Don’t ignore customer capacity when populating your project portfolios!

Whether your company conducts planning on an annual or a continuous basis, the approach is usually the same: identifying and mapping demand against a finite supply of financial and human resources.   High-level effort estimates get derived and aggregated across cross-functional project wish-lists to help governance bodies make decisions about project selection and prioritization.

Estimation and capacity-determination usually focuses on the staff that will be producing key deliverables on these projects and a key role that often gets neglected is the project customer.  In some organizations, this role may also be called the project sponsor if the sponsor’s responsibilities extend beyond providing funding for the project to acting as the main organization advocate, key decision-maker and default point of contact for issues and risks escalated by the project team.

While a customer is not (usually) responsible for producing project deliverables, if they have insufficient time to commit to the project, the impacts of this capacity shortfall could include:

• Delayed decisions resulting in project schedule impacts
• Reduced organization awareness, buy-in and operational readiness to fully benefit from the project’s outputs
• Deliverables rework with accompanying cost impacts based on changes in direction or resulting from decisions that were made with insufficient thought or focus
• Frustration on the part of the project team or project manager when escalated issues, risks or actions are not addressed in a timely fashion

What is especially challenging about this is that while it may be possible (if project budgets have flexibility) to bring in outside assistance to address shortfalls in producing project deliverables, it is rarely possible for a hired gun to easily take over the role of project customer as it usually requires significant specific operational or functional knowledge coupled with well established relationships with peers and executives.

To avoid this issue, a rule-of-thumb for appropriately planning for customer allocation could be developed based on the assessed complexity of the project.

Low complexity, routine projects or those which will result in minimal change to the organization may only require a marginal commitment from the customer, but as complexity or the magnitude of change impacts increase, the customer’s involvement will also increase.  On highly complex or transformational projects, it would not be unrealistic to expect the customer to spend almost all of their time focusing on the project, especially at critical phases in its lifecycle.

This is another advantage for those organizations which have embraced agile approaches – the significant involvement of the project customer throughout the lifecycle is recognized as a guiding principle of agile implementations, and they will be less likely to take on more projects than can be adequately supported by their available customer capacity.

It pays to cut your coat according to the availability of team member and customer cloth!

Throw away the pacifier if your project intake process toddler is experiencing teething pains!

An effective project intake process helps bring predictability to staff utilization and increases the likelihood of critical projects and operational activities being completed on time.  However, nine pregnant women can’t have a baby in one month, and if your intake process is still in its infancy you should expect that there will be some challenges with getting key participants to follow it consistently.

What are some of the symptoms which might lead you to believe that your intake process is being a cranky toddler?

• Project requests are made to the governance committee without advance independent review or validation
• Staff are complaining that they are unable to locate specific projects within your time tracking system to track their time.  After investigation, it turns out those projects were never reviewed or approved by your governance committee!
• Your governance committee never rejects any projects which have been brought to them for review
• Lobbying or even bullying by committee members during review meetings to get their “pet projects” approved
• Each project approved by the committee is deemed a high priority
• Insufficient stakeholder engagement in the development of project requests

So what can you do when you witness these “teething pains”?

One of the worst things you can do when faced with such evidence is to do nothing and hope compliance will emerge naturally – unfortunately, entropy usually increases.  At the same time, overreacting will prove equally ineffective as it will likely lose you whatever goodwill you might have gained to date in working with the committee.

A better approach is to remind the governance committee of the business value gained by following the process – both to the organization as a whole and to the individual committee members.  Remind the group as to why this change was necessary, and actively listen to their feedback to identify if there is any fine tuning which you can do to make the process less onerous.

Encourage members to hold each other accountable for compliance instead of your having to play “process cop” – after all, the best governance committees are self-managing.

Finally, remind the committee of any early wins that were achieved through the introduction of the process – these might include the termination of low value stealth projects or an increased cross-functional awareness of “what’s going on”.

The more you can reinforce the benefits of the process and make it easy for your key stakeholders and governance committee to comply, the faster your project intake process will grow up!

All troubled projects are red, but some projects are more red than others…

Review almost any project status report or project portfolio dashboard and apart from the names of the projects, the next most common field is likely to be a health indicator depicting project health using red, amber or green stoplights.

While these indicators might seem like a good visual method to quickly understand the health of an individual project or a portfolio, the flaw with this approach is that this is a subjective evaluation usually conducted by either the project manager or the project sponsor.  While one might argue that these are the two roles best positioned to assess a project’s health, they are also the ones who have the most “skin in the game”, hence, depending on organizational culture and project management maturity, the ratings provided may be as suspect as team members’ use of percentage complete for reporting task progress.

At one extreme you’ll find the project managers and sponsors who are eternal optimists or those who fear repercussion if they report their projects as being amber or red – with such individuals, a project’s health will rarely be seen to stray from green until it is past the point of recovery.  At the other end of the spectrum are those Chicken Littles who set their project to cherry red the moment they encounter their first issue.  Although most people fall somewhere between these two extremes, natural biases make it hard for stakeholders to truly understand project status, and this difficulty increases when the evaluation is done at an overall portfolio level.

To bring objectivity to the health evaluation process, the use of earned value metrics, standardized healthcheck questionnaires to score the health of the project, and other evidence-based inputs such as the number of open high severity issues or risks which don’t have approved response plans in place should all be considered.

However, not all projects are equally important, and a single quantitative health indicator does not help a governance committee to identify which projects truly require assistance.  Given this, there is value in considering the use of two separate indicators – the first provides a quantitative health score for the project while the second normalizes this score by incorporating the relative criticality of that project to the overall portfolio.

While colorful health indicators can certainly create artistic dashboards, an objective evaluation of project health can help your leadership team overcome the impacts of rose-colored glasses and color-blind stakeholders!