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Sun 3 Jan 2010 04:00 AM

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Project Peril

During the boom years, CIOs pushed their teams to the limit to ensure vital infrastructure would be ready in time - but with the downturn, many of these projects lie cancelled or indefinitely delayed. Piers Ford looks into the vital role of the project manager in preventing these kinds of situations.

During the boom years, CIOs pushed their teams to the limit to ensure vital infrastructure would be ready in time - but with the downturn, many of these projects lie cancelled or indefinitely delayed. Piers Ford looks into the vital role of the project manager in preventing these kinds of situations.

It isn't only the economic climate that's having an impact on the progress of IT projects in some sectors across the Gulf. And while there is a skills shortage - likely to become more acute as projects gather momentum when the recovery hits its stride - this is also just one of several elements that are now influencing project delivery.

According to at least one senior IT executive, the greatest pressure of all is coming from a general, fundamental lack of understanding as to what the project manager's role should be in providing value to the business through the progression and delivery of a project.

Whatever their order of importance, there's no doubt that combined, these factors are making it very difficult for CIOs and IT directors to steer a meaningful path through the challenges of project fulfilment.

"I would suggest that across the region, the project manager is not fully empowered," says Saher Arar, deputy CIO at the National Bank of Abu Dhabi. "They don't fully control the budget, and most organisations are functional rather than projectised. The project manager is not the only person who takes the decision about who joins the project. There needs to be more focus, not just on doing the right thing but on doing it right!"

Not that this has been the case at the National Bank, which has continued to drive forward projects to support growth, including the implementation of a major Unix-based treasury and risk management platform, enterprise data warehouses and Oracle Financials. It currently has a project worksheet of more than 100 active system requirements and is on course to hire more than 50 new IT staff for the department in 2010.

"Certainly we're not doing things in a random way," says Arar. "The focus is very much on risk mitigation. The bank is a very challenging and adventurous place to work and there are a lot of opportunities. That's why we're going to introduce a project management office to help us control our projects better, moderate the risks and manage our resources."

Arar says that the support of senior management to the project cycle is crucial although again, this is not an issue at the National bank of Abu Dhabi. Choosing the right people and suppliers, on the other hand, can be a problem. With a significant ongoing investment in Unix, for example, highly skilled support staff are expensive and hard to come by. The bank needs people who understand the applications and the business, and have an insight into what the traders actually do.

"Where the financial crisis has had an impact is among IT vendors," says Arar. "Before you engage any supplier on a project, make sure that they have an up-to-date profile; you don't want to be signing up with someone who is about to go under.

"Even when you are dealing with a vendor who is supposed to be able to provide you with professional services, you might find that the people they have deployed to the region aren't good enough in terms of the knowledge they bring to the business - which in turn makes it difficult for the CIO to leverage to the business the value of what the project is trying to achieve."

Paul O'Kirwan, director of IT at Dubai Mercantile Exchange (DME) agrees with this assertion. As most would agree, Dubai's project scene has taken a harder hit, particularly in the financial and property sectors, and he says vendors and suppliers will inevitably be feeling the pain as customers rein in projects - leaving CIOs in a potential double bind."In previous times, we'd be looking at getting three years out of a server before replacing it with the latest technology," says O'Kirwan. "Now, we've got four-year-old servers that we want to extend for another two years. And that's not great news for suppliers. Some vendors are suffering terribly, even to the extent of shutting services down, and some won't be able to survive.

"That means we have to reassess and reconsider them on an ongoing basis, constantly carry out due diligence on their financial situation, ask for a list of their current projects. Will they still be around in six months? That's a question you didn't have to worry about before."

O'Kirwan says projects have been mothballed at DME. Anything that doesn't enhance the exchange's core business is scrutinised. A complete planned upgrade to blade servers has been put on ice, for example, in favour of extending the life of the current platform.

"Before, you'd add 10% to the corporate IT expenditure each year as a matter of course," he says. "Now, reductions of 30% are not unusual. Fortunately, our board understands the reality of what they'll be getting for that. We closed down our help desk, for example; it's a luxury we'll have to live without for now. If CIOs are asked to make these checks in corporate expenditure, they also need to be realistic in terms of what they are eventually expecting the project manager to be able to deliver."

The answer, according to project management training consultant Dennis Comninos, is to refocus projects on value and agility - breaking them down into smaller bite-sized chunks that the board will find more digestible.

Comninos has held regular workshops and provided consultancy services throughout the Middle East in recent years. He has noticed a trend in certain emirates and kingdoms - Saudia Arabia and Bahrain - to take project management back in-house, where outsourcing was previously favoured. Elsewhere, and in Dubai in particular, he suggests the shock of the downturn has exposed an inherent lack of focus and reality in IT project management.

"The drop in construction and property sales removed at a stroke the need for IT to help manage these huge projects," he says. "So there's been a knee-jerk reaction: training is the first to go, followed by outside consultancy and then IT systems. So they decide to stick with their legacy systems. And then when the upturn comes, you're left needing all those things back because they tend to make you more efficient."

Comninos says that traditionally, the agile approach to project management hasn't gone down well in the Middle East.

"Culturally, so much emphasis has been on time and cost: having it now, making it the biggest, and spending the most. Now, they're starting to realise that value - and project ROI - are important, and they never spoke about that before. It's been a rude awakening. It's a hard lesson they're learning: how to ride out the storm with caution."

He advises CIOs to approach the board for smaller amounts of funding, and the time to realise micro-projects that will deliver demonstrable value to the business.

"It's no longer about being the best, the fastest, the most expensive," he says. "It's about what we need to do right now to bring value and benefits to the business. And really, that means stop thinking purely about IT and start thinking like business people. Make it agile, show can produce value, and then you can accelerate when things improve."

Joanna Sedley-Burke, business development director at consultancy Sovereign Business Integration (BSI), whose clients include the International Bank of Qatar, says there has been a shift in attitude to project management in the region. Where before, organisations bought the resources to deliver projects - thinking in terms of relatively ‘cheap' daily contractor rates - they are now more willing to buy in the management needed for the projects.

"Our staff work alongside client project management staff and we constantly pick up projects that haven't been fully delivered or resourced," she says. "We know they would rather do it themselves as a means of keeping costs down. But if you take the International Bank of Qatar, they keep using us because we  have the ability to deliver on time and to budget. They recognise that sheer project management experience can't be beaten.

"It's about managing risk and cost, and understanding the risks of going wrong - and what the cost implications might be. Not just in cash, but the softer impact in terms of your ability to grow the business. You need the IT infrastructure to do that, but if you don't invest in the management side, the project will fail to deliver," she concludes.

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