2.52 Projects are managed by a project manager drawn from the business unit sponsoring the development or by a specialist project manager from the Business and Management Services Division's Project Management Unit. The project manager is responsible for co-ordinating all activities of a project's development, monitoring progress against plan and ensuring that appropriate action is taken in the event of variations. This involves developing and maintaining project documentation, identifying and mitigating risk, and maintaining an effective reporting mechanism. As the interdependency of projects has grown, the role of the project manager has become more complex and the services of specialist project managers have been increasingly called upon.
2.53 On large projects, the Department may appoint a requirements manager to provide a link between the business unit sponsoring the project and the EDS team carrying out the development. Key roles of the requirements manager are to ensure that the scope to the project remains focused and does not expand unjustifiably, and to ensure that the solution proposed by EDS meets the requirements.
2.54 The Department has not always been able to appoint managers at the start of a project because of shortages of project management specialists and suitably qualified requirements managers. In some cases, such as the experimental Call Centre project, the requirements manager was not appointed at the start of software development, and in others project managers have been changed during the course of a project. Both Inland Revenue and EDS project sponsors and managers consider that this weakens communication and project direction and it has sometimes increased the work content of projects, even where it has not extended timescales.
2.55 During 1998, the Project Management Services Unit began to respond by expanding and restructuring to help provide the most appropriate expertise to each project. For example, it started to define the different levels of project management expertise available. The potential difficulties of managing each new project are now assessed and project managers with appropriate experience and seniority are allocated. Larger or more complex projects may have teams of project managers with different levels of seniority and experience.
2.56 The Department also began to respond to the shortage of project managers and recruited more than 30 staff between April 1998 and March 1999. Despite this expansion, at the time of our examination the unit was still ten staff below complement and was employing five full-time contractors. The projected growth in workload indicated that an additional 20 project management staff would be required and it was likely that further use of contractors would be required to cope with the short-term lack of project management resource. The Department told us that it had appointed five staff since our examination and that it intended to recruit an additional 15 in 2000-01.
2.57 One of the key tasks of Inland Revenue project managers is to monitor the use of EDS (and Departmental) resources on projects. If EDS staff resources are to be used effectively, managers need to alert the Department's Contract Management Team to any changes in resource requirements so that, subject to the normal approval procedures, new resources can be ordered as far as possible in advance to take advantage of lower EDS charge-out rates (Appendix 2) and to ensure that potentially under-utilised resources, which the Department are committed to paying for, are redeployed.
2.58 We found that project managers may not have sufficient understanding of the contract pricing mechanism and how changes in EDS productivity and the volume and timing of resource requirements may impact on project costs. For example, in the experimental Call Centre project, a delay meant that some EDS staff were not required at the time planned but during the following quarter instead. The project manager did not inform the Contract Management Team, which meant that the EDS staff ordered for the project and paid for by the Department were not used. EDS staff had to be paid for again at higher short-term rates when they were required in the following quarter. The Department told us that, although it had no contractual commitment to do so, EDS had worked with it to minimise the overall financial impact of such cases.
2.59 The Department has recognised the need for training and guidance in its risk management plan. It told us that it had run a contract education session each year and that it planned to produce a guide to resource ordering based on a document which EDS had produced for its staff.