Public Administration CommitteeWritten evidence submitted by Project Management Institute (PMI) (CSR 7)

Summary

1. The Project Management Institute (PMI) welcomes the opportunity to respond to the Public Administration Committee’s call for evidence on civil service reform. Project management is a critical element of the Civil Service Reform Plan, and as the leading global authority on project, programme and portfolio management, we are delighted to be able to offer some ideas on how its full potential within the Civil Service can be realised.

2. Founded in 1969, PMI is the largest global association and leading advocate for the project and programme management profession. With a global goal for organisations to embrace, value and utilise project management and attribute success to it, we currently have over 500,000 members and credential holders in 185 countries across Europe, the Americas, Australasia and South East Asia, working across the public and private sectors to undertake certification, standard development and training. PMI’s certification programme was launched in 1984 and now enjoys vast international recognition. PMI’s global community of certification holders is evidence of our commitment to delivering a world-class certification programme. We have over 6,000 members and credential holders in the UK, and have run academic programmes at universities including Cranfield, Southampton, Manchester, UCL, UWE and Strathclyde.

3. PMI’s global research and experience demonstrates that effective project management can improve service delivery, minimise costs and manage risks. The key to this in our experience is the development of a culture of best in class project management. The benefits are clear to see in projects that have been executed properly across the world. The US Army Corps of Engineers, for example, reported a cost reduction of 20–30% by using trained project managers and a more systematic approach to project management. Successful delivery of the capital infrastructure for the Olympic Games is another case in point.

4. However, in the UK public sector, project failure outmatches project success, with problems occurring through late delivery, cost overruns and inadequate results at project end. The Civil Service Reform Plan itself acknowledges this problem, noting that “Government’s past performance on major projects has been poor, with around a third being delivered on time and on budget.” We suggest some reasons for these failures in this submission, and some solutions, informed both by our own international research into project management best practice and by our knowledge of the UK public sector.

Is the Civil Service in need of radical reform?

5. The Civil Service is currently going through a period of unprecedented change. The Government’s far-reaching plans to tackle the budget deficit have resulted in significant reductions in spending and human resources. Departments have been curtailing consultancy spend. At the same time, radical plans have been put in train to reform the public services with the objective of increasing contestability and choice across the government machine. These developments have all impacted on delivery.

6. Given this, reform of the civil service at all policy and operational levels is essential. The Reform Plan notes that “there are some superb project managers in the Civil Service, but not nearly enough and too many projects fail.” Anecdotal evidence suggests that this trend is set to continue, despite the safeguards put in place by the Government.

7. As indicated above, the Civil Service Reform Plan’s estimation of major project failure, on the basis of MPA figures, is about a third. Whilst we note that this only encompasses those project classed as major, the figure is not significantly different from international trends. PMI’s Pulse of the Profession research found that in 2011, 36% of projects did not successfully meet their original goals and business intent. This has major implications. When a project fails, an average of one third of the project’s budget is lost for good.

8. Reform of project management practices can radically improve performance. In addition, project management reforms cannot be divorced from other efforts to improve talent management within the UK public sector and the Government should not neglect the wider techniques required to truly thrive as a project manager. As indicated in the Civil Service Reform Plan, “much of [poor] performance has been…because civil servants have not been given the skills and tools needed for good project management.

Are the Government’s plans for reform, as outlined in the Civil Service Reform Plan and related documents, likely to lead to beneficial changes?

9. The Civil Service Reform Plan contains a number of recommendations on project delivery aimed at improving performance:

Requiring greater testing and scrutiny of major projects by departmental boards and the Major Projects Authority before they move to full implementation;

Requiring regular publication of project progress and production of an annual report on progress, scrutinised by the Departmental Board;

Commencing training of all leaders of major projects through the Major Projects Leadership Academy by the end of 2014; and

Significantly reducing the turnover of Senior Responsible Owners (SROs).

10. These reforms are to be welcomed and good progress has already been made, particularly through the creation of the Major Projects Learning Academy. However, we would urge government to go further in ensuring appropriate training reaches all levels of the Civil Service and reflects international best practice, especially at a time when “off the shelf” solutions can save time and effort.

11. However, more needs to be done. There are a number of potential risks that could undermine the impact of these reforms:

High churn: Despite efforts to reduce the turnover of SROs, high staff turnover remains a perennial problem within the civil service which has especially impacted on project management. Allied to this, there have been particular issues with some very capable business leaders not having the necessary skills to become SROs, but being moved into project delivery positions as routine part of their civil service careers. Such individuals need to be empowered by senior colleagues through effective training if they are to function effectively. Project management is currently only seen as one of a number of generic skills within the civil service—but it is integral to policy success.

Efforts should, therefore, be continued, in line with the recommendations in the Civil Service Reform Plan, to reduce the turnover of Senior Responsible Owners and ensure that SROs are dedicated project managers where possible, not policy specialists undertaking project management duties as a discrete part of a civil service career.

Lack of resources: The lack of resources dedicated to the Major Projects Authority remains concerning and we note the delays in publishing the first annual report of the Major Projects Authority. As the committee will be aware, the Public Accounts Committee’s recent report on assurance of major projects also highlighted problems on this front, noting that “With a budget of £6 million and a 40% cut in staffing there are inevitably questions over whether [the MPA] can achieve the improvements intended. Inevitably, the Authority has to focus on the biggest, most risky projects. This raises the risk that significant problems within lower priority projects in the Authority’s portfolio may be missed.” The proportion of resources dedicated to project assurance compare unfavourably with standard practice in the private sector.

Narrowly focused training: Training in project management in the UK often lacks a requirement for ongoing assessment, with the passing of a single examination or presentation of a single portfolio being all that is required. PMI would argue that training should be at least in line with the provisions of our own Project Management Professional (PMP®) credential, which requires ongoing maintenance over a three year cycle, and three to five years of dedicated project management experience. We believe that as a general principle, performance should be regularly reviewed and project managers should be assessed on their performance and experience of actual projects, not purely on the basis of examinations.

Neglect of the portfolio and programme approaches: Disciplined project management should start at the portfolio level, with the Government’s overall strategic vision for the civil service and the public services driving initial investment. PMI research demonstrates that 72% of high-performing organisations use portfolio management approaches, compared to only 39% of low-performing organisations. Discussions with officials and comments made by both the Major Projects Authority and Infrastructure UK suggest that there is a lot of thought about moving forward with portfolio approach—but not enough progress. We are aware that the Cabinet Office currently looking at this area which is to be welcomed.

Mismatch between ministerial ambition and project management resources: The impact of politics should not be underestimated, with public comments by ministers, sometimes in the heat of the moment, often driving the demand for projects. As the 2015 General Election draws closer, politics will become increasingly important in programme delivery—and demand for new projects and programmes will increase. This will often not be based on a realistic appraisal of what is deliverable or sensible.

12. Moves to improve project management cannot be divorced from wider plans to build capability within the civil service. Again, the plan proposes a number of actions, including production of a capability plan for the whole of the civil service and a greater focus on commercial and financial skills. These are sensible, although the focus should in our view be on specialist resource in the project management field and more dedicated training, especially at a time when the Government is trying to reduce spending on consultancy.

13. We would propose that government consider a number of options to further drive project management reform in the public sector:

Be more willing to look at international best practice: In project management terms, the UK continues to be too narrowly focused on itself, and its own home-grown associations and solutions. We are not calling for everyone to follow the PMI way—just for the public sector to bear in mind the international direction in which project management is moving, especially given the recent introduction of the ISO 21500 project management standard.

Body of Knowledge: Separate efforts should be made to disseminate a Body of Knowledge on project management across the whole of government, as this can add value to PRINCE2, the project management methodology currently used. PMI’s PMBOK® Guide is not the only solution in this regard, although we would recommend any Body of Knowledge used be as broadly based and international in scope as possible both to ensure that project managers have the widest possible knowledge, and to match the trend towards “off the shelf” products and solutions within government. Indeed, it is crucial that government not ignore the global trends in project management that have accelerated in recent years, as this would risk isolating the UK from global project management and be counterproductive in the longer term.

Changing perceptions: Public sector dialogue on project management is dominated by the language of failure, rather than success. Discussion is focused on those projects that have failed, and what not to do, rather than those that have succeeded, and the positive lessons that can be learnt from them. The generation of more positive vibes around project management can help improve perceptions of the industry and project management as a career whilst simultaneously spreading best practice. PMI is undertaking a number of initiatives in this regard.

PMI was proud to sponsor the Project and Programme Management Award at the Civil Service Awards last year and is looking forward to sponsoring the award again this year as part of our own efforts to promote successful projects and best practice. In addition, we are planning two major research projects in 2013 which will consider the factors behind project success, building on our 2010 US Government Research, Program Management 2010: A study of program management in the US Federal Government. These will look in more detail at success factors in the UK, and at Project Management Offices.

Portfolio and Programme Management approaches need to be more firmly embedded in government, as noted above. These require very different skill sets.

Program Management Job Classification: In the longer term, the Government should look to international examples of best practice in developing project, portfolio and programme management capability and capacity. In particular, the Government should consider the IT Program Management Job Classification introduced in parts of the US Federal Government. The benefits flowing from this demonstrate why similar initiatives should be adopted elsewhere—a dedicated cadre of project managers with expertise and experience, a reduction in the “accidental project manager” phenomenon and better project results in the long run.

Improved attitudes to risk: An issue that has arisen repeatedly in our UK roundtables is attitude to risk, and ways of dealing with risk effectively. This is a particular issue for the public sector. A possible solution is the creation of a joint risk registry with stakeholder. Investment in success is shared, and the culture is transformed as the customer is part of the team. Government needs to export a certain amount of risk to its private sector partners, but is often reluctant to do so. India’s e-government programme, of which PMI has direct experience, shows how this can work effectively in practice.

Project Management Fast Stream: One recommendation that has come up in previous PMI roundtable events has been the creation of a specific project management fast stream within the civil service to ensure that those with the right skills and aptitudes to become project managers are nurtured from an early stage.

Ministerial toolkit: Ministerial awareness of project management drivers could be increased through provision of ministerial toolkit and/or basic training for ministers in the fundamentals of project management. Local councillors in some areas are already trained in project management, and this should be replicated in central government.

November 2012

Prepared 5th September 2013