Tuesday, June 10, 2008

Measuring Innovation

Should we strive to measure innovation? Some high-level measures may be worthwhile to understand the pulse and/or health of innovation. Here are some suggestions for metrics. ...

... "The BCG report recommends that you select a small number of metrics appropriate for your business and have some for inputs, process and outputs. " ...


Via BQF Innovation: Metrics

Labels: , , ,

Thursday, April 24, 2008

Project Success Criteria: What to Measure

I've often written that we shouldn't focus on measuring people, nor let time and budget metrics be our key indicators of project success. This is a key component of my SOPM (Service-Oriented Project Management) model.

That's not to say that time or budget should be ignored. They should be managed. And where it's a vital element of the project, it should be monitored. But these items shouldn't be used across the board to determine whether our organization is successful with project management.

As for measuring individuals, some claim that it's the only way to get results out of people (i.e. what gets measured gets done). I say this is leading by fear, and the dangers outweigh the results it brings. We can also get results by prodding people with a hot poker. That doesn't mean it's the most effective way to create an engaging environment. Napoleon once said there are two levers for motivating people--interest and fear. We're always better off using interest, whether it's with a compelling story, a contest, a call to action, or some other more positive attraction.

So, what SHOULD we measure? Here are the 5-7 things that are most vital:

1) Client Satisfaction (on an ongoing basis, not just at the end of our project when it's too late for course corrections)

2) Employee Satisfaction (this gives us insite into the culture we're promoting. A good list is to use the 12 questions Gallup has determined that employees ask themselves to determine their satisfaction level, as noted by Marcus Buckingham and Curt Coffman in First Break All the Rules. Then, management can be measured by how their employees answer those questions.)

3) Outcomes (progress on current milestone deliverables and interim results as they are delivered ---even if some outcomes can't be measured until the project is technically over. This focuses on the work completed and its tie to real value -- not just time being ticked off on a clock. Also it's best to measure a team's success against those outcomes as opposed to individuals---or their respective departments---and their discrete objectives. This promotes a team atmosphere in which all collaborate toward common goals.)

4) Cultural Alignment (see www.infotool-online for a good product for diagnosing cultural alignment by demographic, showing how well everyone is aligned on "the main thing" your organization is trying to establish culturally---the product also suggests remedies and a path forward).

5) Vision Alignment (the best tool I've seen for this is in The Disney Way and The Disney Way Fieldbook, by Bill Capodagli and Lynn Jackson. Their VisionAlign model, based on practices taught at the Disney University, is a matrix, listing Vision/Mission key points on the left side, and Core Strengths, Values, Objectives, and Stakeholder groups across the top. The columns are mapped to the Vision/Mission points via correlation indicators indicating a fit, potential fit, or area of concern.)

.... And for the more ROI conscious...

6) Total Cost of Ownership (not just the cost of the project. This would include ongoing maintenance, support, etc., at least 3-5 years out, or for the expected life of the product)

7) Total Value of Ownership (including tangible and intangible benefits, and potential long-term and indirect benefits. Accountants and financial types hate this, and there's no magic formula for it, but to ignore it completely is shortsighted.)

One thing is for sure -- continuing to measure project success in terms of on-time, on-budget, and meets specs is taking a very limited view of what success really is. It's time we redefine it.

I'd love to hear others' thoughts on this, and other items worth measuring that keep our focus on real client value and employee engagement.

Labels: , ,

Tuesday, February 19, 2008

Outcome-Based Budgeting; The Right Focus

I recently read that the office of Philadelphia's new mayor, Michael Nutter, is initiating an outcome-based budgeting process. Other cities have had success with this approach as well.

Rather than each department planning their budget in isolation (as many companies do), the budget process will be focused on the outcomes that the money is meant to support, regardless of department.

Not only does an outcome-based focus make sense for budgeting, it makes sense for project measurement, portfolio management, and even Web sites. Much like budgets, all too many web sites are structured around organizational or departmental silos, as opposed to the outcomes that are supposed to be produced.

Labels: , , ,

Wednesday, June 06, 2007

PMO Success Metrics: Proceed With Caution

Based on Benjamin Disraeli's well-known statement about the three types of lies, "lies, damned lies, and statistics," Jeannette Cabanis-Brewin wrote an interesting article in Developer.com about the many faulty assumptions people make based on so-called statistics about PMOs.

Cabanis-Brewin is editor-in-chief for PM Solutions' Center for Business Practices, so she's seen her share of statistics. Some key points:
- There are many interpretations on what constitutes a PMO, so many statistics on PMOs are skewed from the start.

- Some reports indicated high project failure rates in organizations with PMOs. That's likely due to the fact that organizations without PMOs don't tend to measure project success. Without measures, there are no failures.

- Many surveys are poorly designed and miss crucial clarifying questions.

Cabanis-Brewin recommends going to the source and digging into the supporting details to draw your own conclusions. She also reminds us that surveys usually do not contain the definitive answer, but rather serve as a starting point for more research. Finally, she cautions us to beware of the Hawthorne Effect, which states that the act of observing often changes the observed.

I would add that it's also important to be careful what you ask for. Many organizations want to begin using metrics, but are surprised to see success rates so low. They pressure project managers too soon and expect success rates to instantly soar to above 90%. It's vital to give the organization time to address problem areas and develop maturity.

Yes, it's important to capture metrics, but it's equally important to create a blameless reporting environment, by which people will report accurate data without fear of retribution. It's also critical to think about how you measure success. True success doesn't always correspond to on-time and on-budget. But that's another story.

Here's the article...

Lies, Statistics, and the PMO

Labels: , , , , ,

Monday, March 19, 2007

Project Success Measures: What Really Counts?

Finally, people are starting to say what I've been saying for some time. Often , the most telling measures of project success are qualitative, not quantitative. Consider this quote from an excellent article on PMI's latest issue of PMP Passport:
“Measures like on time, on budget and on spec are part of the success criteria, but one could achieve these three and still have a dissatisfied customer,” says Ernie Baker, PMP, president of Start to Finish PM Inc., Verona, N.J., USA."

Halleluyah! Indeed, qualitative measures such as customer satisfaction, customer engagement, and team engagement can often tell us more about the "success" of the project, and can even shed light on why the project wasn't on budget, schedule, or spec.

Here's the article...

PMP Passport - Features

Labels: , ,

Tuesday, February 27, 2007

IT Value EQ Business Value

What is the value of IT? Expressing it in the language of business is essential. Direct tangible impact is the best. However, when tangible financial impact is not obvious, IT professional must connect the dots. ...

... "Everyone on the panel said it makes sense to judge technology projects based on business metrics. Boiled down that means two measurements: Reduced cost and increased revenue. " ...


Via ZDNet: IT Value

Labels: , , , , ,