Q&A: Adalbjorn Thorolfsson on IT project management in Iceland

Tell us about some of the types of IT projects in Iceland

Some of the largest sectors in Iceland are tourism, fishing and fish processing, renewable energy, aluminium smelting, information technology, healthcare and biotechnology, financial services, and the creative industries. Although IT isn’t at the core of some of these sectors, it is nevertheless a key supporting component for most of them.

Information technology is at the heart of most financial services today, and many IT projects are needed to drive changes in banks, for example. Over the past few years, several large projects have been undertaken to replace legacy systems at the Central Bank of Iceland, at individual banks, and at central service providers for the banking sector.

Some of the largest sectors in Iceland are tourism, fishing and fish processing, renewable energy, aluminium smelting, information technology, healthcare and biotechnology, financial services, and the creative industries. Although IT isn’t at the core of some of these sectors, it is nevertheless a key supporting component for most of them

Recently, I was involved in a large public transport project to implement digital fare validation in Reykjavík’s public transport system. Prior to this change, passenger fares were manually verified. We probably skipped four or five maturity levels by implementing a modern account-based ticketing system, and this was quite a big and challenging project.

If we focus more on innovation, then I can mention two exciting Icelandic companies relying on IT. The first one is Sidekick Health, which is a digital therapeutics company that focuses on improving health outcomes through gamified and personalised healthcare solutions. It combines technology, behavioural science and user engagement strategies to transform the way people manage their health and interact with the healthcare system.

The other is Controlant, a leader in supply chain visibility and management, particularly for temperature-sensitive products in the pharmaceutical and life sciences industries. The company uses IoT [internet of things] and cloud-based solutions to ensure the integrity and safety of products, and it played a vital role in delivering Covid-19 vaccines worldwide.

Tell us about the three different approaches to project management – Waterfall, Agile and Hybrid

Waterfall project management is the classical approach that has formally been in use since the 1950s and probably in some form since the pyramids. In simple terms, this approach can be described as a sequential completion of project phases. In IT projects, the phases are typically requirements, design, implementation, testing and deployment. This approach has clear roles and responsibilities, documentation and scope management.

The Agile approach dates to 2001 and challenges the older and somewhat rigid approach, especially for software development. It’s based on the key concepts of iterative development, incremental delivery, collaboration, communication and flexibility. The most popular form of Agile is Scrum, where cross-functional teams operate in iterative development cycles called sprints that are typically two to four weeks long. After each cycle, the customer is presented with deliverables for review.

Agile also has its limitations, some of which are cultural and others related to less control over the scope and traditional methods of measuring progress. This is why many companies are using hybrid approaches for IT projects, with the goal of providing the structured planning and milestones of Waterfall while incorporating the flexibility and iterative nature of Agile. This typically means the project manager is using Waterfall methods for herself and the management, while the IT teams are using the habitual Agile methods.

How are those different approaches applied in Iceland and what are some of the pros and cons? 

Pure Waterfall methods are often used in engineering and construction projects. These projects often have stage gates that need formal budget approval, and these gates fit well with the change of phases in Waterfall. 

The advantage of this approach is that you start with clear expectations, hierarchy and roles. Everything is documented from the beginning, and it’s clear who is responsible for each of the deliverables. The Waterfall approach gives you good control over the scope and allows you to manage the scope more easily at all phases.

The disadvantages are that it requires a lot of documentation, and the processes for making changes are cumbersome. The client is mostly absent during the execution phase, and the deliverables are only visible at the end.

The Agile approach is mainly used in IT-driven companies and IT departments, although some other departments might use Agile methods like Kanban. Some companies have ceased to have project managers entirely, and rely instead on roles like “product owner” and a tight cooperation between the business and IT. In my opinion, these things are cyclical, and I have seen companies fire all IT project managers and then a few years later start to hire for that role again.

The advantages of the Agile approach are that it is flexible for change, and you get deliverables more quickly and more regularly. This method also gives a high level of transparency for all parties and emphasises the importance of communication and cooperation. Rather than holding one person, or a small number of people, responsible for deliverables, the whole team is responsible for the deliverables.

However, this approach has disadvantages. It is not suitable for all projects, and it’s also difficult to predict the final time and cost for a specific set of deliverables. More people need to be trained to use this approach correctly, and it often requires a change in mindset from both management and employees.

Many companies are using a hybrid approach without necessarily realising it fully. Their IT projects are delivered by teams following Agile methods but are often governed by a project manager and a steering group using Waterfall methods. This is how I work in most of my projects that I manage on behalf of the buyer, interfacing either directly with Agile IT teams or supplier project managers who in turn work with Agile teams. 

There are three main advantages to this hybrid approach. The first is the balanced flexibility and structure. It provides the flexibility to adapt to changes, while maintaining a clear structure and plan. The second advantage is enhanced risk management. It combines early risk identification with continuous monitoring and mitigation. The third advantage is the higher-quality deliverables. Iterative testing and feedback help identify issues early, improving the quality of the final product.

There are also three main disadvantages with the hybrid approach. The first is the complex coordination. Balancing the two methodologies can be complex and requires careful coordination and management. The second is cultural resistance. Teams accustomed to one methodology may resist adopting practices from the other. Finally, allocating resources effectively across structured phases and iterative cycles can be challenging.

What does Iceland bring in from the rest of the world in terms of technology and/or project management methodologies?

Being a small country, we rely heavily on the rest of the world when it comes to both technology and project management methodologies.

With respect to the latter, we use the methodologies we have already discussed that were developed and honed by the global community. We also use training and global certifications, such as IPMA certifications for project managers. With respect to technology in project management, most of the solutions are those used by the global market, whether it’s tools for project management, portfolio management, reporting or AI [artificial intelligence].

What can the rest of the world learn from Iceland about project management?

Iceland has several unique characteristics that can inspire others regarding project management.

Iceland’s economy has faced significant volatility. The lesson here is to develop flexible project plans that can adapt to changing conditions, foster a culture that embraces change, prepare for potential disruptions, and develop contingency plans to ensure project continuity

Iceland’s economy has faced significant volatility, such as the 2008 financial crisis, the Covid-19 pandemic, and frequent volcanic activity. The lesson here is to develop flexible project plans that can adapt to changing conditions, foster a culture that embraces change, prepare for potential disruptions, and develop contingency plans to ensure project continuity.

Iceland’s small population fosters informal communication and low barriers to hierarchy, which helps to drive project success. It’s a good idea to promote open communication and collaboration in project teams and between team members and management.

Icelanders are extremely quick to adopt and implement new technologies. In general, companies should strive to stay up to date on the latest tools and methodologies to enhance project efficiency and effectiveness.

Finally, Iceland is the world leader in gender equality, which is beneficial for the economy in many ways. When putting together a project team, managers should consider gender equality and diverse backgrounds to bring in different perspectives and better representation of users, which ultimately leads to better decision-making and results.