Value management and the mindset shift
We have now come to the third and final article in the value management series. The previous article outlined five recommendations for how to implement value management in your own organization or project. However, becoming value-oriented is more than following a method or applying a set of principles. It is about a new mindset.
So how can leaders, project managers and team members learn to think and act in a way that maximizes business value? What characterizes a value mindset? That is the topic for this article.
The mindset shift for project sponsors
For the business leader and project sponsor, the mindset shift is about taking active ownership of the value realization. This means you have done your homework before the launch of a new project. You know what you want to achieve, the expected organizational benefits are clearly stated, and you know how you want to monitor value realization. In dialogue with the project manager you make sure that there is traceability between project deliverables and your value realization goals. The business case assumptions and calculations are regularly revisited and discussed in the light of any new developments impacting the project execution.
A value mindset also requires a readiness to take corrective actions if the business value is at risk. Business leaders may need to close a prestigious project when unexpected costs or serious problems with a supplier threaten to erode the business value of the initiative. From a value management perspective, closing a project in these circumstances could very well be the best course of action. It is far worse to let the company continue to bleed money; money that could have been better spent elsewhere.
As a sponsor you also play an important role in creating good conditions for the project to deliver value, e.g. by using your influence and clout to remove roadblocks. Taking active ownership of value realization means that your organization must have a focused strategy and only a very limited number of change initiatives ongoing at the same time.
The mindset shift for project managers
The big shift for project managers is to include a new dimension into the project planning and steering. As a value-oriented project manager, you spend time and effort to make sure you and your team have a good understanding of the problems you are trying to solve. The project scope can be described both in terms of deliverables and in terms of business value.
During execution, you make active choices to maximize the business value of your project. If required to deliver value, you are willing to adapt the scope, priorities and timing to changing circumstances, or as your understanding of the problem deepens. This does not mean that the scope is changed all the time. However, you actively look for ways to protect the business value when faced with the unexpected. The project strategy may change, but the targeted business value remains the same.
This brings us to another important aspect. A precondition for effective value management is a transparent and open dialogue with project sponsors about challenges such as an unexpected cost increase or quality problems of deliverables.
The mindset shift for team members
Everyone can have a value mindset, not only business leaders and project managers. Business value can in fact be a great motivating force for a project team. Everyone participating in a project should be able to explain what problems you are solving, how you are going to solve them, and what the benefits will be for the receiving organization.
As a value-oriented team member, you are not satisfied with just completing the tasks assigned to you. Moreover, you know how your deliverables fit into the bigger picture. Instead of claiming that it is not your responsibility, you are ready to walk the extra mile to make sure that nothing falls between the cracks. Everything you bring to the table, whether it is ideas, solution proposals, or concerns, have one purpose: to make sure that the business value of the project can be realized.
In this Value Management series, I have argued that a project’s business value is not automatically realized when project deliverables are implemented. Business leaders have to take active ownership of the value realization until the end. The project must be continuously steered toward creating good conditions for value realization. And the importance of value realization has to be deeply rooted in the minds of sponsors, project managers, and team members.
Lovisa Viktorsson is a Senior Business Analyst at FiloProcess.