Strategic Planning for Project Management Using a Project Management Maturity Model

271 Pages·2001·2.809 MB·English

by  Harold Kerzner

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S T R AT E G I C
P L A N N I N G F O R
P R O J E C T
M A N AG E M E N T U S I N G
A P R O J E C T
M A N AG E M E N T
M AT U R I T Y M O D E L
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S T R AT E G I C
P L A N N I N G F O R
P R O J E C T
M A N AG E M E N T U S I N G
A P R O J E C T
M A N AG E M E N T
M AT U R I T Y M O D E L
H A R O L D K E R Z N E R , PhD
Senior Executive Director for Project Management
International Institute for Learning
New York,New York
John Wiley & Sons, Inc.
New York Chichester Weinheim Brisbane Singapore Toronto
(cid:2) (cid:2) (cid:2) (cid:2) (cid:2)
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This book is printed on acid-free paper.∞
Copyright ©2001 by John Wiley & Sons. All rights reserved.
Published simultaneously in Canada.
No part of this publication may be reproduced,stored in a retrieval system or transmitted in any
form or by any means,electronic,mechanical,photocopying,recording,scanning or otherwise,
except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act,without
either the prior written permission of the Publisher,or authorization through payment of the
appropriate per-copy fee to the Copyright Clearance Center,222 Rosewood Drive,Danvers,MA
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addressed to the Permissions Department,John Wiley & Sons,Inc.,605 Third Avenue,New York,
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This publication is designed to provide accurate and authoritative information in regard to the
subject matter covered. It is sold with the understanding that the publisher is not engaged in
rendering professional services. If professional advice or other expert assistance is required,the
services of a competent professional person should be sought.
Library of Congress Cataloging-in-Publication Data
Kerzner,Harold.
Strategic planning for project management using a project management maturity model /
Harold Kerzner.
p. cm.
Includes index.
ISBN 0-471-40039-4 (alk. paper)
1. Industrial project management. 2. Strategic planning. I. Title.
HD69.P75K494 2001 00-043814
658-4(cid:2)04—dc21
Printed in the United States of America.
10 9 8 7 6 5 4 3 2 1
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Contents
Foreword ix
Preface xi
Introduction xiii
1 The Need for Strategic Planning for Project Management 1
Introduction 1
Misconceptions 1
Wall Street Benefits 3
Stakeholders 4
Gap Analysis 5
Concluding Remarks 9
2 Impact of Economic Conditions of Project Management 11
Introduction 11
Historical Basis 11
3 Principles of Strategic Planning 15
General Strategic Planning 15
What Is Strategic Planning for Project Management? 16
Executive Involvement 25
The General Environment 26
Critical Success Factors for Strategic Planning 28
Qualitative Factors 29
Organizational Factors 30
Quantitative Factors 32
v
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vi CONTENTS
Identifying Strategic Resources 34
Why Does Strategic Planning for Project Management
Sometimes Fail? 38
4 An Introduction to the Project Management Maturity Model
(PMMM) 41
Introduciton 41
The Foundation for Excellence 42
Overlap of Levels 43
Risks 45
5 Level 1:Common Language 47
Introduction 47
Roadblocks 48
Advancement Criteria 49
Risk 50
Assessment Instrument for Level 1 50
Questions 51
6 Level 2:Common Processes 67
Introduction 67
Life Cycles for Level 2 68
Roadblocks 71
Advancement Criteria 72
Risk 72
Overlapping Levels 73
Assessment Instrument for Level 2 73
Questions 74
7 Level 3:Singular Methodology 77
Introduction 77
Integrated Processes 78
Culture 81
Management Support 81
Informal Project Management 82
Training and Education 82
Behavioral Excellence 84
Roadblocks 85
Advancement Criteria 85
Risk 86
Overlapping Levels 87
Assessment Instrument for Level 3 87
Questions 87
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Contents vii
8 Level 4:Benchmarking 97
Introduction 97
Characteristics 98
The Project Office/Center of Excellence 99
Benchmarking Opportunities 101
Roadblocks 103
Advancement Criteria 103
Assessment Instrument for Level 4 104
Questions 104
9 Level 5:Continuous Improvement 109
Characteristics 109
Continuous Improvement Areas 110
The Never-Ending Cycle 112
Examples of Continuous Improvement 113
Developing Effective Procedural Documentation 114
Project Management Methodologies 120
Continuous Improvement 120
Capacity Planning 122
Competency Models 123
Managing Multiple Projects 125
End-of-Phase Review Meetings 127
Strategic Selection of Projects 128
Portfolio Selection of Projects 131
Horizontal Accounting 134
Organizational Restructuring 136
Career Planning 138
Assessment Instrument for Level 5 138
Questions 139
10 Sustainable Competitive Advantage 143
Introduction 143
Strategic Thrusts 144
The Need for Continuous Improvement 147
Project Management Competitiveness 148
11 Special Problems with Strategic Planning for Project
Management 151
Introduction 151
The Many Faces of Success 152
The Many Faces of Failure 153
Training and Education 157
Change Management 158
Partnerships 162
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viii CONTENTS
The Impact of Risk Controls Measures 163
Dependencies between Risks 165
Selecting the Appropriate Response Mechanism 168
Conclusions 170
11 Case Studies 171
Case 1: Packer Telecom 171
Case 2: Luxor Technologies 173
Case 3: Altex Corporation 177
Case 4: Acme Corporation 180
Case 5: Quantum Telecom 182
Case 6: Lakes Automotive 184
Case 7: Ferris HealthCare,Inc. 185
Case 8: Clark Faucet Company 187
Case 9: Hyten Corporation 190
Case 10: Como Tool and Die (A) 200
Case 11: Como Tool and Die (B) 204
Case 12: Macon Inc. 207
Case 13: The Trophy Project 209
Case 14: The Blue Spider Project 212
Case 15: Corwin Corporation 225
Case 16: MISProject Management at First National Bank 235
Index 247
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Foreword
To win a decathlon requires the extreme best from the participant. It is a very gru-
eling and demanding set of events. The decathlete is usually very good and in fact
the best in one or two events and in good standing in the other eight or nine
events. The objective is to be the overall best in all ten events. Decathletes like
most athletes must complete in head to head events to know if they are able to win
the overall decathlon. They must study their competitors in the greatest detail and
know their strengths and weakness. They must learn from the other decathletes
what allows them to put out that extra 5% that means the difference between win-
ning and just participating. They must also compete in an environment where the
performance standard required to win is always becoming higher.
Being a project manager is similar to the decathlete and in the business of proj-
ects, the field is very competitive. Similar to a decathlon there are events (nine
knowledge areas) in the Project Management Body of Knowledge. The decathletes
in project management are the companies that are controlling costs,schedule and
quality on a project level. The project-driven companies must find ways to learn
“best practices”in a competitive world and apply these lessons to their processes,
systems, and tools. This method of continuous improvement through measuring
and comparing is referred to as benchmarkingas described by Dr. Kerzner.
Nortel aspires to win the decathlon prize,but realizes it is not possible with-
out both internal and external benchmarking measurements and continuous im-
provements. The internal benchmarking is similar to intramural decathlons where
learning comes from watching the friendly decathletes. A significant opportunity
for learning and continuous improvement occurs when the “best in class” have
entered the decathlon.
Nortel has particapted in the Kerzner five-step Project Management Maturity
Model survey for the last year and a half. The five steps measure the desired di-
ix