(I want to thank Kathie Topel for her contribution to this article.)

The state of project management

In 2015, a survey by portfolio management provider Innotas showed that 55% of IT projects had failed in the last 12 months. By 2017, just two years later, the numbers had improved and only 6% of projects were considered failures. Today, IT projects are delivered on time and within budget; however, up to 24% are considered “low achievers”; projects that do not deliver the necessary commercial benefits. Frankly, projects that don’t provide commercial benefits might as well not get implemented in the first place. The money spent on those projects could have been better spent elsewhere.

So why does this “poor performance” occur?

One of the key elements is the lack of executive sponsorship. Too often, a major multi-year project is launched with great fanfare and laser focus on the part of the executive sponsor. Unfortunately, a crisis occurs (could anyone have predicted Covid-19 in 2020?), or some other major event, and the executive sponsor loses their focus on the big project.

But there are ways to minimize, if not eliminate, this from happening.

The business alignment

When a business is aligned, it means that all levels and actors are clear about the organization’s purpose and make decisions accordingly. The company’s resources, strategies, management systems and communications are all aligned with that purpose.

One would think that any IT project would align with the Business, but this is not the case. My belief is that this is because it takes a lot of work to really understand how IT features and capabilities can enable a company to achieve its strategic goals, and this hard work is not happening. While the executive may be quite knowledgeable about the technology, it is the vendor and frontline workers who best understand the current process and capabilities of the new software or system.

However, the frontline worker may not have a good understanding of how the software’s capabilities can help achieve key business goals.

The key to a successful IT project, one that greatly benefits the business, is to take the business drivers, the Critical Success Factors, of a business and figure out how these drivers can be broken down into metrics (Key Performance Indicators) that will drive the business forward. Metrics that can provide clear actions that need to be taken.

Each industry has its own Critical Success Factors, we will examine two industries below.

Take the example of an airline. One of the key factors for an airline’s profitability is the response time at the gate. Why is this important? The faster the aircraft turns at the gate, the more aircraft can use that gate. The more planes that use that gate, the more flights are being flown. More flights mean more earnings. In addition, faster response time increases customer satisfaction for on-time departure/landing.

In the case of a fast food restaurant, drive-through duration is a critical success factor. Customers don’t want to sit in a drive-thru for 20 minutes. It doesn’t matter if there are 3 cars or 30 cars in the drive-through, no customer wants to wait more than a few minutes. Experiencing a long wait time means the customer will go to a different fast food restaurant next time. The shorter the duration of the self-service service, the more customers can be served and the more profitable the restaurant will be.

First step for commercial alignment: creation of a process map

Let’s delve into the fast food restaurant illustration. Fast food restaurants (also known as Quick Service Restaurants) derive more than 50% of their revenue from drive-through, so shortening the duration is key to a successful restaurant. The first step in reducing transit time is to map the current transit process. At a high level it is:

1. Take the order

2. Take the money

3. Preparing the food

4. Deliver the food (hand it to the person).

So how do you shorten the drive-through time in these 4 areas? Would delivery time decrease if the cashier were twice as fast? While it may be desirable to have a faster cashier, the amount of time saved would be negligible (along with the increased chance of error in order taking). The best approach is to take a step back and look at the process holistically through the use of process maps.

Process mapping along with the duration of each process will reveal that the order taking process can be divided into two sub-parts. 1) The client deciding what he wants 2) verbalizing the request. The second part is pretty quick for most clients. Whether 3 items or 6 items are ordered, the time difference is slight. But the first part, for the client to decide what he wants, especially if it is a family with a small child, can take many minutes. With just one ride, the entire line stops, until Junior decides if he wants a Happy Meal or a Big Mac (in the case of McDonalds). But with two direct access lanes, Junior (lane 1) can take as long as he wants. People in lane 2 are happy because they are not late and can jump in front of junior because they ordered first.

Anything that contributes to Critical Success Factors should be considered as an area for improvement.

In future articles we will discuss how technology can be used for Critical Success Factors.

Leave a comment

Your email address will not be published. Required fields are marked *