Sunday, June 11, 2006

Marketing Your PMO – Metrics - Control


The control drivers are similar to, and overlap, many of the other metric areas, but I think it is important to note that in some instances control is the success criteria. Project Management is an excellent medium for improving control in an organization. Every one has experienced the feelings of helplessness and frustration when things get out of control. If you have children, you know exactly what I am talking about. Unfortunately, even Project Management will not help that problem, but it will help at work. Image the frustration that a COO or CIO feels when they do not seem to be able to influence or change the way their organization works. To them things seem out of control, so they look for ways of creating a situation where they have a certain level of control over what is happening.

You will know that control issues exist when there are not really any good answers to some of the following questions:

  • What is everyone working on?
  • How much time are we spending on new projects?
  • Are we spending our time on the most important work?
  • How are we progressing the corporate goals?
  • Why is everyone so busy yet nothing seems to be getting done?
  • Why does everyone hate us (this happens a lot when IT gets out of control)
And so on. The asking of these questions is the first step in addressing any control issues. If no one recognizes the symptoms as being the result of control issues, then you have an entirely different problem. Control is one of the best ways to advance Project Management in your organization. This problem is a great opportunity to show value, and once you have hooked management on being in control, they will never let go. Hey – they wanted management so they could be in control right? So what to do?

Control metrics are going to be a little broader in scope than the other metrics. One level of control is simply knowing what is going on and being able to direct that. This requires relatively simple metrics and measures. However, you can move up the scale to such things as portfolio management and balanced scorecards which are far more complex and involved. I’m not going to do justice to the more complex metrics, but let’s cover the highlights of possible alternatives.

Inventory – Hopefully you have done this, or at least started. Knowing what is going on is the first step of control. Find out what everyone in the organization is working on. Not what they say they are working on, but what is actually going on. At first this will take some interviewing and investigation. I’ve found that this can be a communication issue. For example, you might ask an IT manager what her group works on. She might recite 4 or 5 big projects and a few smaller ones and completely neglect to tell you about maintenance time. You are representing project management, so the people you talk to may think you are asking only about project management. In the case above, it may have sounded like the manager’s team was not doing a lot, until you find out that 80% of her team’s time is spent on production problem resolution and enhancements. There may be a perception by others that her team doesn’t get much done because no one knows about this other time. Once you find out what is being worked on – document and publicize. That alone will change things.

I’m willing to bet that you will find that your organization is split into an unhealthy number of separate activities. In one personal example, I did this study and found that an IT organization of 150 people were working on 78 separate projects as well as performing regular IT support functions. One CIO referred to this type of situation as a “death of a thousand cuts.” I’ve seen this again and again; look for it in your organization. Just bringing this to light will create some real benefits.

Aggregated PM Metrics – Another more advanced way of demonstrating control is to take the information generally gathered at the project level and aggregate and summarize them. This is the traditional metrics you would expect from a PMO. Some examples are:

  • Projects Delivered on time / on budget / variance
  • Project Change counts and magnitude
  • Actual v. Estimated
  • Resource Time (Realization and Utilization are good here)

Advanced Metrics – Like I said, I will not cover these in detail here, but below are some examples:

  • NPV of Project Portfolio
  • IRR of Project Portfolio
  • Balanced Scorecard and Portfolio Metrics such as:
    o Customer Satisfaction
    o Financial Achievement
    o Alignment / Advancement of organization goals
    o Improved Revenue
    o Cost Savings

There are others, but I caution against these until you have the ability and demand for this type of information. These types of metrics require a bit of infrastructure and effort. If management is not willing and ready to commit this (which they are usually not at the beginning), then you will be in a very unpleasant situation where you cannot deliver. If you get pressure to go with the full load, do whatever you can to push towards a small start. Suggest a prototype, starting with easier information, whatever. I’ve said before one of the best ways to fail with a PMO is to over promise.

1 comment:

Dennis D. McDonald said...

Good stuff. Knowing what's actually happening is an incredibly important place to start.