Offshore R&D Project Management

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Off shoring and Outsourcing of design & research work has posed different type of challenges for operational and strategic management teams.

Off shoring and Outsourcing of design & research work has posed different type of challenges for operational and strategic management teams.

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  • 1. PROJECT MANAGEMENT IN GLOBAL & OFFSHORE R&D ENVIRONMENT: ISSUES AND EVOLUTION OF PROCESS Narendra Pratap Singh [email_address]
  • 2. About The Topic
    • Offshoring of product design, development, engineering and research is fairly new global phenomenon. Workflow at R&D center entails complexities in terms of varying size of work packets, work content, clarity level, type of work, control level etc.
    • This is an effort to provide a practitioner's perspective about evolution of project management system & process at an offshore R&D and engineering center
    • Structure
      • Phenomenon of offshoring
      • Categorization of workflow
      • Project performance of offshore center
      • Project Management Practices at the offshore R&D center
        • Planning, Time, Communication, Cost, Quality, HR, Portfolio
      • System requirement, PMO and Future predictions
  • 3. Product of Flat World
    • Driven by organizational ‘growth oriented’ forces
    • Market expansion
      • Selling
      • Product customization & modification for local needs
      • Manufacturing localization for cost cutting
      • Local engineering support
      • Engineering support to other business units’ engineering teams
    • Success of engineering & design teams – Created confidence about skills
    • External Drivers like core competency, cost competition
    • IT outsourcing
    • BP outsourcing
    • KP outsourcing
    • Engineering Services
      • Outsourcing
      • Offshoring
    • Success & cost saving by IT, BPO & KPO – Created environment
    • Phenomenon of globalization of ‘Business’ is taken as ‘Flattening of World’
    • Two forces, one from inside organization and another from external environment shaped offshoring of design, engineering and R&D
    • Currently 500 offshore Engineering and R&D centers working in India
    • No. growing @ 23% CAGR*
  • 4. Working Model of Offshore R&D
  • 5. Workflow – Projectizing it To Do Tasks Projects
  • 6. Issue of Performance Parameters
    • Traditional benchmarks for project performance parameter
      • Time and schedule efficiency
      • Cost and financial efficiency
      • Resource utilization efficiency
      • Deliverables’ quality as per predefined ‘known’ acceptability parameters
    • Performance benchmark for ‘Innovation’ center’s sponsor
      • Business value of output
      • Cost saving by offshoring
      • New initiatives
      • Intellectual property creation
      • Best utilization of all type of resources – proper administration
    Corporate measures the project output of their offshore center, differently from the existing project performance parameters
  • 7. TRIZ Framework for Project Categorization
    • TRIZ provides tools and methods for use in problem formulation, system analysis, failure analysis, and patterns of system evolution (both 'as-is' and 'could be').
  • 8. Project Mgmt. Practices – Project Planning
    • General Issues
      • Away from market, customer & manufacturing
      • Multiple locations / multiple systems
      • Scoping
      • Ownership
        • End to end project for offshore center
        • Specs. by sponsor, detailing and execution at offshore
        • Work details from sponsor, ‘to do task’ at offshore
      • Interventions
    • Resolution
    • Process for project initiation and authorization
    • One innovation, product development process
    • Collaborative planning
    • Scoping
      • Major role for sponsor
      • Offshore center should try to fill ‘open space’ in scope, proactively
    • Clear-cut work breakdown
    • Clarity on ownership of WBS
    • Time line, milestones & deliverables definition mutually agreed
    • Approval on all aspects
  • 9. Project Mgmt. Practices – Time Mgmt.
    • Vis-à-vis onsite, offshore working adds extra hours
      • Requirement understanding
      • Communication
      • Data management
      • Reviews, approvals and reports
      • At least two layers of project management
    • Time efficiency becomes very important
    • Resolution
      • Invest time in requirement understanding
      • Setting expectation
      • Fully aligned team for each location/program
      • Integrated project plan for both offshore and sponsor
      • Time and task tracking system
      • Fill gap projects and competency building for effective resource utilization
    • Under a project
      • Develop schedule for WBS
      • Extra care for the scheduling of shared ‘domain experts’
      • Resource leveling as per project priority
  • 10. Project Mgmt. Practices – Communication Mgmt.
    • Considered important for project success
    • Challenge in offshore environment
      • Cultural aspects
      • Distance and sense of it
      • People handling communication – hard core domain expert
    • Communicated things get lost in the haze of time
    • Provide required infrastructure
      • Mail/tele/video – con, recording, session sharing tools
    • Policy matter on communication
      • Calendar for real-time communication
      • On-site visits at regular intervals
    • Communication Record
      • Important with PDLC
      • Unified system for communication archiving
  • 11. Project Mgmt. Practices – Cost Mgmt.
    • Cost heads
      • Cost of human resources’ hrs.
      • All project expenses
      • Common expenses
      • Capital expenditure
        • Common
        • Facilities (e.g. RP Machines)
    • Time management system
      • Average cost of hours from cost of human resource
    • Project management system based expense tracker
    • Inputs from financial operation
      • Well defined financial process and tracker
      • Organizational policy for common expense loading
      • Depreciation loading for common capex. directly related to hours of project e.g.= (hrs. on project ‘x’/ total hrs)*(total depreciation)
    • Tracker for the usage of special facilities
      • Load the cost to projects
    • Cost saving – first reason of offshoring
    • Cost of project directly loaded to the cost of product, research program, new initiative
  • 12. Project Mgmt. Practices – HR Mgmt.
    • Inside a project
      • Assigning resource as per WBS
      • Project leader
      • Project specific team structure
      • Domain specific leader
      • Proper resource leveling
    • Organizational Structure
      • More than just a matrix structure
        • Program (Vertical), Domain (Horizontal), COE’s (Bubble)
      • Support departments (Finance, HR, Operation) – Coordination
    • Performance Management
      • Input from project portfolio system
      • Appraise from all elements of org. structure
      • Training need
    • Recruitment
      • For thinking ability, application mind and then for knowledge
      • McGregor’s ‘Y’ people
      • Failure handling / high self esteem people
    • Retention
      • Strategic aspect – can make or break the result
      • ‘ Maslow’s hierarchy
  • 13. Project Mgmt. Practices – Quality Mgmt.
    • Quality measurement for varying type of outputs
      • Objectively measurable
      • Quality of unseen, unknown
      • Quality of research
      • Quality as a feature
    • Subjective quality statement about quality of product would work as a guideline something like ‘ Quality Mission Statement’
    • Review deliverables at every stage – gate jointly by sponsor, domain experts and team members
    • Review comments & feedback from sponsor as ‘first priority’ input
    • Quality process for ‘measurable’
    • Usage of suitable processes for subjective variables at appropriate stage
      • FMEA, Six Sigma, DFA, DFM
    • Quality in-built with work
  • 14. Project Portfolio Management
    • Central system, a repository of all projects
    • Immediate indicator about risk, deadlines, completions
    • Report to corporate about performance
    • Project based performance indicators
      • Business value creation
        • Direct and Indirect contribution
        • Contribution in top-line, bottom-line and business sustenance
      • All project expenses and costs
      • Program performance
      • Teams, individuals
      • Competency development
  • 15. System Requirement
    • Enterprise Project Management (EPM)
      • Hosted and centralized system
      • Entail one resource repository
      • Communication enabler
      • Enable quick changes in plan
    • Project Data and Document Management
      • All project data, documents, communication
      • Enabler of collaboration – PLM and EPM interconnection
      • Transfer for meaningful project data to product management system
    • Applications
      • EPM should be capable to talk with organization systems ( Financial models, expenses, operational processes, HRIS etc.)
    • Portfolio Management
      • Built upon project management system for data integrity
      • Dashboards with proper privilege definitions
  • 16. PMO
    • Process owner and manager
      • Process standardization / templates /best practices
      • Support, guidance & training provider
    • Owner of project management system
      • Strong IT support team for project management system
    • Time management, engagement level assurance
    • Requirement more prominent as the size of is now felt prominently
    • Integrate the job for portfolio management
    • Practical exposer of product development / innovation process first priority, knowledge of PM methodology second
  • 17. Future – Let’s Predict
    • Future of work in organizations will be projectized.
    • Projectized vs. Operationalized
      • Creations/Innovation - projectized
      • Improvement/Renovation – projectized
      • Product or service lifecycle shortening – projectized
    • There will be CPMO (Chief Project Management Officer) in the organizations.
      • When so much of work as project, why not centralize its’ control
      • When COO, why not CPMO or both
        • Friction  transition  coordination  assimilation
    • End Customer as part of product development projects
      • Last mile consumer/ user of the product
      • Like a stake holder - part of each milestone, review and input
  • 18.
    • Thanks