A common theme throughout many of my blogs has been the focus on outcomes and why this is critical to delivering what an organisation actually wants. Too often the overall desired business outcome is agreed, but it then morphs into a different project outcome focused instead on delivering outputs. Let’s take an example from the world of sport.I’m a keen golfer and have many friends who play golf. One friend has a goal of becoming a better golfer by hitting the ball 270 yards down the fairway – a reasonable sporting outcome. However, like many projects this goal is translated into: ‘I need to buy a new driver’. The activity becomes one of product selection that focuses only on selecting the right equipment (the output).
The golfer researches the market, looks at available clubs, ‘pilots a few’ and makes his selection. He then takes it to the course and hits a ball. The ball flies 25 yards further than his old club but still way short of the 270 yards target. Superficially, he has achieved his sporting outcome of selecting new equipment, but he has totally failed in achieving his real desired outcome, i.e. hitting a ball 270 yards down the middle of the fairway. If he had focused on the original sporting outcome he would still have bought a new driver but also invested in lessons, practiced, changed his swing, etc. These other activities would have greatly increased his chances of achieving his desired sporting outcome.
This problem, of focusing on delivering outputs instead of desired outcomes, is also prevalent in many business projects. Let’s take a business example.
The CEO wants to increase sales (a desired business benefit) through the desired business outcome of ‘building closer relationships with his customers and potential customers.’ A project is launched to achieve this. However, the project outcome soon morphs into implementing a new CRM system that may or may not help build closer relationships with clients and therefore increase sales. This subtle but important change in the business outcome happens because a CRM system (the key project output), like our golf driver, is so tangible.
The real desired business outcome, of ‘building closer relationships with his customers and potential customers’ is conveniently forgotten by the Project Manager; in fact he or she may well be of the opinion that whoever is responsible for actually delivering the desired business outcome it is certainly not them!
Of course, a new CRM system cannot guarantee increased sales. There are other ‘mini-outcomes’ that need to be delivered for the desired business outcome to be achieved. For example, marketing and sales processes may need to be changed to make use of the new tool. Users of the new CRM tool need to be trained to use the tool and believe that they should use it daily.
If this project started with the desired business outcome that needed to be achieved and planned backwards there is a higher probability that the outcome would be realised. Conversely, if the project starts with the project outcome of a new CRM system, there is the very high probability that a new CRM system will be implemented but sales and customer numbers will have not risen.
Until projects focus on the true business outcomes successful project delivery will continue to be elusive. Our Outcome-Driven Project Management (ODPM) approach to project management is based on one overriding goal: achieving the best possible project outcomes and directly addresses the most common root causes of project failure. It has been designed to ensure that the focus of successful project management is achieving the best business value outcome of projects.
Project management based on ODPM principles engenders a much more dynamic, commercially-focused project delivery environment. We have found that PMOs which perform project management by ODPM principles operate not as a cost or profit centre but as a ‘value centre’ (i.e. their key role is to generate value for the business it serves) and is in a ‘Virtual Joint Venture’ with the business it serves (i.e. there is real financial risk and reward for both parties).