Project Management Control Systems
- 1. Project Management Control Systems January 2010 © 2010 IBM Corporation
- 2. Objectives Discuss drivers of program/project failure Consider an approach to increase probability of success © 2010 IBM Corporation
- 3. Agenda Project Success Effective Project Management © 2010 IBM Corporation
- 4. Project Success History has proven that many projects will fail Extensive studies have been conducted to understand why failure occurs So why do we continue to see significant failures? This question could be applied to the collapse of mid-west power grid a few years ago or Jet Blue’s recent problems with flight delays. It is also true for Information Technology projects. How often do projects fail and what can be done to prevent failure? © 2010 IBM Corporation
- 5. Project Success Approximately 60% of large Information Technology projects fail or do not meet the expectations at some level.., “ At companies that aren’t among Percentage of Failed IT Projects the top 25% of technology users, three out of ten IT projects fail on 100% average. Translation: amazing 30% 90% experience project failures.” 80% – Julia King, “Survey shows 70% common IT woes”, Computerworld, 60% June 2003 50% 40% You might conclude that this is 30% good news – 70% succeeded. 20% 10% What this analysis doesn’t tell 0% you: Small Mid-Size to Failure How many of these projects were Large Success Budget less Budget greater over-budget, over time or than $500k than $500k defective in function upon completion. Source: Gartner Group Study 2005 © 2010 IBM Corporation
- 6. Project Success Project managers often start with unrealistic expectations for the budget and timeline. Variances from a project time and cost estimate can be significant Software project cost as a function of life-cycle phase 1,2 F e a s ib ility R e q u ir e m e n ts S y s te m S y s te m S y s te m S tu d y A n a ly s is D e s ig n B u ild In s ta ll 4 x x(3+exp(-067n)) Expected range of estimation accuracy 2 x 1 .5 x 1 .2 5 x x .8 x .7 x x .5 x x(3+exp(-067n)) .2 5 x S o ftw a r e d e v e lo p m e n t life -c y c le 1 2 3 4 N Studies have shown that when initial budgeting is completed for a typical software implementation project, the inaccuracies in the estimate can range from 1.4x to 0.6x of the point estimate. The reduction of the variance depends on effective project management. 1 Software Engineering Economics, Barry W. Boehm, Prentice Hall PTR, 1981 2 “Software Size Estimation of Object-Oriented Systems,” IEE Transactions on Software Engineering, Vol. 16, No.5, May 1990 © 2010 IBM Corporation
- 7. Project Success Many studies have been Jaing’s Drivers of IT Project Success 1. Clearly defined goals done to identify sources of 2. Competent project manager success and failure 3. Top management support For example, in the article 4. Competent project team members – “Ranking of system 5. Sufficient resource allocation Implementation Success 6. Adequate communications channels 7. Project tracking (plans, schedules, etc.) Factors” by James Jiang 8. Feedback capabilities in Project Management 9. Responsiveness to client Journal 12/96, Mr. Jiang 10. Client consultation highlighted 13 items which 11. Technical execution he believes drive a 12. Client Acceptance successful project. 13. Trouble-shooting © 2010 IBM Corporation
- 8. Project Success Conclusions A large number of Information Technology projects fail to meet some portion, if not all, expectations, Considerable effort has been expended by businesses, consultancies and industry experts to identify the sources of failure and recommend the path to success, Yet, may IT projects continue to fail…. © 2010 IBM Corporation
- 9. Agenda Project Success Effective Project Management © 2010 IBM Corporation
- 10. Effective Project Management Project and program management effectiveness is often only measured in the final results: – Did the project complete on schedule? – Was the project on-budget? – Did we complete within scope? – Did we achieve the quality expected? Achieving these results requires a sustained, high project performance over the entire life-cycle of the project. In our experience, project success requires the right project management skills, a sound project management control system, and effective management execution. © 2010 IBM Corporation
- 11. Effective Project Management - Right Skills The lack of specific project management skills presents minimal risk for small projects, but poses considerable risk to higher-profile, higher risk midsize to large projects. The skill requirements for a strong project manager are extensive. Overall Traits Requisite Skills Negotiation Diplomacy with Problem Solving Credibility Conflict Resolution Communications Strategic View Leadership Action Business Acumen Responsibility Financial Analysis Risk Mitigation Collaboration Organization Change Catalyst Planning Contracting Risk Manager Administration Technical Experience © 2010 IBM Corporation
- 12. Effective Project Management – A Sound Project Management Control System A Project Management Control System Project Management Control System Framework defines the means by which as program or project is planned, managed and controlled, including: – Project objectives – Project culture – Cost and progress control Project Methodology Management – Operating rules and policies System – Work product templates – Records and documentation © 2010 IBM Corporation
- 13. Effective Project Management – A Sound Project Management Control System – Fourteen Point Model IBM has defined 14 elements of a sound Project Management Control System. Project Definition Through our extensive project M ree sor and Qu gem nt an management experience and work me ali e Ag pon Estimate a t y nt with the Project Management Tr S a Institute, IBM has defined 14 Co ckin nt g & ns ro t io elements of a sound project De l un ca nt i e management system. Ma liverab mm agem nag l Co a n em es M ent PMCS Structure Analysis Non-Starter 5 4 3 2 1 2 3 4 5 Ratings Developmental lan Cha Capable rk P ment Con e ng on a 1 to 5 Wo age trol Scale Advanced n Exemplary Ma M a HR nag k t em Ris men ent g e M ana M Su an pp ag lie nt Org agem em r me Ma na ue Technical en Ma Iss ani ge n Environment t zat ent Source: IBM’s Project Management Excellence Database ion © 2010 IBM Corporation
- 14. Effective Project Management – PM Execution Project Management Success Effective project management execution Highly depends on both: Skilled Possible Highly Success Probable (1) the skills of the Success project/program Manager Project Skills management team and (2) the quality of the Project Management Success Possible Control System. Unlikely Success Limited Experience Poor Quality High Quality Project Management Control System Structure Source: IBM Analysis © 2010 IBM Corporation
- 15. Project Success Conclusions A large number of Information Technology projects fail to meet some portion, if not all, expectations Considerable effort has been spent by businesses, consultancies and, industry to identify the sources of failure and recommend the keys to success. Often project success is measured only in the final results: in-scope, on- schedule, in-budget and met-requirements Achievement of project success requires effective project management throughout the entire project life-cycle. Project success is driven by: 1) Skills of the team (including the PM) and 2) the Project Management Control System to support - communications, management commitment, planning and scheduling, etc. which yields …… Effective Project Management Project Success. © 2010 IBM Corporation