Transparent Decisions: Managing the Project Portfolio

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What do your customers care about? Running tested features in released products. What do we too often do in organizations? Placating enough people across the organization to making some progress on everything, but finishing nothing. Does that make sense to you?

Instead, we can use agile and lean project portfolio management. We don’t have to rely on dog-and-pony shows, prediction, math, ROI, or estimation. We have much better tools: project value, backlog value and demos
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We ask questions that help you differentiate each project's value from each other. How will this project move the organization forward? We start with the zeroth question: Should we do this project at all? We continue with qualitative questions and then ask quantitative questions.

We start with qualitative questions, such as using business value points, which are based not on any predictive number, but might be based on your product's position in the market, or who is waiting for your projects to be complete, or the risk of waiting of waiting for your projects to be done. What's critical is your discussion around the business value, not the points themselves. I'll supply you with some meaty starting questions for the business value discussion.

If you ask quantitative questions first, they devolve into ROI and you never ask the good qualitative questions. If you do need to have some idea of the budget, I’ll address that question, too. But budget is the wrong question. Value is the right question, and we’ll discuss why.

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Transparent Decisions: Managing the Project Portfolio

  1. 1. Transparent Decisions: Managing the Project Portfolio Johanna Rothman New: Hiring GeeksThat Fit @johannarothman www.jrothman.com jr@jrothman.com 781-641-4046
  2. 2. © 2013 Johanna Rothman What DoYour Customers Care About? 2
  3. 3. © 2013 Johanna Rothman ProductsThatWork 3 Products are comprised of running, tested features that are put together into a whole
  4. 4. © 2013 Johanna Rothman What DoWe Do in Organizations? A little of this A little of that 4
  5. 5. © 2013 Johanna Rothman What AreYou Supposed to Do First? 5
  6. 6. © 2013 Johanna Rothman What’s the Problem? Too many simultaneous projects Too much interrupting work Technical work and multitasking is invisible 6
  7. 7. © 2013 Johanna Rothman What Some Project Portfolios Look Like 7
  8. 8. © 2013 Johanna Rothman WhatThese Portfolios Are Missing 8
  9. 9. © 2013 Johanna Rothman CombinationView: Low and Mid Level 9
  10. 10. © 2013 Johanna Rothman What is the Project Portfolio? Organization of all the projects (and all the work) the organization is attempting to manage When they start When they end Which one is #1 Decide when projects are done--or done enough Decide when to stop, kill, or cancel projects 10
  11. 11. © 2013 Johanna Rothman SoWhat? The portfolio of work-in- progress tells you what is happening and when you can change it Similar to a product backlog Requires cross- organizational commitment 11
  12. 12. © 2013 Johanna Rothman Use the Portfolio to Make Decisions,Tradeoffs, and Assignments Move between the strategic view to the tactical view Create a rolling wave plan Provide transparency into the organization’s work 12
  13. 13. © 2013 Johanna Rothman Consider Lean Iterate on value, redefining it over and over... You have more choices if you can see demos as the projects proceed If you can see the work in progress, you can manage it 13
  14. 14. © 2013 Johanna Rothman Project Portfolio Flow 14
  15. 15. © 2013 Johanna Rothman CanYou Use Cost? Maybe. How long and big is your project? You know about the Cone of Uncertainty in phased projects. That says the longer and bigger, the harder it is to predict. I’m from Boston, the home of the Big Dig... 15
  16. 16. © 2013 Johanna Rothman CanYou Use ROI? Now you need cost and return Don’t get me started... 16
  17. 17. © 2013 Johanna Rothman When Matters Most Estimation is tempting: Cost and Date are two sides of the same coin Both are tempered by the business value of when you deliver the feature Features lose/gain value depending on when you deliver them 17
  18. 18. © 2013 Johanna Rothman Rank by BusinessValue Business value is key It is influenced by cost and return and size Biggest influence is the zeroth question 18
  19. 19. © 2013 Johanna Rothman Zeroth Question: ShouldWe DoThis Project At All? 19
  20. 20. © 2013 Johanna Rothman Let’sTake a Step Back What projects are you comparing? Are they comparable or are they across the organization? First, bucket so they are comparable Frogs with frogs Apples with apples IT with IT Engineering with Engineering 20
  21. 21. © 2013 Johanna Rothman What CanThis Project do forYour Organization? Transform the business Grow the business Keep the lights on 21
  22. 22. © 2013 Johanna Rothman How to Make Decisions Qualitative questions Quantitative questions Only do work that’s currently valuable 22
  23. 23. © 2013 Johanna Rothman Qualitative Questions Should we do this project at all? How does this project fit in with all the others? What is the strategic reason for this project? Is there a tactical gain from completing this project? To make this project successful, are we ready to adequately fund it? To make this project successful, are we ready to adequately staff it? Do we know what success looks like for this project? Is there waste associated with the lack of this project? 23
  24. 24. © 2013 Johanna Rothman Quantitative Questions When will we see any monetary return from this project? What's the expected revenue curve for this project? What's the expected customer acquisition curve for this project? When will we see retention of current customers from this project? What's the expected customer growth curve? When will we see reduction in operating costs from this project? What's the expected operating cost curve? How will this project move the organization forward? 24
  25. 25. © 2013 Johanna Rothman Your Project Portfolio is WhereYour Strategy MeetsYour Execution 25
  26. 26. © 2013 Johanna Rothman TechniquesYou May Find Useful Rank with business value points Waste Single and double elimination All of these approaches facilitate the conversation, which is the most important part 26
  27. 27. © 2013 Johanna Rothman Rank with Points Start with many many points. Each person assigns each project a unique number of points. Now discuss. The conversation is key 27
  28. 28. © 2013 Johanna Rothman WhenYou Cannot Agree You have two #1 projects and only one project team Flip a coin, start them in 1- or 2- week iterations Alternate iterations They must achieve done OR Forget iterations and use kanban Now you only have to fight about which feature is next 28
  29. 29. © 2013 Johanna Rothman WhatWill the Lack of This Project Do? If you don’t do this project, what will happen? Will it prevent you from being able to undertake certain types of projects? For those of you transitioning to agile, don’t underestimate paying down technical debt projects. Agile makes many things transparent 29
  30. 30. © 2013 Johanna Rothman Waste Who has waste based on not having this project? Qualitative questions you might ask: What kinds of workarounds are you using now? After this project is complete, what changes? Do we know what success looks like for this project? 30
  31. 31. © 2013 Johanna Rothman Take a Systems-Thinking Approach Project portfolio management is about the organization’s well-being, not a project’s winning or a manager’s winning This is why I have these guidelines for the project portfolio decisions 31
  32. 32. © 2013 Johanna Rothman Guidelines for PPM Decisions PPM decisions reflect the organization’s strategy, so make sure the people making the decisions know the strategy Make sure a small (3-5 people) cross-functional team decides When in doubt, optimize up at the organizational level 32
  33. 33. © 2013 Johanna Rothman Why Does Agile/LeanWork? Agile helps: Finishing running, tested features Have release-able product periodically (every timebox) Lean helps Creating a culture of not having a lot of work in process Instead, finish things and move on to the next one 33
  34. 34. © 2013 Johanna Rothman Why Manage the Project Portfolio? People can only work on one project at a time Know what people work on Makes it possible for the organization to optimize at the organization level Staff the most important work Flow work through teams 34
  35. 35. © 2013 Johanna Rothman 100% Utilization is for Machines 35
  36. 36. © 2013 Johanna Rothman It does not matter how many projects you start. It matters how many projects you finish. 36
  37. 37. © 2013 Johanna Rothman References and Resources ManageYour Project Portfolio: IncreaseYour Capacity and Finish More Projects, Pragmatic Bookshelf, 2009. Tons more on jrothman.com Let’s stay in touch: The Pragmatic Manager, jrothman.com/ pragmaticmanager/ LinkedIn group:Agile Project and Program Management 37

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