The Significance of “E”
The State of PM Tools for the Enterprise

Author: Harvey A. Levine
The Project Knowledge Group
Saratoga Springs, NY & San Diego, CA

The letter “E”, has long had a place of significance, at least during my lifetime. Perhaps my first remembrance of “E” was on an eye chart. Actually, my eyes were so bad that I could hardly get below the “E”, so the lone “E” at the top made a lasting impact.

Today, we are continually bombarded with E’s, both large and small. The little “e” generally stands for “electronic”, such as in "e-mail". We have gone from the “me” generation to the “e” generation. It is everywhere and effects almost everyone (except my 92-year-old mother-in-law, who bemoans the inability to participate in the family’s e-mail round-robin, but continues to resist capitulating to the non-paper mainstream).

ERP and all that Jazz
For us in the project management community, the large “E” generally refers to “Enterprise”. For over at least a decade, we have had it drummed into our heads that “projects” do not exist in isolation, nor do businesses normally rely on a single project for their success.

Emerging from this “revelation”, of course, were tools to assist the enterprise in addressing the issues associated with running projects within the larger scheme of things. Hence was born: Enterprise Resource Planning (ERP) software. A new industry emerged, both as extensions of existing developers (Oracle), and vendors who focused on ERP, such as SAP, Baan, Peoplesoft and J.D. Edwards. (Note: As this is being written, the ERP field may be whittled down to as little as two or three survivors.)

ERP tools focus on specific sub-sets of the project-based enterprise. Among the most popular are accounting & finance, and human resource management. Others include supply chain, and opportunity management.

Extending the Focus to PSA
As different industries joined the search for software that stretched beyond the usual span of project management, a few new enterprise-wide approaches came on to the scene. In the Information Technology (IT) area, the project focus was changing from an emphasis on the schedules, to an emphasis on the effect on resources. While the engagement timing concerns were still an issue, even more attention was addressed to whether there were enough resources available to support the engagements, whether the right resources were available, and if not, were they obtainable. There were two sub-sets of the IT application. The first was for groups that handled their IT needs with internal labor. The other was for groups that provided such services as a business. The latter are called Professional Services Organizations (PSO). These PSOs are also concerned with the return on their resource investment.

To meet this emerging set of needs, a new software industry was born: Professional Services Automation (PSA). For PSOs, PSA solutions work to automate as much of the sales cycle as possible. This includes managing leads, managing contacts, drafting proposals and bids, managing projects, and performing win/loss analysis. PSA software allows for the storing of detailed customer information including contact information, competitor bids and proposals, as well as any documents that relate to a given opportunity. The software allows the PSO to know the needs and habits of prospective clients so that it can generate successful bids.

The focus by IT Departments is slightly different. Managers can search across programs and projects and access very detailed information on employees to find the closest desired match in a weighted manner, which is dynamic in certain instances. This includes the ability for parametric (case-based reasoning) searches.

Typical PSA software is a collection of any of the following capabilities: Sales Force Automation (SFA), Opportunity Management, Resource Management, Human Resources, Program/Project Management, Time and Expense Management (T&E), Document Management, Knowledge or Practice Management, Invoicing & Billing (Financials), and Customer Relationship Management.

Unless the PSA offering is a development from a traditional PS software vendor, the PM component of most PSA systems is either an external product (such as Microsoft Project) or another third-party or acquired product. The potential for interoperability deficiencies can diminish the usefulness of the total offering.

The PSA industry, now about five years old, is struggling to reach profitability and many of the new firms have failed or been absorbed by others.

Extending the Focus to PLM
As I look at some of the developing trends, I see people getting on the bandwagon for "fads" that have little substance. Yet, as these fad-of-the-year categories hit the street, it seems that everyone wants to claim a stake to the territory. The latest one is PLM. At a conference that I attended in Scottsdale recently, at least half of the discussions and vendor focus was on Project Lifecycle Management.

This conference was attended primarily by people who are at the leading edge of designing and using computers in support of Mechanical Design and A/E/C applications. The core applications for this group are CAD, CAE, and document handling. There is also limited interest in traditional PM.

The PLM approach is, for this community, a different look at PM, such as PSA has become for the IT community. A Merrill-Lynch investment manager described PLM as an emerging market and one that is attractive for investment. I’m not betting my wad on this.

What is PLM? If you ask ten people, you are likely to get at least twelve descriptions. One answer, when you ask what it is, is "you’ll know it when you see it". It appears to have a varied scope, depending on the application and the vendor. They are still working on the message and the definition. But that is not stopping everyone from talking about PLM.

In general, PLM is the recognition that there are several linked phases to a project, starting from conception and continuing through closeout. There is a major benefit from being able to capture all pertinent data and knowledge (in some digital format) that can be carried through to the next phase (rather than starting all over).

Obviously, this is not a monumental discovery. But what these people are saying is that tools in support of projects should address all of these phases. As a result, we are running into a second popular theme. This is Interoperability.

There seems to be some question as to who is really responsible for interoperability. We don’t see too much effort on the part of tool designers. So this provides an opportunity for third-party "systems integrators". Among those firms attempting to claim a stake in PLM are IBM, EDS, and PLC. (Is there a law that says that all acronyms must contain three letters?)

Certainly, the ability to select and match components of a PLM system, and then bridge the interoperability hurdles, will take time. And, based on past history, will take a few iterations.

More Alphabet Soup: Project Portfolio Management

Along with ERP, PSA and PLM, we will run across PPM (Project Portfolio Management). This is another catch-all term for doing what we ought to be doing. But, again, the scope and shape of PPM defies definition. It is certainly more than a software solution. It is even more than a process. PPM is a culture. It includes the tools. It includes the processes. It requires the establishment of some type of central project office. It mandates an advanced system of data management, analysis, and communication, all aimed at efficient and effective collaboration and decision-making.

Therefore, do not expect to “buy” PPM as an off-the-shelf product, from a single source.

PPM calls for the alignment of projects with enterprise goals and strategies. PPM calls for the alignment of resources with projects, and vice versa. PPM calls for the optimization of ROI, opportunities, client satisfaction, and rewards for the firm.

PPM is certainly another “E” term. It can encompass all of the above, and then some. You don’t want to be in the projects business without addressing and satisfying this capability.

Traditional PM Tools

With the emergence of ERP, PSA, PLM and PPM, where does this leave traditional PM tools? As mentioned earlier, some of these tools have been embedded (or loosely connected) to the emerging systems. In other cases, the rock-solid PM tools have expanded their capabilities to address the wider needs. This is especially noticeable in the area of Resource Allocation.

Before we get into this, let’s note that the ERP-PSA-PLM solutions, for the most part, treat critical path scheduling as a minor part of the system. When they talk about the “project management” segment of the system, it usually is not as robust as what we will find in traditional PM programs.

So, if you’re really serious about project planning and control, you will usually be better off with a proven traditional PM tool. But, we can’t forget about the need to address resources and costs on an enterprise-level basis. This means beefing up these capabilities in our traditional tools. Let’s look at Resource Allocation, for example.

Expanding the Resource Allocation Capabilities in PM Tools

In the enterprise, our resource pool may be quite large. It may consist of permanent, temporary and outsourced personnel, having multiple skills, in multiple locations. The resources may be allocated to single projects, or split among multiple projects. They may be allocated for specified time segments, or possibly reserved for pending projects.

Today’s PM programs must allow for these conditions. They must allow a task owner to define required skills and schedules for tasks and the system must allow initial assignment by classification (and skill) as an option to eventually selecting a specific resource. The system must aid in this selection, working from an enterprise-wide database. Conditional allocations must be able to be made to reserve resources for opportunities that are not yet approved projects. Classic resource leveling routines are not adequate to do the job.

We are beginning to see these capabilities become available and they will be most welcome. Look, also, for improvements in tracking actuals and time accounting, to support the wider range of conditions in an enterprise-wide environment.

Traditional PM software vendors continue to be profitable and most have survived the technology economic downturn. This is the most solid segment of the industry.

The Significance of “E”
The “E” word (enterprise) is certainly popular and relevant to project management. We must look for computer support that aids in achieving project success in this environment. Many solutions are offered – each with advantages and disadvantages. Many will fall short of delivering their promise, and none will do everything that you want, even if you apply them diligently.

Yet, I wouldn’t want to venture into the projects fray without a good set of tools, placed in a well-structured project environment. Hopefully, this overview will help you to find the best solution for your needs.

Harvey A. Levine, with 43 years of service to the project management industry, is founder of The Project Knowledge Group, a consulting firm specializing in PM training, PM software selection, evaluation & implementation, and PM using microcomputers. He has implemented or enhanced the project management capabilities of numerous firms, often combined with the selection or implementation of computerized project management tools. For more information on Harvey Levine or the Project Knowledge Group, please visit

Mr. Levine is the leading consultant to the project management software industry and is recognized as the leading expert in tools for project management. He has been Adjunct Professor of Project Management at Rensselaer Polytechnic Institute and Boston University. He has conducted project management public seminars for ASCE, AMA, IBM, PMI.

Mr. Levine is the author of books, articles and videos on Project Management. His 2002 book, "Practical Project Management: Tips, Tactics, and Tools", is still available from John Wiley & Sons. Mr. Levine's new book, "Project Portfolio Management, A Practical Guide to Selecting Projects, Managing Portfolios, and Maximizing Benefits", Jossey-Bass, was released in July, 2005. Mr. Levine is past president of the Project Management Institute, a recipient of PMI's 1989 Distinguished Contribution to Project Management award, and has been elected a Fellow of PMI.

Mr. Levine has offices in Saratoga Springs, NY and San Diego, CA. His e-mail address is: