I’m still digesting that Accenture research on what companies that emerged strongly from the 1990-91 downturn did differently during the bad times. As I said in my previous post, this is one of those business news articles that is all about portfolio management, without ever mentioning it.

I suspect that is because a lot of companies - and many management researchers - don’t know there is a name, a history, a set of standards and best practices - for what they are trying to do.

A key finding, for me, was that the most successful companies had a keen insight into their business. Now, this might sound elementary, but 15 years in business journalism have taught me that business is not as rational as you might think. Companies frequently have no idea what is going on within and across departments; duplication of effort is therefore the norm rather than a fluke; and lacking any systematic measurement system, they also have trouble knowing what is working and what isn’t.

That’s why implementing project portfolio management (PPM) usually results in some AHA! experiences. “You mean … we were doing THAT? … three times?” and the resulting cost savings.

So, PPM is one of those project management tricks that both saves money … and allows companies to invest in some “blue horizon” projects that will carry them forward. A tuck here, and let out a seam there, and you can take the “stitch in time” that lays the ground for growth.

But, there’s another aspect of PPM that’s also in line with the research linked to in my earlier post. With apologies for the resolution on this graphic, check out the Portfolio Scorecard model we proposed in our book, Seven Steps to Strategy Execution:

Balancing with realism means taking resources into consideration

Now, usually, you’d see the profitable projects (”bread and butter” projects is one nickname for these) and the necessary ones in two blocks of that square. But, in fact, they fall into the same category. You are going to do these things … no matter what. Either they are required, or they make money (rarely both) and so they are IN.

What’s missing from the balance equation in many models is the upper left quadrant: Do we have the capacity to do this? The people, the skills, the cash … the software, the space, the ideas: the resources that, without which any list of projects is just a wish list.

Everyone is writing about how business can thrive in spite of the downturn … including me. We’re working on a new white paper on the ways that project management discipline can help companies contain costs and become more efficient. (You’ll be able to read it here on or before August 13). But something about the whole idea made me antsy, because merely cutting and thinning and pruning isn’t enough. You’ve got to add the sunshine and fertilizer, too.

And, in fact, research into the ways strong companies have survived previous economic upsets, shows that, indeed “You can’t shrink your way to greatness.”

I was reminded that great Tom Peters quote from Circle of Innovation many times this spring as I watched the unemployment figures rise.

So I went looking for other evidence that greater success - or at the very least, a more sustainable form of success - is created when companies both prune judiciously and invest creatively in their own future.

And I found it.

It’s pretty extensive research, so explore the link yourself, but just to give a precis, companies that flourished coming out of a recession in the early 90s:

• They cut the RIGHT costs .. and did not engage in self-defeating cost-cutting.
• They leveraged their IT systems to gain insight into the business
• They collaborated with stakeholders … instead of pursuing projects/products dreamed up in a vacuum
• They killed or refused the RIGHT projects and opportunities … also based on insight into their own finances, markets, capacity, and so on.
• Rather than merely shrinking - via cost and headcount cuts - they invested in innovative products and processes.

This is one of those articles that never mentions project, program, or portfolio management. You wouldn’t find it if you searched under those terms. Yet, take another look at that list … are we not talking project and portfolio management here?

More rants on why PM/PPM can not just save, but grow, your business … coming soon.

… but I seem to be facing the New Year - and the news cycle - with a sense of unreasonable optimism. Partly this is because I’ve been paging through all my favorite business and projects news sources deciding what to put in our blogroll (check it out in the right-hand column!) There are some really smart people writing about what’s just ahead for projects in the current economic situation, and they can’t all be wrong. The guardedly expressed good news falls under three general headings:

1. “Project Management Eats Economic Downturn for Breakfast.”

2.  “Innovation Eats Recession for Breakfast.”

3. “Green/Alternative Economy Fixes Breakfast for the Planet. Chai, Anyone?”

There’s also, of course, a healthy serving of gloom and doom. Most of it, though, reminds me of something my father once said. Born in 1911, he was one of the last of the hot-type typographers - a craft with tools and methods pretty much unchanged for 400 years. When the little specialty shop where he plied his antique trade finally closed, and he had to learn computer typesetting (in his sixties), he hated it. But, as a game survivor of two World Wars and the Great Depression, he told me philosophically, “when the automobile came along, the wheelwrights and harness makers had to learn something new or go out of business. That’s life.”

Indeed. That said, life can be pretty rough on us when we refuse to recognize which of our self-defeating behaviors need changing. It’s tempting to believe that, because “business as usual” allowed us to have several decades of world-beating economic success, that the way we do business is the right way … the only way.

Project management has been somewhat of a corporate underdog for most of its history. One of the themes that I often heard among attendees at PMI conferences or our own Benchmarking Forums was, “We can’t get the C-level to listen to us!” That’s been changing in the last five years, as more and more companies implement PMOs at the enterprise level, and apply project portfolio management discipline as a tool for strategic execution. That’s why the present global economic situation - what Steve Forbes recently termed “a perfect storm” of conditions affecting nearly all sectors of the economy in nearly every nation - offers those skilled in practicing the discipline and mindset of “managing by projects” a unique opportunity. Project leaders are poised to have the ear of executives, thanks to their tireless trudge up from the trenches - but also are still somewhat “outsiders,” with views just different enough to offer the kind of systemic change companies need. It’s a shame that we had to reach near-collapse before the wisdom of project leaders could get a full hearing at the highest levels of business but - as one wise man said - “that’s life.”