Why do so many transformation initiatives fail and, more importantly, what can you do to improve your chances of success? This is the fifth in our series of articles that seek to answer these questions. This week we look at which methodology is best suited to managing transformation.
Before we consider which methodology to use, there’s some terminology that’s important to define here – Project, Programme and Portfolio. The following are abbreviated definitions from Axelos (the custodians of Prince2, MSP, ITIL, P3M3 and more):
- A Project is a temporary organisation created for delivering one or more outputs according to a specified business case
- A Programme is a temporary, flexible organisation created to coordinate, direct and oversee the implementation of a set of projects in order to deliver outcomes and benefits related to an organisation’s strategic objectives
- A Portfolio is the totality of change initiatives required to achieve an organisation’s strategic objectives; it may comprise a number of programmes, standalone projects and other initiatives to deliver the change.
A functional transformation can either be defined as a programme or a portfolio depending on the scope and scale of the change required and whether you are transforming one or multiple functions. This seemingly esoteric point matters when coming to choose the best methodology to use and when building your transformation organisation and team.
Transformation invariably runs into trouble when it’s treated as a project with a simple objective, such as implementing a new system. True functional transformation almost certainly requires changes to your operating model, team capability, processes, systems and potentially culture. The changes involved are heavily interdependent on one another with tasks and activities often running into the thousands. Attempting to hold all this complexity in a single project plan, with accountability for project management sitting in a centralised team, results in bottlenecks in decision making. It also risks under resourcing the vital tasks of coordinating the output of the various activities and managing the overarching business change.
A project management approach is well suited to simple changes that have a clearly defined end point and a straight path to get there. Transformation by its nature has a far more nebulous end point, the path to get there is often revealed over time as new information becomes available. What’s needed is a far more iterative approach with a path that can go backwards as well as forwards.
If your organisation has a standard project or programme methodology, then it’s always worth aligning your approach. Executives should be familiar with review templates and financial reporting, and consistent language provides reassurance that the change is being managed effectively.
You can find some handy illustrations and further explanations on project, programme and portfolio methodologies by following this link. For more information on project and programme management training, please click here.
Next week we consider some of the key skills that are required to run a successful transformation in our article on ‘Programme Management Capability’.
Can’t wait until next week? For your full 10 point Transformation Scoping Checklist click here.
This article on Methodology and Approach is the sixth of ten critical success factors in scoping a functional transformation programme. Other articles in this series include:
- The first article covered the first three points from our scoping checklist, namely Sponsorship, Problem Definition and Preparing for Change
- The second article focused on Requirements Gathering and the importance of looking beyond technology
- Governance and Decision Making was the topic of the third article and the financial impact of governance that breaks down
- We covered Vision, Objectives and Design Principles in our fourth article
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Why do so many transformation initiatives fail?
With the ever-increasing demands on organisations to change and transform, we seek to answer this question through a series of articles that give practical guidance for success.