CUSTOMERIZING PROJECT MANAGEMENT

IN THE 21TH CENTURY

By Bruce T. Barkley

and James H. Saylor

Published Project Management Journal, September 1995, Volume XXVI, Number 3, The Professional Journal of the Project Management Institute.

            The late 1990's and into early 21th Century may well be seen by future project managers as the era of the "customerized project", the period when the voice of the customer began to be institutionalized into the project management process.  In Liberation Management, Tom Peters talks of "customerizing" the work of business, and developing "seamless" client engagement through direct and continuous customer interface.  (1) Peters' model of the customer-driven project, while it made sense theoretically, has not been made operational for the many professionals in project and product management and quality improvement.  This is because the field of project management has been slow to respond to the quality movement with concepts and tools to focus project managers and support systems on customers, continuous improvement, and organizational culture.  This article suggests a way to make these concepts an integral part of the project management process.  Table 1 outlines the transition from traditional project management to customer-driven project management, a vision for the future of project management.

Table 1.  Unique Aspects of Customer-Driven Project Management

            This article draws from a second edition book, Customer-Driven Project Management:  Building Quality into Project Processes, which the authors synthesize project management and total quality management.  The purpose of this article is to outline the framework of the phases of the customer-driven project management process that provides the practical foundation for the practical application of customer-driven project management.

 WHY SYNTHESIZE QUALITY IMPROVEMENT AND PROJECT MANAGEMENT? 

            The simple answer is that projects which fail often suffer from bad customer interface, bad process management, and too little empowerment of team members.  Reading the literature, we see countless projects which have been characterized by a disconnection with the customer; the lack of early planning and analysis and sound project selection practices; and no acceptable process to respond to down-the-road change orders from customers: who legitimately change their minds about what they want as they learn from the project itself.  The total quality management concept provides project managers with a proven methodology to: (1) select the right project, because it puts the customer in the driver's seat; (2) assure continuous customer engagement from beginning to end throughout the process; and (3) improve the project management process itself in terms of time, cost, and performance through process improvement, process invention, and process reengineering.  Total quality management and project management combine to focus on delighting the customer through total customer satisfaction. 

            Customer-driven project management also changes the prevailing notions about many project and quality teams, which are often seen as short term, limited function groups, and who often lack good grounding in solid problem solving methods.  This new approach requires that a team stay in place from the early development of a quality project or product through to the delivery and acceptance of the project deliverable.  These teams use proven tools and techniques to select projects with the customer; make a conscious effort to focus on the process they will use to develop the deliverable - during design; and use traditional project control processes to get approve projects completed.  Project managers and customers collaborate from beginning to end, and customers actually perform the functions traditionally performed by the project manager. 

            This blending of (1) continuous improvement and quality analysis of customer requirement, and (2) controlled design and production of the right deliverables, produces a powerfully energetic and empowered team.  This idea, first, of empowering the project team as a partner with the customer, and then commissioning them to produce the deliverables generates focus and enthusiasm in the team from beginning to end. 

THE EIGHT PHASE CUSTOMER-DRIVEN PROJECT MANAGEMENT PROCESS 

            The customer-driven project management process requires an unique organizational structure.  The customer and supplier must agree to enter into a partnership to successfully carry out the project.  Also, the traditional project team is transformed to a customer-driven team.  This means the customer-driven project management process is led by the customer as project manager.  This new concept shifts the focus for project results to the customer.  The traditional project manager becomes the team facilitator.  The team facilitator focuses on building a high performance team to accomplish the project while the essential direction and control of the deliverable is exercised by the customer.  Team member are process owners empowered to deliver outputs from their particular processes.  In addition, the project can be supported by a variety of teams as necessary for each specific project. 

            With this focus and organizational structure, the eight phases of the customer-driven project management process are the general guidelines for the customer-driven team to proceed through all the processes of customer-driven project management.  The eight phases go from defining the issues to monitoring the quality outcomes.  The customer-driven project management process finds, selects, analyzes, and implements project and process improvement opportunities concurrently and continuously.  Obviously, each project will require a tailored application of this model. 

            The "customerizing" of project management is facilitated by the use of an eight phase customer-driven project management process.   

Phase 1. Define the Quality Issue. 

            During this phase, the customer's needs and expectations are developed.  This phase defines the "what" of the project.  The focus and priorities of project are determined in this phase.  The mission of the project is clarified, and specific customer requirements are detailed enough to establish priorities.  In addition, critical processes are identified that contribute to the success of the project.  

            The process of defining the quality issue is as follows:  The input is a draft mission from the customer-supplier projects steering team.  This input is used in the process to: (1) establish the project mission, (2) form the customer-driven project lead team, and (3) define the project deliverable.  The output of this process is a project mission statement with a specific project deliverable definition. 

The steps to phase 1 involves the following: 

            *            Determine focus (mission)

            *            Develop teamwork

            *            Define the top-level project process.

            *            Determine the boundaries of the project process.

            *            Specify the output(s) of the project process (deliverable).

            *            Identify customer or customer(s) other than customer- driver.

            *            List other customer needs and expectations.

            *            Identify requirements for input into the project process.

            *            Determine suppliers of inputs.

            *            Determine the customer's metrics of project process performance.

            *            Benchmark critical project processes.

            *            Establish ownership of project process to the customer- driven project                           management lead team. 

            The result of phase 1 is a clear definition of the quality issue.  This definition of the quality issue must be documented.  The documentation contains the following: 

            *            Mission Statement

            *            Customer-Driven Project Lead Team Membership

            *            Roles and Responsibilities Matrix

            *            Project Process Top-Level Diagram

            *            Start and Finish of Project Process

            *            The Project Process Deliverable(s)

            *            Customer(s)

            *            List of Customer Needs and Expectations

            *            List of Inputs for the Project Process

            *            List of Suppliers of the Inputs

            *            Measure of Customer Satisfaction 

Phase 2. Understand and define the process.   

            This phase thoroughly examines all the specific processes required to totally satisfy the customer.  During this phase, the "how" of the project is determined.  It establishes performance outputs and opportunities for improvement.  It is important to understand all the processes required for the project.  This includes current and required process performance.  This phase involves determining input requirements with their specific suppliers and output expectations with all customers.  This includes all internal and external supplier and customers.  It also may include establishing performance expectations based on benchmarking information.  In addition, any potential problems, shortfalls, and improvement opportunities are identified at this time.   

            The process of understanding and defining the processes is as follows: The input is the top-level project process.  The process in phase 2 involves: (1) deciding critical processes to perform the top-level project process, (2) forming or identifying additional customer-driven teams to support the customer-driven project lead team, (3) understanding these critical processes, and (4) defining the performance of these critical processes. The output of this process is a list of improvement opportunities. 

            This involves the following for each process: 

            *            Benchmark critical processes 

            *            Diagram the critical processes at the top and top-down level

            *            Specify the customer or customers

            *            List all customer needs and expectations

            *            Determine whether the process is meeting customer expectations

            *            Discover who owns and influences each process

            *            Determine all the inputs and outputs of each process

            *            Understand the relationship between inputs and outputs

            *            List the suppliers of the inputs

            *            Determine whether the suppliers are meeting the requirements

            *            Determine how to measure the process

            *            Measure the process to determine how it is performing

            *            Understand the value of the process to the deliverable

            *            Determine whether the process can be eliminated

            *            List the problems/issues/opportunities 

            The outcome of phase 2 is a distinct understanding and definition of all the processes, especially the critical processes involved in the overall project process.  Again, the team needs to document this phase.  The process understanding and definition documentation contains the following for each critical process: 

            *            Process diagrams

            *            Input/output analysis

            *            Supplier/customer analysis

            *            Process performance measure(s)

            *            Problems, issues and opportunities

            *            Process targets

            *            Process metrics 

Phase 3. Select Improvement Opportunities.  

            The third phase involves the listing of all improvement opportunities and the selection of high priority opportunities.  It is critical to focus on the processes with significant impact on total customer satisfaction.   

            The process of selecting improvement opportunities follows.  The input is the list of improvement opportunities.  The process in phase 3 involves: (1) specifying selection criteria, (2) determining a selection method, and (3) making selections.  The output of this process is improvement opportunities for analysis. 

            During phase 3, the customer-driven project management lead team selects an agenda of high priority improvement opportunities.  This agenda is based on the information collected in phase 2.  All the improvement opportunities identified in phase 2 are listed on the agenda.  The selection phase involves choosing high priority processes and/or problems for further analysis.  The selection should be made using consensus decision making. 

            The outcome of phase 3 is a list of improvement opportunities for further analysis.  

Phase 4. Analyze the improvement opportunities. 

            This phase uses disciplined analytical tools and techniques to target specific improvements of the selected processes.  This phase involves knowing the exact performance of all processes, the variations in the processes, and the underlying or "root" causes of problems.  This phase provides the objectives for the project and project processes.    

            The process of analyzing improvement opportunities follows. The input is the selected improvement opportunities.  These selected improvement opportunities are further analyzed through the following: (1) process analysis, (2) cause and effect analysis, and (3) data statistical analysis. The output of this process is project(s) objectives. 

            This is the diagnostic phase of the customer-driven project management improvement methodology.  This requires a thorough use of analytical tools to focus on the root causes of problems, process variation, and customer dissatisfaction.  The team asks "why" and then asks "why" again, and again until they are satisfied underlying causes are identified.  This phase accomplishes its complete diagnostics through process analysis, cause and effect analysis, and data statistical analysis.  Process analysis assesses the content of the process.  Cause and effect analysis determines the underlying or root causes of problems.  Data statistical analysis evaluates process performance.  During this phase, the customer-driven project team discovers the issues that prevent the project processes from performing in an optimal way.   

            The analysis phase of the customer-driven project management improvement methodology is one of the essential phases of the process because it assures that the team does not go from symptoms to solutions without looking at underlying causes.  It is underlying causes that represent the agenda for process improvement and project development. 

            In sum, the analysis phase includes: 

            *            Exploring ways to eliminate non-value added steps

            *            Eliminating or reducing high time and cost steps

            *            Developing methods to simplify and remove obstacles

            *            Removing any unnecessary loops

            *            Decreasing any complexity

            *            Getting rid of unnecessary paperwork

            *            Analyzing frequency changes

            *            Purging or lessening waste

            *            Looking for better ways to do the process

            *            Determining the underlying causes of any problem areas.

            *            Establishing process performance (goals).

            *            Listing items for action.   

            The result of phase 4 is a list of project process objectives. The analysis process documentation includes the following: 

            *            Detailed process diagrams

            *            Process analysis report

            *            Cause and effect analysis diagram

            *            Data statistical analysis report

            *            List of project objectives for action 

Phase 5. Take action. 

            This phase relates most closely to the traditional project management phases of concept, definition, and production.  During this phase, actions are taken to explore alternatives, state the project concept, define the project deliverable, demonstrate and validate the project, and develop and produce the project deliverable.  During this phase, the team actually prepares plans, organizes, staffs, controls, and coordinates the project deliverable.  This includes preparing the scope of work, project work break down structure, schedule, and budget.  The customer- driven project lead team assures that the necessary human resource, financial, contracting, and other support systems are in place.  Ultimately in this phase is where the necessary deliverable is produced and deployed to the customer. 

            The action process follows. The inputs for taking action are the project objectives.  The project objectives start the following activities: (1) alternative analysis, (2) project concept,(3) project definition, and (4) project production.  The output of the taking action process is a project deliverable. 

            This phase produces a project deliverable.  The deliverable can be a product, service, system, program, report, component, analysis, procedure, improved process, a corrective action, etc.  The deliverable may be something as complex as a new computer system or it may be as simple as installing a new procedure.  Complex or simple, it involves project management, consisting of concept, definition, and production to provide the deliverable.  Although all of these practices are essential for taking any action, the tools and techniques to accomplish the processes will vary depending on the project. 

            This phase transitions from quality management to project management.  This is where the project deliverable takes shape.  Prior to this phase, the customer-driven project management teams were focusing on customer requirements and supplier's processes.  This is where the project deliverable is designed, produced, tested, and delivered. 

Alternative analysis 

            The first step in the take action phase is alternative analysis.  Alternative analysis consist of the generation, evaluation, and selection of a project alternative.  Alternative generation involves the production of as many ideas as possible to accomplish the project objective(s).  These ideas are then assessed against the team's criteria to determine the best solution.  Finally, the team reaches consensus on one project alternative.  This becomes the project deliverable.   

Project management 

            Once a project deliverable is selected, the project must be produced.  Again, the production of both a service and/or product deliverable requires a structured discipline project management approach.  Therefore, this step relates most closely to the traditional project management phases of concept, definition, and production.  During this phase, besides producing the project deliverable, project processes are performed and improved for completing the project.  In addition, problems are solved during this phase.  Further, customer-driven project teams actually perform project management activities including preparing the scope of work, project work break down structure, task list, budget, critical path network, and gantt charts, as necessary.  Also, the customer-driven project lead team assures that the essential human resource, financial, contracting, and support systems are in place.  Ultimately the output of this phase is the necessary deliverable accepted by the customer. 

            The customer-driven project lead team guides the production of the project deliverable through the assistance of other customer-driven project teams as necessary.  Customer-driven project teams are the keys to achieving total customer satisfaction with the project deliverable, because they are in touch with the whole process of understanding and meeting the real needs of the customer. 

Phase 5a. The concept step. 

            The concept step determines the specific approach to accomplish the project.  During the concept step, all possible methods for the deliverable and its support are identified and evaluated against benefits, costs, and risks.  The concept step defines the project deliverable capable of fulfilling the project mission.  During this step, the detailed project management analysis is accomplished that readies the project for detailed planning in the definition phase.  The subprocesses involved in the concept step are as follows: 

            Deliverable concept

            Support concept

            Trade-off analysis

            Organizational concept

            Resources/Cost estimating

            Schedule outline

            Concept evaluation

            The outcome of the concept step is an approved project deliverable concept for full-scale development.  This step answers the question, "What is the project deliverable?" 

Phase 5b. The definition step. 

            This step defines the project in detail.  It specifies the how and how to of the project.  It details the deliverable, its producibility, its integration with other systems, and its use.  The definition step specifics the performance, cost, and schedule requirements.  The resource requirements of the project are specified in this step.  This is the step where a reliable, producible, and supportable project deliverable is defined and developed to accomplish the mission.  During this step, the detailed project management planning is accomplished including network schedules and work breakdown structures.  In addition, customer-driven project teams are established to perform and improve the project.  The subprocesses in the definition step are as follows:

            Deliverable requirements and design

            Support system plan

            Risk analysis

            Project organization established

            Plan development

            Network schedule formulation

            Deliverable test  

            The outcome of the definition step is a project deliverable certified for production. This step answers the following questions: 

            *            What are the specific processes, tasks, and activities?

            *            Who is going to perform processes, tasks, and activities?

            *            How long the project will take to complete?

            *            When the project will be accomplished?

            *            How much the project will cost? 

            The transition from definition to production requires careful attention by the customer-driven project lead team.  Typically, the transition from definition to production is not a distinct process, but it is a continuous cycle of activities including the concept, design, test, and production or plan, do, check, and act.  To be successful, the customer-driven project lead team instills the discipline of the customer-driven project management improvement methodology. 

Phase 5c. The production step. 

            The production step involves the actual production of the project deliverable and its support elements.  During this step, the customer-driven project teams ready all detailed planning for the operational step by making sure all elements are integrated, interrelated and interfaced.  In addition to the project deliverable, the support elements are produced in this step.  This is the process where the customer-driven project teams perform their tasks and report progress to the customer-driven project lead team.  Also, the project deliverable is tested.  During this step, project management consists of implementation and evaluation.  The customer-driven lead team focuses on monitoring performance of the processes and taking corrective action as necessary.  The subprocesses in the production step are as follows:

            Deliverable production

            Support system development

            Risk management

            Project organization performing

            Plan update and execution

            Network schedule in use

            Production assessment. 

            The outcome of the production step is a project deliverable acceptable to the customer.  

Phase 6. Check results.  

            During the check results phase, the customer-driven lead team measures the deliverable and project processes against the customer's needs and expectations. Figure 11 shows the process of checking results.  The input is the project deliverable.  The process in phase 6 involves: (1) testing the project deliverables performance against customer expectations, (2) determining wheth­er process goals are being met, and (3) taking corrective action as necessary to satisfy the customer and ensure process performance.  The output of this process is a project deliverable for implementation. 

            In phase 6 the team starts with a plan with the specific metrics to check the results for the deliverable and the project processes.  Next, the team actually assesses the deliverable and the project processes.  Are the results as expected?  If no, the team uses the customer-driven project improvement methodology to correct the situation.  If yes, the team continues to implementation.  

            The outcome of phase 6 is a deliverable for implementation that satisfies the customer with project processes capable of meeting performance goals.  Again, the team needs to document this phase.  The check results process documentation contains the following: 

            *            Check results plan

            *            An assessment of the deliverable using metrics

            *            An evaluation of all project processes

            *            List of issues for action

            *            Documentation of corrective action(s)

            *            A re-evaluation 

Phase 7. Implement the improvement. 

            Phase 7 institutes the project deliverable. Figure 12 shows the process of implementing the improvement.  The input is the project deliverable or improvement.  The process in phase 7 involves: (1) planning and gaining approval, (2) instituting the project deliverable and/or improvement, and (3) project operation and support.  The output of this process is a project deliverable continually satisfying the customer. 

            Since the focus is on total customer satisfaction, the implementation of the project deliverable requires the improvement become accepted as a customer satisfier over an extended time period.  This means the project deliverable must be valued and internalized.  The customer-driven project is not complete until the customer uses it.  Depending on the deliverable, this means a varying degree of operation and support.  For instance in a process improvement deliverable, the improved process will have to be used as a daily course of action.  This may make standard documentation and training a necessity.  In the case of a new system deliverable, operation and support is more extensive.  The system implementation requires using and maintaining the system, operation and maintenance manuals, training, facilities, organizational structure, facilities, computer resources, transportation and support services.  As a minimum to implement an improvement means developing a implementation plan of action.   

            The outcome of phase 7 is a deliverable/improvement. The documentation of this phase is the plan of action. The major topics for a plan of action includes the following: 

            *            The specific operation and support actions

            *            List of all steps, tasks, and activities

            *            Assignment of responsibility for each step

            *            Schedule to start and finish the implementation

            *            Schedule for start and completion of each step

            *            Budget 

Phase 7a. Operations and support. 

            A project management step in implementing the improvement is project operation and support. The operations processes are (1) deliverable in use, (2) deliverable being supported, and (3) project performance feedback. The support processes include: customer response support, training, facilities, people resources, supply services, transportation, documentation, maintenance, and computer resources. One major aspect of this step is the continual use of the deliverable by the customer for its intended purpose.  Again, the feedback system is essential to assure the deliverable's performance continues to meet the customer's needs and expectations.  In addition to performance, the other major contributor to total customer satisfaction is support.  This means the effective and efficient use of the improvement focuses on the integration of operation and support considerations.  The target of operation and support is optimum life cycle cost.  This requires aiming at specific customer needs and expectations.  The goal is to provide just the right amount of support for required operations. 

Phase 8. Monitor results for continuous improvement. 

            The process of monitoring the results for continuous improvement follows. The input is the operational project deliverable or improvement.  The process in phase 8 involves: (1) evaluating project performance metrics, (2) assessing the project processes, and (3) seeking continuous improvement of the project deliverable and project processes. The output of this process is a successful project. 

            The customer-driven project management operates over the long-term.  Once the deliverable is operational, the customer- driven lead team as other customer-driven teams as appropriate continue as long as the mutual relationship provides joint benefits for the customer and project supplier.  The team continues to monitor the project and processes performance.  They take action as necessary to maintain total customer satisfaction.  The teams perform continuous improvement activities.  This could include modification of the existing deliverable or even a completely new deliverable.  The project is never complete until there is no deliverable needed by the customer.  

            The outcome of phase 8 is the continuous improvement of project deliverable and project processes. The documentation of this step involves: 

            *            Project performance metrics

            *            Process performance metrics

            *            Issues for continuous improvement 

Phase 8a. Close-out. 

            Eventually, the project will reach close-out.  Close-out consists of (1) close-out plan, (2) divestment of resources, and (3) report of lessons learned. 

            The close-out plan outlines the specific tasks, responsibilities, and time-phasing for completing the product deliverable's life cycle. The plan should consider reassignment of people resources, disposition of the inventory of product deliverable and spares, and logistics support requirements. The close-out plan should consider a final evaluation of all people participating in the project. This evaluation forms the basis for the next assignment. Beyond people, the close-out plan deals with the disposition of inventory. The inventory disposition must include methods that assess both cost and the environment. Finally, the close-out plan requires a logistics support annex to actually accomplish the close-out. This could include: packaging, handling, transporting, disassembly, decomposition, etc.    

            The second subprocess involves the actual divestment of the project deliverable. This includes the phase-out and/or disposal of the project deliverable and project process capability. Besides the actual inventory mentioned above, this may include the project documentation. Depending on the project, the dismantling of the documentation is a major task by itself.   

            The third subprocess in close-out is reporting the lessons learned. This is important for future projects. It becomes a database of information for prospective proposal and customer- driven project management endeavors.

 CONCLUSION

             "Customerizing" project management can move from concept to practical operation through the synthesizing and broadening of the popular management techniques of Total Quality Management and Project Management.  The foundation being a new step-by-step customer-driven process of eight phases.  These eight phases of the customer-driven project process are repeated many times over time in a full scale partnering agreement between supplier and customer.  As each new project is undertaken, project processes are improved using insights and learning gained in earlier partnered projects.