Understanding the project management/cost control Lens
Project managers, systems implementers, contractors, and consultants are "BUILDERS".
They will use their knowledge and skills to build what you specify. But they won’t and don’t live with or benefit from the result. They are accountable for organizing, planning and managing the build – the delivery of the product – no more. The builder will build what you specify. If you miss-specify the building and it does not meet your requirements, that’s your fault, not the builder’s. (Of course if they don’t build what you specify, then that is their fault.)
The builder has a simple view of project delivery – “You specify what you want, when you want it, and what budget you allow; and I’ll organize the people, materials, and tasks to deliver it.” Their measure of success is building to cost and specification.
The builder is not interested in why you want the output, how you’re going to use it, or how much you’re going to sell it for; he/she is only interested in finishing the build, handing over the finished product, and being paid.
The builder’s “project management/cost control” lens, associated mindset, and value system are the basis of most of the standard project management methodologies. They are not focused on the "Why" or the "What" - only on the "How." Potential project specification or scope changes are evaluated by the builder in terms of their project time, effort, and cost impacts.
Understanding the business/governance team lens
The business, Project Sponsors, and Steering Committees/Project Boards are "OWNERS".
The owner's lens, associated mindset and value delivery system are quite different from the builder’s. Whereas the builder is focused on managing the cost; the owner is focused on managing and maximising the net value – ie the owner is focused on managing both sides of the ledger.
For example, the project governance team’s role is to be the guardian of the net value. They and their organizational areas will suffer if the project is mismanaged and does not deliver the value planned. (‘Value’ in this context includes business outcomes and benefits as well as any financial return.)
The owner is keenly interested in the "Why" and "What" in terms of the value to be generated. Net profitability (value) is their primary focus.
The owner's job is to control the builder to ensure the potential profit and value are not lost in building cost overruns or deviations from specification. If the owner can bring the project in under budget, he/she can increase the net value realized.
Potential project specification, or scope changes are evaluated by the owner in terms of their impact on the key value drivers and determinants. Minor cost increases with a major payoff can be attractive to the owner.
The owner's timeframe is the realization of the value.
Whether the owner realizes value depends on his or her ability to specify an outcome capable of delivering the benefits, on the final cost of delivery, and on their ability to realize the benefits in full.
Understanding the investment committee lens
The Board, Executive Team and Projects Investment Committee are the "INVESTORS".
They are the guardians of the longer-term strategy, profitability and success of the organization. They are not only looking at the merits of each individual project but also at the cumulative merit of the planned and existing project portfolio – will these projects cumulatively deliver the type of organization and business results we want?
The investor's 'strategy’ lens, associated mindset and value system are different again from the owner's and builder’s lenses. The investor is looking to utilize and leverage it to extract maximum lasting business success. They want to see ‘1+1=3’.
The investor is investing for sustained benefits and cumulative results, and wants a long-term return on investment. Cumulative business success is the investor's primary focus.
The investor needs to ensure that the project’s value is not only achieved but also sustained; that opportunities to extend the value are enabled and (subsequently) seized.
Potential project, specification, or scope changes are evaluated by the investor in terms of impact on the overall business and portfolio’s cumulative success – assessing not only “How will this change impact this project’s value?” but also, “How will it impact the other projects and business initiatives, existing and planned?”
The investor's timeframe is the next three, five, ten, or more years – i.e. the longer term.
Whether the investor realizes and sustains the expected business value depends on how well (and cost effectively) each project delivers its outcomes, how well the value is realized and sustained, and how well the portfolio is planned, managed, and leveraged. The investor is therefore heavily dependent on the effectiveness of the owner for the achievement of long-term success.