The Importance of Program and Product Management
An enterprise’s ability to manage projects and programs will determine to a large extent the success or failure of the products they produce. Benefits reported by those companies that have completed Program Management Initiatives include:
- 27% greater return on investment in projects
- 30% improvement in project budget performance
- 34% improvement in project schedule performance
- 24% improvement in project risk
- 39% improvement in project requirements performance
Bottom line; Companies with a more comprehensive business perspective of program management are more successful. So how do these companies realize their program management goals? By clearly defining key success factors, phases, milestones, roles and executing in accordance with these outlines. Below we will define these characteristics and present a way to describe your organization’s implementation maturity.
The items we identify as key success factors are sometimes referred to as competencies. We identify these as Key Success Factors to underline their importance in driving your project’s success. The order presented here is for convenience and should not be mistaken by the reader as ranking importance.
Key Success Factors
Governance is the metrics and operations utilized to guide and measure progress. The development and adoption of these metrics enable the program team to gage progress. Incomplete adoption of this key success factor will cause misalignment of the team and the business decision points required for success.
Alignment is the ability to maintain the team’s view of strategies. Product portfolio, sales and overall corporate strategies need to be within the program’s targets to ensure the product contributes to the overall success of the enterprise. Failure to align program goals with overreaching strategies will cloud decision making at every turn.
The coordination of data across the team and enterprise enables all stakeholders to work from the same assumptions. Incomplete data will disable the team’s ability to work effectively. Delays and missed targets will result if current data is not available to all.
Management’s ability to provide guidance, insure accountability and remove obstacles will set the tone for the program. Managers need to be proactive to deliver a best practice solution. Driving decision making and ensuring the team is equipped for the challenges presented.
The planning required to connect information and resources to maintain schedule and meet deliverables is the responsibility of program management. Aligning goals with the availability of information and resources will enable schedule attainment. Conversely, excessive dwell or loopbacks in the dissemination of data will cause delays.
Tracking financial goals and progress across program checkpoints to determine target alignment and support decision gates is imperative to the program’s success. Failure to do so will result in missed targets, ballooning budgets and ultimately canceled programs.
Incorporating a continuous improvement process to assess performance and take advantage of lessons learned. This is a way of institutionalizing the capture of tribal knowledge. Process improvement initiatives reduce the opportunities to repeat mistakes.
Mastering the above factors increases the enterprise’s ability to execute projects. As an enterprise’s execution maturity increases program management efficiency will follow. Continuing to monitor and improve performance will enable more projects and drive growth. Delivering successful products to the marketplace efficiently becomes engrained within the organization. On time and within budget are the typical metrics cited to define a program’s success. But, neither sufficiently define a product’s success once in the market. To do this meaningful metrics need to be established and tracked. Market share, profitability, and performance criteria targets need to be defined early in the program and tracked throughout. The phases and their respective phase gates described below enable the program team to track their progress and move the program forward
Program Management Phases
Step 0: Establish Processes for Various Types of Development Programs
- Define standard phases, gates, and decision criteria
- Develop templates for standard process deliverables
- Define guidelines for process execution and gate facilitation
Step 1: Initiate Program Phase
- Identify and recruit core program team
- Review program phase objectives and inputs
- Review standard operating procedures & identify exception
- Allocate responsibility and accountability
Step 2: Monitor, Control & Report
- Monitor process tasks, deliverables & metrics
- Manage development schedule & costs
- Manage program-level issues and risks
- Conduct internal program reviews
- Communicate to external stakeholders as appropriate
Step 3: Conduct Gate Reviews
- Assemble gate packages for review
- Evaluate program performance against evaluation criteria
- Adjust allocated resources and funding as appropriate
- Review objectives, resources and deliverables for next gate
- Communicate to stakeholders as appropriate
Step 4: Transition Program
- Transition product to steady state management, if appropriate
- Archive program deliverables for reuse and historical reference
- Evolve, improve & institutionalize lessons learned
The above steps and their respective descriptions are provided here as the minimum criteria for a program to meet the established goals. Therein lies the secret to a program’s success; establishing the goals at the program’s inception. Without clearly defining the goals a program is essentially rudderless. After the goals have been established by a small cross functional team, a broader team can be engaged to initiate the program. Once initiated, progress is monitored to track goals and insure that all stakeholders are still informed. Monitoring is a way to manage risks as they arise. Gate reviews are performed only as necessary to maintain alignment with stated goals and milestones. As the program progresses the steps above and the associated reporting assure all stakeholders that the original targets established are to be met. Towards the end of the program when success is near certain the program transitions to archiving the success and developing a maintenance and improvement plan.
Program management is the work done to add substance and value to a set of disparate inputs to deliver products and services. An enterprise’s success in the marketplace is determined by the ability to deliver products and services that meet the needs of the target customers. Obviously the success of the enterprise is driven by the capability to manage programs. Developing the capability of consistent governance to establish project goals and coordinate project teams will fuel growth. As these capabilities mature the enterprise will find it easier to aggregate performance metrics with financial targets. Mastering the Key Success Factors through all phases of the program will drive increased maturity. The ability to increase the problem solving and decision making capacity across an organization will enable the mastery of the competencies driving maturity. How an organization creates distributes and consumes data will provide the tools for solving problems and making decisions.