Dr. Harold Kerzner's Project Management Predictions for 2020

By Harold Kerzner, Ph.D. | Senior Executive Director, International Institute for Learning (IIL)

The landscape for project management changes almost every year. Some changes are relatively small or incremental, whereas other changes can be significant. Major changes to project management will occur in 2020 due to much of the new material that the Project Management Institute (PMI) has published and will be testing on in the new version of the Project Management Professional (PMP)® exam beginning in June 2020.

Most of the critical changes that I see happening in 2020 can be clustered into the six pillars of project management. These six pillars could very well change the face of project management for at least a decade rather than just for 2020.

Pillar #1: Project managers will be expected to manage strategic projects rather than just traditional or operational projects.

For several decades, project managers were only responsible for traditional or operational projects that:

  • Had a well-defined statement of work
  • Used the traditional “waterfall” methodology that was often based upon a one-size-fits-all approach
  • Relied upon earned value status reporting that focused mainly upon the time, cost and scope constraints

Strategic projects were assigned to functional managers whom executives trusted more than project managers. Functional managers were permitted to use whatever approaches they believed would work on their projects, and often without any of the processes, tools or techniques used in traditional project management practices.

Today, more and more companies believe that they are managing their business as though it is a series of projects. As executives begin to recognize the benefits of utilizing effective project management practices, and more trust is placed in the hands of the project managers, project managers are being asked to manage strategic projects as well as traditional or operational projects.

But as will be seen in some of the pillars that follow, many new techniques are accompanied by significant changes in the way that work is executed, e.g. new methodologies, new status reporting processes and new tools and techniques. Strategic projects (such as those involving innovation, R&D and entrepreneurship) may require different skills, a greater understanding of risk management (especially business risk management), and the use business metrics in addition to the traditional time, cost and scope metrics.

Pillar #2: Project management is now recognized as a strategic competency rather than just another career path position.

In Pillar #1, it was stated that project managers are now managing strategic as well as operational or traditional projects. Executive management now appears to recognize and appreciate the contributions that the PMs are making to the growth of the business.

Many companies will conduct a study every year or two to identify the four or five strategic career paths that must be cultivated in the company so that the growth of the firm is sustainable. Project management makes the short list of these four or five career path slots. As such, project management is now treated as a “strategic competency” rather just another career path position for the workers.

How do we know this? Partly, by considering the fact that many project managers now present and report project status to senior management. Historically, PMs conducted briefings for the project sponsors, and only occasionally for senior management. Now, with the responsibility to manage strategic projects that may impact the future of the firm, project managers may be conducting briefings for all senior management and even the board of directors.

Pillar #3: There will be a significant change in the skill set that some project managers may need.

When there exists some commonality among the projects in a firm such that a one-size-fits-all approach can be used during project execution, the skill set for the project managers may be known with some degree of certainty. But referring to Pillar #1, where project managers are now responsible for managing strategic projects, new skills may be necessary.

Strategic projects will vary from company to company, and even in the same company there can be a multitude of different types of strategic projects included in innovation, R&D, entrepreneurship and new product development. The skills needed can vary based upon the type of strategic project. As an example, different skills may be needed whether we are discussing innovation projects that are radical rather than incremental. Some of the new skills needed for strategic projects include design thinking, rapid prototype development, crowdstorming, market research, brainstorming and change management. For project managers involved in multinational strategic projects, the list of skills might also include an understanding of local cultures, religions and politics.

Pillar #4: There will be a significant change in how we define the success (and failure) of a project.

For years, the definition of project success was the creation of project deliverables within the constraints of time, cost and scope. While this definition seemed relatively easy to use, it created several headaches:

First, companies can always create deliverables within time, cost and scope, but there is no guarantee that customers would purchase the end results. Second, everyone seemed to agree that there should be a “business” component to project success, but they were unable to identify how to do it because of the lack of project-related business metrics. Third, this definition of project success was restricted to traditional or operational projects. Functional managers that were responsible for strategic projects were utilizing their own definitions of project success, and many of these strategic projects were being executed under the radar screen because of the competition in the company for funding for strategic projects.

Today, companies believe they are managing their business as a stream of projects, including both strategic and traditional projects. As such, there must exist a definition that satisfies all types of projects. The three components of success today are:

  • The project must provide or at least identify business benefits
  • The project’s benefits must be harvested such that they can be converted into sustainable business value that can be expressed quantitatively
  • The project must be aligned to strategic business objectives

With these three components as part of the project’s success criteria, companies must ask themselves when creating a portfolio of strategic projects, “Why expend resources and work on this project if the intent is not to create sustainable business value?” These three components can also be used to create failure criteria as to when to pull the plug and stop working on a project. Since these three components are discussed in current PMI literature, it is expected that these three components will appear in the new version of the PMP® exam, beginning in June 2020.

Pillar #5: There will be a significant growth in the number of metrics, especially business-related metrics, to be used on projects.

The four pillars discussed previously made it clear that the business side of projects will need to be understood much better than in the past. This will require significantly more metrics than just time, cost and scope.

Companies will need to create metrics that can track benefits realization, value created from the benefits and how each project is aligned to strategic business objectives. To do this may require the creation of 20-30 new metrics. This will undoubtedly lead to major changes in the earned value measurement systems (EVMS) currently being used.

The new project business metrics must be able to be combined to answer questions that executives have concerning business and portfolio health. The list below identifies metrics that executives need for business decision-making and strategic planning.

  • Business profitability
  • Portfolio health
  • Portfolio benefits realization
  • Portfolio value achieved
  • Portfolio mix of projects
  • Resource availability
  • Capacity utilization
  • Strategic alignment of projects
  • Overall business performance

Exhibit 1 shows typical categories of metrics and that new versions of project management (i.e. PM 1.0 – PM 5.0) may appear in the literature. The growth in metrics is due to the growth in measurement techniques. Today, we believe that we can measure anything.

Exhibit 1. Growth in Metrics

Pillar #6: There will be a growth in flexible project management frameworks or methodologies that are capable of measuring benefits and business value as the project progresses and after the deliverables have been created.

The traditional “waterfall” approach to project management implementation has successfully been used for years, but this approach has the limitation that value is measurable primarily at the end of the project. Companies want to have value and benefits metrics reported throughout the project so that they can cancel or redirect non-performing projects.

Techniques such as Agile and Scrum appear to do a better job of measuring and reporting value created through the project, than other approaches. In the future, we can expect more flexible project management approaches such as Agile and Scrum to appear.

Conclusions:

It is unrealistic to think that these six pillars will be the only changes that will occur in 2020. There will be other changes, but perhaps not as significant as these six pillars. The implementation of these six pillars requires that companies try to envision the future and plan for it. For companies that believe in “business as usual” or “let’s leave well enough alone,” these changes will not be implemented. Those companies that believe in “doing things the same old way” will most likely struggle to stay in existence.

Contact IIL to find out how we can support your individual, team, or organizational Learning & Development needs in 2020 and beyond. Email learning@iil.com, call +1-212-758-0177 or request a free consultation on our website.

About the Author
Harold Kerzner is Senior Executive Director with International Institute for Learning (IIL). He has an MS and Ph.D. in Aeronautical and Astronautical Engineering from the University of Illinois and an MBA from Utah State University. He is a prior Air Force Officer and spent several years at Morton-Thiokol in project management. He taught engineering at the University of Illinois and business administration at Utah State University, and for 38 years taught project management at Baldwin-Wallace University.

He has published or presented numerous engineering and business papers in addition to more than 80 college textbooks/workbooks on project management, including later editions. His latest book is Innovation Project Management: Methods, Case Studies and Tools for Managing Innovation Projects (Wiley, 2019).

 

Project Management Professional and PMP are registered marks of Project Management Institute, Inc.


Predictions for Project Management in 2017

By Harold Kerzner, Ph.D.
Senior Executive Director for Project Management, IIL

Every year, there are changes that take place in project management. The predictions for 2017 relate to all levels of management in a firm. Although we have high hopes for a lot of the changes, some bad results can occur. Several of my predictions focus more so on unfortunate results from my 2016 predictions as well as some challenges for the 2017 predictions. Most of these predictions are based upon my lecture series on PM 2.0 – PM 3.0: The Future of Project Management.

  1. Metric mania will grow.

    Not all of the changes that will occur will in 2017 will be favorable. In my predictions for 2016, I stated that there would be a growth in the number of metrics needed to determine the true health of a project. For many companies, the project management community saw this as an opportunity to identify significantly more metrics than were actually needed.  The result was “metric mania” where the organization is now asking the PMOs to periodically evaluate all metrics used and to recommend removal of “bad” metrics that simply create additional work and provide no informational value.

  1. Project management is now being viewed as a strategic business process rather than merely a traditional project management process used for project execution and delivery. 

    Historically, project managers made only project-related decisions (usually concerning the technical aspects of the project) whereas all business decisions were in hands of the project sponsors. Now, because there is more trust in the ability of the project managers to deliver, they are allowed to make business-related as well as project-related decisions.

  1. Project management career paths will become strategic competencies. 

    For decades, project management was treated more so as a part-time occupation rather than as a career path, with the exception of those firms that were project-driven organizations and were pressured by their clients to reluctantly make project management a career path position. Project management is now being treated as a career path in both project-driven and non-project-driven companies. But as companies recognize the benefits that can be achieved from project management, we will see project management maturing into a strategic competency. Each year, companies are assessing which career paths are a necessity for the firm’s critical growth over the next several years. In many firms, project management is now viewed as one of the five critical career paths and being treated as a strategic competency necessary for the firm’s future. Each year, larger portions of a company’s training dollars appears to be committed to project management education.

  1. Each project can have a different definition of success.

    For years, we allowed customers and contractors to work toward their own definitions of success. Now, as project management matures, we are asking the customer and contractor to meet at the onset of a project and come up with a mutually agreed definition of success. Each definition of success can therefore have a unique set of metrics specifically used for that project. If the customer and contractor do not have an agreed upon definition of success, the result can be Exhibit 1 below.

    tire-swingExhibit 1: A Disagreement in Defining Project Success

  2. Project governance personnel will require project management education.

    In my predictions for 2016, I stated that sponsorship by a single individual would be replaced with committee sponsorship. The problem was that, because projects were becoming larger and more complex, all of the necessary decisions could not be made by a single person acting as a sponsor and committee governance would be a necessity. Unfortunately, for many firms, this has created a headache because people placed on the governance committee were poorly educated in project management and were under the impression that project governance and organizational governance are the same. Educational programs will need to be developed for committee governance personnel such that they understand their new roles, responsibilities, decision-making authority and that this can change from project to project and therefore must be a negotiated process at the start of each project so that there is no conflict over duties between the governance personnel and the project managers.

  3. There will be a growth in the use of Portfolio PMOs.

    In my 2016 predictions, I stated that the most important word in the project manager’s vocabulary will be “value.” The definition of a project will include wording on value to be expected. The definition of project success will be based upon value delivered rather than meeting the project’s constraints. Metrics will be established for measuring benefits and value throughout the life cycle of the project. What we are now realizing is that some organization within the company must take the responsibility for selecting and prioritizing the projects in the portfolio of projects such that corporate business value will be maximized. This will be accomplished by the use of a Portfolio PMO. As a side benefit, the Portfolio PMO can prevent “pet” projects from being added to the portfolio and wasting precious resources that provide little or no value.

  4. Projects will be aligned to strategic corporate objectives.

    Project value can come in many forms. One of the responsibilities of the Portfolio PMO will be to track the projects in the portfolio and measure their ability to meet strategic business objectives, thus maximizing the business value for the company. This may create conflicts if the Portfolio PMO selects and prioritizes projects for inclusion in the portfolio based upon strategic business objectives rather than functional, divisional or business unit objectives based upon limited resources.

  5. There will be a growth in unrealistic expectations of project management.

    As project management grows, executives will begin working on larger and more complex projects. While this is often a necessity for growth and survival, the expectations must be realistic. For years, we encouraged project managers to address each project optimistically and with a positive attitude. Now, we will be telling project managers to “hope for the best, but plan for the worst.” Risk management practices will now take center stage and project managers may have to develop detailed contingency plans at an early stage in the project’s life cycle.

  6. There will be a growth in internally developed dashboards.

    As I stated in last year’s expectations, written reports are slowly being replaced by dashboard reporting systems. Most companies hired outside dashboard consulting companies to help create their dashboards. But as the need for more dashboards has arisen, companies will be hiring (or training some of their own people to serve as) infographics or dashboard designers. This should lower the cost to the company and get dashboards that are more closely aligned to strategic business objectives.

  7. Project management methodologies will be replaced by frameworks.

    As more trust is being placed in the hands of the project managers, rigid methodologies that are based upon policies and procedures are being replaced with flexible methodologies or frameworks that can be customized to individual projects. This is one of the concepts of Agile and Scrum.

  8. Multinational project management will grow significantly.

    As more companies seek out the opportunities to become multinational players, the need to develop multinational project management skills will increase. This will require coursework in topics such as international politics, power and religions, and how they impact the way that some projects must be managed.

  9. The role of the change control boards (CCBs) will be modified.

    Traditional, CCBs looked only at a given project when considering whether to approve or deny a scope change. As projects become larger and more complex, resources may have to be removed from ongoing projects to satisfy a scope change on the project at hand. Now, CCBs must consider how the scope change on one project may impact other projects.

  10. The use of Certification Boards will increase.

    There are numerous certification programs can an individual can attend. Most companies provide tuition assistance for these certifications. But now, it appears that, with the number of possible certifications in the marketplace and with that number expected to grow, companies are creating Certification Boards to approve the selection of certifications and to make sure that it adds value for the firm. The growth in certifications will most likely happen only for those firms that reimburse employees for the cost of certification.

  11. Companies will perform world class benchmarking.

    For years, companies believed that project management benchmarking should be done only with companies in their own industry and with similar processes. Now, companies will be performing world class benchmarking where they will measure themselves against the best project management companies in the world rather than just those in their own industry.

The above predictions are the ones that I consider critical for 2017. The introduction of PM 2.0 and PM 3.0 will bring forth additional changes. The predictions described above are part of the lectures on PM 2.0 and PM 3.0.

For those of you that are interested, IIL offers 1-hour, 3-hour, and 6-hour webinars and seminars on PM 2.0 and PM 3.0. For additional information on these webinars and seminars, contact learning@iil.com or visit www.iil.com.

Dr.-Harold-Kerzner-200x300

Harold Kerzner, Ph.D. is IIL’s Senior Executive Director for Project Management. He is a globally recognized expert on project management and strategic planning, and the author of many best-selling textbooks, most recently Project Management 2.0.


Top 10 Project Management Predictions for 2016

By Harold Kerzner, Ph.D.
Senior Executive Director for Project Management, IIL

Every year, the landscape for project management changes. Some of the changes often require considerable effort for implementation whereas other changes may be just cosmetic. But there’s one thing we can be sure about: change is inevitable. It will happen, the question being “When”?

We are in a rapidly changing evolutionary period which I refer to as “Project Management 2.0 (PM 2.0).” Even though many project management practitioners and educators have been expounding the birth and virtues of PM 2.0, sitting in the wings is PM 3.0 waiting to come on stage.

Below are the top ten predictions I am making for 2016 as a result of PM 2.0 and PM 3.0. Some of these predictions have already come true for some companies, but for the majority of firms these will happen in 2016.

  1. Executives will place more trust in the project manager and in project management overall.

    For decades, executives were afraid that project managers would be making decisions that were reserved for the executive levels of management. This limited the authority and decision-making abilities of the project managers. To make matters worse, there was a misbelief that project managers did not know enough about the business in order to participate in business decisions. In 2016, project managers will participate in both project- and business-related decisions and trust in project managers will increase.

  1. Project managers will manage more of the strategic projects.

    Historically, strategic projects were managed by functional managers because executives had limited trust and faith in the decision-making abilities of the project managers. All of this will change and project managers will assume responsibility for managing the portfolio of strategic projects.

  1. Project sponsorship by a single individual will be replaced by committee governance.

    As projects become larger and more complex, it is increasingly difficult for one person to provide all of the necessary support. Committee governance will replace traditional project sponsorship on many projects, especially those in the strategic portfolio.

  1. Corporate resource management practices will come of age.

    The biggest challenge facing most executives is that they do not know how much additional work the organization can take on without overtaxing the existing labor force. By establishing an effective capacity planning system, projects will be approved, added to the queue, and prioritized based upon resource availability. Effective resource management practices should allow us to design a portfolio of projects that will maximize the value that the company will receive.

  1. Structured business case development will become a necessity.

    All too often, projects are approved based upon an unstructured business case that is riddled with holes. Companies will develop templates for the preparation of a business case, accompanied by a benefits realization plan and a description of the value expected at project completion.

  1. “Value” will be the most important word in the project manager’s vocabulary.

    The definition of a project will include wording on value to be expected. The definition of project success will be based upon value delivered rather than meeting the project’s constraints. Metrics will be established for measuring benefits and value throughout the life cycle of the project.

  1. The need for paperless project management will grow.

    Companies will finally realize the cost of preparing useless reports and handouts that nobody wants nor reads. Paperless project management practices will be accompanied by a rapid growth in dashboard reporting of project performance. Executives can expect to see “real time” data on the dashboards rather than having to wait for months to pass by before a report is prepared. This should certainly allow for decisions to be made in a timely manner based upon evidence and facts rather than guesses.

  1. The number of metrics to be used on a project will increase.

    You cannot determine the actual performance of a project, or a project’s success, just by looking at time, cost, and scope. Let me say that again so that it sinks in: You cannot determine the actual performance of a project, or a project’s success, just by looking at time, cost, and scope. For more than five decades (that’s right, five decades) we have avoided looking at additional metrics because we did not know how to measure them. We looked at the easiest metrics to measure, namely time, cost, and scope. This is going to change. We may end up with 10-20 metrics on each project and the metrics can change in each life cycle phase.

  1. Tracking assumptions and constraints will become a necessity.

    For years, we took the easy way out during project execution and believed that the assumptions and constraints would remain fixed over the duration of the project. Now, some of the new metrics we develop will track the assumptions and constraints on projects. This will make it easier to redirect failing projects or those projects that will not provide the expected benefits and value.

  1. Project management maturity models will account for the changes in PM 2.0 and PM 3.0.

    There are several project management maturity models in the marketplace. Unfortunately, many of them have not kept up with the changes dictated by PM 2.0 and PM 3.0. All of this will change in 2016.

The above ten predictions are the ones that I consider critical for 2016. The introduction of PM 2.0 and PM 3.0 will bring forth additional changes.

For those of you that are interested, IIL offers 1-hour, 3-hour, and 6-hour webinars and seminars on PM 2.0 and PM 3.0. For additional information on these webinars and seminars, contact learning@iil.com.

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