If you needed more evidence that projects within organizations are being thought of as strategic activities rather than as mere operational activities consider this PR Newswire: Report Defines How Project Management Execs are becoming New Corporate Chiefs. We are not surprised when we observe firms with strong project orientation create a Chief Project Officer role. Yet we were surprised to find this happening at the New York Times. Drake Associates has had experience with several publishers (college text books, travel guides, online media) having worked as contract project managers on their internal projects. We found that the industry is more prosaic, traditional and process oriented than project oriented. It is not surprising to see CPOs in aerospace, A&E or health care where Project Managers are already highly regarded, highly compensated and given considerable operational authority and strategic influence. The path to this C-level position according to the article:
The people who are being identified as "chief project officers" in these organizations may have different titles or backgrounds, but their charge is the same: They're being given full authority to take all the steps needed to ensure consistent alignment of their organizations' project management activities with corporate-level strategic objectives and goals.
Project management itself is being viewed more strategically within organizations. It is no longer seen as just an operational activity. And it can't be; there is just too much at stake. The trend is showing that it's slowly morphing into a C-level role. When asked if she sees this trend continuing, Beth Partleton, Director of Project Management at Miller Brewing Company replied, "This is definitely the trend, it has to be, when you implement your strategy through projects."
So does your organization need a Chief Project Officer? As project managers and executive consultants we don't see the need for more chiefs. In fact, we're not even fans of Project Management Offices - a highly popular implementation by organizations trying to bring the discipline and techniques of project management to a wider array of operational processes. PMOs work well where they are part of start-up efforts - there from the beginning - or when the organization is already project oriented. Organizations that are process or operationally oriented will find the development and installation of a PMO counterproductive. If a CPO is needed "to ensure consistent alignment of their organizations' project management activities with corporate-level strategic objectives and goals", the organization doesn't need a CPO - they need better leadership.
For those organizations that want to adapt PM traits and processes, a better use of the resources and effort to build a PMO is simply to train those areas outside of product development with the rudiments of project management. Unless the organization has a project orientation where they are acquainted with and using project management methods and procedures in most of their activities, the company is not ready for a PMO. PMOs are not a viable vehicle for changing an organization's culture and that is what is called for in an organization moving from an operational orientation to a project orientation.
The formality that goes along with "Office" or Department status creates its own set of problems - the focus shifts from being effective (getting things done) to being efficient (getting things done cheaply). It codifies and promulgates methods and processes which then get applied indiscriminately. It substitutes procedure for thinking through alternatives, making trade-offs and taking steps to mitigate risks. It makes the organization more risk averse as performance incentives change from doing the right thing to doing it the right way. And in inhibits learning as nothing outside of the approved means and methods are tried or considered.
We recommend that our clients consider projects as strategic initiatives. That is, if it isn't a high risk, high reward strategic activity, it doesn't get elevated to the status of a project. Most capital improvements, upgrade, replacement and maintenance activities, adopting the most popular ERP software or extending product lines can be treated with project management methods, but we don't consider these strategic activities. They can be managed as projects, but they are operational in scope. The goals and objectives of projects must be to provide new and unique capabilities or products that cannot be easily replicated by competitors. Projects should result in new methods or business lines that are defensible and provide a competitive advantage. The very best resources in the organization need to be assigned to projects. If the resources don't exist in-house then go outside and rent them. And the organization must recognize that the future is tied to the successful completion or implementation of these projects.
Projects need to have the approval and a champion at the C-level - but we're not sure creating a C-level role is the right way to do it in most organizations. In fact, we are of the opinion that elevating PM to a C-level function will have exactly the opposite effect in organizations that are not already project oriented. Having a PMO or CPO does indeed raise the awareness of the importance of the function within the organization. It also creates the need to behave in a manner other operationally oriented activities - production, accounting, HR, marketing - employ. And it is precisely this orientation that favors being efficient over being effective. That orientation maintains projects as traditional operational activities rather than as critical strategic efforts.