Securing transformation plans in an international context
In an environment, more and more globalised and competitive, industrial sectors are moving towards practical rationalisation and standardisation. Groups, whose operational headquarters or parent companies develop transformation plans, often dictate these practices seeking to align business practices in their subsidiaries which are deployed internationally.
Nonetheless, if the business practices standardisation is in terms of operational costs reduction or an improvement of service levels, it might, in specific cases, be due to geographical constraints and can become a barrier to the market’s penetration.
It is precisely this balance that the industry strives to respect when it comes to deploying and securing a transformation plan abroad.
Freelog consulting, by its tradition of counselling in industrial performance in international environments, must accompany industrial transformation in the deployment plans.
As such, we now present a balance sheet contrasting practices of project deployment abroad, which is illustrated through three factors.
Costs/quality/time goals not achieved
According to a study, 68% of projects fail to achieve their cost/quality/time objectives. Only 32% of projects are completed within the time limit, the budget and in the expected level of quality.
One of the major reasons for this failure is attributed to 30% of inadequate project management implementation, 20% to ignorance of the perimeter and 17% to the business or technical complexity. The remainder is due to the constraints of the project owner.
These statistics fully justify the usefulness of a PMO (Project Management Office).
Freelog developed practices adapted to the PMO transformation plans abroad in three main components:
- Central PMO deployed at HQ guaranteeing the overall coherence of the proposed transformation project in cost, quality and time;
- A functional “Flying PMO” deployed for operations tied to local stakeholders. This ensures the implementation of the transformation plan and provides functional expertise of business practices to be deployed;
- A PMO “toolbox” oriented not just to reporting but also to monitoring with the introduction of Earned Value Management (EVM).
Our model of PMO successfully deployed for Airbus Helicopters:
As work develops, we acquire some value, depending on the estimated value at the beginning of the project.
To estimate the value increase, an estimation on the physical progress is made. This corresponds to the percentage of work done with regards to the work to be done. The Earned value is calculated by the multiplication of the budget of every task by their physical progress.
Strongly centralised project management and difficulties with cultural differences
Subsidiaries are often based on a unilateral organisational model like thier headquarters and projects are perceived as a dictatorship even before having started or initially deployed.
A set governance needs to be well defined in the project engineering phase that can be a catalyst in change and generally requires a level of responsibility for making the connection between the Master Business Process Owners at HQ and Business Process Owners at subsidiaries.
This model of governance should be rigorous and respected even before starting the project. This is directly correlated to the project’s success.
This is what Freelog Consulting does.
The central PMO and the flying PMOs will be the human link between the governance in parent-son projects. This model of organisation will ensure a continuous and permanent coherence throughout the project.
On the other hand, to limit and smooth the most the cultural aspects, Freelog and its transnational organisation, selects, where possible, “flying PMOs”, speaking the local languages and where possible, being of the nationality of the concerned geography (Freelog has more than 10 nationalities in its staff).
An example of the governance of a parent-son or “mirror” project:
Roll-out can be too aggressive and not durable
“Slow and steady wins the race”, as the saying goes. This is also true for project roll-out logic. Industrial organisations often rush to deployment without the security of a robust project engineered design or “footprint” translated into manuals or handbooks/playbooks.
The manual (IT or business) to be deployed requires subsequent time to be developed. This critical phase must not be done only centrally.
Freelog, with its experiences, recommends the implication of an international actor mature enough (subsidiary/ partner) to serve as a pilot and test the feasibility of the reference book to be deployed.
To maximize the adhesion of stakeholders involved in the deployment, Freelog also suggests the level of maturity be evaluated with regard to the defined stakeholders’ handbook. This will allow, once communicated, stakeholders to take responsibility by encouraging them to progress and to therefore be rewarded.
On the other hand, to secure the roll-out, the manual has to allow a permanent consideration of the improvement of practices. It is thus a question, according to us, of integrating a controlled loop into the peer to peer evaluation phase to develop the model.
We sum up this logic through the following plan and according to six key stages :
This is the way Freelog accompanies its customers in the deployment of their transformation plan. This comes down to three key stages:
- The implementation of functional and central “flying PMOs” covering the practices of project management (included tools), but bringing the necessary business expertise;
- A parent-son governance of the project orchestrating MBPO and BPO by PMO;
- A meticulous preparation of the manual to be deployed allowing the labelling and the continuous improvement of the practices or the process.
|Charly began his career in China in new technology research and development. Coming from organization and management consulting, specialized in Supply Chain, he developed in FREELOG original project and multi-cultural change management practices and methods. Charly has participated in Brazilian development and is now in charge of Asia Pacific development.|