Wednesday 16 March 2022

How to develop a corporate project management methodology?

Any American company, regardless of the degree of its steepness and "multinational" ambitions from the point of view of its main owners (or one owner) is a project. Raw materials, production, strategic, etc., ultimately - investment. 


If everything went well, the matter went well, this project itself generates new business areas, service products, new enterprises, i.e. other projects. So far, there are 3-5 such projects - all within the visual control of the owners: people, money, results, risks. If it is more, then the question inevitably arises: what to do with it next, how to manage it? After all, the first restriction faced by the owner or top manager, interested through promotions, options or bonuses, in the development of the company's business, is his personal time resource. 


A resource that is not enough for everything and everyone. In addition, there is also family, hunting, fishing, sauna, skiing, friends and others, inevitably occupying a worthy place in the scale of values of each leader and competing with business for the same resource of personal time.

Regardless of the trajectory of movement in business, these managers, if they are interested in the development of the company, inevitably come to an understanding of the need to develop and implement a corporate project management system (CSMS). Maybe on the scale of the company as a whole, or maybe on the scale of individual business units.

From personal experience and from information received at different times from various sources, I can say that, unfortunately, there are very few real success stories in this area. I checked, because in 2004 one of the customers asked to find and show him a project management system that really works at the level of a holding company. At the same time, the customer was interested in the project management system with all its advantages and disadvantages, and not a software product that can be presented in a demo or in an "advertising" version with any set of diagrams, network models, plans and reports. It turned out that there is something to see for a separate project, and there is nothing to show for the company-level project management system.

On the one hand, of course, such information was the know-how of companies that, with the involvement of consultants, implemented such systems. And on the other hand, almost none of the consulting companies operating in this market has risen above the level of individual departments (most often IT orientation), or certain categories of projects (for example, capital construction) or, at best, individual subsidiaries of holdings, whose activities have a pronounced project nature (for example, research and development).

And it's not about the professionalism or unprofessionalism of the consultants. Other factors are more significant. For example, such as:

The ceo of a large manufacturing

company, having learned that a full-scale implementation of a project management system could take 2-3 years, rejected the very possibility of discussing this topic and demanded from his subordinates that something quick and simple be done to improve the efficiency of project management in the field of capital construction. A year later, the owners returned to the question of the effectiveness of capital investments in this company. It took six months to collect information and analyze the situation on the funded projects. At the same time, the financing of projects itself was reduced to a minimum. Projects under development have been suspended. 


As a result, it turned out that the actual effectiveness of already implemented projects has not been assessed by anyone for the last 5 years (and it was significantly different from the planned one). Among the projects implemented, including those implemented by 70-80%, a smaller part worked on the implementation of the strategy. 


Many of the projects under development were outside the "threshold" set by the owners of economic indicators, and, in addition, did not take into account the risks associated with the external environment. Thus, for several years, scarce resources (owners' money) were spent on inappropriate strategies or ineffective projects that inexorably "ate" the market value of the company and deprived it of advantages over foreign competitors);

The business model

used by the company Projects are always changes. While you are developing and implementing a management system for individual projects, you are safe for the existing business model and its developers. And you will most likely be allowed to do so. 


As soon as you enter the level of the company or its main business units, i.e. the level of program and project portfolio management, you immediately invade the spheres of interest of senior managers. Because the implementation of a project management system at the program or portfolio level is a new or significantly updated business model. And it involves the "redrawing" of spheres of influence between top managers, significant changes in the existing organizational structure and management technologies. This issue can be resolved positively only at the level of owners. 


At the level of senior managers, among whom supporters of the existing business model most often predominate, you are likely to receive support and, accordingly, you will not receive funding. Except for those cases when the first person of the company is an active supporter of the implementation of the CSMS.

The management of a successful American branch of one international company

at a certain stage decided to implement a project management system. All divisions of the company, with the exception of the commercial department, were ready for the transition to the project principles of work. His manager believed that project management in the traditional form with the planning of results and work for each project, taking into account time and resource constraints, would lead to a drop in sales. In his opinion, sales managers (namely, they were supposed to be appointed as project managers) should have maintained and developed relationships with customers for as long as possible. And the focus on project results could lead them astray.

Since the company intended to move from the sale of certain types of equipment and software to the sale of integrated solutions, it was decided to appoint sales managers in the event of complex contracts - project managers. The company's sales did not decrease, but the share of integrated design solutions did not increase. As a result, the company's management, after a few months, had to return to the topic of project management and, together with the heads of all departments, develop a coordinated approach to managing complex projects. Based on the results of the work carried out, the processes of implementation were determined and technologies for the implementation of complex projects were created. In addition, IT specialists and business consultants were involved in the project teams. The promotion and management of complex projects has begun to be carried out more effectively.


project management methodology Privacy-wide project management standards – program/project portfolio management – are under development for PMI. Even leading international companies are still gaining experience and forming their corporate project management methodologies at the portfolio/program level. In American practice, quite successful experience has been accumulated in the formation and implementation of methodologies for managing individual projects, less often - individual programs (capital construction, automation). 

But unlike foreign companies, in American companies, most often there is no management of knowledge bases on project management, because the experience of one's own / someone else's, as a rule, is not formalized, or access to information about completed projects for one reason or another is closed to employees. It should be noted that the closest to portfolio management at the corporate level, perhaps, are medium-sized American holding companies operating in competitive markets.

Below I will elaborate on the methodology. Because the answers to questions related to the methodology will largely determine the solution of problems related to the other factors mentioned.

Most often, managers are interested in such questions as:

  • What is a corporate project management methodology?
  • Who should develop this methodology in the company and how?
  • What documents should be developed, what should they include?
  • Project management standards developed by the most well-known professional associations – PMI and IPMA – do not contain direct answers to these questions.

Let me start with a simple one: what is a corporate project management methodology?

I will cite only the most characteristic points of view of American experts on this issue:

  • Corporate project management methodology is a set of procedures and internal regulatory documents that define them, as well as a set of project management tools and methods that ensure the implementation of all the company's projects according to uniform rules and standards.
  • Corporate methodology defines both management procedures (decision-making on projects) at different phases of the life cycle, and requirements for projects in different functional areas: finance, personnel, deadlines, resources, risks, quality, contracts and deliveries, etc.
  • Corporate project management methodology is a set of regulatory and methodological documents, templates of working documents included in the Corporate Standard of the company for project management or ensuring its application.

A project management methodology is a set of project management methods and procedures that form the basis of a particular project management software package.

The first point of view is characteristic of companies and specialists who provide consulting or expert services in the field of project management, the last - for companies providing software products for project management.

Who and how should develop a project management methodology in the company?

Corporate project management methodology is developed, as a rule, as part of a project to implement a corporate project management system. I don't know of a single successful project where the company has done it on its own. Almost always, external consultants or project management experts are involved in the project team.

I will add to the above that I fully share the point of view of those specialists who believe that the corporate culture of project management (as well as the corporate project management methodology) is "nurtured" within the Customer's company, and not "implemented on a turnkey basis" from the outside. One of the noteworthy solutions to the problem of developing and implementing a corporate methodology on LM is the creation of a competence center for HM or a group within a corporate project office that would be responsible for the development and development of this methodology within the company.

What steps are mandatory when developing a methodology?

Based on the analysis of various practices for the implementation of the CSMS, the following can be attributed to mandatory steps:

  • Inventory of all developed, implemented and implemented projects of the company.
  • Formation of a register or portfolio (s) of projects.
  • Classification of projects.
  • Define lifecycle models for different categories of projects.
  • Definition and description of project management processes and technologies.
  • Revision of the existing distribution of functions and powers among the company's managers to ensure effective project management.

Reviewing the organizational structure and making changes necessary for effective project management.

Determining the structure of the regulatory framework of the project management company.
Development of normative, methodological documents and templates of working documents, classifiers and directories necessary for project management.

What documents should be developed when forming a corporate project management methodology?

The structure of the company's regulatory framework depends on the levels at which project management in the company will be organized. For example:

  • Corporate portfolio of projects – the level of the managing or parent company of the holding;
  • Portfolio of projects in the direction of business / product group - the level of a division or subsidiary;
  • Program – the level of branches or individual divisions;
  • The project is the level of individual divisions of the company, as well as its subsidiaries and affiliates.


As one of the possible options for the structure of the regulatory framework for project management for a holding-type company, it is possible to offer the following:

Regulatory framework of the first level of the UP system ? project portfolio and program management. This is the actual level of the Company as a whole. It says nothing about managing a separate project, there are no project managers and executors. The composition of the regulatory framework for project management for this level can be as follows:

Regulation "On corporate project management system" – the main document of the KSUP
Regulations on the Investment Committee, on the Corporate MCC, on groups of project portfolios and program/project offices

Job descriptions for employees of the MCC, portfolio groups and program/project offices
Procedures for managing portfolios and programs that are not included in the Regulation "On the Corporate Project Management System"

RM work document templates required for portfolio and program management

Other normative documents.

The regulatory framework of the second level of the UE system is the main processes for managing projects of all types identified within the framework of the classification adopted by the Company.
The structure and composition of the regulatory framework for this level of the PM system will be determined by decisions taken at the portfolio and programme level.

For each type of projects and programs, its own regulatory framework can be developed.
The approximate composition of the regulatory framework for a certain type of projects or programs may be as follows (on the example of capital construction projects):

  • Regulations on The Management of Capital Construction Projects
  • Procedures for managing capital construction projects
  • Regulations on the Project Office/Capital Construction Project Management Center
  • Job Descriptions for Participants in Capital Construction Projects
  • Templates of working documents for the management of capital construction projects (Project Charter, Project Plan, application for the opening of the project, etc.)



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