Criterion 1: Project Environments

Over the years, I've encountered three different types of project environments within the technology and scientific areas. They are the operational environment, the product/process development environment, and the technology development environment. The operational environment is fairly predictable (i.e., low uncertainty), while both the technology and product/process development environments are more unpredictable (i.e., higher uncertainty). There is, of course, some overlap between these broad categories, but understanding generally where your situation fits will help you determine the extent to which agile PM concepts will benefit your project.

The Operational Project Environment

Let's start with the operational project environment (see Figure 2-1). By operational, I mean those projects that are run with a regular frequency, are very similar to each other, and are critical to the day-to-day running of the business. Service provisioning is a good example of the operational project environment. Setting up a customer for a new service, either as a one-time user or on an ongoing basis, can be a significant project to do properly. However, the general workflow is basically the same for each customer. Contract manufacturing is another example of this type of project environment. While each product may be unique, the process for building out and running the manufacturing systems is common across all products.

Figure 2-1: The operational project environment is more conducive to classic PM.

These types of projects are fairly regular, and the organization knows how to do them because it has done many others in the past. Because the level of uncertainty is low, these projects are often better served by classic methods, which are more process-oriented.

The Technology Development Project Environment

Next, let's look at the projects at the opposite end of the spectrum—those focused on the development of a new technology (see Figure 2-2). I am not talking about a new product or application, but rather the development of breakthrough technology, upon which future products will be built. As such, these developments are often referred to as technology platforms. They often become the basis for entirely new companies or industries. Technology development projects are very unique in nature. There is no template project teams can work from and, in fact, a project management template, or any template for that matter, may greatly restrict the team creativity required to create such a new technology platform.

Figure 2-2: The technology development project environment is more conducive to agile PM.

Agile PM is most applicable in the technology/platform development project environment.

These early-stage, groundbreaking projects have never been done before under the same circumstances. The level of internal uncertainty is high. The team requires creativity, determination, and commitment. The project management environment, in turn, needs to support the team's needs and not conflict with them. The general approach to these projects is vastly different from the way the team would approach something that it has done before. The team will likely need to pursue multiple pathways and iterations as it progresses toward its end goal (unlike the more classic approach of focusing on a single, primary, critical path). Agile project management can provide great value in these situations.

The Product/Process Development Project Environment

Finally, let's examine a project situation somewhere in the middle—the product/process development project (see Figure 2-3). While the product/process may be unique, the technology platform is usually already in place, and a well-defined product development process (PDP) is most likely utilized. In the large corporation, product development projects can be complex, cross-functional efforts with many stakeholders, or in a small business, they may be the center of the entire company. While the pure technology development project involves mostly a scientific and engineering team, product/process development involves less front-end science/engineering expertise and more business acumen. Therefore, marketing and manufacturing are usually involved because of their know-how in bringing products to market. These kinds of projects still require a great deal of engineering creativity, yet they must balance those needs with the discipline required to launch and maintain successful products or services.

Figure 2-3: The product development project environment requires a mix of classic PM and agile PM.

These types of projects can also have a relatively high level of uncertainty, especially for those companies in the high-tech and scientific industries. In addition to the scientific uncertainties associated with the technology development project, product/process development must deal with business and market uncertainties, which are classified here as external uncertainties. Since there are many varied perspectives on the cross-functional team, agile PM can create value both by helping to navigate around uncertainty and by providing a mechanism for pulling together diverse teams. Additionally, while product development projects really need a combination of both classic and agile techniques, there is considerable opportunity for applying agile methods, since these comprise such a large percentage of projects in the innovative space.