How to easily predict project results!
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The document outlines strategies for predicting project results, especially for experienced project managers overseeing complex projects. It emphasizes the importance of thorough planning, risk management, and quantitative analysis, providing a methodology for managing uncertainties and establishing accurate estimates for timelines and costs. Key elements include creating a work breakdown structure, identifying risks, and utilizing both qualitative and quantitative analyses to ensure successful project outcomes.
How to easily predict project results!
- 1. How to Easily Predict Project Results! 1 © Joseph Escobar, PMP 2018
- 2. Who is this for? 2 • Experienced PMPs who manage large, complex projects or programs
- 3. First, Take Care of the Basics… 3 • Organize Planning • Define Scope, Goals, & Objectives • Analyze Requirements & Develop Roadmap • Identify Initial Risks • Create a Work Breakdown Structure (WBS) Dictionary
- 4. Why Bother with a WBS? 4 • Refines understanding of major activities • Establishes a framework for reporting • Increases confidence of those accountable • Details supplied by team leaders with guidance from program leadership
- 5. What Should be in the WBS? 5 • Major Activities and Deliverables • Internal and External Dependencies • Decision Points
- 6. What Details Do We Need? 6 • Ownership • Dependencies (Who,What,When) • Deliverables (Who,What,When) • Acceptance Criteria and Handoff • Planning Constraints • Estimates
- 7. Second, Manage Risk — The Secret Sauce 7 • Risk Management Planning • Identification • Analysis • Response Planning • Monitoring and Control
- 8. Levels of Uncertainty… 8 As we know, there are known knowns.There are things we know we know. We also know there are known unknowns.That is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't know. -Donald Rumsfeld, 12 Feb 2002, DoD news briefing
- 9. …and Where they Fit 9 As we know, there are known knowns.There are things we know we know. ➡Facts and Direct Information We also know there are known unknowns.That is to say we know there are some things we do not know. ➡Indirect Information, Context,Assumptions, and Risks But there are also unknown unknowns—the ones we don't know we don't know. ➡Management Reserve
- 10. Qualitative Analysis 10 • Refine the problem • If <event>, then <impact>, and <mitigation> • Determine information needed at decision points, and how to get it
- 11. Risk Prioritization is Cultural 11 • Impact x Probability • Hazard + Outrage • Tolerance • Controllability • Urgency
- 12. Rate your Risks 12 • Priority • Top Risks • Urgency • Periodicity
- 13. Plan Risk Responses 13 • Define Risk Responses (Preventions, Decision Points & Mitigations) • Add Responses to WBS • Calculate expected impact as P x I • If a risk’s probability is very high, then plan as if it would happen • Craft contingency plans for high value risks
- 14. Why Bother with Quantitative Analysis? 14 • Define probability to meet objectives • Define management reserves • Achievable and defendable targets
- 15. Estimates Get Better Over Time, If You Manage Risk Close-OutBusiness Case Under Estimate Over Estimate 15
- 16. Quantitative Analysis 16 • Three-point estimates • Capture best case and worst case in WBS • Opportunities and threats • Capture what could go right or wrong to realize those best and worst cases as new risks • Estimators • Team leads may not be used to thinking this way
- 17. • Calculate expected duration and cost • Calculate duration and cost variances Do the Math 17
- 18. Analyze Schedule 18 • Update schedule with expected durations • Note new project duration • Flag new critical path in WBS Dictionary • Identify near-critical paths and contingencies, in case they become critical
- 19. • Calculate standard deviations for project duration and cost • Identify range of estimates • ~95% confidence = expected duration (or cost) +/- two standard deviations Quantitative Analysis 19
- 20. Range of Estimates 20 Example Project Schedule Analysis (5000 Trials, Near-Critical Path, HighestVariance) 4000 50 100 150 200 250 300 350 1 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 Duration Probability 50% Probability of Project Completion 305 Working Days from Now 95% Probability of Project Completion 344 Working Days from Now
- 21. You Now Have a Solid Plan! 21 • Based on both facts and indirect information • Risk-Adjusted • Contingencies • Quantified degree of confidence • Seizes opportunity; minimizes threats
- 22. Budget 22 • Budget to the plan • 95th percentile cost and duration • Enough to handle the known knowns and the known unknowns • Un-budgeted management reserve • If acceptable status is your organization is +/- 10%, then request 10% • No less than 5% to handle the unknown unknowns
- 23. Set Expectations 23 • Leverage Horstman’s Corollary To Parkinson’s Law ;) • Manage project leadership to risk-adjusted plan (95th percentile) • Manage team to more aggressive expected results (50th percentile) • “A promising course of action with an acceptable degree of risk”