My posts examine how organisations can recognise uncertainty, and find better ways to respond. In the last post I described how the Project Management Office (PMO) can support your organisation in handling uncertainty. I described how the PMO can support your organisation to move beyond competitive myopia and internal ineffectiveness.
This post will introduce how the PMO can play a central role in orchestrating business functions as a flow of activities and in being lean. This will enable your organisation to thrive in an uncertain competitive market.
What does being lean mean?
Being lean is the intention to remove wasteful resources and tasks, in order to improve efficiency and reduce costs. However, the intention of being lean is never to sacrifice quality.
Established organisations are often optimised around executing existing, well understood, products and services. Yet they often find it difficult to find suitable ways to explore and exploit new initiatives.
To address this, the book Lean Enterprise describes four domains which initiatives pass through. They are the Explore, Exploit, Sustain and Retire domains.
In the Explore domain many ideas are tested to determine their viability to potentially become new products and services. Rapid experimentation identifies the few products and services that are likely to fulfil the organisation’s desired outcomes. These few are then further developed in the Exploit domain.
In the Exploit domain, products and services are tested to determine whether they’ll meet market demand. Those that do graduate to the Sustain domain. Product and services in the Sustain domain provide revenue. These are the cash cows that support the whole operation.
Due to changes in the market, products and services in the Sustain domain may eventually deliver little value. In this case they should be phased out in the Retire domain and replaced. These replacements will have succeeded in graduating through preceding domains.
Organisations must acquire the art of balancing flow through the four domains. A flow of new products and services must be created with the right balance of items in each domain. One way to achieve this is by applying work-in-progress limits.
Due to the nature of the increasingly competitive market, the rate of flow (or cycle-time) across the domains must speed up. Waste must be identified and rapidly removed.
How the PMO can play a central role
The PMO can transform itself to play a central role that orchestrates the flow through the domains.
Most organisations are only aware of practices suitable for the Sustain domain, where work is well known. It’s important to realise that such practices aren’t appropriate for all the domains.
The PMO can become the catalyst to develop context-specific practices for each domain. They can help determine and govern the conditions for transitioning initiatives between domains.
The creation of this new governance process should encompass all business functions. This includes the Exec team, Finance, Sales, stakeholder group, product delivery teams, and Operations. New entities such as a Customer Innovation Labs and Investment Review Board should also be considered.
Roadmap for your organisation’s revolution
I’d like to draw to a close by returning to the roadmap I created and first revealed in my previous post. The roadmap shows the possible route an organisation can take to become one that survives and thrives. Portfolio flow, collaboration and governance relate to the boxes with dashed red border.
Context is key, so this roadmap is a generalised route map. Contact me if you’d like to discuss how it could be adapted to meet your organisation’s needs.
The PMO can support your organisation’s revolution of moving beyond competitive myopia and internal ineffectiveness.
The PMO can play a central role in orchestrating a flow of initiatives and activities. This will ensure existing cash cow operations can be replaced with new products and services.
I related this to the roadmap which, when adapted to your context, will shift your organisation to become adaptive and flexible.
Finally, let me know what you think. Contact me if you’d like to learn how I’ve helped clients on this journey.