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Stephen Wise Blog

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Team Building - Competency Development

Standards for hiring and competency models for roles benefits the firm when it is time to develop competency building systems. With clearly defined deliverables and expectations for team members, developing skills and training for skill gaps becomes a more scientific and precise process, preventing waste in training expenditures and misunderstandings about the purpose and potential of training programs. Competency models and standards help employees and employers alike with developing meaningful career plans and career paths. Building proficiencies for success in current and aspirational roles provides workers with direction and motivation for continuing the employment relationship, a key incentive when companies are competing to maintain their talent pools.[1] With quantifiable performance standards, companies can also separate truly high performers from other staff members, allocating development and training dollars where there is the greatest potential for long-term returns on the development investment. These competency models need not be static entities. Instead, once standards have been put in place, it lays the foundation for a continuous improvement model. Both organizational and individual performance standards can be upgraded and enhanced with time, ensuring that the organization remains on a path to growth, market leadership, and competitiveness.[2]

[1]  Federal Acquisition Institute.  “FAC-P/PM Competency Model”.  Retrieved August 5th, 2011 from:  http://www.fai.gov/pdfs/FAC-PPM%20Competency%20Model.pdf
[2]  PMI.  “Project Manager Competency Development Framework – Second Edition.”  PMI, 2007.

How confident are you with the project forecast?

As every project progresses through it's lifecycle, the team’s forecast will evolve. The forecast value may move up or down, however, the accuracy of the forecast should always increase. The basis for increasing accuracy is that all estimates are forecasts with some level of uncertainty and as the project progresses the unknowns/uncertainty will decrease. This holds for forecasting any of duration, work effort, or cost. There are two important concepts in the below figure:  1)      We see the team’s forecast (solid middle line) moves up and down as time progresses; and,  2)      the range in value between the High

 and Low Estimate decreases in steps at each phase.

Estimated Value Progress Stephen Wise 

A key action for the Project Manager is to communicate to all stakeholders that early estimates have higher uncertainty. As part of communication with management and finance stakeholders, I usually ask for a reserve to be added onto my estimates based on the higher uncertainty of estimates and potential negative impact of risks. This amount can be progressively reduced and “given back” as the project progresses over time. Some types of projects inherently have high uncertainty during initiation and planning. For example, integration of custom software. When faced with projects involving high level of unknown, the Project Manger should use “Three-Point Estimating”. This technique will include the full range of possible values of the estimate and

 reduces bias that can lead to a highly optimistic or pessimistic estimate.

 

I usually create custom fields within Microsoft Project 2010 to capture and calculate the three point estimates. The approach is also called PERT. The formula is PERT Estimate = (Optimistic Estimate + 4 X Most Likely Estimate + Pessimistic Estimate) / 6.  Other project teams that work on a high number of similar projects will develop good enterprise knowledge for making estimates. An example would be an energy and gas company that knows 2 resources can lay pipe at 20 metres per hour and the material cost is $150 dollars per foot. Estimates in these situations can be very accurate, from an early stage. A Project Manager may have little control of the level of uncertainty or risk when handed a new assignment. However, appropriate application of the concepts above will lead to successfully managing and quantifying estimates of duration, effort, and cost. 

Stephen Wise

www.IntegrationProfessionals.com

Two themes for Portfolio Agility

I have seen the future and it is agile. The agile I am talking about is not a tool, or methodology, or a movement. It is the outcome when Project Managers have discussions with Sponsors on how to go faster, or how to beat competitors, or how to win new business. Portfolio management is listing, prioritizing, selecting, and controlling business ideas/investments in the context of the top success drivers and constraints affecting the business. In my experience, many projects are handed to the Project Manager that have risks or budget or schedule issues that the PM can’t even quantify. Unfortunately, these very items are likely to be the root cause of missed expectations, budget overruns or schedule delays. Our challenge is to enter into an ongoing conversation to ensure the right investments are being made at the right time. We need to develop and design a new way of thinking to respond to the needs of the business. Here are two themes to help support this change: 1. Focus on enhancing the collaboration and communication between the person managing the work (Project Manager) and the person who wants the work done (Sponsor).
  • Create visibility anytime and to any desired level of detail.
  • Speed everything up so that we can see business benefits/failures faster.
2. Gain trust by eliminating multiple sources of data/truth by bringing data integrity into the project and program environment.
  • Ensure culture is conducive to increased reporting.
  • Communicate better about those things that people care about.
I first head the following from an industry research analyst, “We need better brakes … so we can go faster”. How true! By investing in portfolio management skills and tools to improve communication and data quality, the organizations we support will have improved agility to amplify successes and reallocate resources from underperforming projects.

Earned Value Management - turning on the headlights

Earned Value - Why do I need it?

To paraphrase the words of the Project Management Institute’s standard, when I rely only on a project schedule of tasks, finish dates, and % complete, I will not know where the project is or where it is going. I will simply know where the project was supposed to be and where it is supposed to be going.

What is Earned Value?

Earned Value Management (EVM) is a technique that looks at the relationship between a) actual cost expended, and b) actual work completed, and compares this to c) original budget and work timeline. More formally, the three data points you must understand and memorize are: a)      Actual Cost (AC) – What amount of resources have been expended to complete the work at a given point in time. b)      Earned Value (EV) – Snapshot of work completed at a given point in time. c)       Planned Value (PV) – The Baseline – How far along the project work is supposed to be at any given point in the project schedule.

How do I implement Earned Value? (My cheat sheet below)

  Step 1 (Planning)

  1. Create a Work Breakdown Structure.
  2. Ensure all tasks on the schedule are assigned.
  3. Estimate time to complete each task.
  4. Determine how you will determine that tasks are complete as the project progresses.

 

Step 2 Periodic monitoring

  1. Obtain cost and / or hours expended.
  2. Obtain status on task completion.
  3. Forecast Cost and Schedule performance.

My usual workflow is to enter the planned and actual data into MS Project and then export the time-scaled data to an excel chart. An excel chart (example below)  isn’t 

required, but I highly recommend it as a support to your table of data – a picture is worth a thousand words.

  S-curve  

Combine the data into actionable forecasts

By using Earned Value techniques, you use Project Management discipline to provide key feedback and forecasting to the project team and executives. See four sample 

questions and formulae below.

  EVM formula table

Limitation

Earned Value is not sensitive to the quality of the deliverables. You can be near the end of the project and forecast on budget and on schedule even if the deliverables are poor and the customer will not accept the final product. The expectation is that the PM is using other tools and techniques to manage and control quality.

Stephen Wise

http://www.IntegrationProfessionals.com/

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