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An Integrated Project Management blog post within the category of Program Management used to increase competitive advantage.

The Project Charter’s Value Proposition

"If I identify the value proposition for the project, then I provide direction for downstream decisions, but I don’t have any standard way to clearly state it accurately."

The content of some of the boxes change depending on the project, but the placement of the 9 boxes of the Business Model Canvas is the same. I suppose just how you place these boxes isn’t as important as deciding and then sticking to it. A common look between projects helps identify patterns and facilitates comparisons. The critical thing is to address these characteristics about your projects, and provide a quick summary for comparisons.

The first step in the project charter based on the Business Model Canvas is getting to the value proposition. Your project may have other documents like the governance plan, communication plan, and vision scope document; all part of the larger Project Charter. In that case, this might become the summary of the business section of the assembled Project Charter. Depending on your needs this can be stand alone, or a section of a larger document.

Completion of these boxes may be the result of an extensive strategic planning effort, or a 30-minute interview. Get what you can, and then focus efforts on finding the answers you’re not feeling comfortable with.

Within the Value Proposition box, there is the optimal type of proposition to identify and the CORE proposition. Our first step is to decide what type of offering this project will be delivering. Granted, most projects have more than one deliverable. If this is you case, then think of the aggregate of all the deliverables. What is it that you will truly be delivering? Why are the clients coming to you for that deliverable? You want to simplify the answer down to one of three types of value proposition; Unique, Intimacy of familiarity, and cost.

UNIQUE: This is when your project team can deliver a product or service that cannot be acquired anywhere else. An example might be found in an IT organization that provides security credentials that can’t be gotten from anywhere else. You must go to the IT Department for the credentials. Another example could be a sales person’s rolodex full of past clients that can be called on. The company can’t get that unique set of names that can be called on from anywhere else. I’m not convinced of this value, but it is unique. However, typically, the Unique type of proposition yields the premium price. As a project manager and sponsor, you try to create a unique type of deliverable to increase the perceived value of the project.

INTIMATE: This type of proposition states that your project team has intimate experience with creating the desired deliverable. Due to your familiarity of the problem/solution space, your can deliver a product or service better than anyone, or can do it with less errors.

Maybe your intimate understanding will enable you to be more innovative. This type of proposition is a little more flexible than the UNIQUE proposition, and is slightly less competitive. Let’s face it, its hard to prove your better when there are three other teams both internal and external that have an “Intimate” knowledge of the problem/solution space.

Typically, your price point is lower than the UNIQUE type. Understand that price is the total “cost” of ownership. How much pain is the client willing to go through to acquire and own the deliverable. The lower the price you can ask, the better the deliverable must be. The INTIMATE value proposition must be better packaged, better supported, and easier to acquire than the UNIQUE deliverable. Client involvement is normally less, and mostly oversight in nature. After all, you know what they want, even better than they do.

COST: Think ‘Economy of Scale’. You can offer this deliverable faster, cheaper, and at higher quality than your competitors because you do this more often. You do this all the time, and one more just doesn’t impact the cost that much. An example would be a brochure printing. The artwork and design has already been completed. If your already set up, an additional printing just isn’t that much more cost. It’s easy. I call Frank and ask him for 100 more of the brochure. We don’t discuss the layout, the paper size, where to send it- nope its all done. It’s that easy. You just say, “Give me more!”

The ‘Economy of Scale’ deliverable is very desirable, and has the most demand. If using this type of value proposition, you expect to do it a lot, where as the UNIQUE type, you expect to do it less often, and so must charge more, in all aspects of cost.

Now once you have characterized the deliverable, hence the project, as to deliverable type, we want to take a look at the proposition itself. There are five types of valid propositions, you must select one.

MORE VALUE AT LESS COST: This is the easiest proposition to accept, and easiest to prove. You show what new value they will receive, and how this cost less than it did before. I this case, people like to know what has changed. They want to believe you wouldn’t just charge more than you had to. They are looking for a new competency, new technology, or even a reorganization. You need to point to something, and say because of this we can now do that, in order to maintain credibility.

MORE VALUE AT THE SAME COST: This is an easy proposition to accept. It feels like your giving me something for free. Of course, if I value the new free offering, then I will like it. Normally, this can be explained with process efficiencies, so it’s less important to point to the change enabler.

MORE VALUE AT MORE COST: This is a difficult proposition to accept. From the project team’s point of view, it makes the most sense. If you are going to deliver more value, then of course you will need to charge more. Well, you clients don’t see thing this way.

First you will have to prove that there is more value. More value in past offerings may not be so hard, but more value than delivered from a competitor may be difficult to demonstrate, and this proposition becomes expensive fast. Remember, you must justify more cost, and that seldom works out well.

SAME VALUE AT LESS COST: This is an easy proposition to accept. Demonstrate that the change caused by the project does create the same value. Next, demonstrate how it costs less, or is easier to get, or easier to own, or easier to use. Take away the change risk and bam, you got it.

LESS VALUE AT LESS COST: This is a difficult proposition to accept. Know one wants less value, but the real challenge is to demonstrate that the less value isn’t as much as the less cost. You must show that even though you client will lose a little, the reduction in cost is worth it. Prepare for a long adoption process with this proposition.

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A Risk Boundary Problem

“If I concern my project with risk assessment, then my project targets such as Budget, Schedule, and quality become more reliable, but this will require me to define better project boundaries between strategy, program mandates, and project requirements.”

What is risk? The answer to this question depends on who answers it and the boundaries the individual establishes around themselves. If the answer comes from someone who is responsible for all processes within the Integrated PM system boundary, a clear answer can be expected. Risk is obvious when people own their processes. The owner is anxious about resources being well spent and not wasted, and that the results are acceptable. They want to maximize the chance of success and looks for clues to act upon. In other words, the owner deliberately sees risks and responds to them. If they grow nonchalant and detached, they don’t see many risks or don’t feel like acting upon them. When nonowners see risks, and communicate them to those who run the process, the result is conflict.

Risk arises from factors beyond our control. A designer may consider requirement analysis as a source of risk because it is external to him and he is not sure whether the analysis results will be communicated completely and correctly. This is a "dependency risk." A boundary is drawn around the process, and risks that threaten the process from across the boundary are seen. Risk perception has a built-in boundary perception. Risk definition has meaning only with reference to this boundary.

Within the process owner's boundary, a problem is not immediately seen as a risk, even if it happens to be vague and uncertain. The propensity is to assign the problem to process control and process management.

Across the boundary, the propensities change. A process owner has no influence beyond her boundary. Neighboring processes are alien and appear to be sources of risk. Problems tend to get labeled as risks.

When the boss of the SBU (strategic business unit) looks at the same risk from a larger perspective, the risk looks smaller and local. The risk appears to have occurred due to lack of cooperation between two process owners. She does not want to think of this local issue as a major risk, as things can improve through better management. If provoked, she may term this an internal risk that can be solved by taking internal measures. The SEU boss realizes that the better the management, the fewer the internal risks.

There are some sensitive internal conditions, such as when a PM chooses to run a project without adequate resources and authority. The processes have weaknesses that are well known to the stakeholders. Process weaknesses are potential breeding grounds for risks. But the PM may not have the resources, power, and influence to improve process capabilities. All the PM can do is mitigate the harmful effects, promote awareness of the risks, and prepare contingency plans. Risks have a different connotation in this case.

It is important to define internal risks, because they contribute to more than 65 percent of risks in a typical business environment.

Internal risks are solved by internal response plans. Most internal risks evoke short-term plans that operate within the life of the project. These are dependency risks that are solved by better coordination and risk communication. Some internal risks arise because of lack of process capability. There is no quick solution to such problems. This calls for a well-designed process improvement plan. The nature of improvement can be a series of continual improvements or kaizens, or a major breakthrough improvement of the Six Sigma style. Such improvements require more resources and time.

Yet another type of internal risk is seen on comparing growth objectives with current performance levels. Today is fine, but tomorrow may bring hurdles. Perception of such risks comes from long-term vision. If growth goals are taken seriously, one finds more risks. If growth goals are taken as secondary concerns, one does not see risks. I find that architects of the organization will detect growth-related risks, while most PMs don’t. When an organization is divided, more boundaries appear and employees see more internal risks. When the organization is integrated, such as in Integrated PM, internal risks are called process management issues. In an integrated organization with boundaries, collaborative efforts make up for weaknesses and create an organizational capability that is greater than the sum of individual process capabilities. This is the Integrated PM system with sub-components. In fragmented organizations, risks multiply.

Internal risk is the probability of suffering losses while pursuing performance and growth goals because of inadequacies in process capability (including core and support processes) and organizational structure.

Beyond the organizational boundary, however, things are different.

External conditions are beyond our control. There are risk factors beyond our sphere of influence. Competitors cut prices and marketing times almost ruthlessly. Social forces may erode staff loyalty. The PM sees external risks as threats and develops strategies to deal with them.

External risk is the probability of suffering loss while pursuing performance and growth goals because of uncer-tainties in external conditions.

There cannot be a better example of external risk than requirements.

The requirements keep changing; they "creep." The volatility of requirements is a perennial source of uncertainty and, hence, risk. Requirements go through a metamorphosis, becoming bigger and clearer in each phase of their evolution. Requirement evolution is a subject for continuous observation and modeling. Requirement volatility is beyond our control and is uncertain. Change is inevitable and is beyond prediction. When the requirement risk occurs, it can cause numerous problems for the project. Managers are aware of this. They cannot avoid it, but are prepared. Those who have mastered this risk, experience fewer surprises when requirements change.

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What is Project Risk?

“If I perform risk management for a project, we might be more successful, but I’m not sure what risk really is.”

The original meaning of risk is associated with gambling- to risk is to gamble. When we take risks, there is a chance of gaining and perhaps an equal chance of losing. Project risk has evolved to mean more.

Uncertainty in business ventures has come to be known as risk. Every business venture is basically risky. In new business ventures, project initiatives, and new product development, there are unknown factors and their impacts on the venture are equally unknown. The unknown factors could be favorable or unfavorable. There is a probability that one may either gain or lose business value. However, a loss may hurt the venture. Most business ventures like to assess the probability of loss and compare it with the probability of gain. The decision to go ahead depends on whether the odds are favorable or unfavorable. Risk is the probability of suffering loss. Using this approach, the PMO or Project Steering Committee will not pursue a venture that has a risk probability greater than 49 percent. The odds must be in favor of winning the gamble, even though the tilt is marginal.

Definition 1.1: Risk is the probability of suffering loss.

A refinement of this definition is to include goals, gains, or opportunities in the statement. Perhaps it is implied and obvious that risks relate to gains. Nevertheless, if risks are divorced from the associated goals, then one sees just a set of problems. A risk list should not be reduced to a problem list. Risks have a much broader role to play. We should always include the expected and potential gains that a project offers in the risk assessment.

Definition 1.2: Risk is the probability of suffering loss while pursuing goals

Then there is the consideration of the magnitude of harm from the risk. What will its impact be? The consequence of the risk is evaluated. If the harm is tolerable but the gains are attractive, new decision rules can emerge. One may even take a risk where the occurrence probability is greater than 50 percent. The threshold is not 49 percent. Risk is seen as a weighed parameter and can fluctuate. The weight is based on the magnitude of loss due to risk, if the risk ever occurs.

Risk magnitude is measured using many different estimation methods. When the estimations form a range; such as a minimum of 12 and a maximum of 20, for a measure you want to maximize. You would compute half the distance between the max and min which is 4. Your estimate magnitude is 16 (the mean of the two numbers) with a risk of 4. 4 is 25% of 16, so you might report a risk magnitude of 25%. My point here is magnitude is dealt with in multiple ways.

Risk is defined as the combination of probability of occurrence and the magnitude of loss it causes. This combination is also known as risk exposure. The new definition below takes this into consideration.

Definition 1.3: Risk is the combination of probability and magnitude of loss.

Typically, project risk is defined and measured using Definition 1.3. Measure-ment of risk is often a subjective process. Both the probability and loss are measured using linguistic measures such as "high," "medium," and "low" which are nominal metrics. What matters is not just the risk, but its intensity, measured as risk exposure. Will the risk occur? What will the harm be? These are more significant questions than, "What is the risk?"

A clarification is due at this juncture. If loss occurs because of factors within our control, it is not considered as a risk. Only factors beyond our control give rise to risk. This is the general perception that makes risk management simple. Internal factors are within our control. Hence, only external factors that contribute to loss, which are not under the project manager’s direct control, qualify as risk factors. When this notion prevailed, people believed that they had not caused the risks.

Sometimes, processes are not in control and results are not predictable or what were intended. Such losses become risks. In this case, the origin is not the criterion - predictability and control are important factors. Hence, a complete risk definition would be:

Definition 1.4: Risk is the probability of suffering loss while pursuing goals due to factors that are unpredictable or beyond the PM’s control.

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What types of problems can risk assessment be applied to?

“If I use risk management practices then I might be able to determine a range of possibilities, but I'm not sure of the type of problems risk assessment can be applied?”

Risk management may not be everything you think. Here are some examples of how project estimates other than traditional 'Risk’ logs are used in project planning and project portfolio management.

The Legal Model - A model that calculated the net benefit of settlement vs. litigation was built to aid in legal decisions. The net benefit of a settlement, net cost of litigation, the net cost of the settlement, a total cost of a verdict, and other outputs were calculated. Input variables that comprised broad categories included parameters such as litigation costs, total damages, the likelihood of a verdict, and other probabilistic and economic aspects. Project selection and ranking were then based on the estimates of this risk model. Maintaining a 'risk log' wasn't even part of the effort, but the use of anticipated risk events and the associated probabilities certainly are.

An Environmental Health and Safety Model- Models were built that calculated the total environmental, health, and safety risk and cost associated with entry by the company into various countries around the world. Risk of subcomponents of the model were also calculated and presented. Input-variable categories (many variables per category) included public perception considerations, government approvals/permits, ecological/cultural parameters, health and safety considerations, and evaluation of preexisting damage. In this case, risk assessment happened during strategic program planning and then downstream to provide guidelines and constraints to project managers.

Pipeline Route-Selection model- Oh boy, a comprehensive time-series model was constructed to help a consortium decide which of several routes would be selected to construct a pipeline for a major oil field. The pipeline route-selection model calculated tariffs and other parameters from variables that represented major categories of consideration. These included political concerns, environmental problems, commercial considerations, financial parameters, technical considerations, taxes (for many countries), and other parameters. This model was used with great success to rank and prioritize the routes of pipeline projects. Financial estimates then drove project constraints. Notice when in the project planning cycle, risk management practices and risk events were considered.

Political models- Models were constructed that evaluated other countries based on categories of variables. Categories included political stability, foreign investment conditions, operating environment, transportation infrastructure, and other considerations. Results from the models facilitated comparison of countries on a common scale. Once again, these models drove selection criteria based on risk factors, not during the execution of a project already committed to.

Capital Project Ranking and Portfolio Management model- This model calculated profitability index (PI), internal rate of return (IRR), net present value (NPV), and other financial outputs. Input variables included project safety and environmental aspects, cost estimates, incentives, discount rates, taxes, maintenance and insurance costs, and other considerations. This model was run on all capital projects at a manufacturing facility. The projects were ranked and portfolio-managed based upon the model outputs. No this wasn't the only model used. Before this model was used, other assessments were leveraged while financial information wasn't yet available. These capital projects had already gone through capacity planning and were now going through the second level of estimation. Notice that risk modeling of risk events are used throughout the project planning lifecycle to provide probabilistic estimates. Too many times, as project managers, we use the single value, deterministic estimates of performance factors which are not fixed.

New Products model- Research and development organizations generate products and processes, each of which may have commercial value. It is, however, expensive to launch a new product in the marketplace. Therefore, products and processes need to be ranked. A model was built that included categories of variables. Some of the categories were technical considerations, marketing aspects, financial/commercial facets, and others. The model facilitated the application of weights to the various considerations. Results from the model allowed the prioritization of potential new products. These models can be complex, but depending on when the estimates are being used, can take less than 5 minutes per project to estimate.

Fate/Transport model - A model was constructed to calculate inhalation exposure. Exposure was represented in the model as the average daily dose for noncarcinogens and the lifetime average daily dose for carcinogens. Among the input variables were parameters such as the concentration of chemicals in the air, inhalation rate, bioavailability, exposure duration, exposure frequency, body weight, average lifetime, and other considerations.

My point is that risk management efforts involve more than only the maintenance of the project risk log, and typically models save the organization time, and make their project planning efforts more robust and consistent, smoothing the way for project management activities.

 

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Historical Research

If I collect data like Lessons Learned, and risk logs, then I could learn from the past, but I really don’t know how to conduct historical research effectively.”

Give me any three clients, and I'm betting they will have at least five different ways to do ‘Lessons Learned’ at the end of their projects. They’ll tell me, “Oh I didn’t know Lessons Learned was historical research.” Sarah Adams, a Sr. Project Manager, PHP and somewhat of a monster … well let’s just say, Application Development Team Lead under a lot of pressure.

She pushed the team to hold Lesson Learned at the end of every project phase, but no one ever did anything with them. “Then why did they hold the meetings?” you ask. Because that’s how Sarah was trained, that’s how she did it, and when you were on her project team, that’s how you did it.

It really is too bad, what a waste. The good thing is that if you stick around, you could change this. Maybe we won’t have to wait forever. You could show her a better way. Let’s look at Lessons Learned, Project Reviews, and the like, through the lens of historical research.

Historical Research is a viable research and development method that we can all practice. As we strive to improve and better understand Integrated PM, each one of us, using historical research, can advance the cause.

The purpose of historical research is to reconstruct the past systematically and objectively by collecting, evaluating, verifying, and synthesizing evidence to establish facts and reach defensible conclusions, often in relation to a set of particular hypotheses. With a little care, Lessons Learned and project reviews can provide the PM (Researcher) with the evidence needed.

Sarah was close to being a good example of this, but she didn’t follow through. She wasn’t looking through the lens of research. You bet she systematically collected evidence. However, as far as I know, she never formed a hypothesis to confirm or deny. I need to give Sarah a break for a bit, after all, they never told her at the PMI that she needed to be a researcher.

What does historical research even look like? Let’s take a look at some typical characteristics.

Normally, historical research depends upon data observed by others rather than by the investigator. This means looking at other’s project plans and Lessons Learned documents. Good data results from painstaking detective work which analyzes the authenticity, accuracy, and significance of source material. So now Miss Sarah Adams needs to be a detective, researcher, and in a few sentences, you’ll see the need for a scientist too.

Contrary to popular notions, historical research must be rigorous, systematic, and exhaustive; much "research" claiming to be historical is an undisciplined collection of inappropriate, unreliable, or biased information and conclusions.

Historical research depends upon two kinds of data: primary sources where the researcher was a direct observer of the recorded event, and secondary sources where the researcher is reporting the observations of others and is one or more times removed from the original event. Of the two, primary sources carry the authority of firsthand evidence and have priority in data collection.

Two basic forms of criticism weigh the value of the data: external criticism which asks, "Is the document or relic authentic?" and internal criticism which asks, "If authentic, is the data accurate and relevant?" Internal criticism must examine the motives, biases, and limitations of the researcher, which might cause exaggeration, distortion, or overlooking information. This critical evaluation of the data is what makes true historical research so rigorous-in many ways, more demanding than experimental methods.

While historical research is similar to the "reviews of the literature" which precede other forms of research, the historical approach is more exhaustive, seeking out information from a larger array of sources. It also tracks down information that is much older than required by most reviews and hunts for unpublished material not cited in the standard references.

The Steps for Performing Historical Research:

1. Define the problem. Ask yourself these questions: Is the historical approach best suited for this problem? Is pertinent data available? Will the findings be educationally significant?

2. State the research objectives and, if possible, the hypotheses that will give direction and focus to the research.

3. Collect the data, keeping in mind the distinction between primary and secondary sources. An important skill in historical research is note-taking-small file cards (3 x 5, 4 x 6), each containing one item of information and coded by topic, are easy to rearrange and convenient to file.

4. Evaluate the data, applying both internal and external criticism.

5. Report the findings, including a statement of the problem, a review of source material, a statement of underlying assumptions, basic hypotheses, and methods used to test the hypotheses, the findings obtained, the interpretations and conclusions reached, and a bibliography.

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Create and Leverage Templates

If project managers co-develop standard practices and templates, then practice adoption and baseline performance would be higher, but with so many varying opinions, a ‘We’ culture is required.

Gary stares at his computer monitor, bewildered, as he scrolls through a large folder of project template files, “Just ask the top project managers to share their templates”, he mockingly mumbles to himself. With project performance varying greatly across the different project management teams, Gary, as part of the Governance team, has been tasked with establishing a standard set of project templates to improve project performance across his business unit. Just like a fancy dessert, without a recipe or set of repeatable steps, consistent results aren’t guaranteed.

Creating templates that are leveraged across the organization is something that requires consolidation of input from many sources. Just asking the top performers to give you their templates and combining those into one set of templates, is a daunting task that will not get much buy-in from other project managers. You will get better adoption and leverage of these templates if members of the project management team are involved in developing them. Using a “We” thinking approach and leveraging their diverse knowledge, skills, and experience, you can define much more competitive standard practices and templates.

Even though Gary has been given the authority to define the standard templates, he knows that if he builds them on his own and dictates them to the rest of the organization, not only will very few people adopt them, but they will be much less effective than templates co-developed with the entire team. To lead this initiative, he needs to exercise “We” leadership principles. Key aspects of “We” leadership are to share power, be inclusive, seek feedback, break down silos, celebrate diversity, and encourage discussion.

1) We start by first defining what the characteristics of a good project management process are. 2) Rank these factors based on importance using a simple pair-wise comparison method. 3) We need to define the project phases and their objectives/deliverables. What must we achieve before we move on? 4) Brainstorm on the different tools, methods, templates that could help achieve those objectives. In portfolio management decision making we refer to this step as listing alternatives. Since we don’t have unlimited time, we need to decide out of all the practices we could include in our template, which ones will provide the most value to us.

Using the factors of a good project management practice we defined earlier, we can rank the impact of each proposed practice. When selecting from these ranked practices, the team should keep in mind their current practices and try not to introduce an overwhelming amount of change.These selected practices are included in the baseline template that will be used going forward. This establishes the standard set of practices that Gary was tasked to produce.

By leveraging these standard templates, project performance is no longer solely dependent on the individual managing the project. If we follow the recipe, our desert will turn out well. Performance of your project management teams can now be predicted, measured, and improved. By establishing a fair and inclusive process, that leverages “We” thinking, you can capitalize on the diverse knowledge and experience of your team to create competitive templates that the team is excited to leverage.

 

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Program Management Fast-Service™ Package

“If we select the pmNERDS' Fast-Service™ package, then we get rapid performance improvement, but we’ll need to answer questions and provide feedback.”

We all occasionally get major hankerings, it’s usually something that we can’t wait for and need within a very short period of time. For us it is usually food related, the Fast Food Industry utilizes the notion of standardization to produce food at minimal cost and preparation time while maximizing value within their business constraints. The question is can they make a compelling product while being profitable?

At pmNERDS, that’s our goal with these Fast-Service™ packages. Using product templates, standardized processes, and focused training we’re able to deliver consulting products faster than our clients and competitors, with sustainable margins.

Very few of us look forward to overly complex Program Management processes. We want it to be easier and faster, so process performance in this area looks rather attractive, but what area should be addressed first?

Using some rapid assessment techniques, the Performance Measure Framework, and our performance constraint analysis tool, we help you identify that practice that is holding you back. Then we will propose modifications or creation of a new practice that addresses your specific constraint. This is not about investing lots of time to do it yourself, or just going without, we are offering a third choice…

Our clients hire us do some of the data collection, constraint analysis, process documentation, and change management activities that are part of effective Program Management performance improvement practices. With only a total of 8 hrs. of your time, spread out in 8 sessions over 4 weeks, we complete the analysis and build the necessary deliverables to adopt a new practice, that will improve your Program Management performance. All of this is accomplished within 20 business days.

We’re experts in performance improvement and Program Management practices, you know your business and organization. By using our Fast-Service™ package, you can leave the specialized practices to us, and focus on running your business.

Below is a set of Fast-Service™ package deliverables used to improve your Program Management performance.

SELF-ASSESSMENT REPORT- This is an Excel spreadsheet and chart that is used to identify the major problem areas and bottlenecks of the organizations’ innovation process. The Self-Assessment contains a series of questions related to current practices for gathering ideas, converting ideas into business opportunities, and finally diffusing ideas throughout organization and to market. Using the self-assessment, we can quickly identify the perceived system constraints, and dive deeper into specific process areas that could be causing bottlenecks.

CONSTRAINT ANALYSIS REPORT- This is a set of Power Point diagrams used to identify key system constraints. We use Sufficient Cause diagrams to look at effects and potential causes from the perspective of Resources, Inputs, Controls, and Processes. These diagrams are used to verify effects, validate relationships between causes and effects, and look for additional effects to gain a clear understanding of the current system constraints.

PERFORMANCE MEASURE FRAMEWORK- This is a set of Excel spreadsheets and Power Point diagrams used to manage process improvement. Focusing on 1 of the 16 domains, we will load the selected practice into the Performance Measure Framework. By adding your standardized plans and information assets, such as process diagrams and performance thresholds, into the framework, you can do trade-offs and make process improvement decisions.

PROPOSED PRACTICE EFBD- This is a set of Power Point diagrams used to establish a process definition. The EFBD (Enhanced Function Block Diagram) Illustrates control logic, information flow, and process steps. We build this by looking at past project plans and documenting the current state. Based on constraint analysis, we can make modifications to the EFBD of the practice. We do this with things such as review gates, control activities, additional input screening, and resources inputs. This EFBD standardizes the practice and makes the proposed practice easier to understand, adopt, as well as improve over time.

NEW PRACTICE POLICIES & PROCEDURES- This is a set of Word documents that are used to outline process policies and procedures that enable standardization and improvement. Policies and procedures establish a standard set of minimum expectations and guidelines that are expected to be followed by anyone performing the practice. We create a new baseline of process performance, based on the constraint analysis and EFBD process analysis, by adding policies, process steps or procedural guidelines. This information is used to train people on new process, and monitor process execution and performance.

BUSINESS CASE- This is an Excel spreadsheet that is used to analyze, establish and communicate the business case of implementing the proposed practice change. When change is desired, the value delivered through the change must outweigh the negative impacts, cost, and natural friction that change will cause. All business cases derive from the ability to impact one of the six business drivers: Revenue, Efficiency, Sustainability, Endorsement, Cost and Risk. We will then define the type of value proposition that the new practice will deliver: uniqueness, familiarity, or economy of scale. Lastly, we determine the Cost/Value combination. This process will achieve same value for less cost, or more value for less cost, etc. The business case is used to overcome change hurdles and help people to quickly adopted the proposed change. 

PERFORMANCE SCORECARD- This is an Excel spreadsheet that is used to measure practice performance and drive improvement. The performance scorecard is built from information captured in the Performance Measure Framework. Using the five key performance measures, you can diagnose causes of performance constraints and identify process adjustments to address them. The Performance Scorecard will keep people focused on the key measures that impact overall performance, making improvement efforts more effective.

STRATEGY DIAGRAM- This is a Power Point diagram that is used to communicate the strategic intent of the performance improvement initiative.  The strategy diagram sets a common vision and outlines how different teams/roles work together to perform the key activities needed to deliver the value of the initiative. The strategy diagram helps team members to understand their role, adopt the proposed changes, and buy-in to the initiative solution vision.

COMMUNICATION PLAN- This is an Excel spreadsheet that is used to communicate to and engage all stakeholders and team members of a project. A Communication Plan will identify the target personas and actions that you want them to take, anticipate potential objections, and provide a message that addresses the objections and provokes action. We will develop a communication plan that identifies target stakeholders, develops compelling messages that engage them to act towards the achievement of project objectives.

ROLE BASED TRAINING DIAGRAM- This is a set of Power Point diagrams that are used to identify training needs of job roles. These roles based training diagrams provide standardized capabilities, job role expectations, and training demand analysis by process. These diagrams are used to create training and adoption activities for each role as part of the new practice deployment. Each Role can clearly understand their roles & responsibilities regarding the new practice. This means the activities will get done more efficiently with better performance results. 

PERFORMANCE IMPROVEMENT MILESTONE ROADMAP- This is a Power Point diagram that is used to communicate the performance improvement efforts of the organization over time. Based on the performance constraints, this roadmap identifies the sequence of performance improvements as well as the target process areas. The Performance Improvement Milestone Roadmap will align team members, resources, and efforts to provide the most rapid performance improvement for the organization.

Want to learn more? Contact us either through email or phone.

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Program Management with ‘SENSE’ Process-Service™

“Program Management with SENSE is a Process-Service™ offering of pmNERDS. This offering provides a process umbrella of SENSE, and then line-items of an S.O.W. that can be chosen a la carte.”

Is there any sense at all in your program office, or program management practices? Of course, governance of any kind runs the risk of seaming illogical to a few, but the logic we use in our programs need to be repeatable, maintainable, and defendable. Best practices are used to command the respect of those within your program, build credibility, and reduce the variability of projects.

During our process consultancy, we address:

Stabilize- Using a stabilizing control feedback loop reduce project performance variance. Anticipate the growth driven by portfolio management, but stabilize the path.

Empower- Leverage horizontal commonalities of projects to synergistically increase performance improvements. Support performance by leveraging program strategy, policy, procedures, and standards to make the execution of projects efficient and effective.

Nurture- Identify and break constraints, standardize training, recognize success. Provide needed resources, balance utilization, and allocate budgets. Develop healthy policies for risk, and keep projects safely moving toward completion.

Synchronize- Manage schedules. Collaborate on the enterprise roadmaps, leveraging assets, activities, and resources. Coordinate cash flow with capacity planner. Synchronize all things horizontal across program projects.

Emergent- Programs must capitalize on unexpected emergent behaviors of the program. Agent decisions, resource availabilities, client desires combine at the program level and emerge as prominent features of program behavior.

The pmNERDS process consultancy provides a standard Program Management capability described by the acronym above. This is an umbrella capability needed regardless of any additional practices selected from our a la carte practice menu.

Program Management practices available for selection from the a la carte S.O.W. include Project Phase Templates, Standardization of Charters, Project Scope Statements, Problem Statements, Project Feedback Controls, Change Control, WBS Standards, Verification Planning, The Vision/Scope Document, Resource Estimation Requirements, Duration Estimation Requirements, Resource Utilization Reporting, Capability Management, Cost Estimating, Budgets, Value Management & Forecasting, Financial Ratios, Quality Plans, Communication Planning, Innovation Asset Management, Risk Response Planning, Purchase & Acquisition Planning, Contract Administration, Project Integration Framework, Project Scope Framework, Project Time Framework. Project Cost Framework, Project Quality Framework, Project Human Resource Framework, Project Communications Framework, Project Risk Framework, and Project Procurement Framework.

Organizations that depend on projects to create value and increase process efficiencies, as seen in business units such as IT, Marketing, and NPD, should talk with us if they’re interested in increasing project performance.

After a quick discussion, we can direct you to the best process offering and a la carte practices based on your process improvement goals. By putting together a service package that addresses your key performance constraint, our sales team can help you get the quickest time-to-value, while minimizing risk and cost.

Want to learn more? Contact us either through email or phone.

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Program Management Performance-Service™

“If we engage pmNERDS’ Performance-Service™ for Program Management, then we’ll increase the organization’s competitive advantage, realize higher value from projects, and complete projects more efficiently, but it will require change leadership.”

Our performance improvement consulting practice for Program Management, begins with gathering information about your organization and engagement goals. We conduct a quick gap analysis to construct an engagement roadmap.

Once approved, we will build this roadmap out into a complete project plan and review it with our clients going over roles and responsibilities. We schedule weekly meetings to review the project and discuss relevant decisions. Depending of the length of engagement, steering committee meetings are also scheduled.

Daily scrums are scheduled to address issues and schedule any needed ad hoc meetings. Performance Improvement Consulting involves a great deal of planning and communicating. Underlying each practice is an element of process improvement and use of a standard performance measure framework.

Program Management is more than a convenient container of projects belonging to the same Project Manager. The purpose of projects is to cause a change somewhere. The purpose of the Program, is to look at a set of common state variables that run horizontally across all projects within the program, and govern those values within some threshold.

Consider a wall thermostat, the program tries to maintain the room temperature by governing the thermostat. If the room temperature is too cold, it turns on the heater and heats the room, if the room is too hot, then the Program turns the air conditioner on. The overall purpose is to standardize values across all projects within the program.

During our engagement, we examine control mechanisms in stabilizing feedback loops, and based on organizational concerns such as balancing costs, stabilizing quality, removing variance out of estimations, we work with your team to enable program management.

By leveraging our experience, you can reach expected benefits quicker and with less false starts while being assured that you won’t paint yourself into a ‘process’ corner, and isolate information asset flow to downstream processes. Our performance improvement consulting practice requires a discussion to determine goals, scope of effort, consultant alignment, and the development of a business proposal. We deliver an analysis of current program management process performance and constraints, a roadmap to performance improvement, process design, process exercise, process enablement, deployment, and measurement.

A large part of this effort is process training, skills mentoring, and performance coaching. Depending on the engagement, technology configuration or deployment may or may not be part of this effort.

You can discover more about this service offering by clicking the icon (email or phone) in the top right corner of our website. We’d love to explain this Performance-Service™ and answer any questions you might have.

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Process Improvement Fast-Service™ Package

“If we select the pmNERDS' Fast-Service™ package, then we get rapid performance improvement, but we’ll need to answer questions and provide feedback.”

We all occasionally get major hankerings, it’s usually something that we can’t wait for and need within a very short period of time. For us it is usually food related, the Fast Food Industry utilizes the notion of standardization to produce food at minimal cost and preparation time while maximizing value within their business constraints. The question is can they make a compelling product while being profitable?

At pmNERDS, that’s our goal with these Fast-Service™ packages. Using product templates, standardized processes, and focused training we’re able to deliver consulting products faster than our clients and competitors, with sustainable margins.

Very few of us look forward to overly complex Process Improvement processes. We want it to be easier and faster, so process performance in this area looks rather attractive, but what area should be addressed first?

Using some rapid assessment techniques, the Performance Measure Framework, and our performance constraint analysis tool, we help you identify that practice that is holding you back. Then we will propose modifications or creation of a new practice that addresses your specific constraint. This is not about investing lots of time to do it yourself, or just going without, we are offering a third choice…

Our clients hire us do some of the data collection, constraint analysis, process documentation, and change management activities that are part of effective Process Improvement performance improvement practices. With only a total of 8 hrs. of your time, spread out in 8 sessions over 4 weeks, we complete the analysis and build the necessary deliverables to adopt a new practice, that will improve your Process Improvement performance. All of this is accomplished within 20 business days.

We’re experts in performance improvement and Process Improvement practices, you know your business and organization. By using our Fast-Service™ package, you can leave the specialized practices to us, and focus on running your business.

Below is a set of Fast-Service™ package deliverables used to improve your Process Improvement performance.

SELF-ASSESSMENT REPORT- This is an Excel spreadsheet and chart that is used to identify the major problem areas and bottlenecks of the organizations’ innovation process. The Self-Assessment contains a series of questions related to current practices for gathering ideas, converting ideas into business opportunities, and finally diffusing ideas throughout organization and to market. Using the self-assessment, we can quickly identify the perceived system constraints, and dive deeper into specific process areas that could be causing bottlenecks.

CONSTRAINT ANALYSIS REPORT- This is a set of Power Point diagrams used to identify key system constraints. We use Sufficient Cause diagrams to look at effects and potential causes from the perspective of Resources, Inputs, Controls, and Processes. These diagrams are used to verify effects, validate relationships between causes and effects, and look for additional effects to gain a clear understanding of the current system constraints.

PERFORMANCE MEASURE FRAMEWORK- This is a set of Excel spreadsheets and Power Point diagrams used to manage process improvement. Focusing on 1 of the 16 domains, we will load the selected practice into the Performance Measure Framework. By adding your standardized plans and information assets, such as process diagrams and performance thresholds, into the framework, you can do trade-offs and make process improvement decisions.

PROPOSED PRACTICE EFBD- This is a set of Power Point diagrams used to establish a process definition. The EFBD (Enhanced Function Block Diagram) Illustrates control logic, information flow, and process steps. We build this by looking at past project plans and documenting the current state. Based on constraint analysis, we can make modifications to the EFBD of the practice. We do this with things such as review gates, control activities, additional input screening, and resources inputs. This EFBD standardizes the practice and makes the proposed practice easier to understand, adopt, as well as improve over time.

NEW PRACTICE POLICIES & PROCEDURES- This is a set of Word documents that are used to outline process policies and procedures that enable standardization and improvement. Policies and procedures establish a standard set of minimum expectations and guidelines that are expected to be followed by anyone performing the practice. We create a new baseline of process performance, based on the constraint analysis and EFBD process analysis, by adding policies, process steps or procedural guidelines. This information is used to train people on new process, and monitor process execution and performance.

BUSINESS CASE- This is an Excel spreadsheet that is used to analyze, establish and communicate the business case of implementing the proposed practice change. When change is desired, the value delivered through the change must outweigh the negative impacts, cost, and natural friction that change will cause. All business cases derive from the ability to impact one of the six business drivers: Revenue, Efficiency, Sustainability, Endorsement, Cost and Risk. We will then define the type of value proposition that the new practice will deliver: uniqueness, familiarity, or economy of scale. Lastly, we determine the Cost/Value combination. This process will achieve same value for less cost, or more value for less cost, etc. The business case is used to overcome change hurdles and help people to quickly adopted the proposed change. 

PERFORMANCE SCORECARD- This is an Excel spreadsheet that is used to measure practice performance and drive improvement. The performance scorecard is built from information captured in the Performance Measure Framework. Using the five key performance measures, you can diagnose causes of performance constraints and identify process adjustments to address them. The Performance Scorecard will keep people focused on the key measures that impact overall performance, making improvement efforts more effective.

STRATEGY DIAGRAM- This is a Power Point diagram that is used to communicate the strategic intent of the performance improvement initiative.  The strategy diagram sets a common vision and outlines how different teams/roles work together to perform the key activities needed to deliver the value of the initiative. The strategy diagram helps team members to understand their role, adopt the proposed changes, and buy-in to the initiative solution vision.

COMMUNICATION PLAN- This is an Excel spreadsheet that is used to communicate to and engage all stakeholders and team members of a project. A Communication Plan will identify the target personas and actions that you want them to take, anticipate potential objections, and provide a message that addresses the objections and provokes action. We will develop a communication plan that identifies target stakeholders, develops compelling messages that engage them to act towards the achievement of project objectives.

ROLE BASED TRAINING DIAGRAM- This is a set of Power Point diagrams that are used to identify training needs of job roles. These roles based training diagrams provide standardized capabilities, job role expectations, and training demand analysis by process. These diagrams are used to create training and adoption activities for each role as part of the new practice deployment. Each Role can clearly understand their roles & responsibilities regarding the new practice. This means the activities will get done more efficiently with better performance results. 

PERFORMANCE IMPROVEMENT MILESTONE ROADMAP- This is a Power Point diagram that is used to communicate the performance improvement efforts of the organization over time. Based on the performance constraints, this roadmap identifies the sequence of performance improvements as well as the target process areas. The Performance Improvement Milestone Roadmap will align team members, resources, and efforts to provide the most rapid performance improvement for the organization.

Want to learn more? Contact us either through email or phone.

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Process Improvement with ‘FOCUS’ Process-Service™

“Process Improvement with FOCUS is a Process-Service™ offering of pmNERDS. This offering provides a process umbrella of FOCUS, and then line-items of an S.O.W. that can be chosen a la carte.”

We all agree that “Boiling the ocean” for a lobster fest is a bad idea. The trick in process improvement is to identify the key constraint impacting your project output. Improving any else just won’t produce the needed outcome. Focusing on the key constraint of your process, instead of every constraint will return significant results. However, you must look for the key constraint of the whole system, and not just a part. Knowing what to focus on will do the trick.

During our process consultancy, we address:

Framework- Continuous process improvement is most successful using a performance measure framework. Adding additional information to the framework produces a process knowledge architecture which places process information next to measure information.

Observe- Effect-cause-effect thinking is built upon observation, the cornerstone to the scientific method, and process improvement. Observe performance, form a hypothesis, observe the test, observe the results, observe changes to the process, observe adoption, … yes observe.

Codevelop- Work with the workers performing the activities of the process. Silicate their ideas and engage their efforts. Let them own the new process as if it were their own.

Usability- When the efficiency and effectiveness of a process is countered by usability; usability trumps benefit. Process stability and sustainability comes from ease of use.

Synergy- Build perceived value in the synergistic effect of activity within the process. The perceived value of the process should be larger than the values of each activity added together. The process is a system composed of smaller components working together to accomplish a business objective.

The pmNERDS process consultancy provides a standard process improvement capability described by the acronym above. This is an umbrella capability needed regardless of any additional practices selected from our a la carte practice menu.

Process Improvement practices available for selection from the a la carte S.O.W. include Initiative Preparation, The Prepare Cycle, propose Practice Cycle, Plan Improvements Cycle, Implement Improvements Cycle, Performance Measure Framework, Project Best-Practices, Product Best-Practices, Portfolio Best-Practices, Program Best-Practices, Self-Assessment, Cascading Scorecards, Capacity Best-Practices.

Organizations that depend on projects to create value and increase process efficiencies, as seen in business units such as IT, Marketing, and NPD, should talk with us if they’re interested in increasing project performance.

After a quick discussion, we can direct you to the best process offering and a la carte practices based on your process improvement goals. By putting together a service package that addresses your key performance constraint, our sales team can help you get the quickest time-to-value, while minimizing risk and cost.

Want to learn more? Contact us either through email or phone.

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Process Improvement Performance-Service™

“If we engage pmNERDS’ Performance-Service™ for process improvement, then we’ll increase the organization’s competitive advantage, realize higher value from projects, and complete projects more efficiently, but it will require change leadership.”

Our performance improvement consulting practice, for process improvement begins with gathering information about your organization and engagement goals. We conduct a quick gap analysis to construct an engagement roadmap. Once approved, we will build this roadmap out into a complete project plan and review it with our clients going over roles and responsibilities. We schedule weekly meetings to review the project and discuss relevant decisions. Depending of the length of engagement, steering committee meetings are also scheduled.

Daily scrums are scheduled to address issues and schedule any needed ad hoc meetings. Performance improvement consulting involves a great deal of planning and communicating. Underlying each practice is an element of process improvement and use of a standard performance measure framework.

Our Continuous Performance Improvement (CPI) service uses a Best-Practice deployment framework based on performance measures to guide incremental deployments and continuous improvement. Utilizing portfolio, program, product, people, process, and project management as well as other organizational-enabling practices to consistently and predictably deliver standardized best practices leading to process efficiencies and increases in perceived value, better results, and a continuously increasing competitive advantage.

CPI Performance Measure Framework:

The framework contains the Integrated PM domains of Portfolio Management, Program Management, Process Management, Resource Management, Product Management, and Project Management, shown as letter ‘A’ in the diagram above.

Each domain is broken into a set of standard business strategies; Management & Improvement, Operational & Execution, Leadership & Profitability, Employees & Innovation, Sales & Distribution, Purchasing & Supplier Management, Service & Growth as shown as letter ‘B’ in the diagram above.

The business Unit Enabler Types create the 5 groupings of business enables; Technology, Structural, Cultural, Resources, and Knowledge shown as letter ‘C’ in the diagram above.

Each of these groupings contain business enablers; some predefined and others developed for the specific client. These are illustrated in the diagram above as ‘D’.

The Business Enablers then contain a set of practices, some predefined as best practices, others developed for the client. These are illustrated in the diagram above as ‘E’.

For each practice, we then define targeted performance measures, and actual measures. We are now ready to help the organization conduct CPI cycles. Normally the first time we go through all cycle stages, then leaving the business unit to conduct self-assessments, and may come back for annual assessments.

For each practice, we then define targeted performance measures, and actual measures. We are now ready to help the organization conduct CPI cycles. Normally the first time we go through all cycle stages, then leaving the business unit to conduct self-assessments, and may come back for annual assessments.

The engagement has five major milestones or stages; Prepare for the CPI Initiative, Conduct cycle preparation, propose practices, Plan for Improvements, and then Implement Improvements.

By leveraging our experience, you can reach expected benefits quicker and with less false starts while being assured that you won’t paint yourself into a ‘process’ corner, and isolate information asset flow to downstream processes. Our performance improvement consulting practice requires a discussion to determine goals, scope of effort, consultant alignment, and the development of a business proposal. We deliver an analysis of current continuous process improvement or CPI process performance and constraints, a roadmap to performance improvement, process design, process exercise, process enablement, deployment, and measurement.

A large part of this effort is process training, skills mentoring, and performance coaching. Depending on the engagement, technology configuration or deployment may or may not be part of this effort.

To learn more, click the icon (email or phone) in the top right corner of our website. We’d love to dicuss this Performance Service™ offering and answer any questions you might have.

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A Capacity Planner: How Many Can You Lift?

“If I am a capacity planner, then I am always looking for optimal functionality, but really, what do I do?”

 

Who is a capacity planner? A capacity planner gathers performance data and measures the output to determine optimal fit within the production scheduling. A person in this position is normally at the business unit level, but there are enterprise level capacity planners that look at the whole organization, such as Resource Forecasters or Resource Estimators. A business unit capacity planner may be called a Performance Manager or a Performance Engineer among other titles, but who are they really? Every job is more than just a title.

In previous posts, I have determined the best way to describe a project manager to a child is to classify them as a superhero, like Batman. So, if a project manager is Batman, then a capacity planner is a lot like Alfred, Batman’s butler. Don’t be mistaken, Alfred was way more than Batman’s routine servant. He pretty much raised him. If Bruce was being foolish, then Alfred efficiently reprimanded him. In the background, he never stopped guiding him in the right direction. This is a capacity planner.

A capacity planner can go by many different names, but at the end of the day, the goals are still the same. As a capacity planner, you are here to understand the priorities, the resources available, the true cash flow, as well as the intricacies of the time frame. Alfred understood Batman’s true priorities. Batman wanted to destroy all his foes and save every single maiden, but it took Alfred to continuously remind him that he is only one man. As one man, he only has so much capacity. This inevitably led to the introduction of Robin and later Batgirl. Batman increased his capacity to match the increasing demand.

It might seem trivial to say that the capacity planner needs to understand priority, the cash flow, the time frame and everything else, but it is more complex than you think. It is a balance of continuously fixing the past, adjusting the present actions, and planning for future growth. Planning for growth could entail adding more physical locations, adding personnel, or capital to raise for any given expansion. This plan is always a factor in determining how many transformational/major change projects you can accomplish in a year. How many projects can you really afford given the resources as well as the budget? Sure, you could run yourself and your team down, but as Alfred understood, you still must eat and sleep, even if you're a superhero. In capacity planning, you can’t invoke only major change if you have requests for maintenance/utility or compliance mandate projects.

Your business unit and organization needs a continuous spectrum of projects. If you can do three transformational projects given your organizational constraints than you would need to sufficiently space them across the next few quarters. In between these major projects, you always have a spot for last minute projects or required maintenance projects. A capacity planner is working to design an optimal project schedule by weighing the risk, priority, cash flow, and organizational capacity.

Capacity planning involves looking at what resources are being utilized and making sure these are being allocated correctly for optimal functionality. Managers with this mission are leading their Batmans’ in the direction that means success and growth of the organization by considering the priority, resource availability, and the fluctuating cash flow within a given time frame. Alfred is the only real father figure Batman has in his life. The one force that Bruce Wayne knows will always have his back in any situation. He is the man behind the man. He is the capacity planner.

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Capacity Planning: How Much Can You Lift?

“If I invest significant resources to capacity planning, then I understand the production capacity needed to meet the changing demands, but I am not sure what capacity planning really entails.”

My morning is never complete without a cup of coffee. So, when I first came across the term “capacity planning,” I automatically went to my regular morning struggle, how much coffee can I put into this travel mug without burning myself? This might seem trivial, but it is a delicate process. How big is the mug? Do I want to leave room for cream? How much cream? If your calculation is even slightly off you burn yourself at some point, have a subpar cup of joe, or you managed to cheat yourself out of some coffee.

After some research, I now understand that capacity planning is slightly more complex than filling up a cup of coffee. Capacity planning is the process of determining the production capacity needed by an organization to meet changing demands for its product or services. The goal of capacity planning is to understand the capacity of the organization, and the demand of the customer, to minimize a discrepancy between the two forces.

If only it was as easy as filling your travel mug in the morning, but really, most of capacity planning comes down to two questions. Given the resources I have, how many projects can I do? Given my projects, how much resources do I need?

You might be reading those two questions and think it is that easy, but just like pouring coffee, there are lots of variables involved. The cream to coffee ratio and the size of the travel mug, turns into skill sets, number of projects, strategic plans, as well as the number of resources. If the path to high performance is a pipe, then each of these variables are something blocking the flow.

The key to successful capacity planning is identifying the biggest blockage. You could have a reasonable number of employees and projects, but have a gap in the job roles that can be filled by your resources. Alternatively, you could have resources that are being severely overworked. You have too many projects and not enough resources, in which case, you can reevaluate the number of future projects that can be attempted. The first step to unplugging the pipe or filling that mug is to understand what you have, and what you can do with it, and that is capacity planning.

The luckiest of us out there no longer need to worry about filling up our coffee mugs to the appropriate level. We have Starbucks or an automatic machine that fills our cups to that perfect full, but not too full point. If only real world capacity planning were the same way. The more you understand the more you can plan for at your organization. Capacity planning ensures the long and short term success of key business initiatives at a reduced cost, and who doesn’t want that?

 

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Capacity Planning: How Long Can You Lift it?

“If you want to determine the production capacity and the plan necessary to meet the changing demands for its products and services, then you have done sufficient capacity planning, but what strategy and steps were taken to develop your plans?”

It should be self-evident as to why an organization should care about capacity planning. No one wants to be in the situation where they have tons of people with nothing to do or to have too many projects and not enough people. As work piles up you are unable to become more efficient or grow as a company. You are unable to do much more than fight the fires. A company that has done sufficient capacity planning understands their priorities, the resource availability, the cash flow, as well as the intricacies of their time frame. Every project matters!

The repercussions of a poorly planned product launch are not just some unplanned operational costs, but a battlefield of ruthless customer reviews as well as negative impacts on the company’s image. The goal of capacity planning is to reduce that possibility, by minimizing the discrepancy, and provide satisfactory service levels in a cost-efficient manner. In other words, you are checking the system, and determining if you have the roles and skills needed before scheduling the work. Regardless of the situation, capacity planning involves three basic steps:

  1. Determine Capacity Requirements: Understand what will need to be supported.
  2. Analyze Current Capacity: Determine if it is meeting the organizational requirements.
  3. Plan for Future Capacity: Forecast future business activities and requirements.

There is lots more that can be said about each of these steps, but to begin you must understand your limits. After that is determined, you can start to understand your organizational constraints, the true project priority, and further speculate on production holdup. Companies use one of four general strategies to determine the production capacity, and produced the plans necessary to meet the changing demands for its products and services:

  1. Lead Strategy: Loading the system in anticipation of an increase in demand. The Lead strategy has the goal of luring customers from your competitor by improving service level. You are ensuring that the organization has adequate capacity to meet all demands even during high growth periods.
  2. Lag Strategy: Add the capacity after demand has increased beyond existing capacity. This strategy decreases the risk of overbuilding, greater productivity due to higher utilization levels, and the ability to put off large investments, but it may result in the loss of possible customers due to the product being out of stock or low service levels.
  3. Match Strategy: Add the capacity incrementally in response to changes in demand. This is a more moderate approach to reach the same advantages as in the lag strategy.
  4. Adjustment Strategy: Add or reduce the capacity in small or large amounts due to the consumer’s demand, or do major changes to product, or to the organization.

You made the resources available to really look at the capacity and demand in your organization. You even allowed others to adjust a few of the associated variables such as hiring a new copywriter and adjusted a few projects. So… you’re done with capacity planning? Right? Not so much.

We live in a fast paced world were nothing ever stays the same for too long. The capacity is defined as the maximum amount or number that can be received or contained. This could be about the amount of data on a hard drive, or the maximum amount of work that an organization can complete in each amount of time. It is important to know those numbers, but it is more important to know that capacity requirements can fluctuate between peak and limited demand. You might not require the same number of resources in normal operations as you do in peak demand. You are only human, to ensure the success of business initiatives and reduced cost, capacity planning should be actively done semi-annually, but with this concept, should be continuously in the back of your mind as things change!

 

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Establish Policies & Procedures for Strategic Practices

If we use standardized policies and procedures, then our projects will deliver their strategic intent, but this requires micro-management of projects.

High quality, repeatable, and consistent project performance is a goal of most organizations. Governance, whether in the form of a PMO, Committee, or just policies and procedures, attempts to address this need. The complexity that must be managed for a project to be successful can be overwhelming. For managers to be able to understand correlations and interrelationships between factors in project, portfolio and program management and perform effect-cause-effect thinking that leads to higher levels of performance, the system components must be defined and categorized. Instead of trying to define policies and procedures for every practice and monitor all aspects of the project, the Integrated PM approach to governance leverages system thinking to identify critical variables, leverage points, and constraint analysis to identify the strategic practices that need to be managed through governance.

By boiling down the complexity of your project or portfolio systems to key practices, the overall performance of your organization can be standardized and improved. We attempt to define all the components of your organizational structure that come together to accomplish the strategic goals. Systems Thinking enables a holistic governance while still being able to drill down into smaller components when necessary. Procedures and policies are used to clarify roles, guide practitioners, define state variables used to monitor and manage practices, and provide the desired set of responses to address system constraints and issues.

We develop policies and procedures to ensure that each strategic practice is functioning properly and driving towards its strategic purpose. These policies and procedures define what the practice is supposed to accomplish. The first step is to define the strategic intent of the system, in this case the integrated PM domain, and all the individual practices that make up the system components. Next, we identify the system variables and gain an understanding as to how they interact with, or impact each other. Through systems thinking analysis, we define the process steps and identify leverage points within each practice that will have the most dramatic impact to performance. We set thresholds for these variables and a set of policies and procedures as to how you should respond when certain variable states are reached.

When defining policies and procedures for Integrated PM, the focus should always be on breaking the constraint of the system. The actions and procedures outlined and enforced as part of governance are to guide the project team through the necessary process steps to achieve the highest levels of performance, and will highlight the appropriate responses and actions that should be taken to break the system constraints. When things go off track, the policies and procedures help to identify the issues and propose the procedures that will most effectively address this issue. With policies and procedures defined ahead of time, you will be able to deliver your projects with consistency and continually improve performance.

The END doesn’t justify the means. Getting the project completed doesn’t justify the heroics needed to get there. Policy and procedure get us there in one piece, and enables the organization as a whole to be dependable and perform at predictable performance levels. Governance isn’t micromanagement, it is targeted management. Governance policies and procedures ensure that each individual project team member behaves and takes actions that will deliver the highest performance levels in line with the strategic objectives.

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Project Management: Governance & Approvals

“If I want to have a focused project with a uniform approval process, then I need to have strong governance principles, but I am not sure how to build a foundation of good governing practices.”

When I hear, someone mention the term “governance,” I automatically think about men in powdered wigs standing around shouting at each other. I can’t really tell you why my brain automatically goes to the 18th century, but the term, governance, nevertheless speaks to the same set of policies, regulations, functions, processes, procedures and responsibilities that define an establishment, a government governs their people.

In the project world, it is the management and control of projects, programs, and portfolios. In this governance, the goal is to provide clear and uniform oversight of projects at the management level by formal review and strategic decision-making. A review is an assessment by upper management as well as the uniform evaluation of deliverables as they are being constructed.

A good project manager is not only someone that can communicate effectively, but that has the forethought to continuously prepare throughout the project cycle. Good governance has been a serious topic for centuries, so there is lots to it, so let’s put on our powdered wigs and contemplate actions that would build clarity and establish harmony during a project…

As I mentioned before, there are many different types of governance. Corporate governance defines your organizational line of authority and responsibility, the true powdered wigs. You need project governance to ensure that your decision-making process is as streamlined as possible. Establish a clear line between the two. This will help to define your own line of command for yourself as well as your team, because this is not a short process, project governance starts at the very beginning with the business case and continues past the final review of the deliverable.

In the beginning, with the business case document, you are making a case for why this project should be accomplished and what the exact benefits will be. If these points are not stated clearly up front, then there is little chance you’ll gather the support or teamwork necessary to produce a good product, so no point worrying about governance. At the start of every project, you and your team should have and understand this clearly defined purpose. With this purpose, your team has a focus and can, therefore, single-mindedly create goals for the project cycle.

As the primary wig wearer, how are you going to communicate? Who is going to approve what? This should be established early in the project. You should have a communication plan for all key stakeholders, including your sponsor, the client, the team members, as well as all the other important stakeholders. This is sometimes a regular email or meeting, but rather than taking sole responsibility, you can assign spokespersons to key stakeholders, but updates should remain separate from approvals.

You should have a clear division so that when decisions are needed, setup focused sessions with this select group only. If you include decisions into broader sessions which involve your other stakeholders, the session will become more about getting people up to speed, thereby losing focus and negatively impacting your ability to get to a decision point quickly & efficiently. Having both established at the beginning, promotes project confidence and stability, since you won’t be scrambling to put anything together in the middle of everything else.

Even in the 18th century, people had to work for their wigs, because they were a sign of maturity and authority. Attaining a sense of ownership as a project leader is a similar process, but make sure that the team feels that some ownership is important. After you and your team possess it, you have a single point of accountability promoting empowerment and ownership. You successfully ensured that nobody should be standing around confused about what they should be doing. To get that ownership, everyone should know from very early in the project who is needed for which type of decisions and why. By defining this upfront you’re ensuring less confusion further down the line should an issue or critical decision point bubble up unexpectedly.

The formation of good project management practices takes time, and this is just the beginning of true and meaningful project governance. Yet, building a project foundation with these qualities means that your project has focus, and a uniform understanding of what is expected. You want good governance, because it provides you and your team with solid accountability, strong strategies for project formation, honest disclosure, a definite Business Case, as well as the ability to terminate the project. So maybe governance is not all guys in powdered wigs yelling at each other, because the gentlemen of the 18th century did not have true accountability or honest discourse with each other. The men of the wig wearing period did some incredible things, but in regards to governance, the modern project manager has a slight advantage.

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Systems Thinking

“If I considered all the business functions impacting project success holistically, then project performance would be more consistent and manageable, but there are just too many factors to consider, and management would be ineffective due to analysis paralysis.”

Projects are at the root of Integrated PM. Change is at the root of projects, and it follows that change is at the root of Integrated PM. Central to Systems Thinking is the performance management of this change. Systems Thinking is applied successfully when these three situations below exist.

First, there is someone who is dissatisfied with the current situation. This someone would like to achieve one or several goals, or maintain current threatened levels of achievement using a change the project is supposed to produce.

Second, the way of invoking that change is not obvious. The problem situation is complex. The interested someone may not have enough information about the situation to know or discover all the consequences of decision choices, or to be able to evaluate the performance of these options in terms of their goals, principle purpose, or strategic intent.

Third, the interactions between various elements and projects have a degree of complexity that the limited computational capacity of the human mind cannot evaluate in the details necessary to make an informed decision.

The typical environment where projects exist are systems. What is a system? For now, a system is a collection of things such as tasks, projects, programs, and portfolios that relate to each other in specific ways, i.e. that are organized and follow specific rules of interaction. Collectively, they have a given purpose, i.e. they aim to achieve or produce outcomes that none of the parts can do by themselves.

We can recognize or view something as a system for our own purposes. This is an important insight, in the real-world systems do not exist or create themselves spontaneously, readymade for us to discover. No, Systems are human inventions. We choose to view projects as a system to better manage projects and improve performance.

If we are to deal effectively with the complexity of projects and decision making within our system environment, we need a new way of thinking. This new way of thinking evolved about 1940 and could be labeled ‘systems thinking’. This system thinking has been proven successful within the context of projects. System thinking is used in decision processes which help decision makers explore portfolios of projects in much of their complexity without having to drill down into the trees of the forest.

System thinking is used to find a ‘good’ or ‘best’ compromise solution, and is used frequently to give answers to important ‘what if’ questions, such as “how is the ‘best’ solution affected by significant changes in various cost factors?” or “What is the effect of uncertainty in a critical resource scheduling?”

Integrated PM is the collection of practices leveraging systems thinking to better manage projects holistically within an organization. You’ll wonder how you survived without it. In truth, you probably weren’t surviving, you just didn’t know it.

Download this free E-book- Integrated PM: Applied System's Thinking with Portfolios, Programs and Projects

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Why Your Project Needs a Foreign Policy

Several forces are complicating the environment for cross business-unit projects. Increasing organizational flexibility, a decline in leadership intervention, and an increase in the use of enterprise tools are just a few.

Increasing Organizational Flexibility

There was a time in the not so far past that a business unit had a singular vision. For an example, when working with a video production unit, you knew exactly what the collaboration focus would be about; Video Production. But today, in an environment of information and project specialists, who exist in a matrix organizational structure, it’s not necessarily true.

These business structures exist because they help the enterprise get specialists to where they are needed faster and further. At the same time, the enterprise resource pool of 4k and virtual reality video specialists can be smaller than would otherwise be possible, which reduces the costs of all the projects. The local project manager picks up a little more understanding of the discipline of Video Production, so they know when to call a specialist and when to use a generalist. We all win, which is the point of Integrated PM.

Decline in Leadership Intervention

Another force pushing projects towards a Foreign Policy is the increased capabilities of Business Intelligence. Managers are better equipped to receive status reports and project trends. With this comes the standardization and formal governance of projects. In this new environment, the need for leadership intervention has decreased. Leaders swoop in and become disruptive less and less. When they do, the visit is quick and easy. There isn’t a need to update them as much as there used to be. However, part of this new culture is the clear understanding of what to communicate and when, thus a Foreign Policy.

The Use of Enterprise Tools

A very powerful force pushing projects toward the Foreign Policy is the use of Enterprise Workflow Management tools, Enterprise Project Management tools, and general Enterprise Collaboration Tools. This new technology makes different types of communication possible, driving the demand for policy around that capability.

The Communication Plan

A Project’s Communication Plan “Foreign Policy”. Under the advent of these and other forces, the project team needs a communication plan more than ever. The good news is that this plan can be used repeatedly once developed. In projects that impact multiple business units it’s important to keep the business unit communication channels active through a Foreign Policy that increases the perceived value of your project, its team members and its supported communication channels.

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Val Workman
The font got out of hand here.
Thursday, 08 June 2017 17:21
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Problem Definition Structure

 

   Of course, I understand the desire to jump right into production, but I also understand the wisdom in stepping back and gaining an understanding the problem before trying to solve it. Right, I've heard all about cut/measure ratio. Like in many controversies, this is a false dichotomy. Turns out that depending on your business strategy, industry, and product, typically as much as 60% of all market needs gathered have straight forward solutions with no problems produced. I suppose before I say there are no problems, we should agree upon what a problem is.

   The first attribute of a problem is the need for change. All problems have a current state, and a desired state that is different. The transition from the current to the future state may have nothing preventing it, it's just a matter of doing it. But wait a minute, when we say 'nothing preventing it', does that include resource availability, enough time, and investment? These types of things can also constrain our journey from the current state to the desired state. This introduces the notion of types of problems like business, market, user experience, and technical problems.

   The second attribute of the problem is the resistance to the transition between states. The greater the resistance, the greater the problem. Some problems stem from technical resistance, others cultural resistance, while still others a business resistance. You'd be surprised by the number of problem statements I see that never state the resistance or conflict caused by trying to transition between states. Every problem statement should identify the conflict. Without a conflict, it's at best an enhancement request, not a problem statement.

   The last paragraph implied that problems produce varying degrees of resistance between states. The third attribute of the problem is the quantification of this resistance. Just as you may experience different resistance traveling the different paths from point A to point B; the path you choose to get to your destination impacts the resistance experienced. The third attribute is the path your willing to take.

I find that the 'IF THEN' construct works well in explaining the need for change. An example might be, 'If I start my car, then my dog starts to whine.' Notice that this statement doesn't identify the desired state. Perhaps a way to avoid this ambiguity of what's desired would be, 'IF I start my car, THEN it should start without hurting my dogs ears.' Ok, so where's the resistance attribute in the statement?

   The resistance to the desired change is captured in the form of 'IF THEN, BUT'. Many times resistance isn't identified by the same people capturing the IF THEN component of the problem definition. With the example above, we've add, 'IF I start my car, THEN it should start without hurting my dogs ear, BUT low frequency starters wear out sooner, and require too much battery capacity.'

   Another construct that can be important is the 'IF NOT THEN, BUT'. Many organizations require both constructs in their problem definition process.

   The path is identified by placing the problem statement in different categories. The TRIZ methodology suggests five levels to problem solving aligned with the amount of resistance you are willing to accept. This triaging is the first step in maintaining a balanced opportunity pipeline. By properly categorizing the problem statement, into one of three portfolios or categories, you are able to reduce the number of full problem statements you need to write.

   60% of your problem definitions should be categorized as 'Maintenance & Utility' types, and only consist of the 'IF THEN' statement. These typically will be routed for Level 1 and Level 2 types of innovation. Level 1 uses no innovation, and is addressed through routine design problems solved by methods well known within the specialty. Level 2 requires minor improvements to the existing product using methods well known within the specialty.

   30% of your problem definitions should be categorized as 'Enhancement & Improvement' types, and consists of the 'IF THEN BUT' statement. These typically will be routed for Level 2 and Level 3 types of innovation. Level 2 requires minor improvements to the existing product using methods well known within the industry. Level 3 requires fundamental improvements to the product using methods well known within the industry.

   10% of your problem definitions should be categorized as 'Transformational', consists of the 'IF THEN BUT' statement, and also requires a new business case to be developed. The other two categories of problems are linked to existing business plans. Setting out to address these 'Transformational' type problems is going to require a business case and maybe modification to the product strategy. These typically will be routed for Level 3 and Level 4 types of innovation. Level 3 requires fundamental improvements to the product using methods outside the industry. Level 4 requires a new generation of a product that entails a new principle for performing the product's primary function.

   Level 5 innovation requires a new product innovation charter and is outside of the typical innovation team.

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Derick Workman
I find using the three categories of Maintenance & Utility, Enhancements & Improvements, and Transformational, to be a great way ... Read More
Wednesday, 10 May 2017 08:11
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