Tight budgets have upped the ante in the IT projects organizations choose to pursue this year, and in some cases the CIO's involvement in those projects has increased as a result, consultants and practitioners say. Yet the CIO's contribution to project and portfolio management (PPM) at large enterprises is more often about communication and change management strategy than other parts of the process, SearchCIO.com research shows.
CIOs are involved with managing the project portfolio or adjusting priorities among projects at less than 20% of organizations with more than 1,000 employees, according to our survey of 304 organizations this spring. Rather, those duties are most often performed by IT directors or governing bodies.
Instead, the CIO's role is one of communicating a vision and driving a change management strategy that will result in greater user and organizational acceptance of the projects selected for development.
"There is more riding on the CIO's decisions in the project management space than ever before," said Brian Turner, the chief service delivery officer at Point B, a project leadership consulting firm. "The CIO can't just delegate project management responsiveness to the staff because he must lead by example."
Organizational change management is crucial, agreed Allen Debes, vice president of solution delivery services at Thrivent Financial for Lutherans, a not-for-profit insurance organization with nearly 2.6 million members. Before rolling out its new PPM solution from Hewlett-Packard Co., Thrivent had a soft launch in 2008, configuring resource pools and providing training for resource managers, senior leadership team members and project managers.
"Change management should be the starting point because the overall [project management] strategy will succeed or fail based on this," he said.
A change management strategy formally introduces initiatives to everyone affected by them, and should also introduce any new roles or expectations to team members to get everyone on the same page at the same time.
"Creating a culture where everyone understands their roles, responsibilities and expectations from the get-go increases the chances for project success," said Joyce Perry, an IT solutions leader at Genworth Financial Inc. who helped consolidate three groups at the Richmond, Va.-based company. "And it eliminates most surprises."
Indeed, surprises are one reason for project failures, which persist despite governance and tools like PPM software to keep projects on track. "It often comes down to the fact that the business didn't realize the impact this change was going to have, and therefore didn't plan for it," Turner said.
Research from The Standish Group International Inc. on project success rates found that 24% of projects are canceled partway through or delivered and not used. The SearchCIO.com survey showed that just 11% of large organizations complete all projects in their development queue; the majority (54%) report an abandonment rate of 1% to 10%. The final third don't finish 11% to 50% of projects.
At Genworth Financial, consolidation went smoothly because Perry laid out an extensive workflow for change management during the implementation process. She paid special attention to the rigorous standardization that needed to happen while developing a realistic timeline.
Perry started out by changing small things; changes grew in complexity as the organization worked toward its goals. "You need to be able to crawl before you can run," she said. "Whenever you are changing the business culture you need to plan out the procedure for it, or else the tools will just sit there."
But too much process can also be a problem, resulting in "death by a thousand cuts," as Turner put it.
"Before [the economic crisis], there were two or three approval points to get a project going. Now it feels like the number of stage gates has increased, leaving new, creative projects to die on the vine before they even have a chance."
Tighter budgets have led many organizations to add checkpoints for proposals, aimed at weeding out unnecessary or unrealistic projects before they even start. And although these processes can prevent wasting time and money on projects that don't provide a lot of value, they also stifle innovation and discourage new ideas. Finding a middle ground is difficult, he said.
"If there are too many approval points, people get frustrated and throw up their hands in defeat," Turner said. "But not enough, and engagement can fizzle out."
Developing a vision that meets business objectives and the needs of stakeholders can be the first step in finding that happy medium, he said. "Start basic, envisioning a plan that doesn't necessarily require a lot of tools and processes but has better stakeholder alignment and overall clarity into what the business problem is that is trying to be solved."
Debes said he has struck a balance at Thrivent Financial by staying open to the potential for project adjustments along the way while also following Lean Six Sigma methodologies and ITIL best practices. "We run Lean Six Sigma in parallel to the business processes of the project," Debes said. "And we streamline every project to fit into this overall strategy."
At the end of the day, CIOs are trying to keep operational spend under control while still making progress on IT strategies. They need accurate information on the projects rolling up to them. That's important not just for managing IT but also for engaging the rest of the business leadership team -- one of the CIO's most important responsibilities.
"You can have the most beautiful [project management] tool out there," Debes said, "but without the support of the management team, it just won't matter."
Let us know what you think about the story; email: Kristen Caretta, Associate Editor