)?

Workflow is geared at routing business documents (requisition, expense forms, etc.) through a series of tasks in a predefined order. Workflows are application-specific and are somewhat departmental in scope. The workflow may involve a certain set of predefined documents or forms that a particular application manages and interacts with using a predefined set of roles within an organization.

For example, each week a new timesheet is sent to the team member for entering his/her time spent on a particular project. The workflow engine that sends this notification may also send a reminder if the timesheet is not completed by a particular time. Once the timesheet is entered, the workflow engine will send the information to the project manager(s) for approval before sending this information for payroll. Here a business rule, embedded in the workflow and based on the defined worksheet routing, alerts the human to do a certain work or sends notifications if some other threshold has been crossed.

BPM, on the other hand, is enterprise-wide in scope and spans departmental and application boundaries. When combined with commodity Enterprise Application Integration (EAI) and Business Rules Engine (BRE) technologies, BPM solutions can actually complete the tasks without any manual intervention. BPM-managed processes may impact several business entities such as project managers, sales people, customers, project team, contractors, help desk, accounting and HR departments. Automation of these processes must accommodate these entities and related business documents (timesheet, project plan, customer invoice, expense report, service request, etc.) stored and managed in multiple back-end systems.

Business Process Management also encapsulates modeling, analytics, simulation of business processes and a set of tools to view, control and change ‘run time’ process instances in real-time. Workflow technologies typically lack these features but still can be looked at as a subset of BPM without the ability to orchestrate processes across other applications and data silos.

In the BPM world, the above example may be extended by defining additional systems or human roles (or actors), which can take this automation to the next level. The approval process may be done by a rules engine where all timesheets based on certain conditions or rules are automatically evaluated and approved – with the exceptions going to the project manager. Under this approach none of the rules are ‘coded’ programmatically. Furthermore, the approved timesheet data is automatically routed to the Human Resource application (another actor) where vacation and other employee information is automatically adjusted. If the project work is billable, then a customer invoice is automatically created in the Billing or the ERP system when all the timesheets of the project team are completed (another business rule), in which a notification is sent to the account manager assigned to the customer – as defined in the company’s CRM system. Here the BPM will not only automate the process, it will also provide real-time visibility in managing and reducing billing delays which may impact the company’s ability to pay its own bills.

Tenrox Project Workforce Management System, with its highly configurable workflow and process engine, is specifically designed to manage business processes using a single system of records that unifies customer, project and workforce management and maintains all the relevant information in a centralized auditable database.

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Process Improvement : Job No. 1 (the workforce management and project management perspective)

CIO Insight published an article, "The 30 Most Important IT Trends for 2007." For your convenience, we list the 30 trends below:

Strategy
1. Process improvement will be job No. 1
2. IT works on closing the sale
3. Companies make their Web sites more engaging
4. Customer service gets a tune-up
5. Companies put their mounds of data to work
6. Information governance gains momentum
7. CIOs strive to be strategic

Management
8. The division between IT and business will diminish
9. CIO compensation keeps climbing
10. IT organizations will keep growing
11. CIOs struggle to find business-savvy technologists
12. Outsourcing changes IT management
13. Outsourcing growth slows
14. Offshoring shifts from India
15. Companies invest in IT leadership
16. Demonstrating ROI will remain a struggle

Security and Risk
17. No abatement of IT security threats
18. Security concerns turn users away from Windows
19. Security morphs into risk management
20. Compliance achieves what government intended
21. Compliance spurs financial process improvement

Technology
22. The move to a new architecture marches on
23. Enterprise applications start losing their luster
24. Data quality demands attention
25. IT reluctantly embraces Web 2.0
26. IT innovation loses traction
27. Business process management services and software will frustrate users
28. For business intelligence, the best is yet to come
29. IT organizations start going green
30. Dissatisfaction with vendors is on the rise

In their blog, 180 Systems adds the following comment:

180 View – We also share the view that process improvement will be job No. 1. It’s interesting that process improvement shows up under security and risk [#21]. This makes sense to us. Compliance reviews are deemed a bitter poison by most companies and want them done as quickly/cheaply as possible or at least to provide some suggestions to improve business process.

In my view, compliance is like medicine that tastes bad but is good for you in the same way as getting more exercise and eating healthier food might be unpleasant but necessary for a long happy life. The process improvements brought about by compliance are the very improvements that will make a business more agile and competitive.

Therefore, process improvement—whether for compliance, or for the general "health" of the business—is an essential area for a company to invest, and we are glad to see it is regarded as the #1 trend for 2007.  A workflow-driven project workforce management system is the one of the best ways to achieve and maintain a consistent process improvement program.

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Aberdeen Report: Agility is the Theme

A new survey and report from Aberdeen, “Beyond Time and Attendance: Agility Meets Efficiency in Workforce Management,” is now available, and is complimentary through the Tenrox-sponsored download site (through January 26, 2007). Download the Aberdeen Workforce Management report here.

Bottom line: Organizations with shift-based or project-based workers need the agility to handle unforeseen changes in labor supply and demand. Workforce Management (WFM) solutions have proven their value for organizations that have adopted them, delivering 25% to 450% ROI. Companies with WFM are clearly outperforming those without it.

Aberdeen’s survey of 243 companies found that 34% did not have any WFM system in place, and another 51% were only partially automated. This 85% sample represents organizations that are still thinking and executing in a pre-flat world, (read our post about the Flat World here), choosing Time and Attendance and Workforce Management solutions with limited to no project concepts; meaning project management and project staffing is not even part of their realm of thinking, yet.

The report finds that the most desired capabilities in Workforce Management are:

  1. Planning, Scheduling and tracking of multiple work types (29%)
  2. Prioritizing labor plans based on customer impact (29%)
  3. Allocating labor costs more accurately to projects, activities, or products (27%)

The report includes “Recommendations for Action” for companies at varying levels of maturity in WFM.  We highly recommend that anyone interested in Project Workforce Management read this report to optimize their WFM investment.  Download the complimentary Aberdeen Workforce Management report here.

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New Study Validates Process Controls

Here’s a frank and informative article in the latest CIO magazine about the differences between high-performing IT organizations and the rest: the bottom line is better controls, and real consequences for unauthorized changes within a project.

The article is here: http://www.cio.com/archive/111506/col_sch.html
CIO Magazine, "Are You In Control? Innovation demands discipline as much as it requires freedom." by Michael Schrage. November 15, 2006.

The article takes some very nice stats from a report by the IT Process Institute (buy the full report here). They amount to resounding support for the workflow-driven approach:

The findings quantified distinctions between IT shops that live for the average and the few that take process leadership seriously. Elite IT performers weren’t just two or three times better than median performers—they were seven or eight times better. High performers—roughly 13 percent of the 98 sampled—contributed on average eight times more projects, four and a half times more applications and software, four and a half times more IT services, and seven times more business IT changes. They implemented 14 more changes with half the failure rate.

And what separates these elite performers from the rest? Schrage explains in no uncertain terms:

Two controls towered over all others in impact and importance: Do you monitor systems for unauthorized changes? And are there defined consequences for intentional unauthorized changes? No ambiguity or nuance here. The key discriminator between the best and the rest was that elite performers rigorously monitored and punished unauthorized changes. They had situational awareness of change.

Schrage goes on to make some excellent comments about the value of control over change:

It’s not the work we’re supposed to do that undermines our productivity; it’s our black market economies of unauthorized changes—no matter how well intentioned or essential. We misunderstand the true enterprise costs of change.

As a firm believer in the value of process controls and well-managed workflows, I’m glad to see this validation come from the ITPI and CIO magazine.

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