Presentation on how to achieve business value through effective PPM and Resource Planning practices in business. Talk given by Peter Heinrich, CEO of PDWare Inc., at a PMI executive breakfast in New York City

1. Achieving Business Value Through PPM and
Resource Planning
Peter Heinrich
CEO, PDWare Inc.

2. A Resource Plan
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3. Resource Supply 452.35
# Project Name
1 Cedar 44.40
2 Barbados 136.95
3 St Thomas 157.53
4 Cancun 166.63
5 St Croix 239.58
6 Wilson 250.13
7 Coolidge 288.33
8 Jamaica 313.73
9 Aruba2 329.23
10 Antigua 375.35
11 Fast Track 414.07
12 Oak 422.82
13 Bahama 429.52
14 Willow 433.82
15 Madison 445.12
16 Jackson 449.12
17 Cozumel 456.27
18 Grant 469.47
19 Maple 478.22
20 Adams 516.22
21 Birch 559.22
22 Elm 640.82
23 Pine 709.07
32.26 34.82 38.66 42.50 42.50 42.50 42.50 37.38 37.38 37.38 32.26 32.26
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
6.10 4.10 4.60 6.42 6.32 6.62 5.62 4.62
15.30 17.85 17.05 15.17 13.22 14.12 13.02 13.02 8.40 6.40 2.40 1.00
15.30 17.85 17.05 16.17 14.22 15.12 16.54 17.54 11.92 9.42 3.90 2.50
18.30 17.85 17.05 16.17 14.72 15.62 18.24 19.24 13.62 9.42 3.90 2.50
25.15 24.80 24.20 22.52 21.32 22.57 26.19 27.79 21.62 13.82 5.50 4.10
26.10 26.00 25.40 23.72 22.52 23.77 27.39 28.99 22.82 13.82 5.50 4.10
26.10 26.20 25.60 26.92 26.72 28.17 31.59 33.59 27.22 18.22 9.90 8.10
26.10 26.70 27.65 28.97 28.97 30.42 33.84 35.84 30.17 21.17 12.85 11.05
28.10 27.10 28.05 29.37 29.37 31.12 34.54 36.54 32.37 23.57 15.45 13.65
29.60 30.40 33.35 34.42 34.51 35.96 38.48 40.59 36.12 27.32 19.20 15.40
31.10 32.60 37.55 38.37 38.55 40.20 41.82 44.04 39.57 30.77 22.65 16.85
31.10 32.60 37.55 38.37 39.00 41.10 42.72 44.94 40.87 32.07 23.95 18.55
31.10 32.60 37.55 38.37 39.00 42.00 44.12 46.34 42.27 33.47 24.05 18.65
31.10 32.60 37.55 38.37 40.00 43.00 45.22 47.44 42.37 33.47 24.05 18.65
31.10 32.60 37.55 38.37 40.00 43.00 45.72 48.94 45.07 36.17 26.75 19.85
31.10 32.60 37.55 38.37 41.00 44.00 46.72 49.94 45.07 36.17 26.75 19.85
31.10 32.60 37.55 38.37 41.00 44.00 46.72 49.94 46.67 38.02 28.60 21.70
31.10 32.60 37.55 39.87 42.40 45.40 48.12 51.34 48.07 39.42 30.00 23.60
31.10 33.60 38.55 40.87 43.40 46.40 49.12 52.34 49.07 40.17 30.00 23.60
31.10 33.60 38.55 40.87 43.40 49.40 52.12 58.34 55.07 46.17 37.00 30.60
34.10 33.60 38.55 40.87 43.40 51.40 54.12 64.34 62.07 53.17 45.00 38.60
34.10 33.60 38.55 40.87 43.40 62.40 65.22 76.34 74.07 65.17 57.00 50.10
47.05 46.75 49.95 52.17 53.70 66.20 67.92 78.04 75.02 65.17 57.00 50.10
The Infamous “Cut Line”
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4. • Surveys by PwC, PMI, Standish, Ambler (SW)
• Failure modes
• Fail 1 or more of scope (benefits), schedule, cost
• Call all of these “under performance”
• ~45% average under performance in 2014
How Well are We Doing?
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5. 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1990 1994 1998 2002 2006 2010 2014 2018
Historical Under Performance Rates
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6. • ~5,500,000 United States*
• ~ 28,000,000 10 major countries (incl. the United States)*
• ~41,000,000 10 Major countries by 2020*
• For discussion purposes, ~10,000,000 PMs in US, UK, Europe,
Australasia
* PMI 2015 Global Job Report
How Many Project Managers are
There?
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7. At ~$1,000/year/PM Tools, training, conferences, etc.
• $10 Billion/year
At ~$100,000/year/PM Burdened compensation
• $1 Trillion/year
• $550 Billion/year in the US alone!!
Spending on Project Management
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8. 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1,000
10,000
100,000
1,000,000
10,000,000
1982 1986 1990 1994 1998 2002 2006 2010 2014
Big Investment, Modest Improvement
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9. At each table, take 10 minutes to:
• Identify the most significant resource
planning issues
• Describe their causes & impact
• Note differences among your companies
• Nominate a presenter for your table
Breakout Session
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10. “I don’t get the promised resources at the right time – or not at
all.”
“Scope changes but not resources or schedule.”
Project Managers
Functional (Resource)
Managers
“Management never sets priorities and is always asking us
to do more without considering the current workload.”
At or after phase gates, “That’s not MY plan!”
What is The Problem?
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11. “I don’t have a clue what people are working on.”
“We start all kinds of projects but have trouble finishing them.”
“I can’t tell if our resources are focused on our high priority
projects.”
“We kill projects but they keep coming back.”
And in boom times or bust,
“We don’t know what skills to cut or add when budgets are
reduced or increased. Across the board cuts just kill us.”
Portfolio / Executive Managers
What is The Problem?
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12. • Organization structures/roles > 2500 BCE
• Project Management 1950s
• Life Cycle processes 1970s – 1980s
• Portfolio Management 1980s – 1990s
• Agile, et al 1990s – 2000s
• And now . . . .
- Portfolio Resource Planning & Management
• Or Capacity Planning & Demand Management
Timeline of Solutions
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13. Great Pyramid at Giza OBS
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14. No magic bullet
The human element: people being people
• Most PMs, RMs, and executives are human
• Perceptions, assumptions, misplaced confidence
Turnover – loss of culture and discipline
Lack of data, bad data, missing or inadequate analysis
 Haven’t integrated all necessary processes
and people in a sustainable system
WHY?
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15. Project management serves us well.
But it is not the answer by itself to this problem
No credible resource plan from a collection of project
plans
Too detailed
Inaccurate / out of date
Inconsistent compliance and quality
Doesn’t include non-project work
Not from the resource manager (no accountability)
WHY?
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16. We need a clear data provider role for resource managers
We need a clear data provider role for project managers
We need to use that data in
Initiation & Phase Gate reviews
Portfolio reviews
Operations reviews
Annual and multi-year planning
Missing Elements
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17. A method for answering some key questions in
support of project portfolio and staffing decisions.
Given the people, what projects?
What can we do with the people and skills we have, and when can we do it?
Given the projects, how many of each skill?
How many people with what skills do we need to do all the work we must do
and want to do?
How well are we utilizing the people we have?
What do we do when demand or capacity changes?
What is Portfolio Resource Planning?
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18. A Pretty Picture
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19. A Resource Manager’s Plan/Forecast for a resource
Not Very Pretty Picture
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But the credible data source that makes the process work

20. Proximity and Scalability
Cate
IC 1 IC 2

21. A Project Resource Plan
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22. Organization Resource Utilization
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23. Portfolio Achievability
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24. Resource Management
Portfolio Management
Project Management
Resource Planning Process
Capacity/Demand Management
Project Management
Life Cycle/Phase Gate, Agile, . . .
EPMO
Operational Portfolio Management
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25. Checklist for a Successful Process
1. Capture fresh, credible data (demand, project attributes)
from the resource & project managers closest to the action
2. Demonstrate that you can finish everything you start
using prioritized supply-demand analysis
3. Require a contract at phase gates
among PMs, RMs, and portfolio managers
4. Track, measure, review, respond
get the data, use the data
5. Keep it simple
including methods and tools,
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26. A simple, sustainable data collection process
Functional managers own resource supply, demand and utilization data
Project managers own project planning, attribute status, and delivery
Before you approve a project, demonstrate that it is
achievable, that you have resources with the right skills
available when they are needed
Regular, consistent management review of the analysis
and data.
Capture and use historical data.
In Other Words…
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27. Nothing works well without it
You win big if you do it well
It is not so hard to do it well
BUT it requires consistency, discipline,
and the right tools to get lasting results
Portfolio Resource Planning:
Take This AWAY!
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28. Wheelwright & Clark, Leading Product Development
Chris Chabris & Dan Simon, The Invisible Gorilla
Dan Ariely, Predictably Irrational
Levitt & Dubner, Freakinomics and Think Like a Freak
PMI, Pulse of the Profession
PMI, 2015 Global Job Report
PwC, Insights
Jordan Ellenberg, How Not to be Wrong: The Power of Mathematical
Thinking
Nate Silver, The Signal and the Noise
Hans Rosling,
http://www.ted.com/talks/hans_rosling_shows_the_best_stats_you_ve
_ever_seen#t-149977
References
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29. Definition of “Resource Manager”
• A resource manager has direct reports
Line Managers, Functional Managers, Team Leaders
• First level resource manager
individual contributors as reports
• Resource managers do resource planning
(among other things)
• BUT, other roles might do resource planning,
A Resource Planner in the Portfolio Management Office
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30. Demand/Utilization planning and oversight
Given the resource/skill set we have,
What is the best achievable portfolio?
How do we monitor changes to optimize
utilization?
Capability (staff) planning
Given the projects needed to achieve objectives
or given a spending limit,
What changes to the resource skill profile are
needed?
Two Aspects of Resource Planning
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