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- 1. Predictability in Project Performance using Applied Statistics<br />Rajeev AndhariaPMP, CISA, CISSP, ITILv3 Expert<br />Co-Author “Six Sigma for IT Management”<br />rajeev@myBTP.in<br />
- 2. Agenda<br />The PM Challenge<br />Key Concepts<br />Some Key Techniques<br />Sensitivity Analysis & Criticality Index<br />Monte Carlo<br />Some thoughts<br />Approximate: 30 minutes<br />
- 3. The Project Management Challenge…<br />Boss:I need the Cost number <br />PM:I need details <br />Boss:give me a number now. I wont hold you to it.<br />PM:U will put the number in ur Budget. U will forget we had this conversation & beat me when the project goes “overbudget”<br />Boss: Give me a number or I will beat you right now <br />PM: Ok, it will cost $ 1 million <br />Boss: That’s too high <br />PM: If you already know the number why are you asking me?<br />Boss: you should feel involved & accountable <br />PM: I rather be a developer <br />There are no facts about the future—everything that hasn’t happened is only an ESTIMATE. <br />Boss<br />PM<br />
- 4. The Choice…<br />Would you go to an orthopaedist who did not use X-rays? <br />J.M. Furbringer<br />
- 5. Key Concepts<br />Predictability:<br />Performance:<br />Statistics:<br />degree to which a correct forecast can be made either qualitatively or quantitatively<br />Accomplishment measured against preset standards of accuracy, completeness, cost, and speed.<br />set of tools for collecting, organizing, presenting and analyzing numerical facts or observations.<br />provides tools for forecasting using data & models. <br />
- 6. Key Concepts<br />Project Performance Management<br />Why Statistics & Project Management?<br />increasing the “probability of success” of achieving the unique outcome within the given constraints (i.e. scope, time, cost, quality, risk & resource)<br />improving predictability in project performance using proven practices in “applied statistics” & project management<br />
- 7. Key Technique-1: Activity Criticality Index<br />Given the activity duration estimates, the project manager wants to identify the critical activities. <br />Popularly used technique: CPM<br />Alternate technique: Criticality Index based on Sensitivity Analysis<br />
- 8.
- 9. Sensitivity analysis is a technique for systematically changing parameters in a model to determine the effects of such changes.<br />The Criticality Index expresses how often a particular task was on the Critical Path during the analysis.<br />
- 10.
- 11. Key Technique-2: Monte Carlo Analysis<br />Question: What is the outcome of rolling 2 Dice? <br />
- 12. Question: What is the Project Completion Date? <br />
- 13. Tell me something more on Monte Carlo Analysis?<br />Step 1: Create a parametric model, y = f(x1, x2, ..., xq).<br />Step 2: Generate a set of random inputs, xi1, xi2, ..., xiq.<br />Step 3: Evaluate the model and store the results as yi.<br />Step 4: Repeat steps 2 and 3 for i = 1 to n.<br />Step 5: Analyze the results using histograms, summary statistics, confidence intervals, etc.<br />
- 14. Parting thoughts…<br />Conclusions are judged to be sturdy only <br />if the neighborhood of assumptions is wide enough to be credible and <br />the corresponding interval of inferences is narrow enough to be useful.”<br />Edward E. Leamer (econometrician)<br />
- 15. Parting thoughts…<br />Stakeholder Management can be significantly improved by increased Predictability in Project Performance.<br />Earned Value Analysis<br />Decision Theory<br />Expected Value<br />Sensitivity Analysis<br />Probability Distributions<br />Quality Tools<br />
- 16. Thank You for Listening<br />rajeev@myBTP.in<br />

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