A System for Value Delivery

The information in this section provides a context for value delivery, governance, project functions, the project environment, and product management.

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Section 2.1 Creating Value. This section describes how projects operate within a system to produce value for organizations and their stakeholders. 

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Section 2.2 Organizational Governance Systems. This section describes how governance supports a system for value delivery. 

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Section 2.3 Functions Associated with Projects. This section identifies the functions that support projects. 

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Section 2.4 The Project Environment. This section identifies internal and external  factors that influence projects and the delivery of value. 

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Section 2.5 Product Management Considerations. This section identifies the ways portfolios, programs, projects, and products relate.

2.1 

CREATING VALUE 

Projects exist within a larger system, such as a governmental agency, organization, or contractual arrangement. For the sake of brevity, this standard uses the term organization when referring to government agencies, enterprises, contractual arrangements, joint ventures, and other arrangements. Organizations create value for stakeholders. Examples of ways that projects produce value include, but are not limited to :

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Creating a new product, service, or result that meets the needs of customers or end users ; 

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Creating positive social or environmental contributions ; 

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Improving efficiency, productivity, effectiveness, or responsiveness ; 

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Enabling the changes needed to facilitate organizational transition to its desired future state; and 

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Sustaining benefits enabled by previous programs, projects, or business operatin.

2.1.1 

VALUE DELIVERY COMPONENTS 

There are various components, such as portfolios, programs, projects, products, and operations, that can be used individually and collectively to create value. Working together, these components comprise a system for delivering value that is aligned with the organization’s strategy. Figure 2-1 shows an example of a system to deliver value that has two portfolios comprised of programs and projects. It also shows a stand alone program with projects and stand alone projects not associated with portfolios or programs. Any of the projects or programs could include products. Operations can directly support and influence portfolios, programs, and projects, as well as other business functions, such as payroll, supply chain management, and so forth. Portfolios, programs, and projects influence each other as well as operations.

As shown in Figure 2-2, a system for value delivery is part of an organization’s internal environment that is subject to policies, procedures, methodologies, frameworks, governance structures, and so forth. That internal environment exists within the larger external environment, which includes the economy, the competitive environment, legislative constraints, etc. Section 2.4 provides more detail on internal and external environments.

The components in a value delivery system create deliverables used to produce outcomes. An outcome is the end result or consequence of a process or a project. Focusing on outcomes, choices, and decisions emphasizes the long range performance of the project. The outcomes create benefits, which are gains realized by the organization. Benefits, in turn, create value, which is something of worth, importance, or usefulness.

2.1.2 

INFORMATION FLOW 

A value delivery system works most effectively when information and feedback are shared consistently among all components, keeping the system aligned with strategy and attuned to  the environment. 

Figure 2-3 shows a model of the flow of information where black arrows represent information from senior leadership to portfolios, portfolios to programs and projects, and then to operations. Senior leadership shares strategic information with portfolios. Portfolios share the desired outcomes, benefits, and value with programs and projects. Deliverables from programs and projects are passed on to operations along with information on support and maintenance for the deliverables. 

The light gray arrows in Figure 2-3 represent the reverse flow of information. Information from operations to programs and projects suggests adjustments, fixes, and updates to deliverables. Programs and projects provide performance information and progress on achieving the desired outcomes, benefits, and value to portfolios. Portfolios provide evaluations on portfolio performance with senior leadership. Additionally, operations provide information on how well the organization’s strategy is advancing.

2.2 

ORGANIZATIONAL GOVERNANCE SYSTEMS 

The governance system works alongside the value delivery system to enable smooth workflows, manage issues, and support decision making. 

Governance systems provide a framework with functions and processes that guide activities. A governance framework can include elements of oversight, control, value assessment, integration among components, and decision making capabilities. Governance systems provide an integrated structure for evaluating changes, issues, and risks associated with the environment and any component in the value delivery system. This includes portfolio objectives, program benefits, and deliverables produced by projects. 

Projects can operate within a program or portfolio or as a stand alone activity. In some organizations, a project management office might support programs and projects within a portfolio. Project governance includes defining the authority to approve changes and make other business decisions related to the project. Project governance is aligned with program and/or organizational governance.

2.3 FUNCTIONS ASSOCIATED WITH PROJECTS 

People drive project delivery. They do so by fulfilling functions necessary for the project to run effectively and efficiently. Functions related to the project can be fulfilled by one person, by a group of people, or combined into defined roles. 

Coordinating a collective work effort is extremely important to the success of any project. There are different types of coordination suitable for different contexts. Some projects benefit from decentralized coordination in which project team members self organize and self manage. Other projects benefit from centralized coordination with the leadership and guidance of a designated project manager or similar role. Some projects with centralized coordination can also benefit from including self organized project teams for portions of the work. Regardless of how coordination takes place, supportive leadership models and meaningful, continuous engagements between project teams and other stakeholders underpin successful outcomes.

Regardless of how projects are coordinated, the collective effort of the project team delivers the outcomes, benefits, and value. The project team may be supported by additional functions depending on the deliverables, industry, organization, and other variables. Sections 2.3.1 through 2.3.8 provide examples of functions that are often found on projects, though these are not a comprehensive list. In addition to these functions, other functions may be necessary to enable project deliverables that produce the desired outcomes. The needs of the project, organization, and environment influence which functions are used on a project and how those functions are carried out.

2.3.1 

PROVIDE OVERSIGHT AND COORDINATION 

People in this function help the project team achieve the project objectives, typically by orchestrating the work of the project. The specifics of how this function is carried out within the project team can vary among organizations, but can include leading the planning, monitoring, and controlling activities. In some organizations, this function may involve some evaluation and analysis activities as part of pre project activities. This function includes monitoring and working to improve the health, safety, and overall well being of project team members. Coordination includes consulting with executive and business unit leaders on ideas for advancing objectives, improving project performance, or meeting customer needs. It can also include assisting in business analysis, tendering and contract negotiations, and business case development. Oversight can be involved in follow on activities related to benefits realization and sustainment after the project deliverables are finalized but before formal closure of the project. This function can support portfolios and programs within which the project is initiated. Ultimately, the function is tailored to fit the organization.

2.3.2 

PRESENT OBJECTIVES AND FEEDBACK 

People in this function contribute perspectives, insights, and clear direction from customers and end users. The customer and end user are not always synonymous. For the purpose of this standard, the customer is defined as the individual or group who has requested or is funding the project. The end user is the individual or group who will experience the direct use of the project deliverable.

Projects need clear direction from customers and end users regarding project requirements, outcomes, and expectations. In adaptive and hybrid project environments, the need for ongoing feedback is greater because the project teams are exploring and developing product elements within specific increments. In some project environments, the customer or end user engages with the project team for periodic review and feedback. In some projects, a representative of the customer or client participates on the project team. The customer and end user input and feedback needs are determined by the nature of the project and the guidance or direction required.

2.3.3 

FACILITATE AND SUPPORT 

The function of facilitation and support may be closely related to providing oversight and coordination, depending on the nature of the project. The work involves encouraging project team member participation, collaboration, and a shared sense of responsibility for the work output. Facilitation helps the project team create consensus around solutions, resolve conflicts, and make decisions. Facilitation is also required to coordinate meetings and contribute in an unbiased way  to the advancement of project objectives. Supporting people through change and helping address obstacles that can prevent success is also required. This can include evaluating performance and providing individuals and project teams with feedback to help them learn, adapt, and improve.

2.3.4 

PERFORM WORK AND CONTRIBUTE INSIGHTS 

This group of people provides the knowledge, skills, and experience necessary to produce the products and realize the outcomes of the project. Work can be full time or part time for the duration of the project or for a limited period, and the work can be colocated or virtual, depending on the environmental factors. Some work can be highly specialized, while other work can be done by project team members who have broad skill sets. 

Gaining insights from cross functional project team members representing different parts of the organization can provide a mix of internal perspectives, establish alliances with key business units, and encourage project team members to act as change agents within their functional areas. This work can extend into support functions (during or after the project) as the project deliverables are implemented or transitioned into operations.

2.3.5 

APPLY EXPERTISE 

People in this function provide the knowledge, vision, and expertise in a specific subject for  a project. They offer advice and support throughout the organization, and contribute to the project team’s learning process and work accuracy. These people can be external to the organization  or can be internal project team members. They can be required for the whole project or during  a specific time frame.

2.3.6 

PROVIDE BUSINESS DIRECTION AND INSIGHT 

People in this function guide and clarify the direction of the project or product outcome. This function involves prioritizing the requirements or backlog items based on business value, dependencies, and technical or operational risk. People in this function provide feedback to project teams and set direction for the next increment or element to be developed or delivered. The function involves interacting with other stakeholders, customers, and their project teams to define the product direction. The goal is to maximize the value of the project deliverable.

In adaptive and hybrid environments, direction and insight can be provided using a specific cadence. In predictive environments, there can be designated checkpoints for presentation of and feedback on project progress. In some instances, business direction can interact with funding and resourcing functions.

2.3.7 

PROVIDE RESOURCES AND DIRECTION 

People in this function promote the project and communicate the organization’s vision, goals, and expectations to the project team and broader stakeholder community. They advocate for the project and the project team by helping to secure the decisions, resources, and authority that allow project activities to progress.

People in this function serve as liaisons between senior management and the project team, play a supporting role in keeping projects aligned to business objectives, remove obstacles, and address issues outside the bounds of the project team’s decision authority. People in this function provide an escalation path for problems, issues, or risks that project teams cannot resolve or manage on their own, such as a shortage of funding or other resources, or deadlines that cannot be met.

This function can facilitate innovation by identifying opportunities that arise within the project and communicating these to senior management. People in this function may monitor project outcomes after project closure to ensure the intended business benefits are realized.

2.3.8 

MAINTAIN GOVERNANCE 

People who fill a governance function approve and support recommendations made by the project team and monitor project progress in achieving the desired outcomes. They maintain linkages between project teams and strategic or business objectives that can change over the course of the project.