Agents of Organizational Change

The role of program and portfolio management in leading enterprise change

by Valerie Zeller

There has always been a co-dependent relationship between program and portfolio management (PPM) and organizational change management (OCM). After all, projects are the agent of change, and change is required for enterprises to survive and thrive. Businesses need projects and programs to implement a strategic initiative, deliver a new service or bring a new product to market.

However, this relationship is typically viewed from the perspective of how projects bring about organizational change, which can lead to managing change as an afterthought. Rather than focusing on how projects bring about change, let’s focus on how change brings about projects. This encompasses the role PPM plays in ideating and driving change, especially strategic change. From this perspective, change is not an afterthought or the byproduct of projects that need to be controlled and minimized; change, like digital transformation, is the forethought and central goal, whose impact needs to be leveraged and maximized. 

Leveraging PPM to lead change, rather than to simply react to it, starts with the presumption that any significant change should be treated as a project and managed by the program/project management offices (PMOs).

It is imperative that project organization leaders and PMOs embrace the perspective that PPM can be leveraged to lead change for two reasons: demand and investments. 

Demand: The demand for strategic change is accelerating as risk tolerance for change and willingness to change increases. At the same time, there is evidence to suggest that enterprise stakeholders are expecting PMOs to play a bigger role in leading OCM. According to Gartner research “Five Best Practices PMOs Can Use to Effectively Support Organizational Change” (www.gartner.com/doc/3801869/best-practices-pmos-use-effectively), “In a recent Gartner survey, only 4.3 percent of respondents said that organizational change management was completely supported by a program and portfolio management (PPM) process in their organization.”

Investments: Investing in OCM leadership provides an opportunity for PMOs to promote and expand their value contribution to the business.

Leading Tactical and Strategic Change 

PPM has the potential to lead the way for both types of change — tactical, which include a change in a claims processing workflow to add a legal approval step before management sign-off; and strategic, which are re-engineered mission-critical processes like online purchasing and fulfillment. 

PPM’s role in driving bottom-up tactical change: PPM systems support capabilities for collecting, scoring and ranking ideas. These include idea portals used to crowdsource ideas for change from the grassroots level. Idea management functionality typically includes features for promoting and weeding out ideas, as well as workflows to route the best ideas to relevant parties. 

Once ideas have been screened, they can become formal proposals. PPM systems support robust proposal management functionality to score and weigh proposals based on various selection criteria, such as strategy alignment. Strategy alignment answers the question, “With what strategies does this project proposal align?” The answer to this question should clearly demonstrate a direct line of sight with key organizational objectives and priorities. Without such clarity, most proposals for change can be safely ignored. 

PPM’s role in executing top-down strategic change: Because alignment is reactionary to strategy, it does nothing to proactively drive long-term competitive advantage. To do this requires a process for strategy execution. 

Strategy execution answers the question, “What projects do we need to stand up to implement this strategic change initiative?” This top-down, outside-in approach to driving project ideation and project activity — where strategy or change initiatives come first and projects follow — is critical to making strategic changes like business transformation a reality. 

Positioning organizations for the future with change analytics: Change analytics represent a future in which PMOs preside over a data-centric operation rather than a primarily process-centric one. In this vision, PPM is the system of record and institutional knowledge base for information about available resources, future capacity, program issues and risks, and project and program interdependencies and outcomes. Essentially, change analytics leverage data that is the result of a formal process and approach to institutional learning for strategy formulation.

Strategy formulation based on change analytics can be thought of as a prescriptive decision-support function that answers the question, “What changes should be pursued given what is known and can be predicted about our ability to execute?” In more simple terms, it’s about driving change based on what has and hasn’t worked, what could be predicted to work, and what is likely not to ever work.

Leveraging Change Analytics Information 

PMOs that leverage PPM change analytics to drive strategy formulation have the potential to gain a seat at the business strategy development table, attain trusted advisor status, and influence long-term corporate strategy and competitiveness.

Ways change analytic information can be leveraged in the strategy formulation process include:

People information: PMOs are already the gatekeepers of resource information that include skills, affinities and interests, and they typically own capacity forecasting within the project organizations as well. By collaborating with human resources, PMOs are positioned to create an enterprise-wide talent optimization system that prepares the workforce culturally and skill-wise to drive, adapt to, and thrive on change. This is attainable especially if they leverage PPM scenario planning and resource modeling capabilities. 

Project and program information: This includes information that correlates project success metrics, like on-time and within budget, with factors like project type, project size and scope, and project leader and project team attributes, potentially with the support of AI and machine learning technology. This data can be used to develop a risk score for project selection, and to proactively remedy anticipated implementation points of failure and roadblocks. The information may also be used to structure change initiative roll-outs for success, such as scoping initial deployment phases to achieve quick wins.

Process information: This includes determining which methodology or combination of methodologies (e.g., agile, waterfall, Lean, Six Sigma, Stage Gate™, etc.) work best in a particular situation, and what can be done to continuously improve the process to achieve optimal business and change management outcomes. This means analyzing project delivery processes and outcomes to understand what went right and wrong and what needs to be improved.

It should be noted that the PMO system of record for institutional learning is not only relevant for changes associated with change initiatives and their component programs and projects, but it also supports what otherwise could be a traumatic event or existential threat to the business, such as changes in leadership or departures of key personnel. The change analytic system also serves as the corporate workforce memory for institutional knowledge that can be lost if not captured or digitized before significant planned and unplanned workforce transitions occur. 

By thinking about how best to lead change and maximize its value, rather than focusing on minimizing its impact, PMO and PPM leaders can effectively impact future growth opportunity. In a future where success — if not outright survival — depends on continually adapting and innovating, they may not have a choice.  

Valerie Zeller is a growth strategist with more than 20 years of experience launching innovative solutions in the U.S. and Europe. As the chief marketing officer of Sciforma, she oversees and drives a highly agile global B2B marketing team to optimize marketing initiatives.

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