A Horizontal Process for Managing Projects

A “horizontal” focus is evolving as leading companies stress the importance of cross-project capabilities. For example, one leading company established a central program management group to oversee functional areas across the organization—including procurement and finance—and deliver projects across business units. Projects are put through a cross-functional approval process to ensure they meet all designated criteria and leverage existing knowledge and scale. The group also monitors risks and financial engineering in the company’s global portfolio of projects. Support functions play an important role in each project’s success. For example, resource planning and human resources helped swell the engineering ranks and deployed training where it was most needed, while knowledge management allowed for the capture and dissemination of learning across all projects.

The Figure below depicts the shift from a vertical to a horizontal focus—where companies move beyond executing single projects and instead take a portfolio approach.

capital_project_management_vertical_vs_horizontal

Practices change significantly in a cross-project horizontal approach. For example, project-specific engineering resources are augmented by an enhanced “core engineering” corps and accountability is no longer handed off from one project life cycle phase to the next. Instead,cradle-to-grave accountability is the norm and employed across project strategy, design and operations. Functional silos give way to an integrated approach that pulls in the expertise of buyers, operators and maintenance crews into the concept and design phase. Project budgets and schedules are supplemented by new measures, including more effective buying, design reuse and managing risk exposure.

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