2015 – Project Management Post Year Review

An illustration of 2015 shifting into 2016
29 Jan 2016

2015 – Project Management Post Year Review

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Foreword

The Chinese philosopher Confucius once called reflection “the highest method of gaining wisdom”. Well, project managers (renowned philosophers that we are) also have a saying for this: we call it “lessons learned”. With this in mind, the following Post Year Review (PYR) for 2015 will hopefully help project management practitioners to reflect on the events of 2015 and, in so doing, gain some practical wisdom from these lessons.

In this blog I will outline some of the significant events of 2015 that challenged and changed (for better or worse) the project management community and the way that we manage projects.

But first, a caveat: I haven’t covered everything. In fact, it’s impossible to cover everything, simply because project management has become so ingrained in every industry and sector, that major events in any one will naturally impact the overall practice or specific project managers in some way.

Nevertheless, I hope that the following summary of project management in 2015 is useful to you insofar as it prompts further reflection and wisdom-gaining in the context of your personal life, career, organisation, industry and sector.

So here goes…

Projects in 2015

2015 was declared by the UN to be the International Year of Light. It was the Chinese Year of the Sheep; the year that Marty and Doc travelled to in Back to the Future II; and the hottest year on record. It was also the 100th anniversary of the submission of John Bradfield’s business case for a major program of public works in Sydney. This business case outlined a grand scheme involving the electrification of the suburban railways, an underground train network in the city, and the construction of the Sydney Harbour Bridge. It was audacious, visionary and bold. So naturally, Parliament rejected it.

Fortunately for us, however, Bradfield was a persistent project manager and after seven years of intensive stakeholder engagement (i.e. general nagging and harassment of NSW Parliamentarians), he finally got his business case approved.

In 2015 we added to this strong history of project management. For evidence of this, I point to the 2015 winners of the Australian Institute of Project Management (AIPM) NSW Chapter Project Management Achievement Awards[i], which reveal a cross-section of industry, including:

  • IT projects (UXC Connect won for their SOE software upgrade project);
  • Change projects (NSW Public Works won for the Central Government Relocation Program);
  • Defence projects (Airbus Group Australia Pacific won for the Satellite Communications for RAAF C-130J Aircraft project);
  • Civil infrastructure projects (Sydney Trains won for an Air Compressor Sites project)
  • Energy projects (Worley Parsons won for the AGL Newcastle Gas Storage Facility); and
  • Community projects (The City of Ryde won for the Surf Ryder project at the Ryde Aquatic Leisure Centre).

Industry review

2015 was a year of peaks and troughs for projects, depending on the industry:

Mining & Energy

The mining/energy sector experienced some major shifts marked by the rise of renewable energy projects, and the fall of traditional ones. A large number of projects were undertaken in solar, wind and geothermal energy. At the same time, the number of mining and traditional energy projects declined considerably, although there were still some large-scale mining projects undertaken overseas.

Healthcare

The healthcare sector kept project managers busy throughout 2015, with numerous Government, corporate, and NFP organisations undertaking projects aimed at improving care and expanding services, while reducing operating costs (no contradiction intended). This presented a great opportunity for IT project managers in particular.

Defence

Usually a powerful engine for project jobs, the Defence sector had a tough year plagued by cutbacks, turbulence as the Defence Material Organisation (DMO) transitioned into the Capability Acquisition and Sustainability Group (CASG)[ii], and continued concern about the “valley of death” (that is, the end of the long-established warship building capability in Australia).

However, a glimmer of hope is on the horizon, with the Government recently increasing the Defence budget for 2015-16 by approximately $9 billion, bringing the total budget to nearly $32 billion. This budget will fund Defence’s program of capital investment and reflect the highly anticipated 2015 Defence White Paper. Due for release any moment now (“end of 2015”), the White Paper will outline the Government’s vision for Defence, looking out to 2035. According to the Minister, the White Paper will “describe the capabilities Defence will need to respond to a more uncertain environment.” The Minister also says, “the Government is committed to giving better support to industry and the research community to promote, harness and translate innovative ideas into practical capability.”[iii]

Translation: Projects. Lots of projects.

The expectation/hope is that billions of dollars’ worth of projects will cascade down the supply chains, through the Primes, to the hungry SMEs of industry. And NSW, which is home to more than 80 bases and establishments, and about 28 per cent of the Australian Defence Force’s (ADF) military and civilian personnel, is tipped to see around $5 billion of this. [iv] This is great news for project managers and team members who specialise in combat systems, sonar, electronic warfare, systems integration, and electronics projects.

IT

Information Technology has been a fertile source of projects for decades, and there’s no sign of this slowing. As government and commercial organisations continuously improve, acquire, disrupt and reinvent themselves, they call on IT project managers to update, integrate, and automate the IT systems on which their businesses rely. This has also driven the strong demand for training and certification in IT focused methodologies – most notably Agile methodologies.

Fintech

Another healthy off-shoot of IT was the Fintech industry. Fintech (financial services technology) is one of the fastest-growing segments of the global financial services industry. Worldwide, fintech ventures represent a $60 billion industry, which contributes to 5% of Australia’s GDP. In recognition of this, NSW Premier Mike Baird launched the “Stone & Chalk fintech hub” in Bridge Street, Sydney, in September 2015. This not-for-profit facility provides workspace for 200 start-ups in a 2300 square metre venue.[v]

Innovation & start-ups

The Fintech hub is just one of five Knowledge Hubs that the NSW Government is sponsoring. The four others focus on Digital Creative, Energy Innovation, MedTech, and Transport & Logistics. These hubs provide co-funding and support from the NSW Government for the delivery of collaborative industry development projects. The Hubs provide office space, mentoring, networking, technical support and opportunities to access capital[vi] and are consistent with the federal government’s National Innovation and Science Agenda and Malcom Turnbull’s “innovation lovefest” [vii].

Construction

Construction – the birthplace of project management – had a big year in 2015. Supported by a strong NSW economy and low interest rates, 2015 saw a flurry of construction projects, particularly around July, with NSW building approvals up by 27%[viii]. It was also a good year for construction overseas, particularly in China, the United States and India, where one report stated that approximately 1 million skilled project managers were needed to fill gaps in large, complex projects.[ix]

Local Government

Finally, to Local Government, where the prospect of forced amalgamations in NSW has prompted many councils to establish or strengthen their PMOs, and to develop their project management workforce, in order to demonstrate that they are “fit for the future”[x]. Not only will amalgamations impact the internal resourcing of councils, it will impact the builders and other suppliers of councils, with amalgamations leading to more council work being outsourced to industry.

Trends and Forecasts

Some notable trends of 2015 and forecasts for the coming years:

Project managing from the Cloud

2015 saw a considerable increase in the number and functionality of online project management tools such as Asana, Basecamp, Zoho, Smartsheet, and so on. These tools enable project managers to effectively and efficiently schedule, budget, communicate and access the information that they need onsite, offsite, and anywhere else they need it.

This technology also supports good governance, with sponsors and steering committees able to keep track projects remotely and in real time. Tied to this is the rise of Big Data Analytics which enables executives to base decisions on current data from many hundreds of projects across the business.

This trend seems certain to continue. Project managers will become less and less dependent on their desktop software, as companies increase use of cloud based applications.

PM methodologies

Agile project management practices have been the flavour of the year for IT projects, with a reported 38% of organisations using agile frequently. The most popular Agile methodologies were Scrum, Lean & Test Driven Development; eXtreme Programming and Complex Adaptive Systems.[xi]

PRINCE2 continued to be popular with Government, although this tends not to apply to those agencies focussed on ‘soft projects’ or ‘wicked problems’ like health, disability, aged care, community service, environment, and climate change.

Virtual teams

The use of virtual, remote and international project teams is also on the rise. This trend is one to watch in the coming years as the enabling technology and infrastructure develops, such as:

  • Online collaboration tools such as Google Docs, Dropbox, Meeting Notes, etc.;
  • Videoconferencing tools such as Google Hangouts, GoToMeeting, etc.;
  • Telepresence and holographic technology such as the DVE Immersion Room[xii]; and
  • Remote offices and telecommuting, such as the new Smart Work Hubs owned and operated by Gosford Council. These satellite offices (located in Wyong and Gosford) are fitted out with high-speed broadband and on-site facilities including Wi-Fi, video conferencing, meeting spaces and a kitchen. They are intended to support the 40,000 residents who commute from the Central Coast region to Sydney each day for work, saving hundreds of hours per year of commuting time.
Sustainable project management

Over the past several years we have seen a global trend toward adopting sustainable methodologies and practices like Cradle to Cradle (C2C), Leadership in Energy and Environmental Design (LEED), and Green Project Management[xiii].

Organisations are increasingly including environmental impact in their performance evaluations – so good business is now green business. This transition may be helped by a report published by Academy of Technological Sciences and Engineering (ATSE), an independent body of more than 800 Australian scientists and engineers, called “Green Growth”. The report outlines the opportunities for Australian corporations and government agencies to improve productivity and economic prosperity at the same time as improving environmental and social outcomes.[xiv]

Climate change and sustainability is of course front-of-mind for many people and organisations; but we may also credit the NSW Environmental Protection Agency (EPA), as fines and prosecutions under the Protection of the Environmental Operations (POEO) Act continue to sting project managers and organisations for projects that harm the environment[xv].

Program management

In addition to competent project managers, there has been strong demand for skilled program managers. Most in demand are those program managers who can understand organisational culture; think and act strategically; provide vision, governance and leadership for project managers; and convert corporate strategy into tangible goals and executable pieces of work.

This trend is not just in the private sector. The Financial Management Transformation (FMT) Program currently being administered by NSW Treasury is a sector-wide reform under which agencies are moving to a program-based budgeting and operating model.[xvi] This will require agencies to develop strong program management capabilities with clear linkages to the projects that underpin them.

PM Qualifications

Recruiters have seen continued demand for project management qualifications and certifications with credential-based culling of applicants still the rage (e.g. PRINCE2, Diploma of Project Management, etc.). In the public sector, the Government Sector Employment (GSE) Reform has resulted in NSW government agencies recruiting and developing their project management talent in line with the Public Sector Capability Framework, which includes Project Management as an enabling capability[xvii]. This has also added to the demand for project management qualifications.

 

In conclusion

It was a great year for the project management community and their stakeholders across government, business, and the community. And 2016 is set to be even bigger and better as innovation projects proliferate, the public sector continues to ‘projectise’, and the International Project Management Association (IPMA) teams up with the AIPM to host a massive regional project management conference in Sydney[xviii]. Before the year is out, we may even see the momentous milestone of project management becoming a Chartered profession in the UK[xix].  Till next time… happy projects!

 


 

[i] https://www.aipm.com.au/awards

[ii] http://www.abc.net.au/news/2015-04-01/military-equipment-agency-abolished/6364554

[iii] http://www.minister.defence.gov.au/2015/08/27/minister-for-defence-address-to-the-american-chamber-of-commerce-in-australia-qt-hotel-canberra/

[iv] http://www.industry.nsw.gov.au/business-and-industry-in-nsw/key-industry-sectors/defence-and-aerospace/industry-strengths-and-capabilities

[v] http://www.industry.nsw.gov.au/business-and-industry-in-nsw/news-and-events/news/stone-and-chalk-fintech-hub-launched

[vi] http://www.industry.nsw.gov.au/business-and-industry-in-nsw/news-and-events/news/stone-and-chalk-fintech-hub-launched

[vii] http://www.afr.com/leadership/innovation/malcolm-turnbulls-innovation-lovefest-20151210-glkiwk

[viii] http://www.smh.com.au/nsw/stateometer-shows-nsw-economy-pulling-ahead-20150901-gjchtu.html#ixzz3kjLhDGI0

[ix] https://www.pmi.org/learning/PM-Network/2014/global-jobs-report.aspx

[x] http://www.fitforthefuture.nsw.gov.au/

[xi] https://www.pmi.org/~/media/PDF/learning/pulse-of-the-profession-2015.ashx

[xii] http://dvetelepresence.com/room/home.htm

[xiii] http://www.greenprojectmanagement.org/

[xiv] https://www.atse.org.au/content/energy/green-growth-in-australia-project.aspx

[xv] http://www.epa.nsw.gov.au/

[xvi] http://www.treasury.nsw.gov.au/fmt

[xvii] http://www.psc.nsw.gov.au/workforce-management/capability-framework

[xviii] https://www.aipm.com.au/events/national-conference

[xix] https://www.apm.org.uk/CharteredTimeline