Tuomas Mikkola from Silverbucket hold a presentation “The tools of project organisations”. Tuomas has 20 years of experience in project business so he has gained some insightful perspective and ideas on the matter. This article is based on the content of the presentation. You can watch the presentation from here (only in Finnish).
”Don’t choose a generic tool for your organisation.” This is one of the main statements expounded in the presentation. The explanation for the argument shortly is that one should choose a tool that is perfect for your project type. If we hold on to the project type concept that we presented in the previous article, let’s look closer at the statement from development and delivery project points of view. Which tools are perfect for these project types?
Even though the project types differ from each other, they do have some similarities. For example, all projects need some sort of a project management, hour tracking, project finance and resource management tools. However, there are differences. The delivery projects require usually an invoicing and customer relationship management tools, whereas development projects don’t have needs for such tools. In the development projects the customer is usually internal so actual invoicing is not needed. Nonetheless, a portfolio tool is vital for organisations who do development projects.
When we look at the development and delivery organisations, we see that there are more differences than similarities. However, there are recognized joint needs for common tools. For this reason, it is not reasonable to choose a big generic tool for whole organisation. The question is that what kind of a tool or a group of tools is suitable for your business type or organisation?
Let’s begin with the most fundamental part regarding development project organisation which is the project portfolio management. This was explained and presented through a business case in the previous article. The development organisation requires a tool for evaluating project ideas and calculating the profitability of the project initiatives to serve data for decision makers. After the evaluation the projects either go to production, are postponed or get dismissed. The portfolio tool contributes to successful project management.
Regarding delivery organisations, the invoicing rate plays a vital role. This was also presented and explained through a business case in the previous article. Another statement mentioned in the video presentation is that the easiest way to raise the invoicing rate is improving the resource planning. By raising the invoicing rate, the profitability gets better as well. Regarding a single project, the profitability is already recognized before the start because the planned resources and costs give already an indication of the end result. With an effective resource management, the resources are fully utilized, which has a positive impact on the invoicing rate and profitability percentage.
What kind of tools are there?
One tool option is a monolith system which covers almost everything. This is a good solution if your organisation is ready to adapt the requirements of the monolith tool. Usually this requires changing business processes and habits within the organisation and accepting that there is no room for fine-tuning. The con is that with this tool option, it is hard to gain a competitive advantage. The monolith tool offers a great contribution in some processes but in some it doesn’t deliver the best solutions. However, in general the tool meets the needs sufficiently.
Second option is DIY meaning doing an in-house developed software. When choosing this option, usually the organisation seeks for an ultimate competitive advantage. If business processes can’t be changed at all, then DIY can be the only option left. The con is, though, that this kind of a project is usually highly expensive and time-consuming. Like all big investments.
Third option is ”Best of Breed” tool selection which gets the highest recommendation in the presentation. Best of Breed is suitable for many organisations. This option means that the organisation seeks the best alternatives for different business processes. Tools that don’t require tailoring. The benefits of this kind of an option are: cost efficiency, quick rollout and usually acquiring instantly the advantages. In other words, big rollout projects are not in the way of acquiring the benefits quickly. The competitive advantage comes from getting the best solutions for the different business processes and combining them.
To sum up, it is critical to identify the tool needs which are based on the different project types within the organisation. It is also important to recognize whether your processes are flexible or not, which helps the organisation to find the best tool model and gain competitive advantage.
Watch the presentation: ”The tools of project organisations” (only in Finnish)
Other articles related to the presentation: