Go Beyond Red, Green, and Yellow
Stoplight status (red, green, yellow) for overall cost, scope, and resources for projects has been used by executives for decades to spot risks and issues across a wide array of projects. These lagging indicators speak to how a project’s execution is doing against the developed plan. There is a flawed assumption that if a project is going well, then the goals of the executives are being met.
The Project Management Institute (PMI) estimates that the number one reason for failure is due to a lack of clearly defined goals. This is why you might consider installing proper stakeholder management with SPM (Strategic portfolio Management) best practices in your organization.
Gartner statistics reveal project failure rates between 60% and 85%.”
The Wide Gap Between Project Status and How Executives Evaluate Success
Unless there is a high maturity level within the organization around project management, the topic of value delivery is a key indicator lost in tracking tasks, timelines, issues, and more; and it doesn’t get measured until the project is over, or worse yet, never gets measured at all. Business agility requires a change in governance and when value delivery is discussed and tracked. Regardless of methodology, value plans and milestones must be visible and purposefully governed, and this starts with defining your stakeholder management with SPM.
The gap between vision and execution can be closed with the right people, processes, data, and tools in place. Successful capabilities do not only lie within technology, they also must reside within those people and processes. Methodologies alone are not the answer, just as technology alone can not solve all of your problems. The collective synergies of capability maturity across all aspects of business will get your organization beyond stoplight statuses and monthly or quarterly status decks and presentations to effective value delivery conversations with actionable data to make adjustments where necessary for vision success.
3 Keys to Close the Gap of Stakeholder Management with SPM
The keys to closing the gap between project status and stakeholder management with SPM are as follows:
1. Define and quantify the strategies and goals
A shared understanding of what is valuable and worthy of investment is critical. This cannot be done in a vacuum and requires executive participation. Developing scales that collect data around cost, risk, impact, alignment, and organizational readiness ensure that the right initiatives with the right outcomes are prioritized.
2. Define and monitor the expected benefits
Benefit plans shift the conversation from deliverables and milestones to realization of what is truly important. Monetary and non-monetary benefit plans can be developed so that the 20% cost reduction, or data from the supply chain partner, are achieved and clearly communicated.
3. Monitor the return on investment
Return on investment (ROI) is a critical tool for executives to evaluate if risks, issues, and changes to the initiative are still worth the planned benefits. As scope and schedules shift, ROI begins to dwindle. Understanding which initiatives will yield the most valuable benefits for the investment significantly changes the status conversation. With the correct processes, data, and technology, you can see the immediate impact to ROIs, and therefore make impactful decisions considering more than just the project’s status.
Communicating Project Management Challenges to Stakeholders
Thinking beyond the red, green, or yellow status requires a change to the conversation between executives and the project management office (PMO), which needs to shift long before the project charter or roadmap is drafted. When fewer than 60% of organizations value project management as a capability, that shift can be an uphill battle that begins with stakeholder management with SPM. Most enterprise backlogs, if frozen at this instant, would constitute years of work based on the guardrails of budget and resource.
The ability to clearly see where the budget is exhausted, or resources collide is often sobering, but creates the opportunity to shift the conversation to what must be done vs what should be done and what is nice to have. The data needed to present a backlog with estimations on return, key benefits, and timing based on available resources can represent a significant investment and difficult organizational changes.
Implementing one of the magic quadrant tools is a step in the right direction, but this alone will not improve the conversations or the outcomes of initiatives. Strategic Portfolio Management (SPM) is a framework of capabilities that, when approached holistically, lead to vastly improved outcomes.
Gartner estimates that 70% of digital transformation projects will fail to deliver the expected outcomes by 2025 in the absence of Strategic Portfolio Management.”
Cask’s SPM Framework Enabled on the NOW Platform
ServiceNow enables Strategic Portfolio Management so that in-flight work, a backlog of opportunities, and what-if scenarios can be managed to optimize investment outcomes. Cask’s SPM framework defines the capabilities and processes needed to successfully balance your strategic initiatives within the realities of budget and resource constraints.
With a data-driven approach to understanding the maturity of an organization’s current capabilities and tolerance for change, Cask can help you build a roadmap that provides the Visibility and Transparency needed to change the conversation and replace project status obsession with high-impact value delivery by defining stakeholder management with SPM.