Insight # 62 : Cultivating Change with Less Risk

Cultivating Global Product Development: Maximising Your PMO Harvest

by Pramal Lad

Over the past three years, Pcubed has been engaged with AGCO, a $10 billion multi-tractor brand, to deliver for the first time a consolidated and modularised global manufacturing programme. Here's what that initiative has taught me about developing a high-yield project or programme management office.

Through a combination of breakthrough successes and painful "war wounds," Pcubed has established a knowledge base of what's required to produce results that satisfy end-customers and reward shareholders.
Identifying with parallels of the agricultural cycle, there are five key phases that experience has shown to be essential in a new product development on a global scale:

1. Cultivate the ground;
2. Sow the seed;
3. Nourish and maintain growth;
4. Harvest; and
5. Evaluate the yield.

Pramal Lad on growing an effective PMO Step 1: Cultivate the Ground

Take the time out to evaluate the current programme and project maturity environment before developing the project plan and approach. Understanding the clients' ability to relate to or manage daily activities such as updating project schedules and reporting risks and issues will determine your training requirements to run the programme smoothly.

Other activities to do before you initiate major programme activities include:

  • Clarify and document programme vision and objectives. Ensure senior management and core programme leadership understand the aims of the programme and how the approved budget will deliver required benefits. At a minimum, this should be a well-considered, compelling and agreed "one-page vision" that can be referred to in the duration of the programme and reviewed at each phase/gate.
  • Define roles and responsibilities. It’s not enough for the programme management office (PMO) to simply draw up the org chart; rather, a clear organisational chart with well-defined and understood roles and accountability can make a significant difference when political and emotional arguments surface. The nature of a programme is that of business change -- treading an unchartered path; therefore each person needs to acknowledge a certain degree of flexibility and adaptability in undertaking his or her duties.

Step 2: Sow the Seed

There's an art to planting seeds; the fruits you harvest are directly proportional to how well you sow the seeds. How do you embed a programme to set up for future success? An empowered PMO with direct support from the lead sponsor would be a good place to start. Through a combination of workshops, interviews and global face-to-face meetings, establish the governance structure and meeting cadences. In our experience, this process can take a minimum of three to six months to get global teams really brought into a new way of working.

As experienced consultants, Pcubed was able to enter various territories almost seamlessly, ranging from rural France and England to booming metros in China and India. Through the use of local project support roles, Pcubed supported the regional client leaders to execute major activities and manage functional deliverables.

Step 3: Nourish and Maintain Growth

At the end of the day, a farmer is ultimately at the mercy of the season. Similarly, the programme is at the mercy of changing seasons and conditions as it progresses through phases. The reality of so much continuous change means that key disciplines in communication and governance are essential for handling these shocks.

  • Programme/project review meetings. At various levels, from the ground up, establish weekly, biweekly and monthly meetings. These can be a mix of conference calls and face-to-face, and most importantly, they should have clear purpose and agenda. A common trap is to "over-meet" and with so much travel, team members can forget to dedicate sufficient time to agenda and participant planning. Remember the cost to the business: travel, expenses and effective hour or day "rate" for each attendee's time.
  • Logging risks, issues, actions and decisions. People involved in change need a clear, easy-to-use, simple-to-understand method for tracking major risks and issues and ensuring closure through appropriate actions and decisions. Without those aspects, your programme is bound to fail. Not every risk or issue is fatal; however, just as plant disease can destroy your entire field if not acted upon early, risks can very quickly turn into burning issues. With a global programme, we have found that such activities are best managed with a tool such as SharePoint RAID logs; however, on a local level; there should be an Excel sheet tracker as a minimum, which is to be reviewed once a week.
  • Managing global design change. Without a doubt, one of the most painful activities during the development phase is to manage engineering changes while procurement and testing activities are on-going. Having an efficient and responsive tool to connect various engineering and manufacturing sites so they have the latest and most appropriate design information will not only save you frustration, but avoid millions in wasted tooling budgets.

Step 4: Harvest

After about 18 months into the tractor development programme, we finally began to see the results of our labour as prototypes were built. The role of the PMO is to maintain the enthusiasm and energy through difficult times, with a clear view on the end goal. Integral to this is the ability to generate excitement about respective programme functions and continually share with team members their contribution to the end goal. During the most demanding times, especially with stretched operational teams, they can forget how important their roles are to achieving the finished product. Pcubed played a crucial role in maintaining team morale, ranging from capturing proud moments with photography to putting on regular team building events such as bowling and beers!

Given how large and complex these programmes can be, it's worth taking stock of achievements at regular phased intervals or gates. Many engineering and manufacturing life cycles will have gates already built in; however, as a PMO team, we realised the importance of capturing the "harvest" and communicating effectively to stakeholders. This can be done through gate reports or through periodic reviews against business case drivers or key indicators. It's important for everyone to acknowledge progress and maintain visibility of the bite-sized chunks required to reach the end goal.

Step 5: Evaluate the Yield

Given the competitive nature of global industry, it's imperative to become efficient and develop new ways of working that are repeatable and scalable. For instance, India currently produces a third less per hectare than China and as a result it's experiencing incredible demand for more efficient farm equipment given comparable population growth. Learning from effective farming processes abroad or domestically can significantly boost future farm productivity. Similarly, in the programme environment, it's worth taking stock of programme tools, approaches, and techniques that have worked well and delivered results, versus those that just wasted time. This can be done through formal post-project evaluations and surveys or more informal discussions with key stakeholders.

W. Chan Kim and Renee Mauborgne, who wrote the popular book Blue Ocean Strategy as well as the more recent "Blue Ocean Leadership" for Harvard Business Review's May 2014 issue, have developed a matrix to guide questions when reviewing effectiveness of leaders and their utilisation on "leadership" activities:

  • Eliminate: What acts and activities do leaders invest their time and intelligence in that should be eliminated?
  • Raise: What acts and activities do leaders invest their time and intelligence in that should be raised well above their current level?
  • Reduce: What acts and activities do leaders invest their time and intelligence in that should be reduced well below their current level?
  • Create: What acts and activities do leaders invest their time and intelligence in that they currently don't undertake?

I believe those same questions could be asked of programme leadership.

In conclusion, effective programme management of a global new product introduction requires a grounded approach with deep roots and a PMO team with a tenacious persistence to overcome challenges on their way to the finish line. There will always be a combination of variables from within and outside of your control, and as you improve your understanding of what these are, your ability to maximise the fruits of your labour will improve.

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