0 MGT598 – Summer 2013

What can you do with $40 Billion dollars? Don’t ask Uncle Sam

Posted on by w13jeff

In a June 12, 2013 article, I read from the Project Management Institute (PMI), it says that in a recent study the government risks $148 million for every $1 billion dollars spent.  This is $13 million more than the private sector.  Mark Langley, PMI President and CEO says there are findings where the government is doing very positive things, but he also goes on saying that just 46% of government organizations understand the value of program management.  He also says that program success rates are declining with just under two-thirds of programs meeting their original goals or intent.

He talks about how both the government and the private sector have work to do in effectively aligning program management with organizational strategy and mission.  He says that more than half of the government respondents acknowledged that they frequently focus on specific departmental objects as opposed to the strategic goals of the organization.  Only 11% of the government organizations have a senior-level program management related role, compared to 22% in the global average.  Only 37% of respondents reported there is a formal process for developing program management competency and only 25% reported having a defined career path for those engaged in program management.  This is 17% lower than the global average.

These are staggering numbers when I read them.  I decided to see what this meant to the taxpayer.  I went to the Federal Reserve Bank of St. Louis to plot what the government has spent over the last few years.

pic1

With the exception of the last 2 years, the government has averaged a 7% increase in spending year over year since 2000 and we spent $3.7 trillion in 2012.  If we just looked at the $13 million more in risk that the government takes over the private sector it adds up to almost $50 billion per year as you can see on the chart below.

pic 3

With all the focus on project management and business efficiency, I’m frustrated that the US can’t move forward with this and pave the way for a better run Government.  As the PMI published chart shows below, there are great rewards for a mature project management organization.

Capture

Two things stood out to me in this article.  First, I find it extremely disappointing that project / program management doesn’t align with the overall strategy and that departments are working in silos.  I know this isn’t unique to Government.  Unfortunately, I’ve also experienced this at a few different places and struggle with it today.  Secondly, I don’t know how the government does their budget, but we consider risk when putting our budget together based upon probability and impact.  This means there is less money to use for other projects and programs people want.  I struggle with this topic because we want to ensure we capture all risks of a project, however, it ties up a lot of money from being put into other uses.

How have you or your organization ensured that the projects/programs align with the corporation’s overall strategy?  How have you been able to keep everyone working toward the common goal and not focus on his or her own segment?

How do you plan your budget?  Do you consider risk?  How do you balance appropriate risk with risks that tie up your funds for other projects?

 

You’re the Boss

Posted on by lizc598

http://boss.blogs.nytimes.com/2013/07/08/growing-your-business-how-do-you-define-good-enough/?ref=smallbusiness

The article, posted to the NY Times this weekend, discusses the challenges of growing a business.  There are many factors to consider, including infrastructure, the right employees, expanding resources and training, and the overall focus/goal of the company.  Alexandra Mayzler owns Thinking Caps Group, a company that offers an array of study and educational tools for students of all ages.  She has a company that just passed its 10 year anniversary and has been able to expand into 5 different cities.

This article brought me back to how we participated in our activity of planning out a wedding via a Project Plan chart.  As we saw, there were many different versions of order in what we thought was important and how we defined our Critical Path.  Since we didn’t have cost involved with each activity, it came down to our personal preference of what we felt would be important to us in a wedding, and weighed our decisions on how long we thought activities would be, and a logical order (obviously you have to send out invitations before you can finalize a total count for dinner!).

After reading this article, I reflected on how all companies come to a point during a project that they aren’t quite sure what their critical path should be.  If we are talking more on the operations side, as we did with the Rock Bands activity, it’s a little easier to see since that’s based on financial decisions.  But when looking at a business, there are so many critical paths to consider, including financial, operational, special projects, and the right people.

But as we get more involved with our charity projects and raising money, there are a lot of different outlets and tools we can use in order to reach our goal.  How can we know for sure we are taking the right path?

For our group, we first needed to have a clear idea of who we were targeting for donations, which was going to be friends and family through social media. From there, we needed to put the right tools in place to make this as easy as possible.  This came by us using numerous social media outlets, including Link’d In, Facebook, Twitter, and of course personal e-mails.

Coming back to the article, it’s up to Alexandra to continue to figure out where her focus should lie, and how to create the right momentum in her business to grow and change.

After reading the article, what other ideas would you have for her outside of hiring the right people and expanding leadership skills in order to help her increase her growth?

Cubs Threaten Move from Wrigley

Posted on by lisae598

http://www.usatoday.com/story/sports/mlb/cubs/2013/05/01/chicago-cubs-move-wrigley-field-renovations-tom-ricketts-video-screen/2126331/

As part of yet another drama-filled speech by Cubs owner Tom Ricketts, in a plea to the city of Chicago to build a 6,000 square foot video board on the left field wall, Ricketts proclaimed that the team would leave the location where the Cubs have been for the last 99 years.  While the threat seems real, the viability of the Cubs continuing to sell out while being in last or second to last in a potential future suburban location is slim to none.  The logistics behind the change in the target market are simply too critical to be ignored.  As a previous season ticket holder, I spent many of games with a fear of falling concrete or washing my hands in ice cold water on a just above freezing day in April and the appeal of a new stadium with glamorous amenities (as well as necessities like warm water and restocked toilet paper) would be a dream come true… but not in the suburbs. Having been to a Dodgers game recently in Los Angeles, after completion of the game, people simply returned to their cars and headed home. When I asked a fellow patron on where the nearest bar was located, they smiled and responded with “About 15 miles up the road.” However, being around Wrigley Field at the completion of a Cubs game (or sometimes before depending on the score) has a certain magic to it that cannot be replicated anywhere else. While Ricketts may appear to be negotiating at high stakes, the reality is that the Cubs would wither away without Wrigley but Wrigleyville would continue to thrive based on its shear appeal of location within the boundaries of the city and the proximity to other prestigious neighborhoods. In comparison, the move to the suburbs would cause the permanent fan base to drop immediately and the new fan base obtained would wear off after a few losing seasons. Having personally moved to the suburbs twelve years ago, there are friends that were next door neighbors that I have not seen since due to the inconvenience of traveling either to or from the city. But offer tickets to a Cubs game, and I’m on the blue line before you can tell me who the opponent is.

Besides the change in market demographics, the Cubs would need to work with local transportation as well as highway patrol to assure proper flow of traffic which again differs from the knowledge of traveling in the city. If the Kennedy is backed up, most people familiar with the area would be able to navigate through side streets even without GPS assistance but block an exit on the Elgin-O’Hare and you might as well shut down the entire highway.

So what are your thoughts on a potential Cubs move? Do you think Ricketts has thought out all of the risks associated with the move?

FEMA Working to Extend U.S., Russia Relationship

Posted on by coryg598

Reports have surfaced recently of the Federal Emergency Management Agency working closely with the Russian government to cross-train and share resources in efforts to build a stronger response to catastrophic world disasters. The article attached came from a very conservatively biased article that uses this partnership to attack the current U.S. leadership. However, taking the political conversation out of the picture, this cases is a perfect example to examine the project management capacities of the United States and Russia.

According to the article, the partnership includes “exchanging of ‘experts’ and ‘experience,’ ‘provision of security at mass events,’ and ‘cooperation in disaster response operations.'”

While to this day there are still several political disputes between the U.S. and Russia, there are also several glimmers of hope. Both of these countries have, over the years been a part of some of the largest projects ever managed by a world government. In perhaps one of the largest projects of all time, the Space Race captured the attention of the world. As both countries raced to see which nation would land a man on the moon first, the Soviets and Americans sprung forward in innovation and technology until the US landed on the Moon in 1969.

In a free-market, technology and innovation are rewarded, but attacks on innovation seems to create hostility that only hinders the forward human progress. A book entitled Macrowikinomics by Tapscott and Williams underlines this idea in its entirety. Having read Macrowikinomics, I have to disagree with the author’s thrashing of our current administration for partnering with Russia in terms of Emergency Management and other humanitarian causes that have partnered with Russia under the Obama Administration.

While I don’t believe Russia is a nation that can fully be trusted due to a complicated political history between the United States and Russia, the forward progress of humanity can benefit from the best minds in any nations collaborating to bring new technologies and techniques to solving some of the most difficult mysteries known to man, and in FEMA’s case, to solve some of the most challenging projects we face as a society.

While the Space Race was something that each country handled their own ways, a full collaboration would have likely brought humanity to the moon sooner than 1969. The same is true with the project management involved in deploying a team to help a natural disaster recovery. Sometimes response time is crucial, and creating partnerships to help with the aid can be the difference between life or death.

In closing, the author mentions that this partnership isn’t a popular one, but I believe if both countries proceed cautiously, they will both benefit from it.

http://www.thenewamerican.com/usnews/foreign-policy/item/15899-fema-signs-exchange-deal-with-russian-government

Risk Management: Risk vs. Uncertainty In a Project

Posted on by w13timothy

An important part of the project management process is to also manage any risks associated with that particular project.  In doing so, the project has a much better chance to be successful if anything does happen.  The four main steps in risk management are:

1. Risk Identification

2. Risk Assessment

3. Risk Response Development

4. Risk Response Control

 In following these steps carefully, it allows any project manager or team to identify all potential risks, how they might affect the project, and then how to respond to them and to maintain this response level throughout the project.  Recently there was an article published in Forbes about risk management as it pertains to financial risk which explained the difference between mitigating risk and having complete uncertainty about an event.  Although the article is focused on financial situations, it seems it could potentially apply to project management as well.

The article goes on to say that there is a difference between risk and uncertainty.  Risk is used to define cases of known probability.  For example, McDonald’s most likely understands the probability a person will slip and fall in one of their locations for every million visits to a store.  This would be risk; a known probability which is something they can mitigate.  Uncertainty on the other hand is when the probability of an event is not known at all.  In some cases, companies will treat uncertainty by saying there is an X% chance of an event happening, essentially guessing about the level of that chance.  Complete uncertainty however is when “you don’t know what you don’t know.”  It’s the situation when a company hasn’t even thought of an event in the first place, and so cannot manage it in any way.  These uncertainties are called Black Swans.  The article concludes by explaining that companies ought to have contingency plans that will help to offset any Black Swans.  Again, they are not predictable, but can be minimized by generally planning to have “a Plan B” for this type of situation.

Even though the article’s ideas are all based on economics and finance in the business world, is does seem possible that the same approach can (and maybe should be) used for project management as well.  Matrices are typically created for a project to manage risk, measure how much of an effect those risks will have, and how to deploy a contingency if they happen.  In using the theory explained in the article, these matrices are really only taking into considering the known probabilities of those events happening.  It doesn’t account for the potential of Black Swans, which could wreak more havoc on a project if they occur.

Do you think there should be contingency plans built into projects for the unknown?  Is there a way to include some general safeguards outside of a FMEA plan to really minimize risk AND uncertainy?

 

Sources:

Forbes: Uncertainty and Risk Management: What to Do About Black Swans?

 

Advertising and Project Management Cross Over

Posted on by w13colleen

Advertising agencies need more than creative talent or media experts. In order to run your client’s business there must be efficient and effective project management. It starts with the right partnership between agency and clients. Often times a project does not come to life because of poor management, inaccurate budgets, or unreachable timelines. Agencies and clients are cutting ties due to poor planning and management along with creative issues. In recent ad agency news one of the biggest beer companies pulled their work from BBDO in Canada. Ad Age reported the news this week in the article titled, “Molson Coors Yanks Coors Light from BBDO in Canada.”  There has a been a wave of agency reviews and new accounts where creative was not the reason for the break up. Another article in Inc points to several key factors in reviewing the right agency that points out the importance of proper management, “How to Choose an Advertising Agency.”

BBDO is a super power of creative talent in the U.S., Canada and across the globe. It recently picked up Bud Light account in the U.S. which the stated primary reason why Coors Light pulled the account. On the surface it appears to a conflict of interest however, Bud Light in Canada is managed by Anomaly. Coors Light is behind Bud Light in volume sales however the margin is small which means they are looking for their agency to differentiate the product in advertising and media. Creative differentiation must start with proper management of the account and projects.

Bridgestone has used a private firm out of Dallas for over seven years and most recently ended part of their agreement. Bridgestone creative work is now with Publicis Dallas which is also well-known agency in the industry. However, The Richards Group will retain the sports marketing business. This will require extensive management and coordination between agency partners and clients. The scope and clear definition of roles between the two agencies will be critical to the growth of Bridgestone.

It all starts with the client selection process. Agency selection process is extensive and requires a high degree of management and collaboration. Project management was a key factor in the two examples of why the agency lost the business. The client through the RFP process which includes budget, media targets, creative goals and general agency-client operations defines the scope of the agency’s role.  This is critical for both parties so they produce the right campaigns and drive results for their clients.

Does your company work with an ad agency? If so how is the relationship managed? How does internal project management practices transfer to managing outside partners?

Resources:

http://adage.com/article/agency-news/molson-coors-yanks-coors-light-bbdo-canada/242987/

http://www.adweek.com/news/advertising-branding/bridgestone-tires-moves-publicis-dallas-150988

http://www.inc.com/guides/201108/how-to-choose-an-advertising-agency.html

Communication Barriers in the Client’s Workplace and Possible Solutions

Posted on by denizc598

Nowadays, as seen in many industries, outsourcing has become well-accepted in the project management area. Reasons for outsourcing can vary from industry to industry. In project management, outsourcing is primarily due to the lower budget that many projects have. Nonetheless, the key area to focus on is the “communication barriers that exist when a project manager works at the client’s location and manages an off-shore team by obtaining the client’s scope.”  From this aspect, the article, “Communication Barriers in the Client’s Workplace and Possible Solutions,” highlights several communication problems along with possible solutions.

Below you will see a highlight of these problems categorized under four (4) processes along with possible solutions. These problems are also defined in A Guide to the Project Management Body of Knowledge (PMBOK Guide) – Fourth Edition (PMI, 2008).

  1. Identify Stakeholders
  2. Plan Communications
  3. Distribute Information
  4. Manage Stakeholder Expectations

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Identify Stakeholders and Plan Communications

–          Stakeholder register

  • In the article, the author suggests to have a stakeholder register for every project. The stakeholder register should include the name of the stakeholder, the roles and responsibilities of the stakeholder in the project, the stakeholder’s expectations of the project, and cases in which the stakeholder needs to be contacted and how.

–          Arrange weekly meetings highlighting the exact agenda

  • The project manager needs to determine frequency of the meetings and media, i.e. face-to-face meetings, conference calls, etc.

Distribute Information

–          Plan and execute the right mode of communication

  • The author suggests to use email communication for complex scenarios, and to use face-to-face communication for quick and immediate responses. As for face-to-face communications, the project manager should also send a “re-cap” email of discussions, tasks, decisions, etc. as a best practice.

–          Access to required information, i.e. client’s network, shared folder, etc.

Manage Stakeholder Expectations

–          Negotiate and influence the stakeholder so that certain critical project meetings can still be conducted in the absence of the key stakeholders

–          Accept the fact of how the client works and try to adapt to such working cultures

(Ramaniah, 2012)

The possible solutions seen above can easily be applied to any project in any industry.  This list can be endless since there are several issues and risks in any given project. Therefore, as a project manager, one should consider all four processes. At the end of the day, as the author stated, “It is the project manager’s responsibility to run the show successfully by proactively anticipating such issues and planning how to tackle them.”

In particular, the biggest challenge for me in the project communications management area has been identifying stakeholders in my projects. This has been a challenge since I was new to the company, and initially needed a lot of support and guidance from my manager.

Overall, what are the current challenges that you are now experiencing in the project communications management area? Have you experienced any communication barriers listed under the four different processes?  Have you applied any one of the solutions?

References

Communication Barriers in the Client’s Workplace and Possible Solutions

 

 

Managers are bringing the project down.

Posted on by mikef598

The start of a project is a critical time; a lot of focus is put on budgets, scheduling and risk.  One often overlooked aspect of project is the role the project manager plays.  There are many tools that can help in predicting costs, timing and potential risks of the project.  However, there are few tools to help decide on the project manager other than a ‘gut feel’, or stating ‘I have my best man on the job’.   The way the project manager, manages the project can have a huge impact on the success of the project.   A project manager needs to be able to clearly define milestones and convey these milestones to the project team.  A project schedule and budget often relies on the belief that the team will be efficient throughout the project.  A team without clearly defined goals or confusion within the team will not work to their full efficiency.  In my own experience weeks have been “lost” during a project due to team members working on the wrong tasks or working on tasks that do not help the project move forward efficiently.  Without definition and effective communication all the tools and analysis may not ensure sure the project is a success.

Another important aspect to a successful project is the ability to be able to adjust plans in an effective and timely fashion. This responsibility of decision making often falls onto the project manager.  A project manager that gets bogged down in making decisions can affect the entire project.  The time that it takes to make a decision can affect the schedule; also an improper decision can affect the possibility for a successful project.  Also, during a project a project manager needs to be aware of any changes from the original plan to help the project move quickly and efficiently.  Therefore a project manager that can make critical decisions in a timely fashion increases the chance of a successful project, and can assure the team that the project is well managed and help the project move forward.    A British study estimated that for approximately every 1.5 billion dollars spent on projects, approximately 235 million dollars were at risk due to inadequate project management.

I have seen many instances in my career where the project manager and not the project nature, schedule or budget have had the largest impact on a project.   Many times how the project is conducted and the communication in the project that is most beneficial and often this can be seen by number of successful projects a certain project manager has managed.  These management styles are very hard to be measured often times it is overlooked and not addressed.

How important do you feel the actual project manager has in the overall success in the project?

 

http://www.telegraph.co.uk/sponsored/business/project-management-institute/10125593/pmi-project-leadership.html

Supply Chain Expatriates, Risk or Opportunity?

Posted on by peij598

In last decade, the economic boom in China and its future dominance in key industrial sectors has been a tireless news event and is still an exciting hot business topic. With the rapid business expansion in China, multinational logistics companies are desperately in need of local management personnel to staff new offices and routes.  However, multinational logistic enterprises are experiencing hard times to find qualified candidates recruit them and retain them in China.

The biggest reason that I choose Operations Management (supply Chain Management) as my concentration is that I perceive this as an exciting opportunity to work oversea as an expatriate in China.  I want to develop a broad base of business skills, knowledge of Supply Chain Processes through my MBA courses.  China is evolving and changing everyday; it’s great to be a part of that and witness the improvements that benefit the average Chinese person. I hope that in some way to contribute to the process.

According to the Journal of Logistic Management, the role of the expatriate has never been more important and challenging. The article states supply chain and logistics manager have interviewed Chinese based western expatriates and local professionals on many assignments spanning appointments in operations across the supply chain.  The interviews show that expatriates will be a willing and eager segment within the work force; Chinese people want to learn from best global practices, different management styles and achieve objectives. While expatriates looking for a new challenge will find lots of new learning opportunities and also have the opportunity to shape the future of a business potentially far in excess of their home country business.

Interestingly, expatriates who have completed the foreign assignment successfully are more likely to get promotion when they return.  If this is a win-win situation for both sides, why are more than 30% of expatriates failing to complete their assignment?  What are the major challenges as expatriates in China?

Based on a set of interviews with executives in global logistics companies, it suggests expatriates end their foreign assignments earlier because of the following reasons: cultural difference and languages barrier. These reasons have great impact on expatriates’ performances, motivations and satisfaction.  Most Western business expatriates in China work in unfamiliar surroundings, as they typically do not understand much of the language and the culture. More importantly, these expatriates lack cross-cultural training before they depart to China.

In term of cultural differences, Chinese emphasizes persistence, relationships ordered by status, personal adaptability, leisure time is not emphasized, frugality, and good or evil depends on circumstances.  While Americans emphasizes quick result, status not critical in a relationship, the importance of leisure time, spending, and belief in absolutes about good and evil.

Acknowledging these factors of Supply Chain Expatriates in China it is clear that they face both risk and opportunity prompting companies and individuals to prepare as best they can to improve the success rate of foreign assignments. What are your thoughts?

 

 

References:

Shi, Yanhong and Robert B. HandField, Talent management issues for multinational logistics companies in China: observations from the field.International Journal of Logistics: Research & Applications; Jun2012, Vol. 15 Issue 3, p163-179, 17p

Goffnett, Sean P.; Cook, Robert L.; Williams, Zachary; Gibson, Brian J. Understanding satisfaction with supply chain management careers: an exploratory study. International Journal of Logistics Management. 2012, Vol. 23 Issue 1, p135-158. 24p. DOI: 10.1108/09574091211226966.

Portioil Staudach & Alberto Tantardini (2012), International Journal of Production Research; Jun2012, Vol. 50 Issue 12, p3257-3273, 17p, 2 Diagrams, 5 Charts, 5 Graphs

 

Will anyone miss the car dealer?

Posted on by w13viv
Have I got a deal for you!
Have I got a deal for you!

Tred, a new start up company in Seattle, is turning the concept of car buying on its head by bringing the test drive to you. Why is that significant? Because now, a person can engage in every (productive) aspect of purchasing a car without having to set foot in the dreaded new car dealership.

Prior to the advent of the internet, unless you happened to find a review in an auto magazine, you couldn’t find out anything about a car without stepping into the dealer showroom. By the late 1990s, you could look up information about cars online. Saturn pioneered selling direct to the customer online shortly after. Ebay connected millions of car sellers and buyers. And now, many car dealerships offer online sales and have dedicated internet sales managers. So as long as you don’t care to test drive a car before plunking down your money, you had the ability to do so (indeed, an internet search yielded studies that showed up to 28% of cars are purchased without test drives, and even more people test drive only the car they buy but not the competing products). But most of us are not comfortable with spending a large chunk of our savings without sampling the product.

Enter Tred. In addition to researching, getting pricing, and purchasing a car online, with Tred you can have competing cars delivered to your home for a test drive for just $19. What does that money get you? A ride with a Tred representative (not a dealership employee), a packet of information about the car itself (including dealership forms), no haggle pricing, and best of all – no dealership salesperson. You might think that this would result in fewer sales without someone manipulating the customer’s decisions or pressuring the customer to “seal the deal.” But Tred is counting on their service to actually improve the take rate on vehicles that have been test driven. According to a Gallup poll from last December referenced in the article, “… car sales people ranked below members of congress in trustworthiness…” Therefore, the company is willing to bet that if they can remove as much contact with the dealership as possible from the process, they will increase sales for the dealership and improve the car-buying experience for the customer.

Tred’s financial backers also believe this to be the case. Some of their current investors even know a thing or two about selling cars, including Rick Wagoner, former CEO of General Motors; and Fraser McCombs Capital (their largest investor), whose equity pool includes capital from the owner of eight car dealerships in the San Antonio area. A principal from Fraser McCombs is quoted in the article saying that “A customer asking for a car to be brought to their house is in my opinion converted from a shopper to a buyer.”

What do you think about Tred’s new test drive service? Have you had any particularly bad experiences that have made you want to stay as far from a car dealership as possible?

 http://money.msn.com/business-news/article.aspx?feed=OBR&date=20130619&id=16612466