Project and Development Management – Significance and Objectives

Continuous and effective development is essential for every competitive organization. Saving costs in operations and investing in development enables the organization to create new business solutions required especially by digitalization. If an organization is able to save 20% in service costs through Sourcing and Service Management, it can as much as double its investments in new solutions and services. If these new solutions replace legacy applications and simplify architecture, the organization is able to achieve further savings, and as a consequence, afford the investments required by digitalization.


Figure 5.1.1 Development actions introduced by digitalization.


Development is a coordinated set of actions to capture requirements based on business needs, to implement a feasible solution, and to deploy it to users. All these actions need to be done according to agreed development practices within the given scope of time, resources and value creation expectations. Development can be a continuous flow of changes or, in larger and more complex cases, project-based.

Development Management in a narrow sense takes place throughout the different execution steps depicted in the green bar in figure 5.1.1. However, in a broader sense, development takes place across the entire IT Standard streams as follows:

Enterprise Development captures the ideas, formulates business demands and forwards concepts to Development Management which then executes these demands in the most efficient way. Development Management often resorts to external suppliers and is thereby internally supported by Sourcing and Supplier Management. In the end of the process, the implemented development initiatives need to be successfully handed over to Service Management and deployed into production.

Finally, Strategy and Governance stream defines the organizational structure that outlines how the different development streams are managed. It also indicates the value chain used for creating the tangible business benefits.

Development is coordinated by the Development Management Office (DMO), which also sets and promotes development practices for company-wide control, visibility and consistency. DMO has the mandate to classify and prioritize development initiatives to be approved or rejected by Development Portfolio Steering. DMO has control over resources, dependencies and the performance of major development initiatives, while providing the required support and consultation to maximize business benefits creation and minimize risks.

Many organizations have a Project Management Office (PMO) that handles all the same tasks as the DMO, but just for projects. As more and more development takes place beyond projects, it is recommended to have a full-scope DMO to replace the PMO.

Projects vary greatly in terms of targets, duration, budget, staffing and difficulty. Consequently, not all development initiatives require a project and they can be classified as a change. In all development, excluding a straightforward change, the following topics need to be managed:

  • Business Case validity
  • Goals, scope and constraints
  • Timetables and costs
  • Tasks and deliverables
  • Workloads and needed resources (internal and/or external)
  • Compliance with Enterprise Architecture
  • Quality and risks

Key objectives of Project and Development Management

  • Improve and create new solutions to succeed in competitive environments.
  • Manage the scope, schedule, costs, resources, and value creation of large-scale development initiatives.
  • Support agile and release-based development practices in environments, where the majority of development of existing solutions is incremental, or requires fast time-to-market of new solutions.

A project or change can also be part of a bigger business-driven initiative called a program. Programs are derived directly from strategic initiatives and are formed in situations where the change is rolled out to many business units as sub-projects. The program manager manages the program with the aid of project organizations.


Project and Development Management – Roles and Competence Requirements

As large organizations continuously run several simultaneous development efforts, Development Portfolio Steering is established to evaluate and prioritize opportunities with the support of the DMO. It maintains a list of all major development initiatives and manages their dependencies. The DMO also validates the Pre-Study and the Business Case for Portfolio Steering, which authorizes Conceptualization and Planning. After Planning, Portfolio Steering authorizes execution.

Some smaller changes may fall directly to service delivery, in which case they are handled as change requests under the Service Management Office (SMO). Read more about service delivery and the SMO in the Service Management Stream.


Figure 5.1.2 The Development Management Office and Different Formats of Development.


Projects are governed by their nominated steering groups, which report to Portfolio Steering at Gate Review Meetings. A Project Steering Group consists of representatives of the business and project organizations. The duties of the Project Steering Group, with the support of the DMO, include ensuring that the project creates value for the Business; providing the project organization with guidelines, decisions, and support; and ensuring that the targets of the project are met. The Project Steering Group approves changes to the schedule, budget and scope of the project. The members must have adequate decision-making and resourcing authority as well as sufficient subject knowledge. The Project Steering Group must also escalate decision-making when needed.


Project roles

The Project Owner is typically the head of the business unit or a Process Owner. The Project Owner is responsible for the project’s progress and quality towards business and is usually the chairperson of the Project Steering Group. The Project Owner is also responsible for approval and endorsement of the project deliverables. Furthermore, the Project Owner carries the main responsibility for executing and tracking the realization of business benefits.


Figure 5.1.3 Value-Driven Approach to the Steering Group.


Project Manager is responsible for daily project management and ensures that the project produces the agreed deliverables at the appropriate level of quality. Moreover, the Project Manager has the responsibility of ensuring that the project is implemented on schedule and within budget. The Project Manager also handles project-related changes and escalations to the Steering Group.

Project Manager is a role and not a title. A role means a set of responsibilities, functions and authorizations, which are given to a person or a group of people based on their competence. One person or a group can have several roles. However, this role requires dedication and time, and some organizations have a precondition that the Project Manager has to dedicate at least 80% of his or her time to the role.

Project Manager is responsible for project management communication. The role reports the project status to the Steering Group and acquires the needed decisions. To ensure that the project runs smoothly, the Project Manager must have adequate authority for minor project-specific changes.

Business Lead is someone with the authority and ability to be the project’s face towards business. The Business Lead’s main responsibility is to consult during Project Planning and to ensure that the designed and developed solution addresses the initial needs as specified by the respective line of business. The Business Lead usually executes the Rollout stage together with the Training Manager.

Other key roles typically included in a project team are an end-user representative (Super User, Key User), a technical lead, process owners as well as those responsible for testing and quality assurance. People responsible for communication, competence development and training must also be involved. The roles and responsibilities are defined at the latest in the Planning stage.


Service Development

Service Development is responsible for introducing new services and service development initiatives for the Business. It takes impulses from business projects, concept development, key users and service integration, and carries out the development efforts either as projects or changes.


Figure 5.1.4 Model for Service Development.


Key Roles in Project and Development Management

  • Project Owner
  • Process Owner / Solution Owner
  • Project Manager
  • Business Lead

Steering Functions in Project Development Management

  • Project Steering Group
  • Development Management Office
  • Project Management Office

The Essentials of Good Project Management

Each project is classified based on criteria that suit the organization. These criteria may include the size of the budget, the complexity of the solution, its organizational effects, effects on Master Data or integrations, solution visibility to end users and customers, as well as impact on currently known procedures. The bigger and more complex the project, the more attention it requires. Small projects may require fewer review meetings, resources and deliverables.

Each project has an appropriate Steering Group and Management Model. The Project Plan describes the project organization’s roles and responsibilities, project management methods, owners and other stakeholders, Key Performance Indicators (KPIs), Must-Have Deliverables and documentation methods, as well as follow-up and reporting practices.

Each project has an experienced goal-oriented and business-minded Project Owner and Project Manager, who are capable of inspiring and motivating people. All projects face challenges that the Project Steering Group must handle to minimize the negative impact on the project outcome. The role of the Project Owner is to ensure that the project fits the need of the organization, whereas the Project Manager ensures that the project deliverables meet the requirements and standards set in the beginning.

A project has an up-to-date Business Case and Project Plan. The Business Case defines whether the project still has business justification and is thus validated at each gate or decision point. The project plan is validated and revised according to the Business Case. The plan displays project phases as well as the status of deliverables and project tasks together with their schedules and resources.

The Project delivers a future-proof Solution that meets short and long-run business needs and is based on reliable and easily configurable applications that are fit for the business purpose. The Services required by the solution are planned and implemented professionally and are under the control of Service Management processes.

Change management, communication and training are required for the company to benefit from the outcome of the project. Organizational change impact is one of the Project Proposal’s core issues and is therefore addressed even before the project is established. It is important to consider the scale and direction of change together with personnel attitudes towards change. The project owner is – together with the project organization – responsible for implementing the change and delivering benefits to the business.


Project and Development Management Functions and Phases

In a fast-moving business environment, the time from opportunity identification to the finalized solution must be short. In many cases, development can be implemented by a consistent set of changes to processes, solutions and services without a project. In more complex cases, the development initiative should be classified as a project and appropriate management procedures should be taken. This section describes the project flow from opportunity to business benefit realization.

Project management models are often seen as complex and unwieldy. This is why we introduce a practical Project Model that is largely based on PMBOK and PRINCE2, but the Phases and Stages create a concrete step-by-step guide to run a successful project. Agile methods and the Scaled Agile Framework are favored solution implementation practices. They enable iterative, continuous development as well as quick learning and reaction to changes.


Figure 5.1.5 Project and Development Management Functions.


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