Project Management is based on the premise that you only execute based on what is planned in order to maximize profits. Given its preoccupation with the need to plan based on a presumed unchanging requirement of a customer, project management adopts a predictive approach to management where it is assumed that it is possible to predict, with some degree of certainty, what will transpire as the project unfolds. The focus is to maximize profits but minimizing cost.
This is possible only if the needs of the client are predictable and external environment remains stable. In reality, this is not the case. Almost every aspect of the business ecosystem within which projects are undertaken, including customer requirements, technology, product life cycles and competitor actions change at an increasingly alarming rate. As such, the basic assumption that underlies traditional project management, i.e., you know what the customer requires and you can plan for what lies ahead in order to maximize profits, does not hold. Hence, the idea of maximizing profits based on a prediction of what will happen is based on a false assumption that customers’ needs and the business environment does not change.
This invariably results in having to undo what is done at the terminal stage of a project, leading to losses and delays. Ultimately, costs rise and as a consequence, the ability to maximize profits is impaired. Initially, this was a perennial problem for IT based projects only. Now it has become a problem for almost all projects being undertaken.
What is needed is agility. The ability to change and respond to change in order to profit in a turbulent environment. To be agile means having the willingness and capability to change plans, objectives, beliefs and to a large extent the mindset of the project team. In an ever changing business ecosystem in which the customer requirements are unpredictable, the need to change and respond to change is what keeps businesses alive.
Scrum adopts a methodology that subscribes to this concept of agility. It is fundamentally different from project management in two primary dimensions, approach and focus. In conventional project management, the approach is predictive whereas in scrum the approach is adaptive. In conventional project management, the focus is on maximizing the company’s profit, in scrum the focus in on maximizing the customer’s value.
In conventional project management, the processes and tools used to manage projects is defined and adopted based the assumed customer requirements. The contract is the reference point for customer requirements. However,we are living in a world with increasingly shorter product life-cycles, increasingly disruptive technologies and increasingly uncertain end user requirements. With all this in mind, customer requirements do change. It is not possible for customers to define what they really require in a predetermined contract. What they need is some assurance that the project team will collaborate with them to navigate the uncertainties they themselves face. They need the project team delivering the service or products to be agile.
By being agile, adapting to changing business requirements and focusing on what adds value to the customer, a collaborative relationship evolves between the project team and the customer. There is a heightened sense of awareness of limitations faced on both parties and a deep felt desire to work together to realize the full benefits the customer derives from a project as well as be able to maximize profits comes to fruition.
The scrum methodology is based on certain key principles that drive the adaptive approach and enables the project team to focus on providing value to the customer. There is a standard process that has been recommended that serve as guidelines when adopting scrum methodology. What results is a somewhat different approach to project management, which alters the overall aspects relating to quality, change, risk and value proposition that is normally associated with in project management.
Today, the only constant is change. Changing the way projects are managed is a natural evolution that is required in order to counteract the ever altering world. It is now a need that we can no longer ignore.