DRIVERS OF PROJECT MANAGEMENT IMPLEMENTATION

DRIVERS OF PROJECT MANAGEMENT IMPLEMENTATION
Finance output from project management –
DHLEXPRESSRUbest practice
Disclaimer: this information, which is the fruit of own knowledge, experience and work of
the author is provided for PM conference audience for educational purposes only.
No commercial use

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About me
2
Alexander S Sorokin
MBA, PMP/PME, PRINCE2 Practitioner, 6S green belt
An expert in the field of Strategy, Business efficiency, Project & portfolio
management, Change management, Business process management
and improvement, Documentation management, HACCP, Quality and
safety
A member of Russian branch of ABPMP
More than 18 years of experience in project management
50+ implemented projects for benefit of such clients as:
DPWN DHL Express RU, Renault Rus, Ford, Volvo, Jaguar-Landrover,
GM, GMAIC, Hyundai, BMW, BMW Bank, Volkswagen Rus, Peugeot-
Citroen, AlfaBank, Evraz, Raiffeisen, HP, Seagate, Dell, Intel, Huawei,
NCR, Volga-Dnepr Group, Nestle, Mareven Food Holding (Rollton,
BigBon), AvtoVAZ, VoronezhRusAgro & etc.
Project Management Best Practice

gives no profit?
acts as brake on your projects by “rules”?
Does your PMO…
asks a lot of “rubbish”
information?
It has to support your strategy, but
doesn’t at all really

It seems you just don’t
know how to cook it…

So you need…
A pentagram – 1 item

A frame drum – 1 item
A shaman – 1 man

Strange ancient codex of
spells and curses – 1 book

Dark vault for
dark rituals:
– according to
health safety
standards its space
shouldn’t be less
than 6 sqm per
person

A Voodoo doll of your Customer
Use the picture, if you can’t obtain it…

Sponsor’s
sacrificial
blood – as
much as you
can suck

One bag of pocket money

And finally –
polite and resolute team “to run errands”

and seriously…
Disclaimer: this information, which is the fruit of own knowledge, experience and work of
the author is provided for PM conference audience for educational purposes only.
No commercial use

• To be the main driver of extra revenue and growth of
turnover for the company
Vision of Customer operation group PMO

• Effectively manage projects of the best service solutions,
producing extra value for our customers and for the
business, obtaining new market shares, gaining profit and
increasing competitiveness of the corporate product portfolio
for customers
Our goal

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Drivers of the project’s additional value and positive
customerexperience
16
Effectiveness and
flexibility
Additional Value Profitability
Partnership
Professionalproject
management
Lean-processes
Positive customer
experience
 Profitable for customer
 Top quality service
 Unique selling point
 Strict control
 Professionality
 Reliable partnership
 Fast reaction to requests
 “Turn key ready” solutions
 Portfolio ofready solutions
 High performance
 Minimization of bothering of
customer by processes
 Attention to the customer’s
requirements
 Incorporation of businesses
 Flexibility ofprocesses
 Simplification
 Transparency
 Predictability ofdeliverables
 Turing “customized” into
“standard” and back
 Single bill for all services

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Strategy
17
To be the key center of synergy for our customers, increase a
value of the partnership by provision of unique and smart
service solutions
• Global expertise
• Service excellence
• International focus

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Strategy
18
Where is possible:
Break barriers between businesses
Offer premium special services
Lead by cost-efficiency: continues cost optimization and turning of
customized solutions into a standard platform
Outrun competitors, creating new simple, stable and unique
services, win and rise market share

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• Simple and SMART
• Options for customer
• Transparency for customer
• Minimum time for implementation
• Max effectiveness and reliability
• High-end standards
• Best cost for us
• Satisfied customer
What does “the Best Service Solution” mean?
19
WE CANYES

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 Permanent focus on increasing of profitability of service solutions
 Re-enforce Customer orientation: both external and internal
 Continue improvement of planning and project management. Attention to
milestones
 Share the sense of purpose
 CAN DO
 Re-enforce responsibility of project teams
 Increase our positive image across functions
 Obtain top expertise about business processes and project management
 Learn from lessons and mistakes
 Use Good management practices
Main tasks for COG PMO
20

Project / Portfolio classification
Types of projects according to Global DHL BCA Policy
• New products
• New terminals
• Sales channels growth
Profit increase
1
Service and capability
improvement
Other
• Process improvement
• Fleetrenewal
• Upgrade ofIT equipment
• Technologyinvestments
• New terminals, hubs,
gateways
• Asset replacement
• Asset retirement
• Safety and security
• Compliance
• Strategic investments
2 3

Aspects of COG projects
• Scope: Large international and national industry leaders
Non-standard solutions based on standard
products and processes
Centralized implementation across Russia
• Time: Urgent, expected short implem. time ~3-4 months
Post-project service support during 3-6 months,
later take-over to OPS for further support
• Quality: High-end requirements, premium
• Budget: 90% - projects w/o budget
Continues cost optimization based on cloning of
service business models, standardization and
process improvement

COG PMO elements
Direction Prioritization Investments
MotivationResources KnowledgeManagement
Development
Control
Process
improvement
TrainingsPolicies&
procedures
Projectreviews
Audits and
assessments
Authority matrix
IT systems
Measurements
Communications
Best practices
Reporting
Steering
committee
ProjectArchiveMSProject
Portfolio
tracking tool
ScoreCard
Processes Tools
BCA
Investments
PMO services

PM Methodology
Little Prince
• 7 principles
• 7 themes
• 7 processes
• 24 documents
• Custom tailoring
• 7 principles
• 7 themes
• 7 processes
• 7 documents
• Standard suit
The current owner of PRINCE2tm
is AXELOS

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Step-by-stepactions from first contact to deliverables
25
Six steps from perspective to solution delivery
SpecialService
Document(SSD),
KPIs
Projecttimeline
forecast
Contracting
Businessoffer
Costs estimation/
tariff calculation
Offer
Evaluation
Trainingofownstaff
andcustomer
representatives
Monitoringand
reporting
Take-overAnalysis
Business case
analysis
Solution proposal
Identification of needs
Firstcontact
COG Request/
openingBusiness
case
Signingacontract
Agreementon
processes
Implementation
PM assignment
Projectteam
assignment
Qualityassurance,
Issue andRisk
management
Necessary
changes,Cost
optimization
Post-project
Support
Lessonslearned
2 3 4 5 6
SU IP
Changesof
businessprocess
CS, MP, SB CP
DP

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Tools
Pj title:
ProjectP&L
Pj mgr:
Currency k RUR ACTUAL TARGET
ACTvs
TGT FORECAST
ACTvs
TGT
Analysed mounth JAN 1 2 11 12 TOTAL 1 2 11 12 TOTAL 1 2 11 12 TOTAL
Revenue Total `
Subsequent revenue
non-core revenue
Personal cost
FTE
Transportation cost
Other cost
Margin
Personal cost / FTE
26
P&L
KPI score
card
Project
plan

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Documents
27
Business Case Application
- Describes feasibility of Capital acquisition
Types:
Fast
Full estimation is ready by BCA preparation
Approval in one step
Contains:
• Clear understanding ofinfluence on business
• Project costs, benefits and requirements of capital investment
• Details of necessaryresources and timings
Multi-stage
does notmeet above requirements
Preliminary
Should be prepared in case of risk to lost assetduring properapproval

Documents
Special Service Document (PID)
Describes requirements and “TO BE” service
Contains:
• Currentsituation and description of Customer’s processes
• Requirements to processes,deliverables,quality, scope,timelines
• Key solutions, necessaryresources
• Key IT systems, necessaryequipment
• Description of TO BE service, its specialaspects
• Description of TO BE processes,their variances to standard ones
• Project Schedule
• Risks analysis
• Productcodes,billing scheme
• Project stakeholders,contactinfo, communication plan

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Documents
29
Achievements overview
 Historical data on Russia and DHL RU expected to be aligned with general
presentation slides
 Fin & Strategic objectives had reviewed and aligned in terms ofwording and
outputs
 Value propositions had reviewed and aligned
 SegmentSWOT also reviewed in terms ofwording and outputs
Risks / Issues
 Due to time constraints
some slides on DHL RU
facts could be shorter
than planned
Decisions
 Review ofoptions
 Sign-off SWOT, Fin &
Strategic objectives,
Value proposition
Next steps
 Align options
 Fill in gaps
 Prepare final presentation
 Feed back from Board
DATEPROJECT TITLE - NAME
Project highlight report

Typical Project org. structure
Project manager
Team leader A
COG PMO
Resource
Managers (IT,
FIN, ADM, CS)
Customer Sponsor (OPS)
Customer
representative
(Sales)
Project team A
Team leader B
Project team B

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Stakeholders
Internal
 Senior Management Team
 Project Steering Committee
 Head of COG
 Sales: NCM, KAM
 Operations: OPS Mgr, SSU, G-OPS, GTWs, OPS Performance
and Quality, HSS
 Station managers, Region managers
 Commercial & Marketing: Product Development, Tender
Committee, Yield & Pricing
 Finance: Accounting, ABC group
 IT development
 Customer Service: Customer Interface team, Priority Account
Desk
31

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Stakeholders
32
External
 Customer
 Suppliers & Service providers / Outsourcers
 Customs
 Competitors

Important competencesof Project manager
1. Commitment to Customer
Excellence
2. Commitment to Service
Excellence
3. Collaborative Working
4. Structured thinking, System
approach
5. Change Management
6. Trustworthiness
7. Creative thinking, Problem solving
8. Business Acumen
9. Resourcefulness
10. Equipment and Program
Knowledge

Be leader in project: set goals, manage project implementation, control
deliverables in time, in budget and required quality
2. Make right decision and do right things instead of “doing decision right
and strictly follow rules”
3. Achieve results: insist and demand, where necessary – SOLICIT and
TREAT
4. Remember profitability: keep track of profit and losses of project
5. Advocate interests of client in the company and interests of company in
the face of client
6. Keep own word
Project manager SHOULD:
34

Be entrepreneurialand resourceful
8. Stay professionalin any case. Keep calm and positive attitude
9. Use all available resources to achieve goal, experts where needed
10. Manage team play and support to grow a partnership with external and
internal customers
11. Manage project documentation
12. Be able to communicate anytime and in any case. Communicate,
communicate and communicate
Project manager SHOULD (cont.):
35

Drivers of Success
• Clear target – profit and grow (turnover)
• Delegation of Authority to Project manager
• Motivation on cost reduction
• Control over the project via P&L
• Focus on value, clear benefits of project
• Simple and smart solutions
• Clear communications
• Knowledge about own business, products, capabilities
• Training of executors
• Consider Lessons Learned
• Follow to and create top standards
And… guard nerves and peace of Top management

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Backup. History of COG
2000 г – ChangeAgenda /IT & Change
– Dangerous Goods Group
– PRINCE2 (Parity) trainings (30 trainee)
2003 г – Change programs unitcreated/ OPS
2005 г – Own corporate training of “Basics of project
management”and trainers
– SpecialService supportUnit / OPS
– VAS Revenue,share:1,5%
2006 г – Change programs unitclosed
– ChangeAgenda transferred to COM
– 300+ specialists and middle-levelmanagers trained
– Facility projects to ADM
– ProductImplementation Group created /MKT
– Customer OperationGroup created / OPS
2007 г – ChangeAgenda returned to OPS
– VAS Revenue share: 5%,
Cost-recovery 100%, Avg Margin: 15%
2009 г - VAS Revenue share:7%
2011 г – VAS Revenue share:8,5%
37Project Management Best Practice

Thank you for your attention.
Danke für ihre aufmerksamkeit.
Спасибо за внимание.
Contact information:
KOTTAA
E-mail: as@kottaa.com
WWW: www.kottaa.com

DRIVERS OF PROJECT MANAGEMENT IMPLEMENTATION

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