The Programme and Portfolio Workout is launched

The Programme and Portfolio Workout has been launched. Together with its companion, The Project Workout, this book aims to help you run your organization in a structured, yet agile way so you can meet your strategic goals and make sure all parts of your organization are aligned.

I have made three short videos introducing the books:

1. The first video shows how these books have grown out of the original ‘Project Workout’, first published in 1997 and how they now give you the knowledge and thinking to make your organization succeed.
2. The second video describes The Project Workout and how you can direct and manage one project at a time.
3. The third video describes The Programme and Portfolio Workout, and how you can direct the tens, hundreds or even thousands of piece of work in your organization.

You can see these videos on Robert’s web site

Resource management: everyone is suffering

I was speaking at a PMI conference in Sweden, last March, which gave me the opportunity to sit in on a number of other sessions. This one is all about resource management, given by Peter Kestenholz.

If you are to be successful, you must have the right number of skilled people.

A straw poll of attendees at the presentation found:

• all work in a matrix organsiation;
• 30% have clear resource management process;
• 20% have tools to support resource management;
• only 2% have been trained on the process and tools.

All of them had BIG issues with how resource management worked (or more accurately, didn’t work)  in their organisations. Some ignored it and others had enormous spreadsheets to try and get a grip on the issue of making sure the organisation has the resources to do the work that needs doing. By enormous, I mean at the limit of Excel as a tool. Yes, most use spreadsheets. It sounds dreadful!

Way back in 2010, Forrester said that there was a significant increase in investment of PPM tools specifically to:

• Obtain an accurate view of resource usage;
• Manage investment aligned to strategy.

Today, Gartner says the need for resource management is still one of the top three reasons companies invest in PPM tools. Not a lot has changed. The vision of many senior managers is that they should be able to “drill down” to get any information they need at the level they need it. . . . but few can do this.

Peter has been involved in helping a lot of organisations tackle the “resource issue” and went through a number of things to consider, namely:

1. Have an executive sponsor define the business requirements for resource planning and transparency. Understand the rationale. Without this, don’t bother any further as this drives everything else.
2. Be clear on what you mean by resource capacity. Net? Gross? Overtime? What is a FTE? What formula will you use for any calculation of resource capacity?
3. Ensure, a person can have many skills associated with him/her.
4. HR should own the Organisation Breakdown Structure; hold them to account for keeping it up to date. An out of date structure will break your process. Ensure any tooling can cope with the continuous churn of organisation structures and people allocations.
5. Decide how many different jobs a person can be forecasted to work on. Be clear if people can be asked for by name? by role or by skill (or  any of these).
6. Get rid of your spreadsheets! However, people are used to using these, so consider tools with a similar (and hence familiar) look and feel.
7. Ensure your approach deals with leavers and joiners. For example, be able to forecast a person’s assignment even though they haven’t joined the organisation yet.

You can read more about enterprise wide resource management and tooling in Chapter 14 of The Programme and Portfolio Workout.

No white space = unhealthy company

In an earlier blog I talked about the three necessary conditions if you are to manage your resources effectively (see Link). Resource management is a hot topic in many companies and is the primary driver for them implementing programme and project management systems.

In this blog, I’ll talk about what I refer to as “white space” and why, if you haven’t got this, your company or organisation is in an unhealthy state.  So what is “white space”? The gap between what your resources are committed to and the total resource you have available is ‘white space.’ It is the resources that you have not yet committed to a given activity or project. If you fulfil conditions 2 and 3 from my earlier blog, you will know your white space:

White space = resources available – resources already committed

In the very short term this should be small. It will grow as you look further into the future.
White space is fundamental to a organisation’s on-going health. If you haven’t any in the short to medium term, you are paralysed. You have no one available to change the business to meet new threats or exploit new opportunities unless you withdraw them from previously committed work. White space gives you the resources to effect change in the future.
‘We are in a fast moving environment’ is the common mantra nowadays. If this is truly the case, then you need to ensure that you have ‘white space’ resources ready to meet future needs. You know the people will be required but you are not yet sure exactly what for. If you have no people to change things, things won’t change.

White space must cater for two distinct needs:

● First, it must cover the need to undertake initial investigations from new proposals. People must be available at very short notice to do these and must be highly knowledgeable if the investigations are to have any value.
● Second, you need the resources to undertake the future projects or work.

Compare the former to a company putting a bid together – if this is done by inappropriate people, the timing of when bid and what bids are needed is unpredictable, the bid may be lost or the company may have committed itself to a financial disaster. Just because business projects are  ‘internal’ it does not mean you need not apply the same rigour as you would with external matters. It’s your organisation’s future at stake in both cases.

The figure represents ‘white space’ in graph form. It could apply to a complete organisation, a division, a function or whatever. However, unless you can build this picture you will be taking risks every time you need to set off another initiative.

One of the challenges I have found is that many organisations plan on an annual basis and the financial controllers insist that every work item for the year is itemised and budgeted for, believing that this will ensure efficiency; they simply won’t allow “white space” and expect managers to have 20:20 forecasting vision . . . even in a fast moving environment.  White space is what enables an organisation to be nimble, fast moving or agile (choose your own buzz word).

You can find out more about resourcing in Chapter 14 of the Programme and Portfolio Workout.
 

Portfolio management – the next frontier?

Earlier this month I was speaking at the “Passion for Projects” conference in Sweden. I must say it was a really well organised event and I was delighted to have been invited to speak there. The topic I chose to talk about covered portfolios, project, projects, matrices and maturity. I’ll go into it more in some later blogs. I’ll assume you know a little about portfolio management. Just to recap, portfolio management is all about making sure you pick the right projects to do.  In “The Project Workout” i call them “business programmes” as at the time I wrote the book, the term “portfolio” hadn’t really settled down in the way it has now.  So, in portfolio management you have to make decisions on what to do and which meet the following criteria:

1. It is aligned to your strategy
2. You have the resources to undertake it and operate its outcome
3. The risks are acceptable  (i.e. robust business case)
4. The portfolio, as whole is still balance if you take this on
5. The organisation can absorb the change.

So, the decision makers need to be able to make those decisions and have the data available to verify the criteria.

I was asked a question about this: “If a programme has been approved as part of a portfolio, has the programme sponsor the authority to authorise the project within the programme, or do they all have to be referred to the decision maker at portfolio level?”

My instincts were that if the programme as a whole has been approved, then the programme sponsor should be able to make the decisions . . . however it is not that simple. It all comes down to shared impact. For example, if the programme team has all their own “ring-fenced” resources, then they can make decisions relating to criteria 2. If they share resources with other programmes or components of the portfolio, then they can’t. Similarly, if they are the only ones impacting a “target user group” (change absorbtion) then they can verify criteria 5. If niot, then the decision has been elevated.

Further, the degree of to which there is knowledge of the programme, its resources and impacts at the time it was approved also matters. It may be that the first chunks of work are pretty weel known and as long as these stay in the bounds expected, decision making can be at programme level.

As you see, what appears to be a simple question is actually very complex. The more you ring-fence resources, the greater you can delegate decisions to programme sponsors but, you lose potential efficiencies for using those resources on other work. It’s a balance. Whatever you choose, remember:

1. What ever you do must align with your strategy
2. There is little point in authorising work that cannot be undertaken – in fact it is really damaging
3. You need to ensure the risks of adding this to your work-stack are acceptable
4. You nee to ensure your portfolio remains balanced, when you add the new work in
5. There is little point in doing work, which the operational teams, customer etc cannot accommodate in terms of change.

You can read a lot more about this in The Programme and Portfolio Workout. Many organisations are only just starting to “get it”; it’s all applied common sense.

Is a functional hierarchy fit for modern day businesses?

 

The functional hierarchy is not the only way to run a business.

If what people do counts more than the function or department they belong to and if, for reasons of efficiency, you want to use people to best effect anywhere in your organisation, what is the role of the functions? You know that no change, which is significant to a whole business, can be made within a single function in an organisation. You generally require people from a number of areas contributing to the processes, activities and projects you are undertaking.

In the traditional hierarchy, each head of function decides not only the strategic direction of their function, but also what each and every one of his/her  employees will do and how it will be done. The danger, if functions are too dominant, is that they will drive the business as they see fit from their own perspective. This may not be in line with the drivers that the organisation’s leadership wants to effect. The outcome is that the organisation becomes out of balance.

For example, efficiency is often seen as a good goal. So is responsiveness to customer needs. However, the latter may require you to carry excess capacity in order to meet customer needs at short notice. If one function is driving ‘efficiency’ up by reducing capacity while another is creating a proposition around responsiveness there is likely to be a mismatch and dissatisfied customers.

The projects approach, like the trend towards cross-business processes, aligns all the required skills and capabilities around the attainment of a business objective. In the case of a process, the objective is better operations. In the case of a project, the objective is change for the better. Thus, the functions are not leaders in driving the business, but rather suppliers of people and expertise to projects and processes. The accountability of a head of function is to ensure that the right people are available in the right numbers to service the business needs. They will be accountable for pay, employee satisfaction and personal development. Other key roles will start to become apparent. There will need to be those, expert at particular disciplines, who will create strategy, develop and maintain technical architecture, manage projects, or manage people. However, they will not do this just in the context of a single function, but rather in the context of the complete organisation, working wherever needed across functional boundaries to achieve the business objectives . . . . and that is where project portfolio management (or what Project Workout calls “business programmes”) comes in.

 For more on resource management see The Programme and Portfolio Workout chapter 14.

Getting (and holding onto) your resources

The University of Southern California analysed 165 teams in a number of successful organisations to assess the effectiveness of team-work. Two reasons for teams failing to deliver were found:

●  Project objectives were unclear.

●  The right people were not working on the project at the right time.

In looking for solutions to these two issues, they found that using a ‘projects approach’ gave significant benefits in clarifying objectives (which is just as well or it would conflict with the message in the Project Workout!). On the question  of resources, they found  that having  visibility  of available resources and obtaining commitment for the required resources was key. In other words, if you haven’t got the right people at the right time (numbers and skills) you can’t expect to complete your project. It’s all rather obvious, isn’t it?

You need ALL your resources to succeed.

As I suspect many of you know, obtaining resources and holding on to them can be very problematic, especially in functionally oriented organisations, where the balance of power  is  firmly held  by line  management. In  these circumstances, resources are often committed to projects on the basis of good intention, rather than on good information. Consequently, they can be withdrawn by the owning department, at whim,  if it believes that its own need is greater than that of the project. The result is that resource and skill shortages do not become apparent until they are a problem.

An effective method of resource allocation and commitment is needed, therefore, which meets three conditions:

• Condition 1 – you have a clear view of how resources are being consumed on a project by project basis.
• Condition 2 – you have visibility of the resources available, or soon to be available, within the forecasting horizon of your organisation.
• Condition 3 – commitment of resources should be based on clear information and forms the basis of an ‘agreement’ between the departments providing the resources and the projects consuming the resource.

Meeting these conditions will enable you to anticipate potential resource conflicts before they become a problem. How do you do that? Well, it all relies on how the governance for your organsation is designed, the project manager cannot normally solve this one.  I’ll cover this in later blogs, but in the meantime, you can find out more about resourcing in Chapter 14 of the Programme and Portfolio Workout.