02 External PMI Northern Italy 101119

Copyright Siemens AG 2010. All rights reserved.Wolfgang Raschka, CT O PM

Wolfgang RaschkaNovember 19th, 2010 -

Milano

PM@Siemens Project Management

the

Siemens Way


IntroductionSiemensPM@Siemens

How to establish good project management in a companyStakeholder managementWhat are the different stakeholder expectations?

Siemens Focus Topic 1: ProcessesProcess and quality make the difference

Siemens Focus Topic 2: PeopleWell qualified project managers are a big asset

Siemens Focus Topic 3: TransparencyInformation is power

Maturity and Culture Change

Agenda


Siemens

A global view

World leader

in electrical engineering and electronics solutions

Active in three sectors: Industry - Energy

Healthcare

Annual sales of 77 billion with more than 50% project business

Represented in more than 190 countries

Producing in

219 factories

405,000

employees

worldwide

More than 40.000 projects

per year

Roughly 17,000 project managers


Edition 2001 Edition 2003 Edition 2009

No. of copies: 5,000




Edition 2006

PM@Siemens

a brief history

In a heterogeneous world our project management standards were diverse.So were the project results!Thus, in 2000 Siemens started a project improvement program.The PM Guide has become our standard body.


Edition 2009

Nr. of copies: 25,000

PM@Siemens defines PM standards in a guide with 12 modules and 55 requirements

PM@Siemens goals are:Harmonize Project ManagementImprove profitImprove qualityReduce risk

Most requirements were developed out of best practice examples

from the central

divisions and regional companiesSome of the most important binding standards

are

Project ProcessProject CategorizationProject Manager Development


The PM Guide is binding!

For all Siemens units involved in project business, it is a binding guide.

Besides that, it provides valuable practical advice and orientation for daily project work. Make use of it

for the benefit of our company!

Peter LscherCEO Siemens AG


PM@Siemens acts globally in the roll out of the program

Steering Committee

Innovation

Prof. Dr. Requardt

Board Member, Head

of Corporate Technology

Program

Director:

Dr. Schlo, CT O PM

Core

Team: W. Raschka,

Industry Energy HealthcareCorporate Units for Internal

Projects

Headquarters

USA

CAN -

Canada

MAM -

Meso-America

BRA -

Brazil

AAN -

Austral Andina

NWE

North West Europe

CEE

Central Eastern Europe

SWE

South West Europe

GER

Germany

MEA -

Middle East

RCA -

Russia/Central Asia

AFR -

Africa

SAS -

South Asia

NEA -

North East Asia

ASN -

Asean

PAC -

Pacific

Regional Clusters

Special Partners

PM Academy CMMI Assessment Unit

VorfhrenderPrsentationsnotizenIndustry: auf Division Ebene, nur Osram noch nicht, ist aber angeschriebenEnergy: auf Sectorebene mit etabliertem TeamHealthcare: offene Inkonsistenzen in den verschiedenen Beschreibungen, kein PM@Siemens Coordinator benanntSIS: etabliert und arbeitetSRE: etabliert und arbeitet, eventuell Wanderung in Community Internal Projects

CLUSTER:USA Coordinator nur von Community als Verwalter der Zusammenarbeit gewhlt, aber nicht von Cluster CEO empowertSehr schlechte Arbeitsgrundlage, Steuerung der Implementierung hngt vom Durchgriff der Sectoren abCAN arbeitet mit NWE zusammen und lt sich auch durch NWE im Global Coordinator Board vertretenMeso-America / Austral-Andinagut etabliert, mit Management Committment und eingespieltem TeamBrazil etabliert mit Management Committment, aber neuer Coordinator, luft gutGER etabliert, keine Beteiligung am Budget aber sehr engagierter CoordinatorNWE / SWE / CEE etabliert mit Management Committment, Spannungen durch Abstimmung Verantwortung zwischen Sector/Weltunternehmer und Clusterleitung; CEE hat krzlich Cluster Eastern Mediterranean integriert (war aber frher in unserem Hub MSE schon zusammen und klappt gut)Russia/Central Asia sehr engagiert und langjhriger Coordinator, Intensive Zusammenarbeit mit NWEMiddle East krzlich Zusammenlegung Middle East (wenig entwickelt und gerade Wechsel Koordinator) mit West Asia (etabliert, sehr konservativer und genauer Coordinator der gleichzeitig Q-Manager ist) unter Leitung des frheren West-Asia Coordinators; noch in vielen beteiligten Lndern im Anfangstadium der ImplementierungWestern & Central Africa neuer Cluster mit neuem Siemens Mitarbeiter als Coordinator, Fokusthema des verantwortlichen Cluster CEOSouthern Africa neue Coordinatorin, langsame aber stetige ImplementierungNorth East Asia neue operative Coordiantorin unter gleicher Leitung; Schwierige Situation mit SOC = viel Einfluss aus Sectoren ntig zur Untersttzung der Cluster-PM CoordinatorenSouth Asia gut etabliert mit neuem Coordinator, sehr viele Aktivitten in Indien / Cross-SectorPacific neu aufgesetzt mit kompetenter Fhrungskraft in der Rolle des PM Coordinator, noch in der Anfangsphase (Prozesse gut bearbeitet da vorher in CIO angesiedelt, aber Training / Karriere / MPM etc. noch nicht weit entwickelt)ASEAN Committment Management mit neuer Coordinatorin, derzeit in der Koordinationsphase da der Cluster neu gegrndet wurde und die Lnder noch nicht gut abgestimmt sind; auf dem Weg zur fortgeschrittenen Implementierung


With our 12 modules we focus on three main aspects

Transparency People

Processes

VorfhrenderPrsentationsnotizenYou probably know the output: our first PM Guide, edition November 2001. We documented seven modules with 29 recommendations.Cooperating with representatives of all groups in work teams, we completed the twelve modules and compiled the 53 recommendations in June 2003. We feel that this includes all relevant issues for an organisation to become truly efficient in managing their projects. Since then, we described many topics in more detail and included selected regions into this discussions.This last year was very busy, we developed new tools and many new standards: (for example) PM experience PMA+ Version 4 Worldwide Project Manager Database, integrated in IDD PM Future World for assessment and certification of all levels of Project Managers Uniform PM Categorisation A systematic process for CT SE assessment planning Detailed project definition Alignment of processes and roles with Siemens reference process house -- Above all, we created a new supporting organisation for the global roll out with our hubs (you) and new team members in the PM@Siemens Core Team.NOW it is time to communicate and implement all this! The newest edition of our PM Guide, integrating all these new topics, will be ready given the decision about the uniform project categorisation is taken in january 2006 for print in german and translation into english.








Agenda


Organizational changeThe organization takes the lead defines processes and standards and works on continuous improvement.

People changeThe organization defines necessary roles organizes trainings and certifies its project managers and invites them to engage in further improvements.

Who are the stakeholders of such changes?Top managers lead the change.Line managers back the change.Project managers live the change.Project employees follow the change.

To establish systematic project management means to change the organization


What do the stakeholders expect from good project management?

Project ManagersProject team satisfactionSuccessful projects

Get clear decisionsGuidelines

Little mgmt. interferenceHelp from managementMethods and tools

Entrepreneurial freedomRoom for developmentContinuity and careerFair payment

ManagersCustomer satisfactionProfitable projects

Make clear decisionsNo project crisis

Stable project environmentMeasurementSimilar look & feel

A good overviewPortfolio managementResource planningReliable project managers








Agenda

Processes


Most important improvements at Siemens include

... a standardized project management process

Clear decision making rules

Project categories Quality controls

plus

plus

Respective methods and tools


Project categorization

helps

to focus

and distinguish

Clear System

Division into

Large Projects (A-C)

Small Projects (D-F)

Managers getA good overview

The basis for portfolio management

Project managers getRoom for development

A chance for continuity and career


Standardized milestones

Clear inputs and outputs

Q-Gate systematic

Limits of Authority for decisions

A stable process is the backbone of successful project management

Leadmanagement

Projectacquisition

Bidpreparation

Contractnegotiation

Projecthandover

Project opening

& clearing

PM010 PM070 PM080 PM100PM020 PM040

Detailed

planning

Purchasing &

manufacture Dispatch

Construction/

Installation

Commis-

sioning Acceptance Warranty

PM200 PM500 PM600 PM650PM300 PM400 PM700PM670

QGQG: LoA Meeting

QGQG

Managers getStable project environment

Similar look & feel

Clear decision framework

Project managers getClear decisions

Guidelines

Tools


Q-Gate concept enhances prevention

We achieve comprehensive transparency of the project status.Thereby, we focus on financial, technical and project managementaspects.

Readiness Check

Readiness Check

Structured & methodical

Proven by experts

Makes critical voices heard

Q-Gate

Q-Gate Meeting

Q-Gate Meeting

Clear transparent decisions

Clear escalation procedure

Management involvement

MeasureControlling

MeasureControlling

Sustainable implementation

Integrated in project plan

Clear responsibilities

Quality Manager








Agenda

People


Mea

sure

s

Baseline:

PM career model

PM training and qualification (according to function by in-house Academy)

Certification and adequate assignment

Our way of project manager development

The project manager has to act as entrepreneurwith full profit and loss responsibility!

Obj

ectiv

e

Allow for knowledge and experience

Ensure

empowerment and responsibility

Give

Reward and recognition

Income, project

incentives, key

functions, other forms

of recognitionTarget agreements

Letter of empowerment


The PM@Siemens training and certification scheme

On the Siemens-internal job market, such certificates becomeindispensable

for a Project Manager Career!


E

F

D

C

B

A

Project Engineer

Project Manager

Senior PM

PDir

PM

Small Projects

Training

Certification

yearly staff dialog

17.000 Project Managers

5.600 certified

assignedProject category

The project manager career path


Participants in PM Curriculum (cumulated)

2687

5499

830810599

12902

1565518152

20704

2002 2003 2004 2005 2006 2007 2008 2009

Participants in PM Learning Progr. (cum.)

52 239604

1169

1868

2718

3521

4322

2002 2003 2004 2005 2006 2007 2008 2009

Global PM@Siemens Training Programs

The importance of training: PM Academy

Global standardized development

We trained approx. 21.000 employees in Siemens PM standards.

More than 4.300 Project Managers took learning programs to prepare for certification.

The training and development offers are now available worldwide.








Agenda

Transparency


-100%

-80%

-60%

-40%

-20%

0%

20%

40%

60%

80%

100%

-100% -80% -60% -40% -20% 0% 20% 40% 60% 80% 100%

Gross Margin (OEC)

Gro

ss M

argi

n (F

C)OI before FY 2009

OI in FY 2009OI in FY 2010 before FY 2009 FY 2009 FY 2010

Plan

We measure our success in facts and figures

Gross Margin Development

We look at each project and compare the earnings calculated at the time of the order entry with the monthly updated forecast.

A simple graph shows the improvements and the slippages.

Raw data allow for manifold analyses.


not only for one project, but for our project portfolio

No. of projects xxx

Total project volume FC yyy

No. of projects FC < OI calc. xxx

Corresp. to EBIT / GM yyy

No. of projects OI calc. < 0 xxx

Corresp. to EBIT / GM yyy


We measure the implementation of our program

Status of reporting: Q1/FY 2006Level of Implementation -

Siemens total IL 1Implementation level 1

decision in favor of implementation

There is a concrete goal.

IL

2

Implementation level 2

the PM@Siemens requirement has been analyzed and quantified

The actions for implementing the PM@Siemens requirements are clear and have been described, the potential has been quantified; responsibles have been appointed.

IL

3


action has been elaborated and is being implemented

There is a concrete action plan with deadlines, responsible parties and milestones up to DI 4 to which all those involved have given their commitment.

IL

4


action has been taken

The action plan has been completed in full, all those affected have been informed or instructed accordingly.


We also create operational transparencyProactive opportunity & risk management, claim and

change order management in projects

Monthly / quarterly forecasts in projects (costs, efforts, timelines, measures)

Timely involvement of management (Status Meetings)

Regular analysis of Non Conformance Costs (NCCs)

With all that managers getProfitable ProjectsNo Project CrisisStable Project EnvironmentOpportunity to measure

Project Managers getSuccessful ProjectsMethods and ToolsHelp from ManagementRoom for Development








Agenda


The clear direction: From compliance to culture change

Implementation

Delivery of Change

Movement of Organisation

Measure of Compliance

Intense program, long duration. Requires continuous drive. High potential to regress !

Realization

Assessment of Relevance

Definition of Priority

Development of Program

Relatively short duration

1

2

3

4

0

Level of Implementation

time

COMPLIANCEImplementation of change to process and structure in line with 53 recommendations.

Maturity

Ownership of Change

Continuous Improvement

Measure of Performance

CULTURE CHANGEEmbedded processes, aligned with business need, driving improved performance.

CULTURECHANGE

Continual Evolution !


We now implement continuous improvement

Measures

Standard

Time

Process Maturity

Initial

Repeatable

Defined

Managed

Optimizing5

Impr

ovem

entSiemens

Target: 3,0

Achievable:4,0

6

2

34

5Monitoring

Targets

ProblemAreas

LeversMeasures

Imple-menta-

tion

1

ContinuousImprovement

Process

Implementation

Delivery of Change

Movement of Organisation

Measure of Compliance

Intense program, long duration. Requires continuous drive. High potential to regress !

Realisation

Assessment of Relevance

Definition of Priority

Development of Program

Relatively short duration

1

2

3

4

0

Leve

l of I

mpl

emen

tatio

n

time

COMPLIANCEImplementation of change to process and structure in line with 53 recommendations.

Maturity

Ownership of Change

Continuous Improvement

Measure of Performance

CULTURE CHANGEEmbedded processes, aligned with business need, driving improved performance.

CULTURECHANGE

Continual Evolution !

LoI 4 ?

Achieving LoI 4 is only the Start

Commitment must Continue !

Capability Maturity Assessmentvia

MPM1).

Assessments

Help the organisation identify strengths and weaknesses

Define improvement measures which when adopted, lead to higher levels of process Maturity

Help to improve Customer and Employee Satisfaction and Loyalty

1)

MPM Assessment = Maturity in Project Management

4

3

2

1

VorfhrenderPrsentationsnotizenWe need a continuous improvement process Implementing PM@Siemens is not a once-done-and-forget-about-it process.It is an ongoing process. And the results need effort to be maintained as business, people and organizations change.This can only be achieved by a profound culture change.For example: the recent PM@UK conference in Birmingham with over 180 participants had the cultural change and how to embed this behavior in everybody's daily life as main topic!The key steps to improve your maturity in project business are plotted in our initiative and constantly communicated by all representatives:Start to implement the recommendations and monitor your progress with the scorecardImprove individual projects management by using PMA+ with the team and a coachUse MPM assessments to get a neutral expert view on your achievements and room for improvementThan we move to a better project performance!


Conclusion: Four Steps to Success

Identify all internal stakeholders for project management

development

Line managers

Project managers

Project employees

Others (e.g. HR)

Identify all internal stakeholders for project management

development Line managers Project managers Project employees Others (e.g. HR)

Analyze the different expectations and try to align them

Management must be in the drivers

seat.

Project managers must help in the

organizational development.

Analyze the different expectations and try to align them

Management must be in the drivers seat.

Project managers must help in the organizational development.

Set ambitious targets on various aspects of project management,

e.g.:

Processes and roles

Standards, methods and tools

People development

Transparency and measurement

Set ambitious targets on various aspects of project management,

e.g.: Processes and roles Standards, methods and tools People development Transparency and measurement

Take your time and dont rush. Maturity may take a while!

Set implementation targets and

measure them

After some years, start to measure your processes and operational results.

Take your time and dont rush. Maturity may take a while!

Set implementation targets and measure them

After some years, start to measure your processes and operational results.

The drivers for these goals:

PMOs

around

the

globe!

Only an empowered PMO can reach both

the development of the organization and

the development of our project managers!


Wolfgang RaschkaPrincipal ConsultantSiemens AG, MunichCorporate Technology, CT O PMmailto: [email protected]

PM@Siemens Project Management

the

Siemens Way

Thank

you

for

your

Attention!

PM@SiemensProject Management the Siemens WayAgendaSiemens A global viewFoliennummer 4PM@Siemens defines PM standards ina guide with 12 modules and 55 requirementsThe PM Guide is binding!PM@Siemens acts globally in the roll out of the programWith our 12 modules we focus on three main aspectsAgendaTo establish systematic projectmanagement means to change the organization What do the stakeholders expectfrom good project management?AgendaMost important improvements atSiemens include Project categorization helps to focus and distinguishA stable process is the backbone of successful project managementQ-Gate concept enhances preventionAgendaOur way of project manager developmentThe PM@Siemens training andcertification schemeTrainingCertificationyearly staff dialogFoliennummer 21AgendaFoliennummer 23Foliennummer 24We measure the implementation of our programWe also create operational transparencyAgendaThe clear direction:From compliance to culture changeWe now implement continuous improvementConclusion: Four Steps to SuccessPM@SiemensProject Management the Siemens Way

Documents

02 External PMI Northern Italy 101119