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Combining Value And Project Management Into An Effective

Programme Management Model
Michel Thiry, PMP, CVM

Managing Consultant, PMProfessional Learning, www.pmprofessional.com

e-mail: mthiry@pmp.uk.com

Introduction

In this paper, I will suggest that the current Programme Management paradigm is strictly performance-
based. I will aim to demonstrate that there is a need for both a performance and learning process in
the management of programmes. Following this demonstration, I will suggest that value management
can be combined with project management to form an integrated learning-performance programme
management model. I will further develop this concept by identifying some specific methods and
techniques which can be used to implement such a model. I will also recommend the iterated
application of the model, throughout the programme life cycle from strategic choice, to business
objectives and feasibility, through planning and appraisal, and finally termination.

An Emerging Paradigm in Programme Management

There are a number of definitions of programme management; most of them by organisations who are
heavily in project management like PMI (Project Management Institute), APM (Association for Project
Management) or CCTA (Central Computer and Telecommunications Agency). All these definitions
have both things in common and differences. The main common points are that programmes usually
cover a group of projects; that their management must be co-ordinated; and that they create a
synergy, which will generate greater benefits than projects could do individually. The main differences
are: the fact that they also cover ongoing operations (PMI, 2000); that the elements must have a
common objective (APM, 2000) and the fact that their impact is at the organisational level and
concerns change (CCTA, 1999).

Murray-Webster and Thiry (2000) have tried to integrate those three elements in their definition of a
programme as A collection of change actions (projects and operational activities) purposefully
grouped together to realise strategic and/or tactical benefits. The concept of purposefulness is
related to the objectives, which need to be defined; the word actions refers to ongoing operations, as
well as projects; and the benefits can be both strategic or tactical, but are always measured at
organisational level.

The Current Programme Paradigm

A number of project managers associate programmes with large projects. Other authors associate it
to multi-project co-ordination or portfolio management, which is often associated with resource
management; (Patrick, 1999) or account-client management; this view is also emphasised by
Programme Management computer software, which is essentially designed to support resource
management, planning and cost/time control.

Another view is that of Becker (1999), Pellegrinelli (1997), Reiss (1996) and Bartlett (1998) who link
programmes with organisational change, often IT-based, although a number of programmes are about
change. Even those who advocate that programmes are more than just large projects and need to
address strategic benefits, still advocate a project paradigm to run programmes. For example, the
recently developed Programme Management Maturity Model (PMMM) (Reiss & Rayner, 2001) points
out that most organisations still consider organisation, issues and risk, planning and accounts and
finance as key to the success of programmes, whereas achievement of benefits, stakeholders
management, communications and configuration management seem less important.

Thiry (2001), Weick (1995) and Daft & Lengel (1986) have made a clear distinction between
uncertainty and ambiguity/equivocality. Uncertainty is defined by the difference between the data

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required and the data already possessed; it is a lack of information. Ambiguity, on the other hand,
means the existence of multiple and conflicting interpretations; it is linked to confusion and lack of
understanding. Whereas uncertainty leads to the acquisition of objective information and the
answering of specific questions, ambiguity leads to sensemaking, the exchange of views and the
definition of situations/problems.

Generally, organisation, planning and cost management are key elements of uncertainty reduction, as

well as risk management, which has become a key process in the new PMBOK Guide. Benefits,
stakeholders, and communications are softer issues, linked with the reduction of ambiguity, with which
project managers still not feel comfortable. Configuration management, as currently stated, is about
the product, not the process, project managers traditionally direct a process and do not feel
responsible for configuration beyond delivering what was asked. Grg and Smith (1999), argue that
proponents of the current project (performance-based) paradigm concentrate on describing tools and
techniques, rather than, when to use the most appropriate for the situation.

I would therefore argue that the current programme paradigm is a performance paradigm. It is about
clear objectives and deliverables and robust control techniques embedded in an uncertainty-
reduction process of plan-execute-control which Winch et al. (1998) have already associated to
projects.

The Emerging Programme Paradigm

Strategic management is ambiguous and complex; fundamental and organisation-wide; and has long-
term implications (Johnson & Scholes, 1997). Wijnen & Kor (2000) write that a programme strives for
the achievement of a number of, sometimes conflicting, aims and has a broader corporate goal than
projects, which aim to achieve single predetermined results. Grg and Smith (1999) argue that
strategic management is based on the continuous re-formulation and is a form of continuous
adjustment, whereas projects concentrate on achieving one single particular result within set time and
cost constraints. Partington (2000) argues that programmes require integration across strategic
levels, controlled flexibility, team-based structures and especially, an organisational learning
perspective, which is able to accept paradox and uncertainty. Murray-Webster and Thiry (2000)
advocate a vision, which includes mechanisms to identify and manage emergent change; they use an
idea developed by Hurst (1995) to promote the concept of a learning loop, which completes the
performance loop.

These concepts need to be supported by an ambiguity-reduction process that needs to take place
before any attempt is made at uncertainty reduction (see Figure 1). It is supported by: learning, value
management, sensemaking, information sharing, group decision support and shared construction of
statements. In management, this process uses a range of 'soft methodologies and techniques like
stakeholder analysis, functional analysis, ideation-creativity-innovation, soft systems analysis and
others.

Additionally, in the current organisational context and culture of e-business and accelerated change,
managers are required to process a large flow of often-contradictory information in a short time.
Programme managers, in particular, are caught right between the ambiguous, soft, fuzzy realm of
strategic management and the concrete, hard place of implementation. They have to deal with both
high ambiguity and high uncertainty at the same time.

Decision-making and change situations often mean that multiple stakeholders, with conflicting needs
and expectations, are competing with each other. The expectations need to be brought out in the
open and discussed (Kirk, 2000), stakeholders need to make sense of the situation (Weick, 1995)
and construct a shared understanding of it (Thiry, 2001) before they can progress towards an agreed
decision. It is a context where the aim is to identify and understand needs and expectations and
reduce ambiguity through negotiation before attempting to use any kind of uncertainty-reduction
process.

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Uncertainty
Unsettling
Low High
Change

High Ongoing Sensemaking &

Conversation Value Analysis

Ambiguity

Ongoing Risk Analysis &

Low Operations Problem Solving

Routine

Figure 1: The Uncertainty-Ambiguity Relationship in Change Situations

To be adopted by progressive organisations, thriving in a complex, continually changing environment,

a programme management paradigm would require to include both a learning, and a performance
loop; to address both uncertainty-reduction and ambiguity-reduction. Murray-Webster and Thiry
(2000) have described this integrated process as the programme eco-cycle, which Thiry (2000) has
later called a Decision MakingImplementing Cycle.

The Proposed Model

The model developed in this paper (see Figure 2) acknowledges that there are deliberate (or
planned) strategies and emergent (or unplanned) strategies (Mintzberg & Waters, 1985).

Projects are triggered by a conscious decision to undertake an action; they are based on clear, well-
defined objectives and deliverables; they are a deliberate strategy. The project management process
is initiated with a high level of uncertainty at the beginning (high assumptions/facts ratio); it then uses
tools and techniques like work breakdown, risk analysis and planning, followed by quality, time and
cost control. All those methods are designed to accelerate the knowledge of the project situation
through information gathering and simulation; they are aimed at the reduction of uncertainty.

But, deliberate strategy is just the part of the process that takes place after a decision has been made.
The emergent inputs, which will trigger the need for change, should also concern the programme
manager; whether they are a simple adjustment in a project parameters, or whether it is the
circumstances that initiate a whole new series of actions. The learning loop addresses the processes
required to manage both the emergent inputs and the decision-making process leading to its
resolution.

As stated above, project management processes cover only the implementation part of the strategy
process. There are three other important elements in strategy management, which need to be taken
into account; they are: a) the making of the decision itself; b) the appraisal of its benefit during
implementation; and c) the changes that may influence its execution. These changes will be triggered
by either emergent inputs or the failure to achieve the stated benefits. It does not matter whether it is
a strategic, portfolio or incremental programme; these principles still apply.

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Performance Cycle
Delivery
Project(s) of results Execution
Programme

Control Planning
Deliverable
Decision
Change
Sensemaking Evaluation
Value

Ideation
Capture
expectations
Learning Cycle

Figure 2: The Integrated Programme Management Cycle Model

The Learning Loop

The learning cycle of programmes cannot be based on the same principles as the performance cycle;
time, focus, decision and leadership take different dimensions. Whereas, once a decision has been
made, implementation time should be as short as possible, as it becomes a success factor; more time
is required for the interaction leading to the decision. Whereas planning and execution must be
rational, analytical and efficient, the process leading to decision-making will rely more on sensemaking
and intuition, it will require innovation and creativity.

In the context of this paper, learning will be defined as: the capability to self-assess and feedback to
improve and innovate and consider that there is both a social process and a need for improvement
involved in learning.

Value Management and Learning

I personally believe Value Management (VM) can offer programme managers the tools and
techniques that are missing in project management to tackle the learning loop of the programme cycle.
As Kaufman (1998) stated: The problem with most problem-solving disciplines [] is that they
assume that the stated problem is the real problem; VM is a problem identification, as well as a
problem-solving, methodology.

The VM Standard (CEN, 2000) states that:

A Value Management study involves the application of one or more methods to a
specific subject []. The Value Management study will, regardless of the level at which
the study is being undertaken, follow the sequence set out [] below:
a) define the objective(s) of the [] study in relation to the [] Policy and Programme ;
b) identify the methods and the supporting processes needed to achieve the objectives
1
and select the teams [];
c) identify the functions which are essential to achieve the objectives and which together
will result in the objective being attained;
d) identify how to measure changes in performance and use of resources;
e) set targets for performance and use of resources for each of the functions identified
above in the most effective manner for the organisation as a whole;
f) apply the methods and supporting processes to identify innovative ways of achieving
the targets;
g) select and validate proposals for improvement;
h) implement the proposals which have been chosen by the decision maker;
i) monitor and measure the outcomes and compare with targets;
j) feed back results for continuous improvement [].

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Note 1: In programme management, this would mean to identify the stakeholders.

In the proposed model, I have grouped points a), c), d) and e) under sensemaking; b) and f), under
ideation and g) under evaluation. Point h) is partly the actual decision and, with i) and j) part of the
performance loop review and change processes.

Sensemaking

The first premise of good programme management is to fully understand stakeholder needs and
expectations. Sensemaking has been described by a number of authors. Louis (1980) described it
as: a recurring cycle comprised of a sequence of events occurring over time. The cycle begins as
individuals form unconscious and conscious anticipations and assumptions, which serve as
predictions about future events. (p.241). Weick (1995) suggests that sensemaking is partially under
the control of expectations; it is an interpretive process. As for myself (Thiry, 2001), I summarised it
as a system of interactions between different actors who are [] building a collective understanding
of a situation, developing a strategic model of the intervention and defining a shared [] desired
outcome.

Sensemaking is triggered by expectations: beliefs or assumptions about the future (Kirk, 2000), and
the realisation that the current situation is inconsistent with this vision. Stakeholders then need to
enter a sensemaking process, which, in the context of organisations, I (Thiry, 2001) have defined as
an individual process grounded in social interaction. In the paper, Sensemaking in Value
Management (Thiry, 2001), I have described how VM can provide the methodology to achieve
positive sensemaking and, ultimately, agreement on the benefits, success factors and objectives of a
solution to a complex situation.

Functional Analysis (FA)

FA, is used to:

!" identify the functions of a product, a system or an organisation ;
!" quantify the performances to be reached ;
!" [] improve communication between those involved in the definition, design and development of
the product. (CEN, 2000)
Note that, in a programme environment, functions can be expressed as benefits or objective.

The FA method requires stakeholders to think in terms of objectives and end results. It also requires
an identification of all those who may have particular requirements or expectations with regard to the
product: a stakeholder analysis. FA, if well conducted, generally achieves a comprehensive
description of the functions and of their relationships, which may be systematically characterised,
classified and evaluated (CEN, 2000).

The FA process usually involves the development of a function model, which I have previously called
Function Breakdown Structure (Thiry, 1997); it provides a representation of the agreed understanding
of the expected functional benefits of the programme by the stakeholders. The FBS, because it
classifies functions/benefits/objectives from the more abstract strategic objective (Grg and Smith,
1999) to the more concrete project solutions, can become the framework of the programme, in the
same way as the WBS is the framework of the project.

Ideation and Evaluation

I will not delve into details concerning those two aspects of the learning loop, only to say that
programme managers would apply a creative thinking process, promoted by VM, where creativity,
imagination and lateral thinking are to idea generation what evaluation, analysis and vertical thinking
are to options appraisal. Creative thinking promotes the alternative use of those two techniques in
order to produce a greater quantity of more innovative ideas and apply a better selection and
validation of alternatives. For more information on this process, see Thiry (1997); Kaufmann (1998) or
CEN (2000).

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Review, Evaluation, Change and Feedback Process

Once the decision to undertake a programme, supported by a collection of change actions is taken,
the programme enters the performance loop.

The latest revision of the EFQM Excellence Model (1999) now includes a learning and innovation
loop. Most proponents of the learning/performance paradigm (Wijnen & Kor, 2000; Grg & Smith,
1999; Murray-Webster & Thiry, 2000) argue for a continuous re-evaluation or re-formulation of the
programme, in regards of the achievement of organisational benefits, an inductive (based on
emergent inputs) and formative (to improve) type of evaluation/control.

On the other hand, proponents of the performance paradigm (Bartlett, 1998; CCTA, 1999; Reiss,
1996) argue for a deductive (based on set parameters) and summative (to assess) type of control,
based on performance parameters such as time, cost, resources, risks, etc. I would argue that it is
therefore not appropriate to programme management, as it does not allow for the flexibility necessary
to the management of programmes.

Programme Appraisal

Programmes are usually long-term processes; most programme management authors advocate, as
part of the control process, ongoing re-evaluation of the programme benefits and objectives, as the
programmes expected benefits may change over time (Grg and Smith, 1999; CCTA, 1999; Bartlett,
1998). Following the writings of strategic management authors (Mintzberg et al., 1998; Senge, 1994)
who advocate a continuous appraisal/learning process, authors like Partington (2000), Murray-
Webster & Thiry (2000) and Wijnen & Kor (2000) add the concept of a formal programme appraisal
process, the objective of which is to reassess the programmes critical success factors on a regular
basis.

The learning loop of the full programme cycle is therefore repeated at regular intervals. In order to
achieve stakeholders satisfaction at the time of delivery, it is paramount that a sensemaking process
be included at each appraisal phase and that, when change is required, alternatives be sought and
evaluated to maximise opportunities throughout the process.

The programme appraisal can be planned on a regular basis, but allowance must be made for ad hoc
learning loops, when required by exceptional circumstances or emergent inputs. The appraisal can
typically lead to continuation, re-orientation or termination.

Project Reviews

Project, or sponsor, reviews are quite well described in the project management literature (PMI, 2000).
They basically consist of evaluating project deliverables in regards of the stated project objectives. In
addition, in the emergent programme management paradigm, it involves assessing those results
against the critical success factors of the programme and, in general, against the organisational
benefits, determined by the strategy.

These requirements can be met by steps i) and j) of the VM process described above. The use of VM
in this instance enables the programme manager to ascertain that the project deliverables are still in
line with the programmes expected benefits.

Conclusions

For all those programme managers who believe that programmes are more than just bigger projects
or a portfolio of projects, there is a need to acknowledge that the main difference between
programmes and projects is the complexity and ambiguity of the issues. As I have demonstrated in
this paper, performance-based project tools and techniques are better suited to deal with complicated,
uncertain situations than complex, ambiguous ones.

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I have therefore suggested that value management, as defined in the new VM Standard BS EC
12973:2000, can offer the methods and techniques suited to complex and ambiguous situations. I
have proposed a programme management model, which integrates a learning/value loop with a
performance/project loop to form a full programme management framework. I have also suggested
that the learning loop should be part of both project reviews and programme appraisals in order to
achieve strategic benefits and stakeholders satisfaction at delivery.

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