Delivering Corporate Social Responsibility through Project Portfolio Management
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- Dylan Norton
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1 Delivering Corporate Social Responsibility through Project Portfolio Management Project portfolios are comprised of projects that widely differ in value; vary by their short- and longterm benefits, their alignment with corporate strategy, and their impact to business agility and return on investment. Project Portfolio Management (PPM) is a means to optimize the returns by prioritizing the most value-producing projects to ensure that funds are directed toward the most rewarding initiatives. PPM also eliminates overlaps, gaps, and redundancies between projects, to make the best use of finite resources. While the increasing emphasis on corporate social responsibility (CSR) as a key business driver continues to skyrocket, many organizations focus on management of individual initiatives with a silo d approach, which produces unbalanced performance and ultimately longer returns. When an organization manages corporate social responsibility initiatives through Project Portfolio Management, sustainability transcends from a business objective to a mechanism for evolution and positive change. The value of Project Portfolio Management A recent survey was conducted by PM Solutions of 495 high-level project management personnel from large, mid-sized, and small firms in various industries from around the world, including finance and insurance, manufacturing, healthcare, professional services, and government. The primary purpose of the study was to gain a clearer understanding of current PPM practices, challenges, and trends that will lead to improved PPM success. Organizations with highly capable PPM processes indicate: They are far more likely to realize a broad range of benefits from PPM including improvements in resource allocation, customer satisfaction, strategy execution, cost savings, and time-to-market. They are more likely to have been using project portfolio management for a considerably longer period of time. They are more likely to track the ROI of PPM and find a strong financial argument in favor of continued PPM improvements. They engage in significantly more PPM functions. They are more likely to offer PPM-related training to their employees. And they are more likely to practice PPM across the enterprise, broadening its reach to encompass all of the enterprise s work.
2 While significant efficiencies can be gained through project portfolio management, the inclusion of a sustainability framework to support the management processes will increase benefits and provide, better alignment with corporate strategy and international standards. Figure one (above) provides a look into what is commonly included in a portfolio register/ dashboard. Project Name Project Manager Start Date Target Completion Date Forecasted Completion Date Current Project Phase Whether the project is internal or external Prioritization level in the queue Scoring for Scope, Time, Cost, Quality, and Risk. CSR strategies contain many initiatives, each with a unique and diverse focus and tied together with a common goal which makes PPM the natural way to get them up and running. Few of the benefits that can be realized include: Getting initiatives into operations on time resulting in safeguarded or increased revenue Driving delivery of quality products with increased organizational visibility through use of a standardized approach
3 Reducing costs through supporting procurement in the effective acquisition and use of finite resources. Increasing profitability by emphasizing projects that provide maximum return on investment. Planning/forecasting labor resource and equipment demand and comparing them to available resource and equipment in order to better understand enterprise capacity and meet present and future labor resource and equipment needs. By integrating a framework derived from ISO Guidance on Project Management ISO 50001, The Energy Management Standard, ISO 14001, The Environmental Management Standard, ISO 9001 Principles of Quality Management, and ISO Guidance on Social Responsibility, the common approach to PPM can yields even greater returns. The GPM P5 concept shown below in figure-2 provides eleven categories for sustainability measurements that can be included as benchmarks for project success or criteria for project prioritization. From left to right, Labor Practices and Decent Work, Society and Customers, Human Rights, Ethical Behavior are attributed to the societal bottom line. Transport, Energy, Water, and Waste represent the environmental bottom line and three categories that makeup the financial bottom line are Return on Investment, Business Agility, and Economic Stimulation. Each category contains sub elements that when mapped to a project s product and process can be scored based on the organizations CSR goals as ether a positive impact or negative impact. Figure-2 the GPM P5 Matrix When deploying a CSR strategy using PPM, it is critical to first implement a governance model with built in performance indicators that align with the strategy as the process by which it is delivered is just as important as the outcome. To put it another way, to not employ a sustainable method to deploy a CSR strategy would be as if you were powering a solar panel manufacturing plant with coal harvested by child labor from half way around the world.
4 Lessons Learned The natural bi-product of implementing CSR using a sustainable approach to PPM is the lessons learned that can be gained from each initiative and the maturation of the PPM processes that will ultimately will be applied to standard project portfolios and will penetrate all areas of the business. A recent survey by Cone Communications, reported that nine out of ten consumers stated that they would not purchase goods from companies that are irresponsible. Cone's survey of 10,000 consumers in the U.S., Canada, Brazil, the U.K., Germany, France, Russia, China, India and Japan found more than 33% having used social media to spread positive information about a company and a 25% spreading negative company news. More than half of consumers in the ten countries polled indicated that they changed their purchasing decisions on specific brands in the past year due to the company s reputation as a bad corporate citizen. As sustainability reporting continues to look deeper than the supply chain, organizations are having to adapt where if not managed through a portfolio leads to adhoc implementations and ultimately wasted opportunity for overall organizational growth and maturity. Ethical Corporation recently published an article that indicated a renewed emphasis on strategic planning in order to bring about more pragmatic programs and effective communication of the value of sustainability throughout company sectors and how through these efforts much broader awareness and understanding of sustainability and what it means to all areas of the business. Figure-3, on the right depicts the relationship between the project organization and the flow of organizational opportunity into deliverables that ultimately turn into benefits. When strategic planning is only applied at the operations level and bypasses project management, opportunities for organizational learning, process refinement, and maturity become lost and therefore never get applied to other project types thus widening the gap between sustainability and project management. In order to ensure that the benefits from initiatives such as a CSR strategy Figure 3 Overview of Project management concepts and their relationships (ISO 21500)
5 implementation are fully realized, processes that prioritize, monitor, control, and provide overall structure are critical. PPM ensures that the business makes the right choices and increases productivity and ROI with the right strategic mix of projects.
6 Citations: Management-Shows-Capability-Leads Visited Visited Visited Visited ISO 21500, Guidance on Project Management
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