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Project Portfolio Management – It Starts At the Top

Created on 08 September 2008 Written by Dennis Bolles
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Every journey begins with a destination, or it should, because without a predetermined destination you would not know that you have arrived. We are all on a journey through life and those who plan their journeys with milestones of accomplishments (goals and objectives) are typically those who are most successful in completing each leg of their journey. World-class industry leaders are made up of organizations that set high goals and objectives and develop plans to achieve them.

Having limited resources (people and money) is an aspect of business common to every organization. The challenge most of them share is distributing those resources effectively to achieve the highest return on their investment. You would think that identifying organizational goals and objectives would be an obvious requirement, however that is not the case for many organizations. In many cases, if it is being done, it is not done very well. There are many reasons why this effort is ignored or done poorly.

• There is no formal process to define corporate goals and objectives.

• Firefighting diverts attention from long-range planning.

• Stated goals and objectives are not quantified or quantifiable.

• The development of corporate goals and objects stops at the top.

• There is no formal measurement process to validate status.

• Accountability to achieve goals does not exist.

• There is no personal reward for achieving them or penalty for failing to achieve them.

• It fails to produce desired results.

 

Defining company goals must start at the top and cascade down through the organization structure to the individual department manager’s goals and objectives. The goals and objectives at each level of the organization should support the corporate goals and objectives as well as the goals and objectives of the level it reports to. Establishing goals and objectives is a forecasting activity that requires significant planning and training to achieve the results intended. A formalized process must be documented that identifies the steps taken, roles and responsibilities defined, and the training provided at all levels of the organization.

Companies of all sizes use many methods and techniques with varying degrees of success. There is, however, a simple but effective method used by the Donnelly Corporation, a leading automotive supplier of interior and exterior mirrors with headquarters in Holland, Michigan. Dwane Baumgardner, chairman and CEO, of Donnelly Corporation, wrote a paper entitled “A Constant State of Becoming: Management by Planning at Donnelly Corporation,” published by GOAL/QPC in 1998;. This paper discusses the process, developed by Donnelly, called Management by Planning (MBP). Mr. Baumgardner presents the purpose and value of the MBP process in the paper’s introduction.

“We are all in a constant state of becoming, which will happen either by design or by default. I believe that terms and management fads like change management, or corporate renewal, or reengineering often misdirect thinking and action on a principle reality of life - all life is change, and we are in a constant state of becoming. The reason I believe these management fads are misdirecting is that many of them present change as an event, a single project or series of discreet projects each with its own finish line. On the contrary, I have found change to be a highly systemic and never ending process. The good news is that we have the advantage today of being able to manage our becoming. Pity the dinosaurs who were victims of changes; and I’m not just talking about T-Rex. How about Studabaker, Packard, canal builders, railroads, and the A&P grocery stores? We now have a much greater opportunity to control our own futures, to be actors not victims, to become by design not default. This article is about how our company thinks and acts on our commitment to continuous growth and performance, and a most effective process for managing our becoming, what we call Management by Planning (MBP)."

Baumgardner goes on by stating that “the company’s operating philosophy is based on a partnership among five constituents: customers, owners, employees, suppliers, and the community they live in. The MBP process is designed to identify goals and objectives to achieve improvements in each of the five areas, which in turn result in helping the company become a world-class leader in its industry.”  

About the author:

 
 dbolles_1x1.25.jpg
Dennis Bolles has more than 30 years experience with business and project management in multiple industries. His primary focus over the past 15 years has been advising organizations on methodology development, governance and corporate strategy. He led a virtual project team of 300 volunteers world-wide to a successful completion and on-time delivery of the PMI ANSI Standard PMBOK® Guide Third Edition in 2004. He is a published author of many project management articles, seminars, and two books entitled "Building Project Management Centers of Excellence" and "The Power of Enterprise-Wide Project Management". See his full profile on LinkedIn and invite him to join your network. 
Last Updated on Tuesday, 31 July 2012 23:20
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