achieving business value through ppm and resource planning

Achieving Business Value Through PPM and Resource Planning

Peter HeinrichCEO, PDWare Inc.

P. Heinrich - PDWare Inc.2

A Resource Plan

2/18/2016


Resource Supply 452.35# Project Name

1 Cedar 44.402 Barbados 136.953 St Thomas 157.534 Cancun 166.635 St Croix 239.586 Wilson 250.137 Coolidge 288.338 Jamaica 313.739 Aruba2 329.2310 Antigua 375.35

11 Fast Track 414.07

12 Oak 422.82

13 Bahama 429.52

14 Willow 433.8215 Madison 445.1216 Jackson 449.12

17 Cozumel 456.27

18 Grant 469.47

19 Maple 478.22

20 Adams 516.22

21 Birch 559.22

22 Elm 640.82

23 Pine 709.07

32.26 34.82 38.66 42.50 42.50 42.50 42.50 37.38 37.38 37.38 32.26 32.26Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

6.10 4.10 4.60 6.42 6.32 6.62 5.62 4.6215.30 17.85 17.05 15.17 13.22 14.12 13.02 13.02 8.40 6.40 2.40 1.0015.30 17.85 17.05 16.17 14.22 15.12 16.54 17.54 11.92 9.42 3.90 2.5018.30 17.85 17.05 16.17 14.72 15.62 18.24 19.24 13.62 9.42 3.90 2.5025.15 24.80 24.20 22.52 21.32 22.57 26.19 27.79 21.62 13.82 5.50 4.1026.10 26.00 25.40 23.72 22.52 23.77 27.39 28.99 22.82 13.82 5.50 4.1026.10 26.20 25.60 26.92 26.72 28.17 31.59 33.59 27.22 18.22 9.90 8.1026.10 26.70 27.65 28.97 28.97 30.42 33.84 35.84 30.17 21.17 12.85 11.0528.10 27.10 28.05 29.37 29.37 31.12 34.54 36.54 32.37 23.57 15.45 13.65

29.60 30.40 33.35 34.42 34.51 35.96 38.48 40.59 36.12 27.32 19.20 15.40

31.10 32.60 37.55 38.37 38.55 40.20 41.82 44.04 39.57 30.77 22.65 16.85

31.10 32.60 37.55 38.37 39.00 41.10 42.72 44.94 40.87 32.07 23.95 18.55

31.10 32.60 37.55 38.37 39.00 42.00 44.12 46.34 42.27 33.47 24.05 18.65

31.10 32.60 37.55 38.37 40.00 43.00 45.22 47.44 42.37 33.47 24.05 18.65

31.10 32.60 37.55 38.37 40.00 43.00 45.72 48.94 45.07 36.17 26.75 19.8531.10 32.60 37.55 38.37 41.00 44.00 46.72 49.94 45.07 36.17 26.75 19.85

31.10 32.60 37.55 38.37 41.00 44.00 46.72 49.94 46.67 38.02 28.60 21.70

31.10 32.60 37.55 39.87 42.40 45.40 48.12 51.34 48.07 39.42 30.00 23.60

31.10 33.60 38.55 40.87 43.40 46.40 49.12 52.34 49.07 40.17 30.00 23.60

31.10 33.60 38.55 40.87 43.40 49.40 52.12 58.34 55.07 46.17 37.00 30.60

34.10 33.60 38.55 40.87 43.40 51.40 54.12 64.34 62.07 53.17 45.00 38.60

34.10 33.60 38.55 40.87 43.40 62.40 65.22 76.34 74.07 65.17 57.00 50.10

47.05 46.75 49.95 52.17 53.70 66.20 67.92 78.04 75.02 65.17 57.00 50.10

The Infamous “Cut Line”

2/18/2016


• Surveys by PwC, PMI, Standish, Ambler (SW)

• Failure modes• Fail 1 or more of scope (benefits), schedule, cost• Call all of these “under performance”

• ~45% average under performance in 2014

How Well are We Doing?

2/18/2016


1990 1994 1998 2002 2006 2010 2014 20180%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Historical Under Performance Rates

2/18/2016


• ~5,500,000 United States*

• ~ 28,000,000 10 major countries (incl. the United States)*

• ~41,000,00010 Major countries by 2020*

• For discussion purposes, ~10,000,000 PMs in US, UK, Europe, Australasia

* PMI 2015 Global Job Report

How Many Project Managers are There?

2/18/2016


At ~$1,000/year/PM Tools, training, conferences, etc.

• $10 Billion/year

At ~$100,000/year/PM Burdened compensation

• $1 Trillion/year

• $550 Billion/year in the US alone!!

Spending on Project Management

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1,000

10,000

100,000

1,000,000

10,000,000

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Big Investment, Modest Improvement

2/18/2016


At each table, take 10 minutes to:

• Identify the most significant resource planning issues

• Describe their causes & impact

• Note differences among your companies

• Nominate a presenter for your table

Breakout Session

2/18/2016


“I don’t get the promised resources at the right time – or not at all.”

“Scope changes but not resources or schedule.”

Project Managers

Functional (Resource) Managers

“Management never sets priorities and is always asking us to do more without considering the current workload.”

At or after phase gates, “That’s not MY plan!”

What is The Problem?

2/18/2016


“I don’t have a clue what people are working on.”

“We start all kinds of projects but have trouble finishing them.”

“I can’t tell if our resources are focused on our high priority projects.”

“We kill projects but they keep coming back.”

And in boom times or bust, “We don’t know what skills to cut or add when budgets are reduced or increased. Across the board cuts just kill us.”

Portfolio / Executive Managers

What is The Problem?

2/18/2016


• Organization structures/roles > 2500 BCE

• Project Management 1950s

• Life Cycle processes 1970s – 1980s

• Portfolio Management 1980s – 1990s

• Agile, et al 1990s – 2000s

• And now . . . . - Portfolio Resource Planning & Management• Or Capacity Planning & Demand Management

Timeline of Solutions

2/18/2016


Great Pyramid at Giza OBS

2/18/2016


No magic bullet

The human element: people being people• Most PMs, RMs, and executives are human• Perceptions, assumptions, misplaced confidence

Turnover – loss of culture and discipline

Lack of data, bad data, missing or inadequate analysis

Haven’t integrated all necessary processes and people in a sustainable system

WHY?

2/18/2016


Project management serves us well.

But it is not the answer by itself to this problem

No credible resource plan from a collection of project plans

Too detailedInaccurate / out of dateInconsistent compliance and qualityDoesn’t include non-project workNot from the resource manager (no accountability)

WHY?

2/18/2016


We need a clear data provider role for resource managers

We need a clear data provider role for project managers

We need to use that data in

Initiation & Phase Gate reviews

Portfolio reviews

Operations reviews

Annual and multi-year planning

Missing Elements

2/18/2016


A method for answering some key questions in support of project portfolio and staffing decisions.

Given the people, what projects? What can we do with the people and skills we have, and when can we do it?

Given the projects, how many of each skill? How many people with what skills do we need to do all the work we must do and want to do?

How well are we utilizing the people we have?

What do we do when demand or capacity changes?

What is Portfolio Resource Planning?

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A Pretty Picture

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A Resource Manager’s Plan/Forecast for a resource

Not Very Pretty Picture

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But the credible data source that makes the process work

Proximity and Scalability

Cate

IC 1 IC 2


A Project Resource Plan

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Organization Resource Utilization

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Portfolio Achievability

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Resource Management

Portfolio Management

Project Management

Resource Planning ProcessCapacity/Demand Management

Project ManagementLife Cycle/Phase Gate, Agile, . . .

EPMO

Operational Portfolio Management

2/18/2016

P. Heinrich - PDWare Inc.

Checklist for a Successful Process1. Capture fresh, credible data (demand, project attributes)

from the resource & project managers closest to the action

2. Demonstrate that you can finish everything you startusing prioritized supply-demand analysis

3. Require a contract at phase gatesamong PMs, RMs, and portfolio managers

4. Track, measure, review, respondget the data, use the data

5. Keep it simple including methods and tools,

252/18/2016


A simple, sustainable data collection processFunctional managers own resource supply, demand and utilization dataProject managers own project planning, attribute status, and delivery

Before you approve a project, demonstrate that it is achievable, that you have resources with the right skills available when they are needed

Regular, consistent management review of the analysis and data.

Capture and use historical data.

In Other Words…

2/18/2016


Nothing works well without it

You win big if you do it well

It is not so hard to do it well

BUT it requires consistency, discipline, and the right tools to get lasting results

Portfolio Resource Planning:

Take This AWAY!

2/18/2016


Wheelwright & Clark, Leading Product DevelopmentChris Chabris & Dan Simon, The Invisible GorillaDan Ariely, Predictably IrrationalLevitt & Dubner, Freakinomics and Think Like a FreakPMI, Pulse of the ProfessionPMI, 2015 Global Job ReportPwC, InsightsJordan Ellenberg, How Not to be Wrong: The Power of Mathematical ThinkingNate Silver, The Signal and the NoiseHans Rosling, http://www.ted.com/talks/hans_rosling_shows_the_best_stats_you_ve_ever_seen#t-149977

References

2/18/2016

http://www.ted.com/talks/hans_rosling_shows_the_best_stats_you_ve_ever_seen#t-149977

http://www.ted.com/talks/hans_rosling_shows_the_best_stats_you_ve_ever_seen#t-149977


Definition of “Resource Manager”

• A resource manager has direct reportsLine Managers, Functional Managers, Team Leaders

• First level resource managerindividual contributors as reports

• Resource managers do resource planning(among other things)

• BUT, other roles might do resource planning, A Resource Planner in the Portfolio Management Office

2/18/2016


Demand/Utilization planning and oversightGiven the resource/skill set we have,

What is the best achievable portfolio?How do we monitor changes to optimize utilization?

Capability (staff) planningGiven the projects needed to achieve objectives or given a spending limit,

What changes to the resource skill profile are needed?

Two Aspects of Resource Planning

2/18/2016