Project Initiation

$2.2 million. Tim sunk his face into his hands and thought about how he got here. Why isn’t this working? What is wrong here? How am I going to dig myself out of this mess?
Six months earlier, Tim Jacobs was promoted to Project Manager and began the long process of implementing the new financial system. He was excited about his new role – in the past, as a systems administrator, Tim worked on many different projects and always thought he could do a better job if given the opportunity. His opportunity came and his first project was a big one – implement the new financial system in nine months with a three million dollar budget. Much of the company’s processes relied on this system to work and the project had to come in on time, on budget.
Six months into the project, Tim spent $2.2 million of his budget and was already projecting an additional three months beyond the nine month plan. He wasn’t sure how he was going to fix the problem, but he was sure he made some mistakes to get to this point.
Project management methodologies define how a project should function and the phases project managers must do for a successful project. The first phase, Project Initiation, defines the steps a project manager should take before a project is officially started. Building a solid foundation for the project allows the project to stand strong when the weight of it starts to pile on. In Project Initiation, the Project Manager develops a solid business case, ensures the project is aligned with corporate and department goals, performs a risk analysis, and identifies the key stakeholders for the project.

Develop a Solid Business Case

The first step before any project is started is to create a solid business case. Why are you initiating this project? Too many projects start without a firm rationale and senior management buy-in, which often results in failure.
A solid business case defines what the project is, what the results of the project will be, how it benefits the company, and the financials involved. We recommend involving your finance team in constructing the business case to ensure it has correct financial models.
After you have constructed your business case, present it to your senior management team for approval and buy-in before proceeding.
In Tim Jacob’s project, since the company had already made the decision to implement the new financial system, Tim prepared a small business case and did not ask finance for assistance. The vendor gave him some average returns on investment (ROI) numbers for companies in his industry and he used those in the business case. He submitted the business case to his boss, but did not present it to other senior managers for buy-in.
Tim should have prepared a solid business case for the project. Even though the “company had already made the decision,” preparing the business case would have helped people think through the decision and not be influenced by outside factors. Additionally, perhaps the $3 million budget was inadequately prepared and finance could have identified a more realistic budget number.

Compare Your Project to Corporate and Department Goals

Every project should fit within your corporate and/or department goals, mission, and vision. If it doesn’t – why do the project? A project that is properly aligned with the company will help move the firm forward. Many projects are undertaken for personal reasons, or “kingdom building” – designed to build a single manager’s workforce. These projects are prone to failure as the politics involved will weigh too much on the project team.
Tim didn’t know, but he walked into a minefield with the financial systems project. The vendor selected was the competition of the current system in place and many of the employees who used the old system on a day to day basis didn’t want to change. They did not participate fully and frequently would do things to delay the project. The company was struggling financially and after two rounds of layoffs, many employees saw this project as not aligned with the corporate goals.
Tim’s project suffered from poor PR and the lack of buy-in from many key departments. This contributed to the delays and increased costs during the system implementation.

Identify Key Stakeholders

Identify the early key stakeholders for the project and decide which ones should be involved in the business case preparation. Key stakeholders are crucial to the success of the project. These are individuals within your organization that have a stake in your project and it affects them or their departments.
Tim did identify the key stakeholders in his project initiation phase, but did not contact them while preparing a business case. He believed that they were all on-board without checking with them himself. In his situation, the CFO and CIO at the company frequently did not get along and the CIO was driving this project. The CFO was not completely on-board with it and did not have a personal stake in its success. In fact, quite the opposite, part of him hoped it would fail to embarrass the CIO. As project manager, Tim should understand the dynamics of these relationships and craft a way to get the CIO and CFO to buy in to the project.

High Level Risk Analysis

At the project initiation stage, the project manager should perform a high level risk analysis. This isn’t a detailed risk plan, but a top level view of the risks associated from this project will assist the key stakeholders in deciding whether or not to proceed.
Tim didn’t feel there were many risks associated with this project – the vendor had great references and it was obviously time for an upgraded financials system at the company. Unfortunately, by not identifying the high level risks, he walked into many situations unprepared.

The Results

Though Tim could not go back and redo the first phase of the project, he did recover by:
  • Identifying the key deficiencies in the project to date.
  • Working with the vendor to “crash” down several tasks to get the project back on-schedule (he did come in late, but only three weeks late).
  • Increasing the communication of the project and asking for key employees’ help during the project, getting them more actively involved.
  • Identifying the cost increases the delay had caused and receiving approval for a budget revision for the project.
Many of the consequences of this project could have been avoided had Tim built a solid foundation for this project. The Project Initiation phase provides an opportunity for the project manager to create such a foundation.


1 komentar:

crazy deals mengatakan...

have initiative and everything will follow

Posting Komentar

 
© 2010-2011 Formula Business Online | Template By: Choen