Organization Structure Texas Instruments

109Project Management • ©2004 APQC

One of the world’s oldest and largest semiconductor makers, Texas Instruments

Inc. is the market leader in digital signal processors. For more than six

decades, Texas Instruments has created milestone innovations, including the fi rst

commercial silicon transistors, the fi rst integrated circuit, and the fi rst electronic

hand-held calculator. More than half the wireless phones sold worldwide contain

Texas Instruments’ digital signal processors, which are also found in many other

devices such as VCRs, automotive systems, and computer modems. Texas

Instruments’ semiconductor off erings also include logic chips, microprocessors, and

microcontrollers11.

Ranking 197 on the 2004 Fortune 500 list, Texas Instruments employs more

than 34,000 people worldwide and reports 2003 revenues of $9.83 billion. In

addition to Semiconductor, the company’s businesses include Sensors & Controls and

Educational & Productivity Solutions. Texas Instruments is headquartered in Dallas

and has manufacturing, design, or sales operations in more than 25 countries.

For the purpose of this case study, Texas Instruments focused on information

technology projects:

• customer-initiated projects (projects paid for by customers),

• internal support projects (e.g., IT system upgrade and developing new human

resources policies), and

• internal improvement initiatives.

Texas Instruments’ IT services considers its “pre-project analysis” exemplary

among its project management practices. For this analysis, Texas Instrument’s IT

services project execution group (PE group, also referred to as a project management

offi ce or PMO) researches the business problem or problems to be solved and develops

high-level cost and schedule estimates. Together with information gained on risks,

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Texas Instruments Business Applications

—Project Execution

11 Source: www.hoovers.com and www.ti.com (retrieved 4/2/2004)

P R O J E C T M A N A G E M E N T

110 Project Management • ©2004 APQC

constraints, assumptions, etc., the analysis project allows the sponsor to review the

potential project from a cost/benefi t standpoint. From January to October 2003, 18

pre-project analysis projects were performed, resulting in 14 projects sponsors decided

not to pursue.

Texas Instruments’ Information Technology Services Business Applications HistoryIT services established its business applications function to support enterprise-

level business applications and execute project/program management for those

applications—projects funded by the business or IT. Enterprise-level business

applications are those such as SAP and i2 (Texas Instruments’ key applications);

mainframe legacy applications of Modplan, SPS, SCAS, and PDB; and other

applications including Vertex, XMS, Viewstar, Clarity, and 1099.

IT services’ 1999 SAP implementation was a major undertaking and the fi rst

global, single-instance SAP implementation. IT services spent the fi rst few years

stabilizing the systems and educating people. To facilitate this stabilization, IT services’

organization model initially worked along functional lines. By 2002, each vertical

function (“plan to start,” “order to cash,” and “purchase to booking”) was responsible

for the running and maintenance of applications, projects, and enhancements. Along

the lines of the business functions, project managers focused exclusively in one of

these three areas. Texas Instruments project management professional Robin Bray

said, “People viewed their roles as ‘I support planning’ or ‘I support department

XYZ.’” It was a functional model with a silo approach to support and development.

By 2003, IT services discovered that although functional alignment allowed

people to focus on a particular knowledge area and build a depth of expertise, it

resulted in:

• limited knowledge sharing between functional areas,

• very few people with cross-functional knowledge,

• diff erent processes and inconsistent results across silos (and therefore an inability

to gauge success), and

• an inability to rationalize resources across the organization and ensure people

work on the right priorities.

Th us, IT services fl ipped the organizational model by breaking down silos and

replacing them with a process focus. People from technical resources became part

of a consolidated technical support organization responsible for project execution

and “level 2” and “level 3” supports, which involved a change for 130 people. (IT

Operations handles data center responsibilities and “level 1” customer service; it is

a separate group that aligns with the business processes, is responsible for the core

technology that all Texas Instruments personnel use, and reports to the CIO.)

After the changes, IT services project managers viewed their roles diff erently. Th ey

saw themselves as project managers responsible for business projects and running SAP

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and IT systems. Th e new model resulted in:

• each group’s responsibility for a single process across all enterprise resource

planning applications,

• a consistent framework around all enterprise resource planning activities,

• a project focus on process as well as product, and

• a foundation that allowed project management best practices to be developed.

As with all changes, Bray said, it also introduced a new set of challenges.

OVERALL BEST PRACTICESThe concept of project managers was foreign to Texas Instruments’ IT

services group prior to the 2003 organizational model change. Th is large shift was

accomplished successfully through three best practices identifi ed by IT services:

1. an outstanding leadership team that works with each of the project managers to

mentor and develop them,

2. a formal documented process for project management that details what is required

while executing projects in the organization, and

3. a knowledge-sharing forum for project managers with the focus on all knowledge

areas necessary to be an outstanding project manager.

LeadershipIT services’ project execution leadership team, composed of three project

management professionals (PMPs), had to judiciously proceed to change mindsets

and engender cautious optimism among senior leaders. These change leaders’

long history of successful project management helped them establish a successful

framework and convince senior leaders of the need for change.

Leaders fi rst focused on project management principles: an organization defi ned

by project roles (e.g., project manager, business analyst, and architect) that enables

depth in one area but still spans the entire enterprise resource planning system. Th is

allows for growth of project team skill sets, which rely on industry standards such as

the Project Management Institute’s Project Management Body of Knowledge and

Software Engineering Institute methodologies that set forth a “waterfall” approach

rather than rigid “levels.” (IT services tailored some of the language and process

steps to meet its needs.) Additionally, some team members earned their PMP

certifi cation.

The leadership team, which was determined to redefine the paradigms,

embraced cultural concerns and change management issues. With the radical change

in responsibilities—project managers are responsible for schedule, budget, and

resources—came a change in minds and procedures across the IT services system.

Th e goal was consistently successful project execution. IT services’ success has led to

four additional project management offi ces in the company.

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Formal and Documented ProcessProject executive group leaders built a Web site, created project management

training classes, established a project management process, and structured a formal

project execution organization. Th eir toolbox consisted of:

• mentoring;

• business readiness—determining customer satisfaction and business value through

the right training, people, information, timing, and business sense (i.e., “Does

this make sense across projects?”);

• tools and templates—to be used as a starting point;

• communication tools;

• project reviews;

• project execution internal Web site; and

• project execution process—the waterfall approach with an emphasis on time

rather than budget or score.

From an infrastructure point of view, the project execution process spans seven

phases with information technology readiness reviews (ITRs) conducted at certain

points to look at infrastructure and hardware: initiate, analyze (ITR0), design (ITR1),

build, test (ITR2), install (ITR3), and close. Reviews typically take fi ve to ten minutes,

identify who is involved, and document who gives approval. (A list identifi es who says

“yes” or “no”; it is up to the project team to do the work with operations personnel.)

Th e project management process overlays the project execution process: initiating

(authorizing the project or phase), planning (defining objectives), executing

(coordinating resources to carry out the plan), controlling (ensuring objectives are

met through monitoring, measuring progress, and corrective actions), and closing

(formal acceptance and orderly ending) (Figure 24).

Business readiness is always the focus and an ongoing concern during this process.

Project managers focus on users and potential disruptions; they question whether

they are acting in the best interests of their customers, accounting for other projects,

and presenting a consistent image to customers. Th ey view a quality product as a

result of business readiness and ITR: product, project, customer service, and support.

Business readiness begins with business alignment on needs and involves key decision

makers/infl uencers, steering team, and sponsor. It entails project team involvement by

stakeholders and power users and includes user stakeholders during deployment.

Business readiness existed in IT services prior to project management; they are

much stronger together and help IT services present more benefi cial information for

executive decision making. Texas Instruments’ new CIO focuses on projects that add

value to the company.

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Knowledge-sharing ForumIT services knowledge-sharing areas are those nine from the PMBOK, slightly

modifi ed to fi t Texas Instruments’ needs: schedule, budget, risk, scope, business

readiness/communications, resources, quality, project organization, and procurement.

Th ese are viewed as a house (Figure 25, page 114), IT services is building “rooms”

(process groups) for the house; each room consists of the same steps: initiate, plan,

execute, monitor/control, and close.

For good scheduling, project managers are now responsible for developing a “work

breakdown structure” for most projects. Microsoft Project has not been installed on

everyone’s computers because IT services wants project managers to avoid getting

caught up in “tools” and instead focus on process. With project execution’s progress,

it is now looking at enterprise portfolio management tools.

Key to the house are fi ve intrinsic skills project managers have at their disposal:

communication, influence, problem solving, negotiation, and leadership—the

soft skills (Figure 26, page 114). To better understand soft skills, project managers

underwent the Myers-Briggs personality test.

IT services’ knowledge-sharing forum initially focused on project management

“big picture” topics. A two-hour monthly meeting covered project management

overview and competencies. Th e 2004 focus is now on PMBOK knowledge areas,

scheduling, quality, and procurement. It includes project management classes, best

practices, and “Texas Instruments tailoring” to discuss PMBOK theory and examples

(i.e., templates and real-world examples of how templates were or were not applied).

Th is has grown into an IT services-wide information sharing. Th e plan is to begin

providing additional bimonthly knowledge-sharing/lessons learned sessions just for

project managers to retain the useful nature of the earlier, more focused sessions.

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Initiating

Planning

Executing Controlling

Closing

Project Execution Process

Figure 24

Business alignment on needs – Key decision makers/influencers, steering team, sponsor

Project team involvement – Stakeholders, power users

Deployment – Users, stakeholders

Defining objectives and selecting best course of action

Authorizing the project or phase

Coordinating resources to carry out the plan

Ensuring objectives are met – Monitoring – Measuring progress – Collective actions

Formal acceptance orderly ending


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Communication Infl uence Problem solving

• Speaks effectively• Fosters open communication• Listens to others• Creates compelling presentations• Aggressively informs

stakeholders (internal and external)

• Builds relationships• Displays organizational savvy• Knows the business• Focuses on customer needs• Inspires trust

• Analyzes issues• Uses technical/functional

expertise• Uses sound judgment• Creative/Resourceful

Figure 26: The Soft Skills

Negotiation Leadership

• Collaborates• Manages disagreements• Builds consensus• Understands trade-offs

• Provides direction• Leads courageously• Fosters teamwork• Motivates others• Champions change• Coaches and develops• Drives for results• Shows work commitment• Attracts and develops talent• Recognizes global implications• Manages execution

Initiate Plan ExecuteMonitor

and Control Close

• Business case/Cost benefi t analysis

• Project charter• High level

milestones• High level

project estimates

• Role and responsibility assignmeants

• Initial business engagement strategy

• Preliminary risk identifi cation

• Defi ne scope• Work

breakdown structure

• Resource requirements

• Project schedule (tasks/durations/resources)

• Cost estimates• Risk planning

(mitigations/contingencies)

• Statement of work

• Work results/Progress reports

• Change requests

• Identify need for performance

• Improvements• Input to

performance appraisals

• Rewards and recognition

• Necessary updates to:

– Budget – Schedule – Scope – Risks – Contracts – Resource

plans• Performance

reports• Corrective

action

• Lessons learned• Transition plans• Project closure• Documentation/

Archives• Formal

acceptance

Figure 25: Project Management Knowledge Areas


Th e IT services Web site gives depth and breadth to facilitate knowledge sharing.

It illustrates the project management process and references the diff erent knowledge

areas. It houses the template repository by mainly relying on PMBOK; documents

are listed in alphabetical order by document type (e.g., Microsoft Word, PowerPoint,

and Excel). Web site visitors can also easily access project management training

information, including details of upcoming training classes as well as an archive of

past training presentations.

Improvements to the ProcessIT services’ leaders found that implementing a formal process has been an

improvement over ad hoc or project manager-dependent methods because it increases

awareness of the project manager’s role and responsibilities and the understanding

of expectations. Leaders smoothed the typical resistance to change by giving more

authority to project managers, who decide what makes sense for each project and

tailor the process to their needs to get the “right amount of process” required for

success.

DRIVING CONSISTENCY IN PROJECT MANAGEMENTProject/Program Definition

IT services follows the Project Management Institute’s guideline and defi nes a

“project” as a temporary endeavor with quantifi able results. “Programs” are multiple,

related projects governed by a program management team or individual. Th e company

does not use a minimum time frame or budget to defi ne a project; complexity of eff ort

drives the defi nition.

Project Management Organization/Methodology Texas Instruments’ project execution project management organizational structure

helps ensure consistency in project delivery (Figure 27, page 116).

IT services functions as a matrix organization. It has a project management offi ce

with resources dedicated to enterprise projects and uses run/maintain resources as

needed on projects. Resources organized in the project management offi ce typically

execute project management; one exception is the smaller project management offi ce

that functions in a more limited area tied directly to a major SAP program. Creating

project management offi ces has enabled more attention to be paid to project execution

and delivery, and it has resulted in improved communication to management and

better reaction to project risks and issues.

Th e project execution leadership team is the owners of the project methodology.

Project Managers/TeamsA dedicated group of nine project managers is organized in the IT services project

management offi ce. In addition to a direct supervisor, who reports to the project

management offi ce manager, there are four to fi ve members who function as part-time

project managers as needs dictate.

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Th e project execution leadership team (“project management offi ce leaders”)

meets weekly to determine what projects need to be discussed and assigned with

project managers. Once assigned, project managers are responsible for fully staffi ng

their projects. Some of the project resources come from the project management

offi ce (13 business analysts and ten architects) and some come from the run/maintain

groups or resources external to the company (i.e., consultants and other contractors);

onsite and off site team members can be used. Th e project managers must consider

their project needs, budget limitations, and transition to support requirements when

staffi ng their projects. To help eff ectively accomplish this, IT services has a transition-

to-support representative assigned to all projects from the run/maintain organization;

this representative’s purpose is to ensure the product can be effi ciently moved to

support status.

Resources are determined based on availability, strengths, and desires. Th e typical

project team will have one project manager (and potentially a customer representative

with some project management functionality), one to three business analysts, one to

two architects and a certain number of developers depending on needs. Th ere is also

a transition to support contact for all projects, and many projects additionally have

business readiness and communication resources.

Leading their teams, project managers are charged with a host of

responsibilities.

• Defi ne and document the project schedule and build and manage the overall

project plan.

• Identify, request, and manage project resources and manage time commitments

and responsibilities of resources assigned to the project and lead project team

development.

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Project Execution Organization

Figure 27

LEVEL 2 SUPPORT PROJECT EXECUTION LEVEL 3 SUPPORT

Project Management

9 Senior TI Resources

Solution Architecture

10 Senior to Master TI Resources

Business Technical Analyst

13 Junior to Senior TI Resources


• Create the project budget or validate pre-assigned budgets and track project

expenditures and notify management and business if project exceeds budget.

• Determine overall business readiness and acceptance of the project. Depending

on size of project, a business readiness team member may be assigned to directly

support the project.

• Communicate project status to IT management, business representatives, and

business readiness team, as well as any other project stakeholders.

• Work any changes to the project (scope, schedule, budget, etc.) and use eff ective

change management processes.

• Create, manage, and maintain the project repository (server directories containing

all project information).

• Ensure that all project resources have access to all needed hardware and

software.

• Ensure that all project resources are engaged on the project and have a full

understanding of their roles and responsibilities.

• Close out the project by archiving documents and releasing resources.

• Collaborate with:

– management and business representatives to defi ne project scope;

– the project team in risk identifi cation and analysis;

– managers of project resources by giving performance feedback;

– project customers and management by setting and meeting expectations;

– support transition leader and aff ected support teams to ensure the project is

eff ectively transitioned to support; and

– the business readiness representative to gather project closeout metrics

(customer satisfaction survey).

Part-time project managers are organized in the project management offi ce

to ensure consistency. IT services is experimenting with a limited number of run/

maintain resources to manage smaller projects. When this occurs, a mentor from the

project management team is assigned to them.

Th e organizational structure is set up to maximize communication and focus

on projects while also allowing for the appropriate level of focus on run/maintain

activities. Additionally, it allows opportunities for involvement in multiple types of

projects across many diff erent IT services systems. However, there is a split between

project resources and run/maintain resources that can present challenges.

Multiple skills sets under the project management offi ce umbrella allow IT services

to strike a balance between structure and fl exibility. In addition to project managers,

the project management offi ce has dedicated business analysts and architects. Th us,

as the project needs change, a more varied skill set in the project management offi ce

allows the organization to restructure project resources more easily.

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Project Management StrategyOnce IT services projects are initiated, they follow this process:

• preliminary project analysis concept—develop options and cost estimates;

• receive funding approval—defi ne processes for all sizes of projects;

• problem definition—tie to business priorities and business value, defi ne assumptions

and constraints, and develop project charter;

• triple constraint and key constraint discussions—defi ne scope, budget, and schedule;

and

• staff project and begin work—defi ne business analysts, transition to support, and

architects early in the project.

For a project to be worked by the project management offi ce, it must fi rst receive

funding by a business unit. Once funding has been received (meaning a business

group is willing to accept the cost of the project), the project management offi ce

is more secure in the knowledge that the project deliverables will be used. Prior to

funding, projects undergo the project management offi ce’s pre-project analysis; this

analysis delivers a cost estimate and project charter, which are used by the potential

sponsors to determine whether they want to accept funding responsibility for the

project.

Th e project management strategy aligns with the company’s overarching strategic

plan. Th e stated (if informal) purpose of Texas Instruments’ IT services department

is to help Texas Instruments make money. Th e project management offi ce relies on

its collaboration with the Texas Instruments business units to help determine needs

to increase the organization’s revenue and profi ts. When Texas Instruments business

units identify a potential project, it is their responsibility to defi ne the benefi ts to be

gained. Th e project management offi ce estimates project costs and allows the business

to determine whether the project should be funded based on this information.

Th is project management approach has resulted in numerous projects being

cancelled prior to their start based on the cost/benefi t analysis available to business

units at the end of a pre-project analysis. Th e approach allows IT services to spend its

time on useful and relevant projects instead of hot-button or reactionary projects.

Resource AssignmentTh e project managers are responsible for all staffi ng needs of their projects. To

help ensure adequate resources, the project management offi ce management and

Web site provide guidance to help them in defi ning basic project resource needs.

Almost invariably, the project business analysts and transition-to-support managers

are assigned at the beginning of the project.

Prior experience and future goals are reviewed to match resources to specifi c

projects. IT services tries to take opportunities to give employees experience in new

areas, whenever possible, while still ensuring that the appropriate amount of expertise

resides in each project. To do this, the organization ensures that either the lead

business analyst or project manager has experience related to the systems impacted;

architects also ensure that the right expertise exists in a project team.

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New projects start constantly, and resource availability is considered. Typical

project managers have roughly three projects running simultaneously; they have

the fl exibility to reprioritize when necessary. When a current project completes the

closeout process, project resources are reassigned.

Two project managers and one business analyst are currently located off site. Th ey

are part of the project management offi ce and attend meetings via conference calls and

Microsoft NetMeeting or WebEx, and they are involved in attending and delivering

training. Care is taken to ensure they are included as much as possible in the project

management offi ce process improvements, and they are involved in multiple process

teams. Local resources are also on all project teams in which these off site resources

participate. As with all other projects, this allows multiple input points to gather

information regarding the project’s status and plans.

Project Management Professionalism/TrainingTh e concept of the professional project manager is fairly new to IT services. To

encourage its development, project manager has recently been made an offi cial job

title in IT services. Additionally, there is an IT services-wide project management

team dedicated to improving project management capabilities and expertise.

Members of the project management offi ce are on this team. Th e monthly project

management knowledge-sharing sessions have evolved from big picture topics to more

narrowly defi ned topics, including in 2004 cost estimating, communication, scope

management, and team development. Th ese sessions are open to people outside of the

project management offi ce and increase overall knowledge of the project management

discipline.

Th e project managers in the project management offi ce are highly encouraged to

attend and participate in the monthly knowledge-sharing sessions. PMP certifi cation

is discussed with the project managers and the option to study for and obtain the PMP

certifi cation is available. Training classes on project management have occasionally

been used in the project management offi ce with good success. Although some multi-

day training classes have been given, the project management offi ce typically does not

engage in much lengthy, formal training; it has been focused more on smaller, more

informal training opportunities. New project managers are also shown processes and

given the opportunity to provide suggestions for process improvements. Experienced

project managers serve as mentors.

Structuring and Negotiating Project ScopeStakeholder analysis and discussions launch the scoping process. Initial project

scoping is done in conjunction with cost and schedule estimating (i.e., its triple

constraint model). Potential project sponsors are given a proposed scope, cost, and

schedule. Based on all three of these items, the sponsor can determine whether the

project has the benefi t to off set the costs. If the project is approved, then an initial

scope baseline has been established. Proposed changes to the scope will also generate

new cost and schedule estimates, which will be reviewed by the sponsors; sponsors

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must validate that business value objectives are still achievable. (In some cases, the

proposed scope change may be transformed instead into budget or schedule changes.)

Again, approval based on the cost/benefi t analysis may be given, resulting in a new

scope baseline. Th is process can continue throughout the life of the project.

Maintaining Consistency in Project Management DeliveryConsistency among projects is gained through knowledge sharing, mentoring,

organization structure, process, and training (including PMP).

Project manager is a full-time job and a career path in IT services. Turnover in the

project management offi ce has been fairly low. IT services takes steps to understand

individual goals and tie them to Texas Instruments’ goals to ensure people have

opportunities to meet personal and career goals.

When new project managers are brought into the project management offi ce, they

receive instruction on processes and are placed immediately on process improvement

teams. Th ey are given access to the project management offi ce Web site, which

describes project management and software life cycle processes and contains links to

multiple tools and templates that can be used. Th e use of these common tools and

templates helps to drive overall consistency.

BUILDING PROJECT PORTFOLIOS BY PRIORITIZING PROJECTS Texas Instruments’ projects fall into the following framework (Figure 28). IT

services owns infrastructure projects; a business steering committee manages decisions

regarding projects less than $100,000; and the IT project review board makes

decisions regarding projects greater than $100,000. Business and IT collaboration

determines readiness.

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IT Services Project Framework

Figure 28

Business IT project review team managed• Large projects—more then $100K• Multiple business, functional• Driven by business needs

Business steering team managed• Business applications• Semiconductors business IT• Web solutions• Make IT• Design IT

Infrastructure• Growth• Cost• Maintainability• Security

Busi

ness

Rea

dine

ss

Business funds

IT servicesowns


IT services’ project philosophy centers on business benefi t, positive perception,

avoidance of business disruption, and “going live” only when ready. Projects may

be selected based on benefi ts such as increasing revenue, reducing cost, enforcing

compliance, and increasing customer satisfaction. Th ey are approved because of the

business case/business value expected out of each project; sponsors are required to

complete a standard form for each project to explain the need.

Milestones do not dictate decisions; rather, decisions dictate milestones. IT

services project managers believe in the importance of not compromising quality,

performance, or readiness to attain a milestone; and they emphasize the importance

of realistic project plans.

Texas Instruments’ IT project review team is responsible for decisions regarding

all business-funded and support entity projects that exceed $100,000. Th e team

establishes annual plan project funding levels (with a spending limit) and approves

requests for new projects (single, multiple-business, and support entity), which

underscores the value of good business cases.

Th e review team’s full-cycle governance entails quarterly (and ad hoc as required)

meetings to approve new projects and review the status of current projects that

are behind schedule, over budget, or out of scope, and the team determines the

appropriate course of action, answering the following questions to discern the

business value:

• Are we doing the right things?

• Are we doing them the right way?

• Are we getting them done well?

• Are we getting the benefi ts?

• Should we stop doing something?

• Will the project still achieve the intended business results?

• Do we invest more, reduce scope, or stop?

Th is team comprises numerous representatives.

• Business—Business entity fi nance and operations managers, sales and marketing,

Make IT, corporate fi nancial planning, and general accounting representatives

• IT services—Select IT leadership team members

• Corporate controller and sponsor• Facilitator and business readiness• CIO and CFO—invited to participate

Preliminary project analysis prior to project launch plays an important role in

weeding out low-value projects. It provides an indication of whether the project is a

good investment of time/dollars for the company by setting forth an upfront review

of the project, a problem statement, options, a listing of pros and cons, cost estimates,

and recommendations. Following this process, many projects are canceled: in 2003,

14 of 18 projects were cancelled, and half were cancelled in 2004.

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Allocation of ResourcesResources are requested through a formal process. The project execution

leadership team assigns resources to projects based on availability, knowledge, and

project need. Changes in project needs may cause resources to be reallocated to the

highest priority project or lower priority projects to be put on hold. Final project

prioritization decisions come from the project execution project leadership team with

knowledge of business needs.

Funding decisions are made by business leaders to ensure alignment with the

strategic objectives of the company. A spending limit is set for IT projects in general.

Each functional area or business must show business value to compete for and obtain

funding.

Th e project management offi ce’s 35 staff members are assigned to various projects

based on priorities; these priorities and project activities are closely monitored. Due to

the preliminary project analysis process, IT services rarely goes far down the path of a

low-value project. Signifi cant focus is currently on business value and understanding

the business need. If expected value cannot be quantifi ed, then it is diffi cult to obtain

project funding.

Approximately one-third of the project management offi ce group’s resources need

to be charged out to the businesses; thus, two-thirds of that expense generally comes

from the general IT funding.

To enhance ongoing management decisions, management uses project scorecards

to get a quick understanding of the status of all current projects and remind them

of completed or canceled projects. Giving management quick access to project

information allows them to make better decisions related to current and future

projects.

MEASURING PROJECT DELIVERY AND END RESULTSTh e IT services project management offi ce defi nes success as customer satisfaction,

avoidance of business disruption, and business value. Th is defi nition links to the

company’s priorities of execution, market share, and revenue growth. Expected

deliverables in each category follow.

Customer Satisfaction

• Ensure project is perceived positively

– Identify all project stakeholders

– Eff ectively communicate benefi ts and impact of project

– Ensure all stakeholders are prepared for change—no surprises

• Measure perception: customer satisfaction surveys

– All project stakeholder groups surveyed

– Electronic surveys and one-on-one discussions utilized

– Schedule and budget success are elements of customer satisfaction

No Business Disruption

• No operational impact

– No impact due to poor product quality

– No impact due to ineff ective training or communication

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– No impact due to multiple projects creating time constraints for business

stakeholders

• Accomplished through:

– Executive steering team guidance

– Risk averse approach

– Signifi cant planning eff ort

– Not milestone driven

– Install when ready

• Software testing

• End-user training

• Organizational change management

Business Value

• Help ensure projects selected are those that will provide the most value to TI

• Keys to success

– Leverage existing project management processes

– Business stakeholder buy-in

– Incorporation into project funding process

To experience no business disruptions and achieve stakeholder satisfaction, the

project management offi ce has concentrated on measuring customer satisfaction using

customer surveys. Th is typically entails a core set of questions asked to ensure scores

can be measured and rolled up across projects.

Th is year, the project management offi ce will begin to calculate other metrics,

such as budget and schedule. It does not measure customer satisfaction midstream,

but it has processes to get project budget and schedule issues throughout the life

cycle.

Cost eff ectiveness for projects is determined by comparing the project’s business

value to the cost of the project. Business value can be defined in various ways

depending on the project, but it should be specifi c and quantifi able.

Business Value: Identification, Monitoring, and MeasurementIT services has recently incorporated a more formal business value process into its

IT project process. Th e value is defi ned upfront to ensure selected projects are the best

for the company; it is monitored over the life of the project, and it is measured on its

completion. Specifi c steps in the business value identifi cation process follow.

Business Value Identifi cation

• Identify expected business value for the project

– Understand the problem to be solved

– Understand the business expectations and objectives

– Understand the alignment with other business priorities

• Identify appropriate metrics

– Should be from a business perspective

– Should use existing business metrics

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– Get buy-in from key stakeholders

– Understand when and where value should be realized

• Quantify expected savings or value

– Quantify how metrics will be impacted by project

– Calculate in dollar terms when appropriate

• Baseline agreed-upon metrics

– Need to baseline to show post-project impact

– Understand that some baselines may need to be trended over an extended

time frame

– Revise expectations if necessary

• Determine data collection process for metrics

– Assign ownership for each metric

– Understand other key aspects

— source of data (i.e., system, person, report, and survey)

— unit of measure

— when and how often should data be collected

— documented/repeatable method of collection

— how data will be evaluated

– Understand other initiatives impacting metrics

– Identify the person responsible for post-project business value measurement

Business Value Monitoring

• Revisit expectations and metrics with key stakeholders

– Monitor changes (external, project, etc.), and assess the impact to business

value

– Revise business value expectations and metrics if necessary

– Re-solicit stakeholder buy-in

• Perform ongoing data collection and metrics validation

– Reassess metrics that may fl uctuate

– Test expectations for metrics when possible

– Reset expectations as necessary

– Re-solicit stakeholder buy-in

Post-Implementation Business Value Measurement

• Collect and analyze post-project data

– Collect data for metrics

– Compare data to baselines and expectations established earlier in the

project

– Assess any changes (i.e., external or project) and determine impact

• Present business value results

– Know your audience

– Be consistent, unbiased, and conservative when presenting results

– If expected business value is not achieved

— Discuss reasons why

— Discuss next steps

• Document and share lessons learned

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Th e project management offi ce believes it is eff ective at holding lessons learned

meetings and sharing information by word of mouth, but it would like to improve

on using this information by capturing it in a repository.

Reviews and ScorecardsData integrity is ensured during collection via project reviews and status checks

with managers. To make data informational and useful, presenters use a standard

project review template to focus on the key issues such business problem, scope,

schedule, and budget. Reports are monthly and quarterly for key projects; project

scorecards are maintained on the Web. Action items gathered during the project

reviews are tracked and handled by the project managers or project management

offi ce management

Monthly internal project reviews are conducted at the vice president level; this

provides visibility for project managers and key business and IT priorities. After each

project review, the session is discussed to determine helpful aspects as well as areas that

need to be changed; lessons learned are shared to enable continuous improvement.

Quarterly IT services reviews focus on large or challenged projects.

Project scorecards are used across IT services and reviewed by upper management

and business stakeholders. Th ese are Web-based scorecards with green/yellow/red

indicators (assigned by project manager judgment); they are reported by business

line, IT organization, and major or minor project (major projects must be part of

the monthly reviews). Th ese are captured in a Lotus Notes® Domino database, and

any employee can access them; the stamp identifi es the person who last modifi ed the

document. (Scorecards do not include budget numbers for security issues.)

Th e project leadership team periodically checks to ensure project scorecards

are up-to-date. Project reviews include reviewing scorecards and making necessary

adjustments to content. Weekly project reviews can result in changes to the indicators;

project managers must communicate with sponsors before changing to “red.” Deep

technical issues are not included because the scorecard is also used by the business.

If changes are requested of the scorecard format and usage, then a formal team

and process is in place to approve or reject it.

Accountability/AuthorityProject team members are held accountable for project results. Project

performance factors into members’ organizational ranking and compensation.

Members are ultimately responsible for each project’s success. Th ey are expected to

manage both the “hard” and “soft” aspects of the project and are given the appropriate

authority to do so. Th ey are not held responsible for anything out of their control, but

they are responsible for appropriate escalation by alerting management in a timely

and appropriate manner.

Performance reviews include specifi c feedback on project performance to support

any strengths or issues being discussed. Typically bonuses are not tied to projects.

Yearly bonuses (for certain job grades) and raises are dependent on overall performance

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for the year. Managers have smaller rewards (e.g., gift certifi cates, e-mailed notes,

verbal confi rmation, and team lunches) that can be used at their discretion.

Greatest Measurement ChallengesMeasuring project delivery has not been an issue in IT services. However,

measuring customer satisfaction, once project team members and other stakeholders

have moved on to other eff orts, has proven more challenging. Also, there has been

no process in the past to measure business value delivered by the project, but this is

changing.

FINAL COMMENTS AND THOUGHTSLearning from Project Management Missteps

Two notable disappointments were identifi ed: lack of project success criteria at

the beginning of the project and inconsistent project execution.

Project management offi ce leaders expressed disappointment in getting to the

end of the project and not understanding how to measure the project’s value to the

company. Although the project might have been the “right” thing to do, there was

no quantifi cation. Th us, the project management offi ce began to focus on upfront

identifi cation of the business value, monitor value along the way, and measure it

post-project.

Texas Instruments is beginning to see pockets of achievement in consistency

in execution. To facilitate this growth, the project management offi ce is increasing

informal learning and mentoring in the teams of project managers and business

analysts; and it is transitioning from process development to skill development.

Leaders believe the organization has done a lot of work to help individuals become

better project managers but it has not reached a level of maturity where it is

consistently successful in managing all projects. Key challenges on the horizon are

improving the lessons learned process and transitioning to a learning organization,

using customer satisfaction data more eff ectively, and establishing more metrics for

success.

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Organization Structure Texas Instruments

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