Heise cusimano


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  • My name is Russ CusimanoI’m a principal with ePMWe are a global consultancy that helps project teams achieve predictable and profitable results – change their gameTwo goals for this talkRaise awareness that current approaches are improved but not sufficient.Provide some approaches for firms that are striving for the next level of project performancePlease feel free to ask questions during the presentation
  • People, process and technology is a familiar framework for understanding project organizationsPredictable execution is the goal. If our teams, processes and technologies are predictable, projects are more successfulInvestments in improving organizations have lagged behind those in process and technology People are complex and variable Difficult to understand and manage ScaryTransition: there are three false assumptions or misconceptions about organizational capability that are holding our industry back
  • Three points:Enlightened companies are putting Organization Capability practices in placeLargely they are process driven, mechanical and extensions of prior best practices. For example, in addition to building resource loaded schedules, we are making staffing plans with skill notations. Team building has become a standard practice usually provided in house.Organization planning sections of Op plans and PEPs have become more extensive and may include gap / risk assessment.These practices provide at least a basic and consistent approach for major capital projects. Transition: The best practices and plans assume some things about organization planning at this level…One assumption: there is a cause and effect relationship Not true Putting the conditions in place doesn’t produce results Best practices are really not-worst practices Benchmarks are too general
  • another incorrect assumption is that the people who are available will match the work scope or will figure it outProject managers put too much emphasis on experience – we know what we’re doing, we can adaptIt drags the project downEvery project is a unique combination of work and people It’s not the same team It’s not the same work It’s not the same business environment Every mismatch between work requirement and capability incurs a 15% productivity penaltyBenchmarks, best practices and “the way we did it the last ten times” do not sufficiently account for this team, this work, this projectThree points:Companies struggle to manage their PM disciplines within a dynamic global resource marketplace. As a result, there is an uneven distribution of skills and experiences which are sometimes poorly matched. With the variations of cultural matches, personnel from diverse backgrounds (geography, company heritage, client / contractor, etc.) often personnel are placed in key positions with degradation of almost half of their effectiveness. Mismatches can occur due to skills / experience “stretches” or simply cultural misfits.
  • … that brings us up from 60% effectiveness to 65%Three points:The symptoms we hear usually point to an individual, team or contractor who is failing. There is an acceptance of tinkering, turnover and reactive management attention to organization issues. The scope demands more qualified people or teams – often they are not as clear on the demands of the scope at the outset. Certainly, the demands of the organization necessary to fulfill the scope are not known. Transition: and that acceptance is a real problem – one we need to change if we expect to generate non-linear performance improvements…
  • … if we in this room were the start of the movement that rejected the status quo,how would we shift to dramatically improved organization performance? Match organization characteristics to the characteristics of the work – do this using similar engineering regimen as we do in designGenerate a mindset that we want work to flow uninterrupted Prepare teams (people who actually show up) for the work – use simulation guided practice sessions at key leverage points.HOWEVER we should not take these conditions for granted and use our vigilance to: - learn in simulation and practice sessions - use “near miss” thinking to stimulate organizational learningMeasure, adjust and simulate throughout operations / project lifecycle
  • Fast, easy and effectiveSimilar to directing a play and rehearsing the cast before opening night
  • The value of computer simulations are well known and widely accepted Structural design Aerospace Automotive industryTeams explain why the model shows what it doesUse the simulator to catalyze their risk assessmentLike rehearsing – directed and focusedDraws big circles around places where issues may be
  • … I have an energy industry example to show you in a minute but first a good one that comes from the medical field.Three points:1. Dissatisfied with performance in the surgical theater Kaiser Permanente employed studies using HRO concepts2. Of the steps I identified on the prior slide, they focused on one – the use of preparation and practice of the team that showed up3. In this highly proceduralized and process oriented environment, the use of pre-op run through had dramatic resultsNot only did performance improve but morale increased as well! Transition: now let’s shift into an energy industry example that comes from ePM’s case studies…
  • models team behaviors and human work28 years of Stanford development11 years of ePM industrial validationNASA-licensed and customized
  • Each comes with certain expectations and intentions These are based on experiences Simulation quantifies the difference for a specific project teamThis is not a “best practice” dissertation;Not generalIt is a quantitative analysis of how these assumptions and expectations play out on THIS project with THIS team
  • General expectations on the left Conventional wisdom Common knowledge GutThe question is: HOW MUCH on THIS PROJECT?
  • The benefit is not as dramatic as process quality because the organization structures are more complexPause here before going on to next exampleWhat are the benefits to the project? Experiment, test and perfect before start Don’t have to rely solely on experience Build strong consensus – everyone gets heard, everything gets objectively tested Faster decisions – 2 to 3 times fasterMore predictable outcomes
  • Summary1. Match organization characteristics to the characteristics of the work – do this using similar engineering regimen as we do in design2. Prepare teams (people who actually show up) for the work – use simulation guided practice sessions at key leverage points.3. Generate a mindset that we want work to flow uninterrupted HOWEVER we should not take these conditions for granted and use our vigilance to: - learn in simulation and practice sessions - use “near miss” thinking to stimulate organizational learning4. Measure, adjust and simulate throughout operations / project lifecycleIn the course of our work, we’ve seen some key places where doing this type of organizational planning is important.
  • Heise cusimano

    1. 1. EngineerExceptionally Capable Project Teams February 2012 Organization Performance by Design™
    2. 2. The new realityEngineered organizational capabilityproduces predictable results • Organizational capability doesn’t just happen • Design a more predictable organization • Rehearse the team, measure and adjust • Case study • Question and answer 2
    3. 3. State of the industryWhere have we invested in predictability? Complex People Variable Organizational capability is the largest single opportunity to improve predictability $ Process Technology $ 3
    4. 4. Misconception #1 The realityOrganizational capability doesn’t justCreating the right conditions improveshappen – therepredictability is no cause and effectBest Practices Capability HappensBenchmarks Experienced People 4
    5. 5. Misconception #2 The realityIt’s typically about 60% right“We get it about 90% right” Who shows up • Every project and team this time? is different enough • Every work requirement that isn’t matched by a capability incurs a 15% productivity penalty 5
    6. 6. Misconception #3 The realityPeople failuresothermore on thethan not,We can fix the are, 10% often flydesign failures • Failure is attributed to individuals or sub- teams • Continual reworking is accepted as inevitable • Exchanging people for others “more qualified” is expected 6
    7. 7. A new realityEngineer organizational capability Match the Rehearse the Measure andOrganization to the Team and Learn Adjust Work• Understand gaps • Conference room • Project phase and mismatches pilots transitions• Design for an • Computer • Disruptive events uninterrupted simulations and conditions flow of work 7
    8. 8. Real time simulationRehearsals, conference room pilots andtable top demonstrations • Good for single business processes • Anticipate and prepare • Respond rather than react • Develop and test solutions to known or likely failures 8
    9. 9. Non-real time simulationComputer simulation of complexorganization behavior • Apply to entire team and project scope • Design prior to execution • Adjust to adverse conditions and test solutions • Identify unknown risks and weaknesses 9
    10. 10. Kaiser Permanente improvement programA ten-minute rehearsal prior to surgerydramatically improved predictability • Wrong site surgeries eliminated • Improved patient recovery rates • Nursing turnover rate decreased from 23 percent to 7 percent • Positive perceptions of teamwork doubled 10
    11. 11. SimVision® technology and methodsPractical simulation methods are easy toapply and produce useful insights People, Skills, Experience ROI Organization Culture and Leadership Quality and Safety Work Processes Schedule Variability 11
    12. 12. Informed project designCompare three possible organizationstrategies for a new project • Use a high-level work plan and schedule as a test bed • Simulate three different owner-contractor relationships – Compare overall project outcomes – Quantify quality risks • Look for advantages associated with various conditions and contractual arrangements 12
    13. 13. Quantify the expectationsEach strategy is intended to enablespecific outcomes • Project team is a hybrid of Owner and Contractor personnel • Staffing of each function is determined by core experience Best Player • Take maximum advantage of available expertise • Intended to be lowest-cost • Contractor staffs project functions • Owner team reactively audits performance and seeks Audit corrections and improvements • Intended to be highest-quality • Contractor staffs project functions • Owner team works proactively to remove barriers, prevent Dual Player delays and enable superior outcomes • Intended to minimize schedule variance 13
    14. 14. On this projectAudit and Dual Player have a 20% to 50%higher staff cost than Best Player• Both require more Owner-Contractor coordination• Audit creates more rework to be performed by the Contractor• Dual Player facilitates the Contractor’s job and proactively avoids rework 14
    15. 15. On this projectAudit and Dual Player impact staff costand predictability in different ways• Audits increase Contractor costs and +/- 3 sigma uncertainty• Dual Player makes the Contractor’s work more predictable and about 25% less-costly• Owner adds staff in both cases 15
    16. 16. On this projectAudit makes the schedule lesspredictable• The retrospective nature of Audit +/- 3 sigma creates significant schedule growth and uncertainty• Dual Player improves predictability and might increase total time 16
    17. 17. On this projectAudit and Dual Player produce asignificant quality advantage• Predictable +/- 3 sigma results High• Complies with standards• Performed Low according to plan 17
    18. 18. On this projectAudit and Dual Player improvecommunication and safety• Communications are clear, timely and beneficial +/- 3 sigma High• Information is available where and when its needed• Communication is more carefully planned and Low managed 18
    19. 19. When to applySimulation and rehearsal are mostvaluable when uncertainty is greatest • Project conceptualization • Team formation and start up • Phase transitions such as from Pilot to Full Scale Production 19
    20. 20. SummaryProject teams can be engineered andoptimized for success • Combine simulation science with experience • Match the organization structure to the work at every phase • Rehearse and learn 20