Frank Saladis, PMP
Value Driven Project Management And Your Future As A Project Manager Frank P. Saladis PMP
International Project Management Day • Purpose - Recognize and acknowledge project managers and project teams • Promote the value of Project Management • PMI ® Mission – Making Project Management Indispensible for Business • IMP-Day Mission – Making the Project Manager Indispensible for Business Success
Today’s Agenda • Project Management Reality • Achieving Project Management Maturity • 7 Value Postulates • Traditional and Non Traditional Projects
• Types of Value • Requirements management • Definition of Success • Next Generation Project Managers
Project Management - Reality No matter what you do, things will go wrong If you stay calm and break problems down into pieces, you can handle many difficult situations
Project Management - Reality • There are some common situations to expect: Oversights Being forced to do stupid things Resource shortages Low quality Direction changes, personnel issues Threats of mutiny
Project Management - Reality • Difficult times are learning opportunities. Take the time to examine how it happened and how it could have been avoided • Taking responsibility for situations, regardless of who caused them, always helps to expedite resolving the problem • In extreme situations, go into damage control mode. Do whatever it takes to get the project into a known and stable state
Project Management - Reality • Negotiation is useful not only in a crisis situation, but also in management. Good negotiators work from people’s interests, not their positions • Have clear lines of authority at all times. People should know who has decision making power before a crisis occurs
Project Management - Reality • People respond to pressure in different ways. Be observant and open in how you help the team deal with the different kinds of pressure Scott Berkun, The Project Artist
Achieving Project Management Maturity
Dr. Kerzner’s 16 Points to Project Management Maturity 1.
Adopt a project management methodology and use it consistently.
2. Implement a philosophy that drives the company toward project management maturity and communicate it to everyone. 3. Commit to developing effective plans at the beginning of each project. 4. Minimize scope changes by committing to realistic objectives. 5. Recognize that cost and schedule management are inseparable.
Dr. Kerzner’s 16 Points to Project Management Maturity 6.Select the right person as the project manager. 7. Provide executives with project sponsor information, not project management information. 8. Strengthen involvement and support of the line management.
Dr. Kerzner’s 16 Points to Project Management Maturity 9. Focus on deliverables rather than resources. 10. Cultivate effective communications, cooperation, and trust to achieve rapid project management authority. 11. Share recognition for project success with the entire project team and line management. 12. Eliminate nonproductive meetings.
Dr. Kerzner’s 16 Points to Project Management Maturity 13. Focus on identifying and solving problems early, quickly, and cost effectively. 14. Measure progress periodically. 15. Use project management software as a tool—not as a substitute for effective planning or interpersonal skills. 16. Institute an all-employee training program with periodic updates based upon documented lessons learned.
Preparing Yourself For The Future Top Five Key Competencies of a PM: Communications Skills-verbal and written Leadership Skills Organizing Skills-planning, time management Interpersonal Skills Negotiating Skills-Diplomacy and mediating Team Building Skills Technical Skills
Understanding Value
Postulate #1 It doesn’t matter if you execute a project extremely well or extremely poorly if you are working on the wrong project. Value-Driven Project Management
Postulate #2 Being on time and on budget is not necessarily success.
Value-Driven Project Management
Postulate #3 Completing a project within the triple constraint does not guarantee that the necessary business value will be there at project completion. Value-Driven Project Management
Postulate #4 Having mature project management practices, including an enterprise project management methodology, does not guarantee that business value will be there at project completion. Value-Driven Project Management
Postulate #5 Price is what you pay. Value is what you get. Warren Buffett Value-Driven Project Management
Postulate #6 Business value is what your customer perceives as worth paying for.
Value-Driven Project Management
Postulate #7 Success is when business value is achieved.
Value-Driven Project Management
The Customer Supplier Model In a project, the customer is the next person in the process Supplier
Customer Supplier
Set Expectations intentionally (values) Define Deliverables Establish Acceptance Criteria (for each C/S interface)
Customer Supplier
Customer Supplier
As of this second quit doing less than excellent Work! Tom Peters
The Continued Evolution Of Project Management
The “Traditional” Project – Time duration of 6-18 months – The assumptions are not expected to change over the duration of the project – Technology is known and will not change over the duration of the project – People that start on the project will remain through to completion (the team and the sponsor) – The statement of work is reasonably well-defined – The target is stationary – Few stakeholders 26
The “Nontraditional” (Complex) Project – Time duration can be over several years – The assumptions can and will change over the duration of the project – Technology will change over the duration of the project – People that approved the project (and are part of the governance) may not be there at completion – The statement of work is ill-defined and subject to numerous changes – The target may be moving – Multiple stakeholders 27
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Changes Due To Nontraditional Projects Integrated Processes Behavioral Excellence Informal Project Mgmt.
VALIDATION
DEFINITION DISCOVERY
Culture MANAGEMENT CLASSIFY
Management Support Training and Education
UTILIZATION
PUBLICATION IMPLEMENTATION
CAPTURING BEST PRACTICES
HEXAGON OF EXCELLENCE
Traditional Nontraditional
CEO NETWORKED Americas PMO
ss ce l o r P ntro Co s es oc tion r P ni fi De
CFO
PMO EPM
REVALIDATE
sic e Ba ledg ow Kn
s nt es oc eme r P v o pr Im
Level 4 Benchmarking Benchmarking
Level 3 Singular Singular Methodology Methodology
Level 2 Common Common Process Process
Level 1 PMO Mexico
PMO Brazil BrazilPMOPMO/Europe PMO Asia Asia PMO UK/Europe PMO
Common Common Language Language
MATURITY MODELS
Level 5 Continuous Continuous Improvement Improvement
Success and Value
Success Success is not necessarily achieved by completing the project within the triple constraint. Success is when the planned business value is achieved within the imposed constraints and assumptions. Triple Constraint Value
Value-Driven Project Management
Types of Value Theoretical Values
Economic Values
Social Values
Values Religious Values
Aesthetic Values Political Values
Factors Influencing Value • • • • •
Satisfaction Alignment Process Criteria Outcome Criteria Return on Investment
Researching The Value Of Project Management, Janice Thomas,PhD, Mark Mullaly PMP,
Value Drivers •Cost savings •Revenue increases •Customer retention •Greater market share •Improved competitive position •Reduced rework and write-offs
•Attainment of strategic objectives •Greater social good •Quality of life •Brand recognition and reputation •Employee retention •New products and services
Types of Business Values •Foundation values are those values that must be achieved in the short term for the continuous operation of the firm on a day-to-day basis. •Strategic or innovation values are those values that must be achieved for the long term survivability of the firm.
Value-Driven Project Management
Changing Values
(Adapted from Ken Hultman and Bill Gellerman, Balancing Individual and Organizational Values, Jossey-Bass/Pfeiffer, a Wiley Company, Š2002, Pp.105-106)
Moving Away From:
Moving Toward:
(Traditional Values)
(Effective Values)
Autocracy
Trust
Job Descriptions
Competency Models
Power and Authority
Teamwork
Internal Focus
Stakeholder Focus
Security
Taking Risks
Conformity
Innovation
Predictability
Flexibility
Internal Competition
Internal Collaboration
Identify and Consult System Stakeholders • If you are lacking consideration of everyone who is likely to be affected by the introduction of the system, there is a great likelihood of missing some critical requirements. • “Identifying stakeholders and discussing the system with them makes people feel like they are part of the requirements elicitation process. In fact, it makes them a part of it.”
Use Business Values to Drive Requirements Elicitation • If a system is to be useful, it must contribute to the key concerns of the business. If the concerns are identified and used as drivers of the requirements elicitation process, there will be higher confidence that the system will meet real organization needs. • Making the business concerns explicit helps to focus and clarify these goals.
Collect Requirements from Multiple Viewpoints • If requirements are collected from a single viewpoint, they are unlikely to meet other stakeholders’ requirements. • Collecting requirements from multiple viewpoints is a useful way to prioritize requirements • Identified viewpoints can be used to help organize requirements elicitation and organize the requirements specification, too.
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New Developments in Project Management New Success Criteria Governance
Key Performance Indicators
Dashboard Design Measurement
The Changing Definition of Success • • • • • •
Success is not simply the triple constraint Connect with organizational goals Focus on customer satisfaction Generate team and employee satisfaction Success must have a business component The constraints must be prioritized – continuous focus on competing demands • Value is now included in success criteria 41
lue Va
Tim
Quality
ty
Risk
Scope
ali Qu
Image/ Reputation
st Co
e
Modifying The Triple Constraints
Risk Value
Scope
Traditional Projects
Cost
Time
Image/Reputation
Complex Projects
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Disney’s Prioritization of Constraints
• Safety • Aesthetic Value • Quality
• Time • Cost • Scope
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New Developments in Project Management New Success Criteria Key Performance Governance Indicators
Dashboard Design Measurement
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Defining Value Metrics (KPI) PAST VIEW
PRESENT VIEW
Metrics are fixed for the duration of the project
Metrics can change over the duration of the project
(Time and Cost Metrics Only)
(Metric-Driven Project Management)
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Typical KPI – – – – – – – – – – – – – – –
Percent of work packages adhering to the schedule Percent of work packages adhering to the budget Number of assigned resources versus planned resources Percent of actual versus planned baselines completed to date Percent of actual versus planned best practices used Project complexity factor Customer satisfaction ratings Number of critical assumptions made Percent of critical assumptions that have changed Number of cost revisions Number of schedule revisions Number of scope change review meetings Number of critical constraints Percent of work packages with a critical risk designation Net operating margins
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New Developments in Project Management New Success Criteria Key Performance Governance Indicators
Dashboard Design Measurement
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Dashboard Design Dashboard
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FACTOR
DASHBOARDS
SCORECARDS
Performance
Operational issues
Strategic issues
WBS level for measurement
Work package level
Summary level
Frequency of update
Real time data
Periodic data
Target audience
Working levels
Executive levels
Dashboards Versus Scorecards
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New Developments in Project Management New Success Criteria Key Performance Governance Indicators
Dashboard Design Measurement
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Variable Time
EVMS
EPM
VMM
Cost A Comparison: EVMS, EPM and Quality VMM Scope Risks Tangibles Intangibles Benefits Value Tradeoffs
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Measuring Value Expected Benefits, Results or Outcomes
Value Conversion
Profitability
Easy
Customer Satisfaction
Hard
Goodwill
Hard
Penetrate New Markets
Easy
Develop New Technology
Medium
Technology Transfer
Medium
Reputation
Hard
Stabilize Work Force
Easy
Utilize Unused Capacity
Easy
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Benefits and Value at Completion Traditional Reporting • Time at Completion • Cost at Completion
Forecast Reports
Future Reporting • • • • •
Time at Completion Cost at Completion Benefits at Completion Value at Completion Other Metrics at Completion (Business Leading Indicators; i.e. Time to Value)
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New Developments in Project Management New Success Criteria Key Performance Governance Indicators
Dashboard Design Measurement
Project Selection and Governance • Select projects based on business value, the customer’s view of value, and the societal view of value Tangible benefits Intangible benefits Compliance and regulatory • Determine project continuance by measuring short and long term value
Your Future As A Project Manager
Project Management Continues to Evolve “What got you here, wont get you there� Marshall Goldsmith and Mark Reiter
Next Generation Project Managers • Primary Skills: Knowledge of the Business Interpersonal skills Quantitative skills Behavioral skills Risk Management Integration skills
The Future - A Call To Action Project Managers Offer: • • • • • • •
Leadership Logic Common sense Conflict resolution Teamwork Risk Management Technical knowledge
• • • •
Cost management Effective communication Innovation and Creativity The ability to coordinate and integrate • A Business Savvy approach to getting things done • Stakeholder management
Extreme Project Leadership: Go Beyond Traditional Thinking • Accomplishing work through other people • High level of trust in your team • Expert in people skills • Relationship building- team, suppliers, internal organizations, management • Collaboration • Stress Reduction (effective communication) • Mentor and Coach
The Project Manager P - Professionalism at all times R - Respect for all stakeholders O - Ownership of each assignment J - Judicial decision maker E - Excellence in execution C – Communicator T – Team player and team builder
The Project Manager M - Motivator A - Action oriented N - Negotiator A - Always available G - Genuine commitment E - Energetic and empowering R - Responsible for success
Focus on the Future • Project Management is a Profession • The Profession is still growing • Let’s keep a good thing going by celebrating successes and learning from experience • Be Creative • Become an outstanding leader • Continue to raise the bar • Make a difference • Balance projects with leadership and process • Develop skills for the international environment • Focus on short and long term project value
Engage!
Frank P. Saladis PMP saladispmp@msn.com
References The World Class Project Manager- Robert Wysocki and James P. Lewis: Perseus Publishing PM Network Magazine- November 2001. Bridging the Gap Fast Company Magazine- December 2001. Turnaround Leadership The Future Of Project Management-PMI 速
References The Leadership Challenge- Kouzes and Posner Successful Meetings Magazine- April 2002 Fast Company Magazine – August 2003 Fast Company Magazine – June and July 2005 Creativity for Leaders – Gary Fellers