Reduce risk by enhancing estimation!

imageI’ve frequently said that project management is about bringing predictability to uncertainty and while a lot of my writing focuses on managing the impacts of uncertainty through effective risk management, estimation is another area where uncertainty needs to be addressed.

If you are fortunate enough to be managing projects where sufficient historical data exists to account for nearly all sources of variation then I envy you.

For the rest of us, here are some estimation principles which should be applicable regardless of the project’s domain or specific context.

  • Use more than one estimation method: Consider this a form of hedging your bets. If you derive close to the same estimated value using different techniques, the likelihood that your estimates are significantly incorrect drops. Consider combining bottom-up and top-down methods.
  • Document and share assumptions related to the estimates: It’s always a good idea to have a second pair of eyes review estimates, but without understanding the underlying assumptions which those estimates were based on, it can be very difficult to provide quality feedback. If the assumptions are not documented, it eliminates your ability to identify proactively when internal or external changes might invalidate the assumptions & their associated estimates.
  • An estimate should never be provided as a single value: Without some understanding of the variation in the stated estimate, it’s impossible to manage the uncertainty resulting from it. This variation could be stated as a range or a confidence level.
  • Discourage multitasking during estimation: Estimation takes significant mental effort and if the subject matter experts involved are distracted, the quality of your estimates will suffer.  Consider breaking up the estimation process into more short meetings as one way to overcome this.  Also, avoid estimation right after lunch time or at the end of the working day as your team might be less focused.
  • Evaluate estimates across multiple dimensions: Just as it is helpful to use more than one estimation technique, it’s also valuable to analyze estimates in different ways to try to identify flaws. For example bottom-up activity estimation will give us detailed effort data at the work package level. But aggregating these estimates by resource role or by project phase will enable us to evaluate whether the ratio between roles or phases is logical.
  • Remove the person from the evaluation: It helps to have peer-level reviews of estimates without knowing who produced them. This sounds wrong, but no subject matter expert is omniscient and our positive biases about them might cause us to unconsciously miss estimation flaws.

Improving estimation is not a silver bullet to slay all sources of project schedule or cost variation but elevating project management capability is about evolution, not revolution!

Categories: Project Management | Tags: , , , , | Leave a comment

Who should track project benefits realized?

imageConsistent measurement and reporting of the benefits realized from projects is a key step towards portfolio management maturity. While it’s good to improve practices around identification, evaluation, selection and prioritization of projects, the proof is in the (benefits) pudding!

This is easier said than done.

It’s hard enough when the business cases for projects don’t clearly identify the expected benefits or when those benefits are intangible or difficult to measure. But it can be even more difficult when the sponsor and other stakeholders who were directly responsible for development of the business case or realization of the benefits are in different roles or are no longer with the organization.

There’s a lot to be said for requiring benefits reporting periods to be as short as possible – one year or less. However, sometimes even in that time period the individuals most closely associated with the project’s outcomes might have moved on.

This is why I recommend that the reporting of realized benefits be centralized within a portfolio support, finance or similar team outside of the original sponsoring department. That way, should a reorganization occur or the original sponsor move on, there is continuity and consistency of reporting.

There’s another reason to consider centralizing the benefits reporting function – independence. Don’t get me wrong – I am not impugning the integrity of sponsors. The way in which benefits are reported and analysis done against original business cases can vary widely. Given this, centralizing this function might help improve the quality and consistency of information reported.

The other benefit of such centralization is that identification and analysis of root causes for variance can be done at the portfolio-level resulting in practice improvements which will have a more immediate and broader benefit than if this activity was distributed.

Realizing the benefits of benefits realization requires careful consideration of the “who” as well as the “how” and “when”!

Categories: Project Portfolio Management | Tags: , , , | Leave a comment

Focus less on the management and more on the resources with resource management!

imageA common complaint made about recent generations of North American parents is that we have over-parented our kids. Between obsessing over their moods, their marks, their behavior and their free time, our focus has shifted from the children to all of the activities and processes which we need to be performing.

An analogy could be made with resource management.

Let’s take resource planning or workload management.

In matrix organizations, complicated processes and tools get implemented to answer the deceptively simple question “what’s Bob going to work on over the next few months?”. Inevitably, the data captured becomes the focus of scrutiny with both functional and project managers complaining about its inaccuracy while simultaneously being reluctant to invest the effort which will be required to improve quality.

However, the more direct approach of having staff review their own data and confirm or correct allocations is rarely utilized. We like to think that we are helping our team members to take greater ownership for their work, but if this doesn’t start with their planned allocation, are we truly empowering them?

A second example relates to personal development.

Many organizations have instituted annual personal development planning cycles and established targets for the percentage of staff who are expected to have plans defined and updated. The cumulative effort involved with this process is significant which can become a source of frustration for staff and their managers.

The upside of these practices is that it prevents people managers from neglecting their crucial role in supporting development planning. But any team member who is truly interested in their personal growth will have already invested effort in development planning.

Why do we believe that mandating “compliance for all” will inspire the remaining staff to better themselves, especially when we set deadlines on completing the planning and don’t account for their existing workloads?

Why not test my assertion with your own organization? Create a simple value-stream map for key resource management processes and highlight those steps which directly engage the resource. If it’s less than 25%, are your practices truly staff-focused?

Increasing employee engagement has gained tremendous popularity over the past few years, but in the process, we’ve forgotten that to achieve this, “employee” comes before “engagement”!

Categories: Facilitating Organization Change, Process Peeves | Tags: , , | Leave a comment

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