Download ppt - Project Management Flight stimulator 1.0

03-23-05July 2014

project – programme – portfolio management : project – programme – portfolio management :

Flight SFlight SttimulatorimulatorPresented by Jan Biets

[email protected] Mechelen - Belgium page 1 • view on reporting

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 2 • KPI & KGI

Project Management!Project Management!

• Together with some other presentations:

– PMO as a Service

– Project Management Dynamics

– Graphical Project Reporting

– Setting up reporting & Tracking tool

– Project planning Logic, how to optimise your schedule

This presentation focuses' on performances and goals tracking of your project , programme and portfolio management.

note:

•It is not the author’s intention to be aligned with whatever existing methodology, nor framework;

•‘projects’ – in this presentation, ‘projects’ can mean projects, programme, or portfolio

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 3 • PMO

Project Management KPI, KGI, and PQSi’s : Project Management KPI, KGI, and PQSi’s : Flight “SFlight “Sttimulator” !imulator” !

• What is the purpose:

– TO KNOW ‘WHERE’ YOU ARE !

– Increase success rate of -strategically- projects;

– Decrease failure rate of -strategically- projects

– Improve - visual- reporting data;

– Improve baseline information to take decision upon;

– Improve communication, also to ‘non project management’-skilled audience , i.e. executive management;

– Increase effort in strategically supportive projects; define metrics for measuring progress/success/quality of balanced scorecards;

– Order (go / kill ) strategically important projects;

• Very often lack of right information to be used by stakeholders to have a clear understanding of the project status, progress , and ‘forecast’.

• Reason to take drastic, but un-rightful decisions, which can endanger outcome of organisation’s strategy;

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 4 • PMO

Project Management ‘s “BSC Service provider”Project Management ‘s “BSC Service provider”

project managementprogramme management

portfolio management, stakeholder, sponsor, shareholder, strategy, Finance, HR… Management needs tools to report, to

manage, to steer, to decide.

To measure is to know Control and improve

Identify the elements that have an impact on the outcome

‘the truth is out there” , or

on your Flight Stimulator Cockpit

Stakeholders, programme managers, stockholders, project managers , … need to know some key important data in order to be able to ‘manager, take appropriate decisions , steer their ‘strategy business’ (project, programme,…)

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 5 • BSC

Flight SFlight Sttimulator, why?imulator, why?These tools are an identification what the ‘health’ situation is of the project / investmentThese tools KPI and KGI’s are (must be!) well identified, well selected, monitoring tools;

Perspectives (according Kaplan & Norton)• Finance• Customer• Internal processes• People, learning, and growth

Those perspectives must be monitored, based on information obtained from the ‘project’Therefore, selection of the right KPI and KGI is mandatory.Therefore, selection of the KPI and KGI must start with

KQ’s : KEY QUESTIONS.

What do you want to monitor ?!What do you want to track ?What do you want to know?

These questions are depending on your ‘Quality’ (Fr)/ Role / Function / Responsibility

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 6 • BSC

Flight SFlight Sttimulator, how?imulator, how?

Measure is to know Control and improve your project , programme , portfolio

Identify the elements that have an impact on the outcome:

First, you design the ‘service’:

Define the most correct questions. And,

get answers on KEY QUESTIONS ! [ KPQ and KPQ ]

How to perform?What are the metrics to identify the performance ‘grade’

What Goals ? What achievements ?

Secondly,Where can I find the information , or data to measure the

specific metric

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009 page 7 • BSC

Flight Stimulator, defining flight coordinatesFlight Stimulator, defining flight coordinatesMeasure is to know

Control and improve your project , programme , portfolio4 domains to ‘metric’

•Progress;•Budget;•Quality;•…

•Required Skills;•Required Training;•360° evaluation;•…

•Expected commercial value;•Earned Value management;•NPV•Budget & accounting•ROI•…

•Planning;•Quality;•CPI;•SPI;•…

A more eloborated list with KPI and KGI is attached

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014 page 8 • View on Reporting

Flight Stimulator, what are the connectors ?Flight Stimulator, what are the connectors ?

Example based on a development project (R&D, define , design, and build) of pharma production facility.

To manage e.g. ‘margin%’ or get ‘New Customer (revenues): dynamic links can be identified / defined

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009

QA

training staff

innovationPM

skillsEVAEmployee

satisfaction

cost prediction

KISS

efficiency

innovation

policyPM

methodology

roles & responsibility

product / servicemanagement

re-use / templat

e

processes

performance (improvement)

project management

satisfaction policy / SLA

cost overrun

margin % new customer(revenues)

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People

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Think-tank+

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009 10

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009 11


Internal business&processInternal business&process

• Efficiency:

– Core of project organisation, with multiple elements supporting efficiency, or at least having impact on;

– Reinforcing circles:

1. processes, kiss, tools, performance

2. Innovation, re-use, product management

3. Project methodology, project management, roles and responsibility

– Efficiency has direct impact on MARGIN %

• Less ‘efficiency’ costs margin%;

– Focus and management of the reinforcing circles to manage and improve ‘efficiency’;

efficiency

Easy ! WORK on EFFICIENCY. The elements are clearly defined


Internal business&processInternal business&process

• For each of the steering for ‘margin%’, we have to identify the elements that have impact on “margin%”;

• From bottom to top;

• Work on each of the steering elements:

– Identify actions that have positive impact;

– Measure (by well-defined KPI and KGI’s) the progress;

– PDCA : plan – do – check – (re-)act

– Set thresholds , target values for each of the KPI – ‘Flight Stimulator’;

Enjoy the Success

xyz


set up BSC’s: very powerful toolset up BSC’s: very powerful tool

•Measuring is knowing;•Define what information is required to be able to assess your project on ‘total project quality management’?;•A ‘best’ tool is Balanced Scorecards (Kaplan/Norton);

•A well defined BSC allows a in-depth view on the projects, thus:•Increasing organisation’s benefits of outcome of project (application);•Increasing lessons learned for other project initiatives; your organisation will improve project-ability behaviours;•Decreasing failure rates of projects, and consequently , negative impact on organisation’s strategy;

Reference to ‘Project Management Dynamics” @ SLIDESHARE.net

Abbreviations:

BSC - Balanced Scorecards (Kaplan & Norton)


some interesting PM criteriasome interesting PM criteria

• There is a lot of –valuable - information available when executing a project, but some interesting data has to be excavated, you have to know where to find it, and what to do with;

– Time:• Schedule (overall, per phase;)

• Schedule performance index [SPI]

– Finance• How are we going against budget;

• Cost performance index [CPI];

• Earned value analysis [EVA/-M];

• Return on investment [ROI];

• Net present value [NPV];

• Expected commercial value [ECV];

criteria that constantly emerge (1/2) :

Abbreviations:

SPI - schedule performance index

CPI - cost performance index


some interesting PM criteriasome interesting PM criteria

• There is a lot of –valuable - information available when executing a project, but some interesting data has to be excavated, and you have to know where to find it;

– Resources• How much time are we spending on the project,

• How many resources we need (globally, per IT department, roles);

• Do we use the available resources;

– Scope: Is the scope [creep] in line with expectations (?)/ (!);

– Quality (total quality project management – TQPM)• Is the plan realistically built-up;

• Number of issues reported;

• Are we reviewing and fixing quality problems;

criteria that constantly emerge (2/2) :

note:

An organisation with project tradition, has advantages when building up a project minded attitude and a benchmark data-warehouse to assess the projects and improve the project’s success rate, thus organisation’s strategy outcome.


TIMETIME

Time: How are we going against schedule;

– Progress on schedule;

– Number of tasks late started;

– Number of tasks overdue (not closed);

– Number of open tasks;

– Metrics & status : traffic light

– Define : (these are default values)

• number : 1 – 2 : orange

• number : 2+ : red

– Explain reason:

• E.g. technology, resources, errors, training, management


FinanceFinance

Finance: How are we going against budget schedule

– Earned value management (and assessment)

– Progress on schedule (€);

– Cash flow;

– ROI , pay-back time;

– ECV;

– Metrics & status : traffic light

– % : orange

– %+ : red

– Define reason to understandAbbreviations:

ECV - expected commercial value

ROI - return on investment

NPV - net present value

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009 page 19 • View on Reporting

Rationale: An important project quality success indication (PQSI) is the number of met requirements.This can be: Functional requirements , tangible and intangible, operations, up-time , availability, mean time between failures, matching with technology policy, …

•Define clear user requirements•Identify , quantify , ‘name it ! ‘•List requirements;•Build metrics;•Test or assess during review meetings;•Report;•Validate the met requirements versus the requirements defined;•Prioritise the application / project outcome;•PDCA (plan-do-check-act);•Set up improvement project.

TQPM – TQPM – meeting functional requirementsmeeting functional requirements

What is the scope of the project?!

What is quality / success rate of the project?

What is to be assessed during the project review meetings/process?


METRICS : FINANCE - EVAMETRICS : FINANCE - EVA

What?

• Measure of project progress;

• Forecast completion date and final cost;

• Provide schedule and budget variances:

• By integrating 3 measurements, EVA provides consistent, numerical indicator with which you can evaluate and compare projects.

Key:

• Where are we on schedule?

• Where are we on budget?

• Where are we on work accomplished?

Abbreviations:

EVA – Earned Value Analysis



How?

• It compares the ‘planned’ amount of work with what has actually been completed, to determine if COST , SCHEDULE, and WORK ACCOMPLISHED are progressing as planned

• Work is ‘EARNED’ as it is … 100% completed

EVA gives a uniform unit of measure: € or man-days

EVA provides an ‘EARLY WARNING” for prompt corrective actions

Example:

30% time spent

30% € spent

Equals 30% work performed ?

Not necessarily !

Abbreviations:




Abbreviations:


BCWS – budgeted cost of work performed

planned cost of the total amount of work scheduled

to be performed by milestone date

ACWP – actual cost of work performed

cost incurred to accomplish the work that has bee done to date

BCWP – budgeted cost of work performed

planned (not actual) cost to complete the work that has been done



Some more abbreviations:

SV - Schedule Variance (BCWP – BCWS)

comparison of amount of work performed during a given period of time to what was scheduled to be performed

Negative variance means that the project is behind schedule

CV – Cost Variance (BCWP – ACWP)

comparison of the budgeted cost of work performed with actual cost

negative variance means that the project is over budget

Example:

Schedule Variance = BCWP – BCWS

Cost Variance = BCWP - ACWP

Project management Office – setting up the ‘Measuring’-serviceProject management Office – setting up the ‘Measuring’-service July 2014

• Follows a listing of KP , KG and PQSI’s *

• On request, there is a list at your disposition of KP & KGI’s for Construction Projects;

• On the Internet there are more overviews of KPI’s;

• There is a column attached with ‘framework / standard’ relation per KP, KG and PQSI:

– ITIL

– ISO21500

– PMI – PMBOK

– PrinceII

– ValIT

– Cobit

*: project quality success indicator

page 24 • Set up BSC
















Total Quality IT / asset Management : TCO of applications, infrastructure, and Total Quality IT / asset Management : TCO of applications, infrastructure, and maintenance related costs (existing IT-infrastructure)maintenance related costs (existing IT-infrastructure)

Rationale:

knowing when to make a technology switch (‘warning’)

Explanation

Assessing the existing technology applied in IT infrastructure (hardware and software);

List the known expenses for each of the configuration item;

Controlling the total cost of ownership of each configuration item;

Knowing at the right moment when to switch to other technology;

Plan(-ned) investment: less unlucky surprises;

Add to roadmap: know what resources will be needed (fiscal year, staffing, priority);

Purpose:

•Management decisions

•Optimising of portfolio, and asset management.

•Strategic IT management

•TCO (total cost of ownership)

•Technology follow up (don’t stay behind the competition)

Not entirely in scope of this presentation , but….


TQPM : TQPM : Balanced scorecard Balanced scorecard (new product project selection)(new product project selection)

• Factor 1: strategic fit and importance

• Factor 2: product and competitive advantage

• Factor 3: market attractiveness

• Factor 4: core competencies leverage

• Factor 5: technical feasibility

• Factor 6: financial reward versus risk



• Factor 1: Strategic fit and importance

– Alignment of project with business’s strategy

– Importance of project to the strategy

– Impact on the business



• Factor 2: product and competitive advantage

– Product delivers unique customer or user benefits

– Product offers customer / user excellent value for money

– Competitive rationale for project

– Positive customer / user feedback on product concept (concept test results)

Driver:

ECV – expected commercial value

ROI – return on investment



• Factor 3: Market attractiveness

– Market size

– Market growth and future potential

– Margins earned by players in this market

– Competitiveness – how tough and intense competition is

• Factor 4: core competencies leverage

– Project leverages our core competencies and strengths in:

• Technology

• Production / operations

• Marketing

• Distribution / sales force



• Factor 5: Technical feasibility

– Size of technical gap

– Familiarity of technology to our business

– Newness of technology (base to embryonic)

– Technical complexity

– Technical results to date (proof of concept)

• Factor 6: financial reward versus risk

– Size of financial opportunity

– Financial return (npv , ecv)

– Productivity index

– Certainty of financial estimates

– Level of risk and ability to address risks

Abbreviations:

NPV – net present value

ECV – expected commercial value



Some ‘play-’rules:

• Projects are scored by the gatekeepers (senior management) at the gate meeting using these six factors on a scorecard (0-10 scales);

• The scores are tallied, averaged across the evaluators, and displayed for discussion;

• The project attractiveness score (PAS) is the weighted or un-weighted addition of the scores, taken out of 100;

• A PAS score of 60/100 is usually required for a go decision.



Some ‘play-’rules:

• Projects are scored by the gatekeepers (senior management) at the gate meeting using these six factors on a scorecard (0-10 scales);

• The scores are tallied, averaged across the evaluators, and displayed for discussion;

• The project attractiveness score (PAS) is the weighted or unweighted addition of the scores, taken out of 100;

• A PAS score of 60/100 is usually required for a go decision.


Time is up. Much more to talk about this interesting topic….

Questions ?

Linkedin Jan Biets - [email protected]

? ?????? ? ?

Project management Office – setting up the serviceProject management Office – setting up the service Maart 2009 48HR Management 3/0Lack of Training 1/1

Bad Hiring 1/1

Low Staffing 2/1Unskilled Employees 4/2

Bad Design 2/1

Wrong Answers 1/1

Poor Support 1/4

Long Hold Times 1/1

Faulty Market Surveys 1/1

Poor Materials 1/1

Low Quality Product 1/3Ineffective Marketing 1/1

High Pricing 2/1

Relationships Among Causes of Low Customer Satisfaction

Low Customer Satisfaction 0/3