Can you measure your project performance?

The Dutch say “Meten is Weten” – to measure is to know. Measurements have become fashionable everywhere. In companies, in schools, in hospitals … everything is driven by targets and measurements. Everyone is trying to deliver their targets and key performance indicators (KPI’s).

The fashion has come to the world of Project Management. However, in Project Management, targets are used slightly differently. Rather than set an arbitrary target, you create a plan. To measure, you compare your plan against reality (your “actuals”). Project performance measures how well you are delivering against your plan.

The traditional performance measurements for projects have always been cost and time. There’s even an acronym OTOB which neatly sums up the Project Manager’s drive to deliver on time, on budget. When people speak about project performance, they typically are talking about OTOB: are you delivering on time, on budget, relative to your original agreed plan?

If OTOB is the traditional measurement of Project Performance, modern Project methods have followed the fashion, and added more measurements. Some people have added a third dimension, Quality, and transformed OTOB into OTOBOQ.

The latest Prince2 manual (2009) follows the fashion. The subject of measurements arrives in Chapter 1, which introduces 6 key aspects of performance (whereas in the previous version it was buried in a later chapter). Prince2 suggests that the best practice is to control not just Time and Cost, but also Scope, Quality, Risk and Benefits.

In reality, you may need to go a little further: you may need to break Cost into Financial cost and Effort, as these must be controlled very differently. Financial cost is based on expenditure of money (purchase orders, invoices…), while Effort is man-days of work. So you have up to 7 aspects of performance to control. For each, you need to compare plan versus actuals

❑ Time
Time is the easiest measurement. Your plan is probably a schedule of work (typically a Gantt diagram), including milestones (and for Prince2, stage boundaries). So this plan gives your planned time. As the work advances, you track actual time using the dates that the work was actually finished.

❑ Financial Cost
Financial cost data is also quite easy to measure. You can estimate your planned costs in various ways. Some people estimate from the Gantt diagram; others collate the information in a Business Case. You should measure actual costs as soon as you commit to expenditure (e.g. when you raise a purchase order). Be proactive about recording actual costs: don’t wait until the invoices are recorded in your accounting system, and certainly don’t wait until they are paid. 

❑ Effort
Effort is mandays of work. Effort can be easy to estimate, but is often difficult to measure. Using a Gantt diagram, you can estimate effort in man-hours or man-days. This gives your planned effort. Effort is difficult to measure, because most organisations don’t have time-sheet systems (or if they have them, they are not used by all project contributors). And, as it’s surprisingly difficult to deploy time sheets solutions (i.e. to get enough people to use them week by week), measuring actual effort is also surprisingly difficult. (For many projects, it’s effectively impossible).

❑ Scope
Scope used to be hard to control, but with modern methods, it’s a lot easier. If you use Prince2’s product based planning, you can predict your planned scope based on the product decomposition. It’s easy to detect when the products are delivered, so you can easily track actual scope. (It’s not just Prince2 that helps. Some Agile methods, such as Agile Atern, also are making control of scope easier: Atern uses a Prioritised Requirements List).

❑ Quality
Prince2 also makes it easier to control quality. Using Prince2’s product based planning technique, you can do simple-but-effective quality planning, giving your planned quality. As the work is done, each planned quality test is done, which gives your actual quality.

❑ Risk
Risk is typically controlled though regular estimates throughout the project, rather than by measurements. Each time you plan (or replan), it’s wise to perform a risk analysis. This gives your forecast of risk – your planned risk. When you execute your risk counter-measures, you mitigate the risk, and lower your forecast risk level. To measure your actual risk is difficult, and probably impossible. The best you can do is to revise your estimates, using regular risk analyses.

❑ Benefits
Benefits are also typically controlled through regular estimates, rather than measurements. In many projects, you cannot measure the benefits, as they are realised after the project has closed. Your Business Case should give the planned benefits. If you can’t measure actual benefits, you should review estimates regularly: using Prince2, you will review your Business Case at the end of each stage (and the associated Benefits Review Plan).

So for Project Managers, “Meten is Weten” (to measure is to know) is a little simplistic. You need to control project performance, but you can’t measure everything.

Certainly Prince2 helps you to "know" your project -  it gives you a framework for controlling your performance – and that helps with boosting your  performance. Give it a try!

Open the gate to more effective project management

For a team manager, one of the simplest and most effective ways to structure your team’s project management effort is to introduce gate-process methods. They are not rocket science, they are not state-of-the-art, but they work. If are manage a group of projects, and you want long-lasting improvements  in project management, then you should be looking at  gate-process methods. 

Gate process methods break a project into stages and gates:
    •    A stage is a block of work in a project (sometimes called a phase). It’s run by the project manager, and typically will be several weeks long, sometimes several months long.
    •    A gate is a decision point. The board makes a go / no-go decision, based on the work done in the current stage, the plan for the next stage and the overall viability of the project. It’s called a gate for a reason: if no-one opens it,  then it stays shut. That’s important. If the board don’t take a explicit decision to proceed, then the gate stays shut and no more resources should be used on the project. The project must stop.

Many best practice project management methods are gate processes. For example, Prince2 is built around stages, but Prince2 is flexible - it  allows for a variable number of stages. Prince2 doesn’t use the word “gate”, but it has end-of-stage decision points which are gates -  the project board must explicitly approved the next stage plan. Gated methods also are a part of best practice portfolio management guidance. In the same family as Prince2, the MoP guide (Management of Portfolios) highlights the importance of gated methods, saying that “quick wins can demonstrate the value of a portfolio management approach. The first steps commonly include applying staged release of funding so that investment of resources is associated with confidence in successful delivery. Also pay particular attention to a rigorous start gate…” 

Prince2 is a generic gate process method, applicable to any type of project. There are other gate process methods which are specific to various industries and project types.

    ❑    One of the most developed stage gate methods is PetroGate, a method used in the oil and chemical industries. For example, a major chemicals company starts all major investment projects with up to four stages and gates. Gate four is the key decision point - at this gate, the investment budget is approved.

    ❑    In IT, various IT methods for solution development such the v-model have been translated into stage-gate project management methods. For example, the IT project teams in a major bank used a stage-and-gate method to boost the reliability of the handover to operations at the end of the project. The final gates checked that the right work had been done prior the hand over to the support teams and the project closedown.

    ❑    In New Product Development, many companies implement a funnel approach to product development using stages and gates. They generate hundred of ideas and start lots of projects. Weak ideas or unprofitable products  fail to get beyond gate 1 or gate 2. If a hundred projects are started, perhaps only 20 or 30 get into prototyping and development and under 10 get though the final gate which approves the product launch in the marketplace.

    ❑    In the construction industry, gated methods are used. As construction projects can be long, some industry methods can have many stages (ten or more). But if it’s a renovation project, there may be fewer stages, and if it’s a demolition project, there may be only one or two stages.
   
Be careful when you deploy gate-process methods. Avoid the traps
    •    Each project is unique, you should not  force all projects into a rigid structure. 80% of your projects may follow your standard method, but 20% of your projects should definitely not (but could still use a generic gate-process approach such as Prince2)
    •    Understand overlaps. Stages are sequential, but some teams need overlapping “phases”. (Prince2 explains how to handle this, although in the current 2009 version the vocabulary it uses is confusing)

So if you are a team manager looking to boost project management efficiency, check out gate-process methods. One good starting point is Prince2, because it is a general purpose gate-process method, which you can tailor to your company or industry needs.  Take a look … open the gate to more effective project management.

Avoid overload: manage your personal and project bandwidth

A trap is waiting for you in today’s busy world, where everyone is under pressure to get things done, lots of things. Do it all today! Get things done now!

The trap is multi-tasking. If you try to do too much at once, you lose focus and become less productive. It’s a trap at the personal level, and it’s a trap for project teams too.

To avoid the trap, you need to recognise your limits. A person has limited “band-width”.  And so does a team, a project or a company.

Multi-tasking sounds attractive. It’s a fashionable term borrowed from the world of computing. But if it’s great for computers, it’s a trap for humans when it overloads you. Overload destroys your focus and your productivity. If a task needs some prolonged concentration, some serious brain-work, then you need to reduce your multi-tasking.

It’s a trap that project managers can fall into. Some project managers abandon good practice and try to run their project using a to-do list. They are inviting overload and burn-out.

There are several easy and effective ways to avoid the trap.

1) At the personal level, and for small teams, Kanban approaches can work well. Kanban is a “lean” technique, where you have a backlog of work (your to-do list) but you limit the work in progress using a visual planner. For example, you may decide that only one task per person can be “in progress”. When the task is finished, start another. If you don’t finish it, put it back on the backlog list, then start another. (Read more about personal kanbans here)

2) At the project level, traditional methods like Prince2 use planning and delegation to maintain focus, while Agile methods use scope management.

    ❑    Prince2 uses planning to focus on your current work: Prince2 breaks the project into stages, and the project manager focuses on one stage at time. Prince2 has a simple and effective planning technique – with a clear and simple stage plan, you know what work needs to be done this week or this month. The plan replaces the to-do list and allows the project manager to focus on a limited number of current tasks.

    ❑    Prince2 uses delegation to sharpen your focus: Prince2 breaks the work into deliverables (or “products”) that are delegated to sub-teams. Each team has its own team manager, and the project manager doesn’t micro-manage the sub-teams. The delegation of work reduces the load on the Project Manager, who can focus on managing the project (rather than on doing the work).

    ❑    Agile approaches often focus on delivering just the right scope. Methods like ATERN (also known as AgilePM) use MuSCoW prioritisation as a way to avoid overload. Business needs are prioritised as “Must Have”, “Should Have”, “Could Have” or “Won’t Have”. If the project manager or the teams are overloaded, they concentrate on the “Must Have” needs. They know how to focus – they reduce their bandwidth, knowing that the “Should Have” and “Could Have” needs can wait.

3) Sometimes the problem is wider than the single project; it’s at the portfolio management level. Companies need to avoid overload, they too have limited bandwidth for change. MoP (Management of Portfolio) addresses this with portfolio prioritisation models, which can take into account both resource capacity (do we have enough people?) and resource capability (do we have the skills?)

So next time you need to handle pressure, don’t just build a to-do list. Don’t try to do everything at once - multi-tasking is a trap that can destroy your productivity.

That glitzy to-do list app on your smart-phone is tempting. It’s perhaps a good tool, but it shouldn’t be the only the only tool in your toolbox. Don’t run your life or your project using a to-do list, you will run into overload and stress. Widen your horizons; add some additional tools to your toolbox, either traditional tools like planning and delegation or innovative ones like Kanban and MoSCoW.

P3M3: behind the acronym is an important tool

Project Management is full of acronyms. PID, WBS, ROI… there are hundreds. Some of them help us, some of them confuse us.

P3M3 is a troublesome acronym that’s been around for a few years. Some people like it, some hate it, some don’t understand it. P3M3 is certainly not a good acronym, but don’t be put off. Take the time to understand it, and you will discover a useful tool-set that can help any organisation to measure its progress in Project Management and related areas.

Firstly, let’s decode the troublesome acronym. It’s a confusing acronym, because the acronym is not the sum of P3 + M3, as you might expect. No, P3M3 is the fusion of two other concepts, MM + P3M (but neither concept actually exists as a stand-alone acronym)

    1.    MM is about Maturity Models
    2.    P3M is  Project Management, Programme Management and Portfolio Management

So P3M3 is about measuring your team’s maturity to manage projects, programmes and portfolios. 

P3M3 comes from the UK, and belongs to same family as Prince2, MSP, MoP and P3O. If you are using one or more of these methods, then it will directly help your team to measure your progress; if you are not, then don’t worry, they are designed to be general purpose models, and you can still use these tools.

Let’s deal with the two parts separately

1) MM = Maturity models.

P3M3 is based on models, which help us to measure maturity. Each model tries to express one aspect of maturity. 

A maturity model attempts to measure your team’s maturity, on a scale from 1 to 5, based on defined best practice. It’s not just an arbitrary measurement, it’s a well designed model based on a set of criteria founded in proven best practice.

For example, P3M3 contains a maturity model for project management (called PjM3). This is based on a 360° set of measurements of project management maturity, using 7 dimensions such as financial management, risk management and resource management. This can be used by any team, whether it is using Prince2 or not. For the Prince2 community, there is dedicated model to measure the team’s ability to run better projects using Prince2. (This version is called P2MM).

2) P3M = the management of change initiatives (projects, programmes and portfolios)

P3 is a useful little acronym. It stands for Projects, Programmes and Portfolios. These are increasingly called “Change Initiatives”. They are three different ways of managing change.

Project Management has been around for years, and many organisations have reasonable maturity in project management. Programme Management is more recent, and Portfolio Management is the new arrival. All three are tools for change, to help the organisation to manage change efficiently and effectively.

So P3M is about management of change, and P3M3 is about measuring your organisation maturity to manage change.

Some organisations manage change well. They implement a strategy which changes the organisation. They innovate, adapt and survive. Their change management is effective.  When they invest in a project (or a programme or a portfolio), they can expect a good return on that investment.

So that is why P3M3 is so important. It measures your organisation’s ability to change. To innovate. To adapt. To survive.

Concretely, P3M3 drives improvement. It helps you to assess your maturity, objectively and with a structured 360° view. When you know your strengths and weaknesses, you can improve. If you know that, for example, your project financial management is fairly strong (say, level 3), but your project risk management is weak (level 1), you can launch some targeted improvements in risk management.

That’s a fast track to improvement. A fast track to better management of your projects, programmes and portfolios. Which means more efficient and more effective change management for your organisation.

That’s why P3M3 is so useful.

Four ways to build value in Portfolio Management

Getting started with Portfolio Management is typically quite easy. Essentially it’s all about reporting. But once this is in place, what next? It’s easy to lose momentum and get trapped in a weekly cycle of reporting.

To make sustainable progress on Portfolio Management you need identify how to add additional value from Portfolio Management. This way, you can make sustainable progress. You won’t lose momentum.

The first step in Portfolio Management is reporting. You gather all the various project, programmes and change initiatives together. This may take time, but it’s reasonably easy. If you are working at the enterprise level, your enterprise portfolio is the sum of all the approved, active change initiatives in your company. If there are a lot of initiatives,  focus on the bigger ones. If you are working in a department such as I.T., your I.T. portfolio is the sum of all your approved, active I.T. initiatives, including those which support other departments.

This first step is typically fruitful, as it invites answers to several pertinent questions:
- what projects and programmes have been approved? 
- are project and programmes well defined (are there overlapping projects? are some projects part of bigger programmes?)
- do you have wildcat projects?(unofficial, i.e. active but not actually approved)
- do you have zombie projects? (dormant, i.e. approved but not active)
- do you have straggler projects? (the project should have closed, but instead has drifted into maintenance or support work)

Reporting is the first step. What comes next? How to sustain momentum and avoid the trap of low-value repetitive reporting?

The way forward is to identify where your company needs to add value with Portfolio Management.

There are basically four ways to add extra value

1) Target the right projects, to generate value
    ❑    You choose to focus on the project approval process. You start to build a project prioritisation model, which is a decision support tool for choosing which projects to run. The model will help to build a balanced, achievable portfolio, aligned to your strategy
2) Help projects to deliver, to protect the value-adding process
    ❑    You choose to focus on tracking and monitoring projects. You ensure project inter-dependencies are managed. You work on resource bottlenecks. You highlight problems and push forward issue resolution.
3) Push for better performance, so more projects deliver well
    ❑    You choose to focus on project performance. You monitor actual performance against plan (on time? on budget? how good are the estimates?); and whether projects following your expected ways of working. Then you feed back lessons and drive improvements.
4) Follow up on business cases, to ensure real long-term value-for-money
    ❑    You focus on delivering value. You ensure all projects have a solid business case, which is reviewed before work starts, at key milestones, at closure - and most importantly in the weeks and months after closure, to ensure benefits are really sustained.

When you can identify where to add value, you have a goal. A destination. Once you understand your destination, you can plot the journey: your next next steps become clear.

An invaluable next step is to benefit from other people’s experience to guide your journey. For Portfolio Management, you now have guidance in the form of the MoP framework (Management of Portfolios) and the P3O guide (Portfolio, Programme and Project Offices). For example, the MoP guidance explains how to build a portfolio prioritisation model, while the P3O guidance explains how to to build a value proposition.They are interlinked - MoP helps you to define your destination, while P3O helps plan out the journey.

When you know your destination, when you have a plan for the journey, taking the next steps is easier…

Your first Prince2 project starts like 1-2-3

Here’s how to start your first project with Prince2 in three easy steps

You’ve been to Prince2 training, you’ve sat the exam. Now you are back at your desk. You re-open the manual, with its 320 pages, 19 chapters and 26 documents… where do you start? 

Let’s make this as simple as 1-2-3.

1) Write the Project Brief and get it agreed by your executive
As its name suggest, the Project Brief is a SHORT document. Make the document easy to read. The Prince2 book gives a suggested composition of the document, but go for readability and clarity rather than formality and detail.

The brief should include the project organisation structure. You are the project manager, and you need an executive. This is VITAL, yes, the absolutely vital minimum - without an executive you are not using Prince2. The Executive will assume responsibility for the project, you will be executing on his or her behalf.

The Brief should also include a definition of the Project Product - your final deliverable. It’s important to write this down, as it defines your scope. The Prince2 book says this is a separate document, but you can probably write it as a paragraph of your Brief.

To define your Project Product correctly, you need to understand who is your Customer or User (could be an internal or external customer). You need to discuss your deliverable with your Customer, to understand their needs. The Project Brief should include their quality expectations and acceptance criteria.

When the Project Brief is written, the Executive should validate it. Until this is done, you should not move forward.

2) Create a Product Breakdown Structure, and get it agreed
The Product Breakdown Structure (or PBS) is a great way to understand what you need to produce. The PBS starts with your Project Product which is your final deliverable. The PBS will show more detail - it will probably show 15 or 20 key deliverables.

The easiest way to create a PBS is with sticky-notes on a flip chart or whiteboard. If you use sticky-notes, it’s easy to reshape the PBS as ideas emerge. Ideally you work with a colleague or two, to ensure you get an all-round vision.

When it’s done,  you can convert the sticky-notes version into electronic form with a diagramming tool, such as Visio or Powerpoint.

It’s important to create a PBS before you do any planning. For Prince2, the PBS is a first step of planning. If you are using a planning tool, such as Microsoft Project or even Excel, you should create your PBS and get it agreed BEFORE you do any work with your planning tool. Keep the PC switched off!

You need to review the first version with key people - the Project Executive, your Customer or User, and with the team leads who will produce the solution. When it’s agreed, build a high level Project Plan around the 15 or 20 deliverables in your PBS.

3) Create a Business Case, working with your executive
The business case provides the business justification for the Project. It explains the resources that the project will use, and balances them against the expected benefits. It’s a important document, but you need to apply the KISS rule (Keep it Simple and Short)

The problem with the business case is to decide how much detail you need. Your executive will guide you regarding the level of detail. Apply the KISS rule, and NEVER add unnecessary detail (for example, if your company doesn’t need you to express benefits in cash terms, then DONT try).

You start with a summary of your resources needs, and the expected benefits. (In some projects, that’s all that is needed).
    •    The resources are typically people and/or money. You need to understand the type of resources you will need. (For example, you need designers and testers, plus money to buy some equipment).
    •    The justification is based on benefits - get input from your executive about expected benefits. You both need to understand the type of benefits your project will generate. (For example, cost savings and reduced maintenance).

Once you have a summary, you can add more detail, but ONLY IF NECESSARY. You may need to convert resources and benefits into money terms. You may need a timeline. You may need a complex financial calculation such as NPV. But ALWAYS apply the KISS rule - don’t do work that you don’t need.

In three easy steps, we have the foundations for the PID (the Project Initiation Document). The three key pillars for the PID are the Project Brief, the Project Plan and the Business Case. Our three easy steps create those three pillars.

That’s how to convert your Prince2 classroom training into practice. Just take three easy steps, 1, 2, 3.

Why a project manager is like the conductor of an orchestra

Here’s an incredibly easy question that many people get wrong.

Question: What is a project manager? 
Answer: Someone who manages a project.

Many projects and many companies get this question wrong. They don’t understand the project manager role. They think that the project manager delivers the project. They think the project manager is a “doer” not a manager.  They hire technical specialists as project managers and ask them to get stuck into the technical work.

Let’s be clear: The project manager’s role is to MANAGE the project. He or she is primarily a manager. Any technical expertise is useful but secondary.

Prince2 is clear about this. Prince2 has a well defined project organisation, in multiple levels

    1.    At the top level is the Project Executive (sometimes called Project Sponsor or Project Owner) and the project board. This is the level which takes decisions and assumes accountability.

    2.    In the middle is the Project Manager, who manages the project day-by-day and coordinates the specialist work.

    3.    At the third level are the Project Teams who do the specialist work and need technical expertise.

For Prince2, the project manager is like the conductor of the orchestra.
    •    The conductor doesn’t make music;  s/he coordinates the musicians.
    •    The project manager doesn’t deliver the project’s work;  s/he organises the work

For Prince2, a key task of the project manager is to package up work and give it to the teams.

It’s like a handshake. We need agreement between the project manager and the team manager on the work to be done

    •    The Project Manager proposes a “Work Package”
    •    The Team Managers proposes a Team Plan to deliver the Work Package

Once they are agreed, the work can start.

And once the work does start,  the project manager has to follow up on progress.  The project manager has to MANAGE progress, without being too “hands-on” nor too “hands-off.”

    ❑    If the project manager is too hands-on, s/he wastes time (and often ends up doing the work rather than managing it)
    ❑    If the project manager is too hands-off, s/he may lose control (and fails to manage)

To manage correctly, the project manager should review the work package status regularly at periodic “check-points”. A check-point isn’t a long and boring weekly status meeting. Prince2 avoids “management by meeting” which is time consuming and ineffective.

A check-point is a regular event, typically weekly.
    •    A written status report
    •    A meeting (optional)
    •    Follow up

A check-point should always start with a written status report. It’s important that the status report is written, and it’s important that the project manager gets it before the meeting. This allows the meeting to be a short-and-sharp meeting - the Project Manager can focus on a few key points from the written report. This is “management by exception”, which saves time and helps to ensure that the Project Manager is focused and effective.

The team’s checkpoint report is structured into
    •    what the team has done in the current week
    •    issues
    •    what the team expects to do next week.

Let’s look at an example. Perhaps a team manager sends a Check-point report every Thursday to the Project Manager. On the Friday, the project manager might discuss with the team manager (face to face, or by phone, by instant message…):
    •    two tasks which were not finished on time
    •    one issue which looks worrying
    •    one task which must be planned for next week

The Project Manager focuses on a few exceptional points rather than on the broad status. It’s management by exception. The Project Manager is a manager, and doesn’t need to control everything in fine detail. In some projects, the Project Manager may need strong technical expertise in order to define Work Packages; and may even directly manage one or more teams. But the key task for the Project Manager is to manage.

So now we have the right answer to the question “What is a Project Manager”. The answer is simple with Prince2. The project manager is … a manager.