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                                                        I’d like to thank you for inviting me to
                                                        speak at your workshop.
                                                        My contribution to this topic is from the
                                                        point of view of a program controls
                                                        manager in the aerospace and defense
                                                        business.
                                                        The programs we work are software
                                                        intensive, but not in the way commercial
                                                        software projects are.
                                                        The software on our programs is
                                                        embedded in other systems – avionics,
                                                        flight controls, ground management
                                                        systems of aircraft and spacecraft.
                                                        Other parts of our firm work programs
                                                        for commercial enterprise IT.
                                                        The principles I’m going to introduce you
                                                        to today are applicable to all projects no
                                                        matter the domain or the context in that
                                                        domain.
                                                        From software, COTS IT, construction, any
                                                        project where the outcome is critical to
                                                        the success of the participants.




The 5 Immutable Principles of Project Management                                                   1/62
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                                                        There are three outcomes for this talk.
                                                        1. I’m going the suggest there is common
                                                           misunderstanding that software
                                                           development and project
                                                           management are the same thing.
                                                        2. There are 5 irreducible principles for
                                                           managing any project, no matter the
                                                           domain or the context.
                                                        3. And, as software developers, along
                                                           with the project manager, if you are
                                                           not answering the questions from
                                                           these irreducible principles, you’re
                                                           probably doing project management
                                                           and your project is in jeopardy and
                                                           you may not know it.




The 5 Immutable Principles of Project Management                                                  2/62
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                                                        We’ve all seen the numbers.
                                                        We’ve all been told how bad things are.
                                                        77% of project failures are due to poor
                                                        planning or poor project management.
                                                        Here’s one more look.
                                                        But we’re here to work on only one of the
                                                        aspects of the “money flushing” part of
                                                        your project activity
                                                        We’re here today to talk about the
                                                        project management aspects of projects.
                                                        The planning, scheduling, costing,
                                                        management verbs of projects.
                                                        These are called the Programmatic
                                                        Elements of the project. Versus the
                                                        technological aspects.
                                                        As a program manager I’m very
                                                        interested in the technology. But my job is
                                                        to make sure the programmatic aspects
                                                        work, so the technology has a chance of
                                                        actually showing up on time.




The 5 Immutable Principles of Project Management                                                3/62
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                                                        So first let’s review what is a project.
                                                        It’s a one off event. It’s not operations. It’s
                                                        not repeatable processes – although the
                                                        processes that manage projects are
                                                        repeatable, the project itself is a one
                                                        time occurrence.
                                                        The reason this is important is that
                                                        projects are a “one chance to get it right”
                                                        type of endeavor. Operations has
                                                        several chances to get it right. Maybe a
                                                        lot of chances. Sometimes only a few. But
                                                        never just one.
                                                        Now there is another word here –
                                                        probability.
                                                        Projects have a probability of success.
                                                        There is no guarantee. We’d like this
                                                        probability to be as high as possible. For
                                                        some projects the probability is high –
                                                        close to 100%. For some projects the
                                                        probability, while acceptable, is actually
                                                        low.
                                                        There is 1 chance in 149 of losing the
                                                        mission for the Orion Manned Spaceflight
                                                        program with specific types of launch
                                                        vehicles.
                                                        What’s the probability of having your
                                                        Enterprise ERP project rollout fail in a
                                                        way that causes an unrecoverable loss to
                                                        your company? Good question.
                                                        How can you improve the probability of
                                                        success for your project? Another good
                                                        question.



The 5 Immutable Principles of Project Management                                                    4/62
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                                                        Mr. Blaise’s quote is applicable to almost
                                                        every major project we’ve encountered.
                                                        It’s sad but true that we simply don’t
                                                        know how to stop work once we’ve
                                                        started.
                                                        The work shop today is not about that
                                                        decision though.
                                                        It’s about applying the principles of
                                                        project management, so we don’t have to
                                                        treat projects in such a “black and white”
                                                        manner.




The 5 Immutable Principles of Project Management                                                 5/62
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                                                        Management is a verb.
                                                        When applied to an object, like a
                                                        project, this verb is the actions needed to
                                                        control and guide the development of the
                                                        outcomes of the project.
                                                        No matter what your approach, self
                                                        guided or all the way to formal project
                                                        management methods, projects need a
                                                        framework in which to make progress.
                                                        The definitions here define the
                                                        boundaries of the processes applied to
                                                        the project.




The 5 Immutable Principles of Project Management                                                  6/62
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                                                        When we put these terms together we
                                                        arrive at the basis of today's work shop.
                                                        We need knowledge, skills, tools, and
                                                        techniques in order to increase our
                                                        Probability of Project Success (PoPS).
                                                        The five (5) immutable project
                                                        management principles are independent
                                                        of all these things.
                                                        At the same time they apply to any and
                                                        all these things.
                                                        And finally they are independent of any
                                                        project domain and any context in that
                                                        domain.
                                                        With the concept of Project +
                                                        Management in hand, let’s look at the
                                                        domain and context in those domains for
                                                        applying this verb and noun.




The 5 Immutable Principles of Project Management                                                 7/62
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                                                        The notion of simplicity has entered the
                                                        discussion around project management
                                                        methods, tools, processes, and other
                                                        elements.
                                                        On one end we have Leonardo’s quote
                                                        about simplicity being the ultimate
                                                        sophistication.
                                                        On the other we have Mencken’s
                                                        reminder that complex problems and
                                                        their solutions are connected in ways we
                                                        may not actually understand.
                                                        Searching for simplicity in the absence of
                                                        understanding the “system” usually leads
                                                        to disappointment.
                                                        When we’re walking through our
                                                        immutable principles today, let’s keep in
                                                        mind the connection between simplicity
                                                        and complexity and the solutions we
                                                        need to address this complexity.




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                                                        Here’s an idea that we don’t always
                                                        consider upfront when we look for
                                                        processes and principles.
                                                        The amount of risk a project can tolerate
                                                        is directly related to the business domain
                                                        and the context of the project within that
                                                        domain.
                                                        Understanding the tolerance for these risk
                                                        levels are critical to choosing and
                                                        applying any software development
                                                        method.
                                                        However, the five immutable principles
                                                        presented here are juts that, immutable.
                                                        They must be present in some form no
                                                        matter the product development method,
                                                        the level of risk tolerance of the domain
                                                        and the context within that domain.
                                                        The risk tolerance for cost is defined as
                                                        the ability for the customer to absorb
                                                        changes in the planned cost through
                                                        management reserve and the application
                                                        of additional funds.
                                                        The risk tolerance for schedule slippage is
                                                        defined as the ability to still produce
                                                        value for the customer in the presence of
                                                        a late or slipping schedule.
                                                        The risk tolerance for Technical
                                                        Performance means the customer is willing
                                                        to accept technical capabilities that are
                                                        less than planned.
                                                        With this background, let’s look at the
                                                        five (5) immutable principles.



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                                                        The five immutable principles of project
                                                        management are:
                                                        1. Know where you are going by
                                                           defining “done” at some point in the
                                                           future. This point may be far in the
                                                           future – months or years from now. Or
                                                           closer in the future days or weeks from
                                                           now.
                                                        2. Have some kind of plan to get to
                                                           where you are going. This plan can be
                                                           simple or it can be complex. The
                                                           fidelity of the plan depends on the
                                                           tolerance for risk by the users of the
                                                           plan.
                                                        3. Understand the resources needed to
                                                           execute the plan. How much time and
                                                           money is needed to reach the
                                                           destination. This can be fixed or it can
                                                           be variable.
                                                        4. Identify the impediments to progress
                                                           along the way to the destination.
                                                           Have some means of removing,
                                                           avoiding, or ignoring these
                                                           impediments.
                                                        5. Have some way to measure your
                                                           planned progress, not just your
                                                           progress. Progress to Plan must be
                                                           measured in units of physical percent
                                                           complete.




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                                                        When we confuse product development
                                                        with project management, we’ve missed
                                                        answering the 5 immutable principles
                                                        questions.
                                                        We skipped directly to the “doing” part
                                                        of the project.
                                                        The “managing of the doing” is not the
                                                        same as the “doing.”
                                                        Both are needed of course.
                                                        If we only have the “doing” part, then the
                                                        project is guided by the immediate
                                                        outcomes of the development process.
                                                        The project outcomes “emerge” as it
                                                        progresses. This is the basis of some forms
                                                        of Agile. There may be broader goals,
                                                        but the development team only responds
                                                        to the “next” increment.
                                                        Many projects are successful applying
                                                        this product development method as a
                                                        replacement for project management.
                                                        The other approach – and this is a
                                                        context sensitive approach – is to define
                                                        the needed capabilities, the requirements
                                                        needed to fulfill those capabilities, and
                                                        the work plan to make those requirements
                                                        appear.
                                                        This does not mean the fidelity of the
                                                        requirements is complete. Some could be
                                                        vague, some could be altered as we
                                                        proceed. But the end-to-end goal is
                                                        defined with enough fidelity to assure the
                                                        customer we understand what DONE
                                                        looks like.


                                                                                                      11
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Our first step here is to separate a Plan
                                                        from a Schedule.
                                                        The PLAN is a procedure used to achieve
                                                        an objective. It is a set of intended
                                                        actions, through which one expects to
                                                        achieve a goal.
                                                        The SCHEDULE is the sequence of these
                                                        intended actions, needed to implement
                                                        the PLAN.
                                                        But we don’t what to mix the PLAN with
                                                        the SCHEDULE.
                                                        The PLAN is the strategy for the successful
                                                        completion of the project.
                                                        In the strategic planning domain, a PLAN
                                                        is a hypothesis that needs to be tested
                                                        along the way to confirm we’re headed.
                                                        The SCHEDULE is the order of the work to
                                                        execute the PLAN.
                                                        We need both. PLANS without
                                                        SCHEDULES are not executable.
                                                        SCHEDULES without PLANS have no
                                                        stated mission, vision, or description of
                                                        success other than the execution of the
                                                        work.




The 5 Immutable Principles of Project Management                                                12/62
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                                                        When we say “where are we going,” we
                                                        should be talking about physical
                                                        outcomes – the deliverables.
                                                        When we say deliverables, what
                                                        deliverables are we talking about?
                                                        The deliverables should be those that
                                                        fulfill the requirements.
                                                        So what are the requirements?
                                                        As our quote says here, the single hardest
                                                        part of building a system is deciding
                                                        what to build.
                                                        No matter what method you use to make
                                                        these decisions – from the agilest of
                                                        methods to the most formal, we need to
                                                        have the requirements stated in a form
                                                        that is testable, verifiable, and traceable
                                                        to the PLAN and SCHEDULE.




The 5 Immutable Principles of Project Management                                                13/62
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                                                        Here’s some words that we’ll encounter
                                                        during the development of requirements.
                                                        These are not the only words of course,
                                                        but these words are important ones.
                                                        One critical set of words are “Stated”
                                                        versus “Real.” Stated requirements are
                                                        any requirement that is written down –
                                                        that is stated. “Real” requirements are of
                                                        course requirements that are really
                                                        needed by the system to fulfill its business
                                                        case.
                                                        Other words are important as well.
                                                        “Verified” and “Validated” are a pair.
                                                        One of the requirements words that
                                                        causes much extra work is “derived.” A
                                                        derived requirement is one that is not
                                                        primary, but is secondary. As such it may
                                                        not be obvious that it is a requirement.
                                                        There are requirements words that should
                                                        be avoided. The first one – that may not
                                                        be obvious – is “Customer.” Which
                                                        customer? How do we know what the
                                                        customer wants? One simple way out of
                                                        this is to state the requirement, that we
                                                        think is a customer requirement, in terms
                                                        of a business requirement. Complete with
                                                        a business reason, business case, business
                                                        payback, other business reasons.
                                                        Of course there are phrases that should
                                                        be avoided as well. “User Friendly” has
                                                        started to be purged from the
                                                        vocabulary – at long last. But “flexible”
                                                        and “reliable” are still hanging around.


The 5 Immutable Principles of Project Management                                                14/62
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                                                        The key here is that requirements tell us
                                                        something about where we are going.
                                                        But requirements come in all shapes and
                                                        sizes.
                                                        Here’s a sample of two extremes.
                                                        A small project and a not-small project.
                                                        The small project is straight forward in
                                                        terms of requirements. There is a list of
                                                        them on the flip chart. They are likely
                                                        well understood. They probably can be
                                                        estimated in terms of cost and schedule.
                                                        And most importantly the interactions
                                                        between the requirements can be intuited
                                                        with a little effort.
                                                        The project on the right is a different
                                                        class of effort. This is the top level
                                                        components (if you can call them that) of
                                                        the Future Combat System. It’s a $35B,
                                                        that’s billion with a B program to
                                                        restructure the entire US Army Battle
                                                        Space Management processes.
                                                        I help one of the teams – the Class I team
                                                        – build their Performance Measurement
                                                        Baseline and get that information into a
                                                        cost and schedule management system, so
                                                        they can use Earned Value Management
                                                        to “manage” their program.
                                                        FCS is a software intensive system, where
                                                        software is in everything from small hand
                                                        held devices to major facilities housing
                                                        the “battle space management
                                                        command.”
                                                        If the software doesn’t work, the FCS
                                                        doesn’t work. Soldiers can’t do their job.
                                                        If soldiers can’t do their job – there’s a
                                                        BIG PROBLEM.


The 5 Immutable Principles of Project Management                                             15/62
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                                                        Let’s start our exercise with a topic that
                                                        should be familiar to you – flying to the
                                                        moon.
                                                        We flown to the moon and returned
                                                        safely before.
                                                        It can’t be that hard.
                                                        Yea right.
                                                        We’ll use the current moon mission as a
                                                        framework to ask and answer the
                                                        questions posed by the five (5) immutable
                                                        principles.




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                                                        For the moment, let’s use a simpler
                                                        analogy to connect with something more
                                                        tangible.
                                                        Let’s pretend we want to go on a hike. A
                                                        nice hike to the saddle just to the right of
                                                        the peak above this lake. That saddle is
                                                        Pawnee Pass. It’s just west of Boulder
                                                        Colorado, and a bit south of Rocky
                                                        Mountain National Park.
                                                        We’d like to go to Pawnee Pass in a
                                                        single day – there and back. Not get too
                                                        wet if it rains. Not be too hungry. And
                                                        have a good time along the way with our
                                                        hiking group.
                                                        That’s our mission.




The 5 Immutable Principles of Project Management                                                17/62
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                                                        These two words should be tattooed on
                                                        your wrist.
                                                        If we don’t have a Plan, our schedule is
                                                        not credible. Plans are not Schedules.
                                                        And Schedules are not Plans.
                                                        A Plan is the Strategy for the successful
                                                        delivery of the project. Plans state “what”
                                                        is to be done (programmatically what,
                                                        not technically what). Schedules state
                                                        “how” it is to be done –
                                                        programmatically how it is to be done.
                                                        While this may seem subtle or maybe not
                                                        even useful, it is critically important for
                                                        several reasons:
                                                         The plan shows how the project
                                                          produces increasing value and
                                                          increasing maturity of the products.
                                                         It’s is the “road map” from the
                                                          beginning to end, INDEPENDENT from
                                                          the actual durations of the work.
                                                         The Plan speaks to What we are
                                                          doing.
                                                         The schedule is the “driving instructions”
                                                          for the vehicles on the roads, following
                                                          the map.
                                                         The execution of the schedule is the
                                                          actual “driving” of the vehicle by the
                                                          driver along with the passengers.
                                                        All three are needed, no one can be
                                                        missing, all three interact with each other.




The 5 Immutable Principles of Project Management                                               18/62
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                                                        Plans are strategies. They tell us the flow of
                                                        the project in terms of deliverables and the
                                                        increasing value and maturity of those
                                                        deliverables. I’m going to introduce some new
                                                        words here that we’ll use later. They are just
                                                        words for now, so their exact meaning is not
                                                        important.
                                                        This is similar to the Value Stream Map found
                                                        in Lean Six Sigma.
                                                        The “map” is the flow of the Significant
                                                        Accomplishments in the project or program.
                                                        For these Accomplishments, there are a set of
                                                        Criteria that define the “exit conditions” for
                                                        the underlying work. Defining these criteria
                                                        BEFORE defining the details of the work is the
                                                        basis of the Planning process.
                                                        This is a top down-first approach . It is NOT a
                                                        Top Down only approach, just the 1st step in
                                                        the process. But with the Accomplishments and
                                                        the Criteria defined, there is a notional view
                                                        of what “done” looks like. Measureable in
                                                        some units meaningful to the project
                                                        management team and the stakeholders in
                                                        the project.
                                                        This focus on the definition of “done” is
                                                        important for several reasons:
                                                        1.   “Done” is a measure of 100% done, not
                                                             partially done, not almost done. But
                                                             DONE. This is the concept of “starting
                                                             with the end in mind,” popularized by
                                                             Covey.
                                                        2.   Along the way to DONE, there are
                                                             measures of “getting to done” that are
                                                             “mini-dones.” These “maturity assessment
                                                             points” are the way to measure physical
                                                             percent complete in terms of the product
                                                             maturity rather than the consumption of
                                                             resources or passage of time.



The 5 Immutable Principles of Project Management                                                    19/62
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                                                        Now that we know about the existence of
                                                        a Plan, what is the Schedule? Why is it
                                                        different from a Plan?
                                                        The Schedule shows the work needed to
                                                        produce the “deliverables” in the Plan.
                                                        This sounds like a tautology – a statement
                                                        of the obvious.
                                                        But there’s more to it than that.
                                                        This work is ONLY the work needed to
                                                        cause the “exit criteria” to appear of
                                                        each individual definition of the criteria
                                                        for named Accomplishment.
                                                        In a previous slide we mentioned the
                                                        definition of the Accomplishments come
                                                        first. With these definitions – and most
                                                        importantly the order in which these
                                                        Accomplishments must be accomplished
                                                        I know this is not as clear as you’d expect
                                                        at this point.
                                                        But we’ll need to use an example before
                                                        we get back to the details.
                                                        For now think of the schedule as the
                                                        description of how the individual Exit
                                                        Criteria from the “lumps of work” are to
                                                        be accomplished.




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                                                        Now that we know where we want to go, the
                                                        next question is how to get there.
                                                        How do we build the products or provide the
                                                        services needed to reach the end of our
                                                        project.
                                                        There are numerous choices, depending on
                                                        the domain and the context of the project in
                                                        that domain.
                                                        For the software domain there are many
                                                        context’s. Using the example on the previous
                                                        page, let’s look at two methods. These are
                                                        the extreme ends of the spectrum of contexts
                                                        and methods. They can serve to focus the
                                                        discussion on project management rather than
                                                        product development methods, by hopefully
                                                        disconnecting project management from
                                                        product development so we can look at them
                                                        separately.
                                                        In the first software development context – a
                                                        list of features, SCRUM is a popular
                                                        approach.
                                                        But there are many more software based
                                                        project, possibly more complex than the
                                                        example from the previous page to the
                                                        “wickedly” complex program also shown on
                                                        the previous page.
                                                        The SCRUM method is shown in its common
                                                        diagram. But below it is the method used for
                                                        product procurement in the US Department of
                                                        Defense – DoD 5000.02. The products are
                                                        not actually developed by the DoD (except in
                                                        rare cases). But are instead, procured. So
                                                        acquisition management is guided by this
                                                        process.
                                                        Both are iterative, both are incremental, both
                                                        can deal with emerging requirements, both
                                                        make use of “test driven planning,” and both
                                                        have clear and concise measures of physical
                                                        percent complete.



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                                                        Know that we know something about our
                                                        “mission,” “vision” – going to the moon,
                                                        let’s see if we can answer the question of
                                                        “how” do we get there?




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                                                        Now that we know some things about
                                                        what capabilities we need and how we
                                                        might cause these capabilities to appear
                                                        at the appointed time and place for the
                                                        planned cost and schedule, do we know
                                                        what we need to be successful?
                                                        We need to constantly ask this question.
                                                        If we don’t ask and answer the question,
                                                        we’ll find out what is missing when they
                                                        arrive on our doorstep.
                                                        At that point it will be too late. It is not
                                                        too late to acquire them, but too late to
                                                        acquire them within our planned schedule
                                                        and planned budget.




The 5 Immutable Principles of Project Management                                               23/62
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                                                        Now that we know where we’re going
                                                        and how to get there – do we have all
                                                        we need to reach the end?
                                                        Staff, time, money, the necessary skill and
                                                        experience and the proper management
                                                        support.
                                                        These are all obvious on any project – at
                                                        least any well managed project.
                                                        But there are always underlying issues
                                                        with answering these questions.
                                                        The first is that management as well as
                                                        the development organization are
                                                        always optimistic about the outcome. This
                                                        is the very nature of project
                                                        management. Why be pessimistic?
                                                        Well maybe not pessimistic, but how
                                                        about realistic? What do we mean when
                                                        we say realistic? One good word is
                                                        credible. Credible could be optimistically
                                                        credible or pessimistically credible. But
                                                        either way we have a credible
                                                        understanding of what it takes to reach
                                                        the end.
                                                        One part of credible is knowing what the
                                                        risks and uncertainties are and how we
                                                        are going to dealing with them.
                                                        Managing in the Presence of these
                                                        uncertainties is critical to reaching our
                                                        goal. Risk and uncertainty never go
                                                        away. They are always there. They are
                                                        unavoidable.




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                                                        Once we recognize that time is not money
                                                        and money is not time, the next eye
                                                        opener for all project work is there is a
                                                        natural statistical variability of both these
                                                        elements.
                                                        So no matter what software development
                                                        method you are applying inside a project
                                                        management set of processes, you must
                                                        come to grips with the statistical nature of
                                                        cost, schedule, and technical
                                                        performance.
                                                        This area is called Programmatic Risk and
                                                        its cousin Technical Risk.
                                                        The Programmatic Risk concept is not well
                                                        understood outside the defense and
                                                        space business. There it is mandated that
                                                        Programmatic Risk be managed – DID
                                                        81650 describes this mandate.
                                                        The Monte Carlo simulation method is the
                                                        way to assess the behavior of the
                                                        network of activities, but there subtleties
                                                        beyond just the simulation of the network.
                                                        The Monte Carlo tools don’t easily model
                                                        the coupling and correlations between
                                                        the work activities in a proactive manner.
                                                        There are other tools for modeling the
                                                        network, but they are also outside this
                                                        presentation.




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                                                        So let’s see if we can gather everything
                                                        we need for our project.




The 5 Immutable Principles of Project Management                                             26/62
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                                                        Project Managers constantly seek ways to
                                                        eliminate or control risk, variance, and
                                                        uncertainty. This is a hopeless pursuit.
                                                        Managing “in the presence” of risk,
                                                        variance and uncertainty is the key to
                                                        success. Some projects have few
                                                        uncertainties –only the complexity of
                                                        tasks and relationships is important – but
                                                        most projects are characterized by
                                                        several types of uncertainty.
                                                        Although each uncertainty type is distinct,
                                                        a single project may encounter some
                                                        combination of four types:
                                                        1. Variation – comes from many small
                                                           influences and yields a range of
                                                           values on a particular activity.
                                                           Attempting to control these variances
                                                           outside their natural boundaries is a
                                                           waste (Muda).
                                                        2. Foreseen Uncertainty – are
                                                           uncertainties identifiable and
                                                           understood influences that the team
                                                           cannot be sure will occur. There needs
                                                           to be a mitigation plan for these
                                                           foreseen uncertainties.
                                                        3. Unforeseen Uncertainty – is uncertainty
                                                           that can’t be identified during project
                                                           planning. When these occur, a new
                                                           plan is needed.
                                                        4. Chaos – appears in the presence of
                                                           “unknown unknowns.”
                                                        “Managing Project Uncertainty: From
                                                        Variation to Chaos,” Arnoud De Meyer,
                                                        Christoph H. Loch and Michael T. Pich, MIT
                                                        Sloan Management Review, Winter
                                                        2000.


The 5 Immutable Principles of Project Management                                              27/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Project duration and costs are random
                                                        variables drawn from some underlying
                                                        probability distribution.
                                                        In probability theory, every random
                                                        variable is attributed to a probability
                                                        distribution.
                                                        The probability distribution associated
                                                        with a cost or duration describes the
                                                        variance of these random variables.
                                                        A common distribution of probabilistic
                                                        estimates for cost and schedule random
                                                        variables is the Triangle Distribution.
                                                        Using the Triangle Distribution for the
                                                        costs and durations, a Monte Carlo
                                                        simulation of the network of activities and
                                                        their costs can be performed.
                                                           Monte Carlo methods are used to
                                                           numerically transform and integrate
                                                           the posterior quantitative risk
                                                           assessment into a confidence interval.
                                                        The result is a “confidence” model for the
                                                        cost and completion times for the project
                                                        based on the upper and lower bounds of
                                                        each distribution assigned to each
                                                        duration and cost.




The 5 Immutable Principles of Project Management                                              28/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved

                                                        If risk management is how adults manage
                                                        projects, here are some principles of
                                                        project risk management.
                                                        These five principles are simple, obvious,
                                                        but difficult to implement. This reason
                                                        they’re difficult is that most people shy
                                                        away from risk. Managing in the
                                                        presence of risk does not come naturally.
                                                        It is a learned behavior. And once
                                                        learned it has to be practiced. But before
                                                        it can be learned and then practiced,
                                                        “managing in the presence of risk,” must
                                                        become part of the business culture.
                                                        Some cultures doe this better than others.
                                                        NASA is probably better than others. But
                                                        even NASA has moved a risk adverse
                                                        culture in the past decades.
                                                        1. Hoping that something positive will
                                                              result is not a very good strategy.
                                                              Preparing for success is the basis of
                                                              success.
                                                        2. Single point estimates are no better
                                                              than 50/50 guesses in the absence of
                                                              knowledge of the standard deviation
                                                              of the underlying distribution.
                                                        3. Without connecting cost, schedule,
                                                              and technical performance of the
                                                              effort to produce the product or
                                                              service, the connection to value
                                                              cannot be made.
                                                        4. Risk management is not an ad hoc
                                                              process that you can make up as you
                                                              go. A formal foundation for risk
                                                              management is needed.
                                                        5. Identifying risks without
                                                              communicating them is a waste of
                                                              time.


The 5 Immutable Principles of Project Management                                              29/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved

                                                        Project Managers constantly seek ways to
                                                        eliminate or control risk, variance and
                                                        uncertainly. This is a hopeless pursuit.
                                                        Managing “in the presence” of risk,
                                                        variance and uncertainty is the key to
                                                        success. Some projects have few
                                                        uncertainties –only the complexity of
                                                        tasks and relationships is important – but
                                                        most projects are characterized by
                                                        several types of uncertainty. Although
                                                        each uncertainty type is distinct, a single
                                                        project may encounter some combination
                                                        of four types:
                                                        1. Variation – comes from many small
                                                           influences and yields a range of
                                                           values on a particular activity.
                                                           Attempting to control these variances
                                                           outside their natural boundaries is a
                                                           waste (Muda).
                                                        2. Foreseen Uncertainty – are
                                                           uncertainties identifiable and
                                                           understood influences that the team
                                                           cannot be sure will occur. There needs
                                                           to be a mitigation plan for these
                                                           foreseen uncertainties.
                                                        3. Unforeseen Uncertainty – is uncertainty
                                                           that can’t be identified during project
                                                           planning. When these occur, a new
                                                           plan is needed.
                                                        4. Chaos – appears in the presence of
                                                           “unknown unknowns.”
                                                        “Managing Project Uncertainty: From
                                                        Variation to Chaos,” Arnoud De Meyer,
                                                        Christoph H. Loch and Michael T. Pich, MIT
                                                        Sloan Management Review, Winter
                                                        2000.




The 5 Immutable Principles of Project Management                                              30/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved

                                                        The use of point estimates for durations
                                                        and costs is many times the first impulse in
                                                        an organization low on the project
                                                        management maturity scale.
                                                        Understanding cost and durations are
                                                        actually “random variables,” drawn from
                                                        an underlying distribution of possible
                                                        value is the starting point for managing in
                                                        the presence of uncertainty.
                                                        The Triangle Distribution is used as a
                                                        subjective description of a population for
                                                        which there is only limited sample data,
                                                        and especially where the relationship
                                                        between variables is known but data is
                                                        scarce. It is based on the knowledge of
                                                        the minimum and maximum and a “best
                                                        guess” of the modal value (the Most
                                                        Likely).
                                                        Using the Triangle Distribution for the
                                                        costs and durations, a Monte Carlo
                                                        simulation of the network of activities and
                                                        their costs can be performed. Monte
                                                        Carlo methods are used to numerically
                                                        transform and integrate the posterior
                                                        quantitative risk assessment into a
                                                        confidence interval. The result is a
                                                        “confidence” model for the cost and
                                                        completion times for the project based on
                                                        the upper and lower bounds of each
                                                        distribution assigned to each duration
                                                        and cost.
                                                        This approach to estimating provides
                                                        insight into the behavior of the plan as
                                                        well as sensitivity between the individual
                                                        elements of the plan.


The 5 Immutable Principles of Project Management                                                31/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved


                                                        In many descriptions of project
                                                        management – cost, schedule, and quality
                                                        are considered as the “Iron Triangle.”
                                                        Change one and the other two must
                                                        change as well. It turns out this is too
                                                        narrow a view of what's happening on a
                                                        project.
                                                        It’s the Technical Performance
                                                        Measurement that replaces Quality.
                                                        Quality is one of the Technical
                                                        Performance measures.
                                                        Technical Performance Measures describe
                                                        the status of technical achievement of the
                                                        project at any point in time.
                                                        The Planned technical achievement is part
                                                        of the Performance Measurement
                                                        Baseline (PMB) in the same way the
                                                        Planned Value (BCWS) is part of the
                                                        PMB.
                                                        The TPMs use the techniques of risk
                                                        analysis and probability to give program
                                                        managers the early warning needed to
                                                        avoid unplanned costs and slippage in
                                                        schedule. Systems engineering uses
                                                        technical performance measurements to
                                                        balance cost, schedule, and performance
                                                        throughout the life cycle.
                                                        TPMs compare actual versus planned
                                                        technical development and design. They
                                                        also report the degree to which system
                                                        requirements are met in terms of
                                                        performance, cost, schedule, and
                                                        progress in implementing risk handling.


The 5 Immutable Principles of Project Management                                              32/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved



                                                        Risk Management means using a proven
                                                        risk management process, adapting this
                                                        to the project environment, and using this
                                                        process for everyday decision making.
                                                        Technical performance is a concept
                                                        absent from the traditional approaches
                                                        to risk management. Yet it is the primary
                                                        driver of risk in many technology
                                                        intensive projects.
                                                        Cost growth and schedule slippage often
                                                        occur when unrealistically high levels of
                                                        performance are required and little
                                                        flexibility is provided to degrade
                                                        performance during the course of the
                                                        program. Quality is often a cause rather
                                                        than an impact to the program and can
                                                        generally be broken down into Cost,
                                                        Performance, and Schedule components.
                                                        The framework shown here provides:
                                                         Risk management policy.
                                                         Risk management structure.
                                                         Risk Management Process Model.
                                                         Organizational and behavioral
                                                          considerations for implementing risk
                                                          management.
                                                         The performance dimension of
                                                          consequence of occurrence.
                                                         The performance dimension of Monte
                                                          Carlo simulation modeling.
                                                         A structured approach for developing
                                                          a risk handling strategy.




The 5 Immutable Principles of Project Management                                               33/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved


                                                        It does no good to manage risks if the
                                                        results are not communicated to all the
                                                        participants.
                                                        Risk communication is the basis of risk
                                                        mitigation.
                                                        This plan needs to address the following:
                                                         Executive summary – a simple summary
                                                          of the program and the risks
                                                          associated with the activities of the
                                                          program. Each risk needs an ordinal
                                                          rank, a planned mitigation if the risk is
                                                          active (a risk approved by the Risk
                                                          Board), and the mitigations shown in
                                                          the schedule with associated costs.
                                                         Program description – a detailed
                                                          description of the program and the risk
                                                          associated with each of the
                                                          deliverables. This description should be
                                                          “operational” in nature, with the
                                                          consequences description in
                                                          “operational” terms as well.
                                                         Risk reduction activities by phase –
                                                          using some formal risk management
                                                          process that connects risk, mitigation
                                                          and the Master Schedule. The efforts
                                                          for mitigation need to be in the
                                                          schedule.
                                                         Risk management methodology – using
                                                          the DoD Risk Management process is a
                                                          good start. This approach has proven
                                                          and approved by high risk, high
                                                          reward programs. The steps in the
                                                          processes are not optional and should
                                                          be executed for ALL risk processes.


The 5 Immutable Principles of Project Management                                                  34/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Risk Management is a full time effort.
                                                        Even if it is a part-time job.
                                                        Someone needs to “own” the risks and the
                                                        process around risk management.
                                                        Someone or a collection of “someone's”
                                                        needs to have risk management in their
                                                        mind(s) at all times.
                                                        Risk Management is not something you
                                                        can do once and them forget. The risks
                                                        don’t just go away.
                                                        They are forever there, even if they are
                                                        mitigated, retired or bought down.




The 5 Immutable Principles of Project Management                                                 35/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        When we ignore the fundamental
                                                        statistical nature of project work, we are
                                                        creating risk.
                                                        This risk comes not from the underlying
                                                        probabilities, but from our ignorance of
                                                        this process.
                                                        We believe, wrongly, that our estimates
                                                        are static point values – a single number
                                                        representing the estimate. We fail to
                                                        take into account the statistical processes
                                                        that drive this number.
                                                        Durations, costs, technical performance.
                                                        When we fail to make these variances
                                                        visible we are managing our project with
                                                        a “head in the sand,” just like this guy.




                                                                                                36/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Many speak about risk management as
                                                        part of the project management process.
                                                        But do they do risk management as part
                                                        of the project management process?
                                                        Test yourself and anyone who claims to
                                                        be doing risk management




The 5 Immutable Principles of Project Management                                            37/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        So let’s look for some impediments in our
                                                        project to fly to the moon.
                                                        There are many of course, but let’s see if
                                                        we can come up with some that are not so
                                                        obvious.




The 5 Immutable Principles of Project Management                                              38/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Measures of progress are one of the
                                                        difficult topics in project management.
                                                        Typically we measure progress by the
                                                        consumption of resources and the
                                                        passage of time.
                                                        We talk about “budget,” being “on
                                                        budget,” being “over budget.”
                                                        We talk about the passage of time.
                                                        “We’re on schedule,” “we’re late,” “our
                                                        schedule is slipping.”
                                                        These are all necessary things to talk
                                                        about. But they are not sufficient for our
                                                        project’s success.




The 5 Immutable Principles of Project Management                                               39/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        Performance measurement is the
                                                        comparison of actual performance
                                                        against an integrated baseline plan
                                                        consisting of integrated cost, schedule
                                                        and technical goals. The baseline used
                                                        for performance measurement should be
                                                        a single, integrated plan, because the
                                                        analysis of cost performance must include
                                                        schedule considerations and the
                                                        evaluation of schedule performance must
                                                        include technical performance
                                                        considerations.
                                                        Given a project where some tasks are on
                                                        schedule, some are ahead of schedule
                                                        and some are behind schedule, overall
                                                        project status is virtually impossible to
                                                        determine. It is no wonder that many
                                                        project managers are literally “flying by
                                                        the seat of their pants” without a good
                                                        feel for where the project stands at any
                                                        given point in time.
                                                        A systematic, organized process for
                                                        collecting performance information and
                                                        presenting it in a clear manner on a
                                                        regular basis is essential to the project
                                                        management process.




The 5 Immutable Principles of Project Management                                               40/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved

                                                        With the information from the previous 4
                                                        irreducible principles, we now need to
                                                        confirm we are making progress. The key
                                                        principle here is “planned progress.” We
                                                        must pre-define what progress we must
                                                        make at any specific point in the project,
                                                        otherwise all we can determine is the
                                                        passage of time and the consumption of
                                                        money. Preplanning the progress is the
                                                        basis of “performance based”
                                                        measurement for both project processes
                                                        and technical products.
                                                        Like Kent Beck’s (eXtreme Programming)
                                                        advice we need feedback on our
                                                        progress.
                                                        There is only one kind of feedback for
                                                        projects – measures of physical percent
                                                        complete.
                                                        No soft touchy feely measures of
                                                        progress. No hand waving measures.
                                                        Physical, tangible evidence of progress.
                                                        Something that can be physically shown
                                                        to the customer. Something that is
                                                        compliant with the planned technical
                                                        outcomes at this point in the plan.
                                                        Scrum does this by predefining the
                                                        outcomes of the iteration. DoD 5000.02
                                                        does this as well with the Integrated
                                                        Master Plan and Integrated Master
                                                        Schedule.
                                                        So looking at two extremes of the
                                                        spectrum – one a software development
                                                        method and the other a mega-program
                                                        procurement method. Both share the same
                                                        principles and outcomes. Something that
                                                        is tangible and measurable at
                                                        incremental steps along the way to
                                                        “done.”


The 5 Immutable Principles of Project Management                                              41/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        For successful measurement of progress in
                                                        a project we need to have:
                                                         Tangible evidentiary materials
                                                          measure progress to plan.
                                                         Pre–defined existence of this evidence
                                                          in meaningful units of measure
                                                          established before starting work.
                                                         Progress is defined in these same units
                                                          of measure.




The 5 Immutable Principles of Project Management                                              42/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved




                                                        There are many opinions about
                                                        measuring progress to plan.
                                                        Here’s what some authors have said.




The 5 Immutable Principles of Project Management                                              43/62
Copyright ® 2010, Lewis & Fowler, All Rights Reserved


                                                        Let’s talk a bit about a common fallacy in
                                                        the project management world.
                                                        The notion of the “iron triangle” has fallen
                                                        into disrepute lately.
                                                        We all should know about the iron
                                                        triangle. It connects cost, schedule, and
                                                        quality – or some 3rd element in place of
                                                        quality.
                                                        Actually the variable in place of quality
                                                        is “Technical Performance Measures”
                                                        (TPM).


                                                        Technical Performance Measurement
                                                        (TPM) is a technique for predicting the
                                                        future value of a key technical
                                                        performance parameter of the higher-
                                                        level product based on current
                                                        assessments of products lower in the
                                                        system structure.
                                                        Continuous verification of actual versus
                                                        anticipated achievement of technical
                                                        parameters confirms progress and
                                                        identifies variances that might
                                                        jeopardize meeting a higher-level end
                                                        product requirement.
                                                        Assessed values falling outside
                                                        established tolerances indicate the need
                                                        for management attention and
                                                        corrective action. A well thought out
                                                        TPM program provides early warning of
                                                        technical problems, supports
                                                        assessments of the extent to which
                                                        operational requirements will be met.

The 5 Immutable Principles of Project Management                                               44/62
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)
Immutable principles of project management (fw pmi)(v4)

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Immutable principles of project management (fw pmi)(v4)

  • 1. Copyright ® 2010, Lewis & Fowler, All Rights Reserved I’d like to thank you for inviting me to speak at your workshop. My contribution to this topic is from the point of view of a program controls manager in the aerospace and defense business. The programs we work are software intensive, but not in the way commercial software projects are. The software on our programs is embedded in other systems – avionics, flight controls, ground management systems of aircraft and spacecraft. Other parts of our firm work programs for commercial enterprise IT. The principles I’m going to introduce you to today are applicable to all projects no matter the domain or the context in that domain. From software, COTS IT, construction, any project where the outcome is critical to the success of the participants. The 5 Immutable Principles of Project Management 1/62
  • 2. Copyright ® 2010, Lewis & Fowler, All Rights Reserved There are three outcomes for this talk. 1. I’m going the suggest there is common misunderstanding that software development and project management are the same thing. 2. There are 5 irreducible principles for managing any project, no matter the domain or the context. 3. And, as software developers, along with the project manager, if you are not answering the questions from these irreducible principles, you’re probably doing project management and your project is in jeopardy and you may not know it. The 5 Immutable Principles of Project Management 2/62
  • 3. Copyright ® 2010, Lewis & Fowler, All Rights Reserved We’ve all seen the numbers. We’ve all been told how bad things are. 77% of project failures are due to poor planning or poor project management. Here’s one more look. But we’re here to work on only one of the aspects of the “money flushing” part of your project activity We’re here today to talk about the project management aspects of projects. The planning, scheduling, costing, management verbs of projects. These are called the Programmatic Elements of the project. Versus the technological aspects. As a program manager I’m very interested in the technology. But my job is to make sure the programmatic aspects work, so the technology has a chance of actually showing up on time. The 5 Immutable Principles of Project Management 3/62
  • 4. Copyright ® 2010, Lewis & Fowler, All Rights Reserved So first let’s review what is a project. It’s a one off event. It’s not operations. It’s not repeatable processes – although the processes that manage projects are repeatable, the project itself is a one time occurrence. The reason this is important is that projects are a “one chance to get it right” type of endeavor. Operations has several chances to get it right. Maybe a lot of chances. Sometimes only a few. But never just one. Now there is another word here – probability. Projects have a probability of success. There is no guarantee. We’d like this probability to be as high as possible. For some projects the probability is high – close to 100%. For some projects the probability, while acceptable, is actually low. There is 1 chance in 149 of losing the mission for the Orion Manned Spaceflight program with specific types of launch vehicles. What’s the probability of having your Enterprise ERP project rollout fail in a way that causes an unrecoverable loss to your company? Good question. How can you improve the probability of success for your project? Another good question. The 5 Immutable Principles of Project Management 4/62
  • 5. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Mr. Blaise’s quote is applicable to almost every major project we’ve encountered. It’s sad but true that we simply don’t know how to stop work once we’ve started. The work shop today is not about that decision though. It’s about applying the principles of project management, so we don’t have to treat projects in such a “black and white” manner. The 5 Immutable Principles of Project Management 5/62
  • 6. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Management is a verb. When applied to an object, like a project, this verb is the actions needed to control and guide the development of the outcomes of the project. No matter what your approach, self guided or all the way to formal project management methods, projects need a framework in which to make progress. The definitions here define the boundaries of the processes applied to the project. The 5 Immutable Principles of Project Management 6/62
  • 7. Copyright ® 2010, Lewis & Fowler, All Rights Reserved When we put these terms together we arrive at the basis of today's work shop. We need knowledge, skills, tools, and techniques in order to increase our Probability of Project Success (PoPS). The five (5) immutable project management principles are independent of all these things. At the same time they apply to any and all these things. And finally they are independent of any project domain and any context in that domain. With the concept of Project + Management in hand, let’s look at the domain and context in those domains for applying this verb and noun. The 5 Immutable Principles of Project Management 7/62
  • 8. Copyright ® 2010, Lewis & Fowler, All Rights Reserved The notion of simplicity has entered the discussion around project management methods, tools, processes, and other elements. On one end we have Leonardo’s quote about simplicity being the ultimate sophistication. On the other we have Mencken’s reminder that complex problems and their solutions are connected in ways we may not actually understand. Searching for simplicity in the absence of understanding the “system” usually leads to disappointment. When we’re walking through our immutable principles today, let’s keep in mind the connection between simplicity and complexity and the solutions we need to address this complexity. The 5 Immutable Principles of Project Management 8/62
  • 9. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Here’s an idea that we don’t always consider upfront when we look for processes and principles. The amount of risk a project can tolerate is directly related to the business domain and the context of the project within that domain. Understanding the tolerance for these risk levels are critical to choosing and applying any software development method. However, the five immutable principles presented here are juts that, immutable. They must be present in some form no matter the product development method, the level of risk tolerance of the domain and the context within that domain. The risk tolerance for cost is defined as the ability for the customer to absorb changes in the planned cost through management reserve and the application of additional funds. The risk tolerance for schedule slippage is defined as the ability to still produce value for the customer in the presence of a late or slipping schedule. The risk tolerance for Technical Performance means the customer is willing to accept technical capabilities that are less than planned. With this background, let’s look at the five (5) immutable principles. The 5 Immutable Principles of Project Management 9/62
  • 10. Copyright ® 2010, Lewis & Fowler, All Rights Reserved The five immutable principles of project management are: 1. Know where you are going by defining “done” at some point in the future. This point may be far in the future – months or years from now. Or closer in the future days or weeks from now. 2. Have some kind of plan to get to where you are going. This plan can be simple or it can be complex. The fidelity of the plan depends on the tolerance for risk by the users of the plan. 3. Understand the resources needed to execute the plan. How much time and money is needed to reach the destination. This can be fixed or it can be variable. 4. Identify the impediments to progress along the way to the destination. Have some means of removing, avoiding, or ignoring these impediments. 5. Have some way to measure your planned progress, not just your progress. Progress to Plan must be measured in units of physical percent complete. The 5 Immutable Principles of Project Management 10/62
  • 11. Copyright ® 2010, Lewis & Fowler, All Rights Reserved When we confuse product development with project management, we’ve missed answering the 5 immutable principles questions. We skipped directly to the “doing” part of the project. The “managing of the doing” is not the same as the “doing.” Both are needed of course. If we only have the “doing” part, then the project is guided by the immediate outcomes of the development process. The project outcomes “emerge” as it progresses. This is the basis of some forms of Agile. There may be broader goals, but the development team only responds to the “next” increment. Many projects are successful applying this product development method as a replacement for project management. The other approach – and this is a context sensitive approach – is to define the needed capabilities, the requirements needed to fulfill those capabilities, and the work plan to make those requirements appear. This does not mean the fidelity of the requirements is complete. Some could be vague, some could be altered as we proceed. But the end-to-end goal is defined with enough fidelity to assure the customer we understand what DONE looks like. 11
  • 12. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Our first step here is to separate a Plan from a Schedule. The PLAN is a procedure used to achieve an objective. It is a set of intended actions, through which one expects to achieve a goal. The SCHEDULE is the sequence of these intended actions, needed to implement the PLAN. But we don’t what to mix the PLAN with the SCHEDULE. The PLAN is the strategy for the successful completion of the project. In the strategic planning domain, a PLAN is a hypothesis that needs to be tested along the way to confirm we’re headed. The SCHEDULE is the order of the work to execute the PLAN. We need both. PLANS without SCHEDULES are not executable. SCHEDULES without PLANS have no stated mission, vision, or description of success other than the execution of the work. The 5 Immutable Principles of Project Management 12/62
  • 13. Copyright ® 2010, Lewis & Fowler, All Rights Reserved When we say “where are we going,” we should be talking about physical outcomes – the deliverables. When we say deliverables, what deliverables are we talking about? The deliverables should be those that fulfill the requirements. So what are the requirements? As our quote says here, the single hardest part of building a system is deciding what to build. No matter what method you use to make these decisions – from the agilest of methods to the most formal, we need to have the requirements stated in a form that is testable, verifiable, and traceable to the PLAN and SCHEDULE. The 5 Immutable Principles of Project Management 13/62
  • 14. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Here’s some words that we’ll encounter during the development of requirements. These are not the only words of course, but these words are important ones. One critical set of words are “Stated” versus “Real.” Stated requirements are any requirement that is written down – that is stated. “Real” requirements are of course requirements that are really needed by the system to fulfill its business case. Other words are important as well. “Verified” and “Validated” are a pair. One of the requirements words that causes much extra work is “derived.” A derived requirement is one that is not primary, but is secondary. As such it may not be obvious that it is a requirement. There are requirements words that should be avoided. The first one – that may not be obvious – is “Customer.” Which customer? How do we know what the customer wants? One simple way out of this is to state the requirement, that we think is a customer requirement, in terms of a business requirement. Complete with a business reason, business case, business payback, other business reasons. Of course there are phrases that should be avoided as well. “User Friendly” has started to be purged from the vocabulary – at long last. But “flexible” and “reliable” are still hanging around. The 5 Immutable Principles of Project Management 14/62
  • 15. Copyright ® 2010, Lewis & Fowler, All Rights Reserved The key here is that requirements tell us something about where we are going. But requirements come in all shapes and sizes. Here’s a sample of two extremes. A small project and a not-small project. The small project is straight forward in terms of requirements. There is a list of them on the flip chart. They are likely well understood. They probably can be estimated in terms of cost and schedule. And most importantly the interactions between the requirements can be intuited with a little effort. The project on the right is a different class of effort. This is the top level components (if you can call them that) of the Future Combat System. It’s a $35B, that’s billion with a B program to restructure the entire US Army Battle Space Management processes. I help one of the teams – the Class I team – build their Performance Measurement Baseline and get that information into a cost and schedule management system, so they can use Earned Value Management to “manage” their program. FCS is a software intensive system, where software is in everything from small hand held devices to major facilities housing the “battle space management command.” If the software doesn’t work, the FCS doesn’t work. Soldiers can’t do their job. If soldiers can’t do their job – there’s a BIG PROBLEM. The 5 Immutable Principles of Project Management 15/62
  • 16. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Let’s start our exercise with a topic that should be familiar to you – flying to the moon. We flown to the moon and returned safely before. It can’t be that hard. Yea right. We’ll use the current moon mission as a framework to ask and answer the questions posed by the five (5) immutable principles. The 5 Immutable Principles of Project Management 16/62
  • 17. Copyright ® 2010, Lewis & Fowler, All Rights Reserved For the moment, let’s use a simpler analogy to connect with something more tangible. Let’s pretend we want to go on a hike. A nice hike to the saddle just to the right of the peak above this lake. That saddle is Pawnee Pass. It’s just west of Boulder Colorado, and a bit south of Rocky Mountain National Park. We’d like to go to Pawnee Pass in a single day – there and back. Not get too wet if it rains. Not be too hungry. And have a good time along the way with our hiking group. That’s our mission. The 5 Immutable Principles of Project Management 17/62
  • 18. Copyright ® 2010, Lewis & Fowler, All Rights Reserved These two words should be tattooed on your wrist. If we don’t have a Plan, our schedule is not credible. Plans are not Schedules. And Schedules are not Plans. A Plan is the Strategy for the successful delivery of the project. Plans state “what” is to be done (programmatically what, not technically what). Schedules state “how” it is to be done – programmatically how it is to be done. While this may seem subtle or maybe not even useful, it is critically important for several reasons:  The plan shows how the project produces increasing value and increasing maturity of the products.  It’s is the “road map” from the beginning to end, INDEPENDENT from the actual durations of the work.  The Plan speaks to What we are doing.  The schedule is the “driving instructions” for the vehicles on the roads, following the map.  The execution of the schedule is the actual “driving” of the vehicle by the driver along with the passengers. All three are needed, no one can be missing, all three interact with each other. The 5 Immutable Principles of Project Management 18/62
  • 19. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Plans are strategies. They tell us the flow of the project in terms of deliverables and the increasing value and maturity of those deliverables. I’m going to introduce some new words here that we’ll use later. They are just words for now, so their exact meaning is not important. This is similar to the Value Stream Map found in Lean Six Sigma. The “map” is the flow of the Significant Accomplishments in the project or program. For these Accomplishments, there are a set of Criteria that define the “exit conditions” for the underlying work. Defining these criteria BEFORE defining the details of the work is the basis of the Planning process. This is a top down-first approach . It is NOT a Top Down only approach, just the 1st step in the process. But with the Accomplishments and the Criteria defined, there is a notional view of what “done” looks like. Measureable in some units meaningful to the project management team and the stakeholders in the project. This focus on the definition of “done” is important for several reasons: 1. “Done” is a measure of 100% done, not partially done, not almost done. But DONE. This is the concept of “starting with the end in mind,” popularized by Covey. 2. Along the way to DONE, there are measures of “getting to done” that are “mini-dones.” These “maturity assessment points” are the way to measure physical percent complete in terms of the product maturity rather than the consumption of resources or passage of time. The 5 Immutable Principles of Project Management 19/62
  • 20. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Now that we know about the existence of a Plan, what is the Schedule? Why is it different from a Plan? The Schedule shows the work needed to produce the “deliverables” in the Plan. This sounds like a tautology – a statement of the obvious. But there’s more to it than that. This work is ONLY the work needed to cause the “exit criteria” to appear of each individual definition of the criteria for named Accomplishment. In a previous slide we mentioned the definition of the Accomplishments come first. With these definitions – and most importantly the order in which these Accomplishments must be accomplished I know this is not as clear as you’d expect at this point. But we’ll need to use an example before we get back to the details. For now think of the schedule as the description of how the individual Exit Criteria from the “lumps of work” are to be accomplished. The 5 Immutable Principles of Project Management 20/62
  • 21. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Now that we know where we want to go, the next question is how to get there. How do we build the products or provide the services needed to reach the end of our project. There are numerous choices, depending on the domain and the context of the project in that domain. For the software domain there are many context’s. Using the example on the previous page, let’s look at two methods. These are the extreme ends of the spectrum of contexts and methods. They can serve to focus the discussion on project management rather than product development methods, by hopefully disconnecting project management from product development so we can look at them separately. In the first software development context – a list of features, SCRUM is a popular approach. But there are many more software based project, possibly more complex than the example from the previous page to the “wickedly” complex program also shown on the previous page. The SCRUM method is shown in its common diagram. But below it is the method used for product procurement in the US Department of Defense – DoD 5000.02. The products are not actually developed by the DoD (except in rare cases). But are instead, procured. So acquisition management is guided by this process. Both are iterative, both are incremental, both can deal with emerging requirements, both make use of “test driven planning,” and both have clear and concise measures of physical percent complete. The 5 Immutable Principles of Project Management 21/62
  • 22. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Know that we know something about our “mission,” “vision” – going to the moon, let’s see if we can answer the question of “how” do we get there? The 5 Immutable Principles of Project Management 22/62
  • 23. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Now that we know some things about what capabilities we need and how we might cause these capabilities to appear at the appointed time and place for the planned cost and schedule, do we know what we need to be successful? We need to constantly ask this question. If we don’t ask and answer the question, we’ll find out what is missing when they arrive on our doorstep. At that point it will be too late. It is not too late to acquire them, but too late to acquire them within our planned schedule and planned budget. The 5 Immutable Principles of Project Management 23/62
  • 24. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Now that we know where we’re going and how to get there – do we have all we need to reach the end? Staff, time, money, the necessary skill and experience and the proper management support. These are all obvious on any project – at least any well managed project. But there are always underlying issues with answering these questions. The first is that management as well as the development organization are always optimistic about the outcome. This is the very nature of project management. Why be pessimistic? Well maybe not pessimistic, but how about realistic? What do we mean when we say realistic? One good word is credible. Credible could be optimistically credible or pessimistically credible. But either way we have a credible understanding of what it takes to reach the end. One part of credible is knowing what the risks and uncertainties are and how we are going to dealing with them. Managing in the Presence of these uncertainties is critical to reaching our goal. Risk and uncertainty never go away. They are always there. They are unavoidable. The 5 Immutable Principles of Project Management 24/62
  • 25. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Once we recognize that time is not money and money is not time, the next eye opener for all project work is there is a natural statistical variability of both these elements. So no matter what software development method you are applying inside a project management set of processes, you must come to grips with the statistical nature of cost, schedule, and technical performance. This area is called Programmatic Risk and its cousin Technical Risk. The Programmatic Risk concept is not well understood outside the defense and space business. There it is mandated that Programmatic Risk be managed – DID 81650 describes this mandate. The Monte Carlo simulation method is the way to assess the behavior of the network of activities, but there subtleties beyond just the simulation of the network. The Monte Carlo tools don’t easily model the coupling and correlations between the work activities in a proactive manner. There are other tools for modeling the network, but they are also outside this presentation. The 5 Immutable Principles of Project Management 25/62
  • 26. Copyright ® 2010, Lewis & Fowler, All Rights Reserved So let’s see if we can gather everything we need for our project. The 5 Immutable Principles of Project Management 26/62
  • 27. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Project Managers constantly seek ways to eliminate or control risk, variance, and uncertainty. This is a hopeless pursuit. Managing “in the presence” of risk, variance and uncertainty is the key to success. Some projects have few uncertainties –only the complexity of tasks and relationships is important – but most projects are characterized by several types of uncertainty. Although each uncertainty type is distinct, a single project may encounter some combination of four types: 1. Variation – comes from many small influences and yields a range of values on a particular activity. Attempting to control these variances outside their natural boundaries is a waste (Muda). 2. Foreseen Uncertainty – are uncertainties identifiable and understood influences that the team cannot be sure will occur. There needs to be a mitigation plan for these foreseen uncertainties. 3. Unforeseen Uncertainty – is uncertainty that can’t be identified during project planning. When these occur, a new plan is needed. 4. Chaos – appears in the presence of “unknown unknowns.” “Managing Project Uncertainty: From Variation to Chaos,” Arnoud De Meyer, Christoph H. Loch and Michael T. Pich, MIT Sloan Management Review, Winter 2000. The 5 Immutable Principles of Project Management 27/62
  • 28. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Project duration and costs are random variables drawn from some underlying probability distribution. In probability theory, every random variable is attributed to a probability distribution. The probability distribution associated with a cost or duration describes the variance of these random variables. A common distribution of probabilistic estimates for cost and schedule random variables is the Triangle Distribution. Using the Triangle Distribution for the costs and durations, a Monte Carlo simulation of the network of activities and their costs can be performed. Monte Carlo methods are used to numerically transform and integrate the posterior quantitative risk assessment into a confidence interval. The result is a “confidence” model for the cost and completion times for the project based on the upper and lower bounds of each distribution assigned to each duration and cost. The 5 Immutable Principles of Project Management 28/62
  • 29. Copyright ® 2010, Lewis & Fowler, All Rights Reserved If risk management is how adults manage projects, here are some principles of project risk management. These five principles are simple, obvious, but difficult to implement. This reason they’re difficult is that most people shy away from risk. Managing in the presence of risk does not come naturally. It is a learned behavior. And once learned it has to be practiced. But before it can be learned and then practiced, “managing in the presence of risk,” must become part of the business culture. Some cultures doe this better than others. NASA is probably better than others. But even NASA has moved a risk adverse culture in the past decades. 1. Hoping that something positive will result is not a very good strategy. Preparing for success is the basis of success. 2. Single point estimates are no better than 50/50 guesses in the absence of knowledge of the standard deviation of the underlying distribution. 3. Without connecting cost, schedule, and technical performance of the effort to produce the product or service, the connection to value cannot be made. 4. Risk management is not an ad hoc process that you can make up as you go. A formal foundation for risk management is needed. 5. Identifying risks without communicating them is a waste of time. The 5 Immutable Principles of Project Management 29/62
  • 30. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Project Managers constantly seek ways to eliminate or control risk, variance and uncertainly. This is a hopeless pursuit. Managing “in the presence” of risk, variance and uncertainty is the key to success. Some projects have few uncertainties –only the complexity of tasks and relationships is important – but most projects are characterized by several types of uncertainty. Although each uncertainty type is distinct, a single project may encounter some combination of four types: 1. Variation – comes from many small influences and yields a range of values on a particular activity. Attempting to control these variances outside their natural boundaries is a waste (Muda). 2. Foreseen Uncertainty – are uncertainties identifiable and understood influences that the team cannot be sure will occur. There needs to be a mitigation plan for these foreseen uncertainties. 3. Unforeseen Uncertainty – is uncertainty that can’t be identified during project planning. When these occur, a new plan is needed. 4. Chaos – appears in the presence of “unknown unknowns.” “Managing Project Uncertainty: From Variation to Chaos,” Arnoud De Meyer, Christoph H. Loch and Michael T. Pich, MIT Sloan Management Review, Winter 2000. The 5 Immutable Principles of Project Management 30/62
  • 31. Copyright ® 2010, Lewis & Fowler, All Rights Reserved The use of point estimates for durations and costs is many times the first impulse in an organization low on the project management maturity scale. Understanding cost and durations are actually “random variables,” drawn from an underlying distribution of possible value is the starting point for managing in the presence of uncertainty. The Triangle Distribution is used as a subjective description of a population for which there is only limited sample data, and especially where the relationship between variables is known but data is scarce. It is based on the knowledge of the minimum and maximum and a “best guess” of the modal value (the Most Likely). Using the Triangle Distribution for the costs and durations, a Monte Carlo simulation of the network of activities and their costs can be performed. Monte Carlo methods are used to numerically transform and integrate the posterior quantitative risk assessment into a confidence interval. The result is a “confidence” model for the cost and completion times for the project based on the upper and lower bounds of each distribution assigned to each duration and cost. This approach to estimating provides insight into the behavior of the plan as well as sensitivity between the individual elements of the plan. The 5 Immutable Principles of Project Management 31/62
  • 32. Copyright ® 2010, Lewis & Fowler, All Rights Reserved In many descriptions of project management – cost, schedule, and quality are considered as the “Iron Triangle.” Change one and the other two must change as well. It turns out this is too narrow a view of what's happening on a project. It’s the Technical Performance Measurement that replaces Quality. Quality is one of the Technical Performance measures. Technical Performance Measures describe the status of technical achievement of the project at any point in time. The Planned technical achievement is part of the Performance Measurement Baseline (PMB) in the same way the Planned Value (BCWS) is part of the PMB. The TPMs use the techniques of risk analysis and probability to give program managers the early warning needed to avoid unplanned costs and slippage in schedule. Systems engineering uses technical performance measurements to balance cost, schedule, and performance throughout the life cycle. TPMs compare actual versus planned technical development and design. They also report the degree to which system requirements are met in terms of performance, cost, schedule, and progress in implementing risk handling. The 5 Immutable Principles of Project Management 32/62
  • 33. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Risk Management means using a proven risk management process, adapting this to the project environment, and using this process for everyday decision making. Technical performance is a concept absent from the traditional approaches to risk management. Yet it is the primary driver of risk in many technology intensive projects. Cost growth and schedule slippage often occur when unrealistically high levels of performance are required and little flexibility is provided to degrade performance during the course of the program. Quality is often a cause rather than an impact to the program and can generally be broken down into Cost, Performance, and Schedule components. The framework shown here provides:  Risk management policy.  Risk management structure.  Risk Management Process Model.  Organizational and behavioral considerations for implementing risk management.  The performance dimension of consequence of occurrence.  The performance dimension of Monte Carlo simulation modeling.  A structured approach for developing a risk handling strategy. The 5 Immutable Principles of Project Management 33/62
  • 34. Copyright ® 2010, Lewis & Fowler, All Rights Reserved It does no good to manage risks if the results are not communicated to all the participants. Risk communication is the basis of risk mitigation. This plan needs to address the following:  Executive summary – a simple summary of the program and the risks associated with the activities of the program. Each risk needs an ordinal rank, a planned mitigation if the risk is active (a risk approved by the Risk Board), and the mitigations shown in the schedule with associated costs.  Program description – a detailed description of the program and the risk associated with each of the deliverables. This description should be “operational” in nature, with the consequences description in “operational” terms as well.  Risk reduction activities by phase – using some formal risk management process that connects risk, mitigation and the Master Schedule. The efforts for mitigation need to be in the schedule.  Risk management methodology – using the DoD Risk Management process is a good start. This approach has proven and approved by high risk, high reward programs. The steps in the processes are not optional and should be executed for ALL risk processes. The 5 Immutable Principles of Project Management 34/62
  • 35. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Risk Management is a full time effort. Even if it is a part-time job. Someone needs to “own” the risks and the process around risk management. Someone or a collection of “someone's” needs to have risk management in their mind(s) at all times. Risk Management is not something you can do once and them forget. The risks don’t just go away. They are forever there, even if they are mitigated, retired or bought down. The 5 Immutable Principles of Project Management 35/62
  • 36. Copyright ® 2010, Lewis & Fowler, All Rights Reserved When we ignore the fundamental statistical nature of project work, we are creating risk. This risk comes not from the underlying probabilities, but from our ignorance of this process. We believe, wrongly, that our estimates are static point values – a single number representing the estimate. We fail to take into account the statistical processes that drive this number. Durations, costs, technical performance. When we fail to make these variances visible we are managing our project with a “head in the sand,” just like this guy. 36/62
  • 37. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Many speak about risk management as part of the project management process. But do they do risk management as part of the project management process? Test yourself and anyone who claims to be doing risk management The 5 Immutable Principles of Project Management 37/62
  • 38. Copyright ® 2010, Lewis & Fowler, All Rights Reserved So let’s look for some impediments in our project to fly to the moon. There are many of course, but let’s see if we can come up with some that are not so obvious. The 5 Immutable Principles of Project Management 38/62
  • 39. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Measures of progress are one of the difficult topics in project management. Typically we measure progress by the consumption of resources and the passage of time. We talk about “budget,” being “on budget,” being “over budget.” We talk about the passage of time. “We’re on schedule,” “we’re late,” “our schedule is slipping.” These are all necessary things to talk about. But they are not sufficient for our project’s success. The 5 Immutable Principles of Project Management 39/62
  • 40. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Performance measurement is the comparison of actual performance against an integrated baseline plan consisting of integrated cost, schedule and technical goals. The baseline used for performance measurement should be a single, integrated plan, because the analysis of cost performance must include schedule considerations and the evaluation of schedule performance must include technical performance considerations. Given a project where some tasks are on schedule, some are ahead of schedule and some are behind schedule, overall project status is virtually impossible to determine. It is no wonder that many project managers are literally “flying by the seat of their pants” without a good feel for where the project stands at any given point in time. A systematic, organized process for collecting performance information and presenting it in a clear manner on a regular basis is essential to the project management process. The 5 Immutable Principles of Project Management 40/62
  • 41. Copyright ® 2010, Lewis & Fowler, All Rights Reserved With the information from the previous 4 irreducible principles, we now need to confirm we are making progress. The key principle here is “planned progress.” We must pre-define what progress we must make at any specific point in the project, otherwise all we can determine is the passage of time and the consumption of money. Preplanning the progress is the basis of “performance based” measurement for both project processes and technical products. Like Kent Beck’s (eXtreme Programming) advice we need feedback on our progress. There is only one kind of feedback for projects – measures of physical percent complete. No soft touchy feely measures of progress. No hand waving measures. Physical, tangible evidence of progress. Something that can be physically shown to the customer. Something that is compliant with the planned technical outcomes at this point in the plan. Scrum does this by predefining the outcomes of the iteration. DoD 5000.02 does this as well with the Integrated Master Plan and Integrated Master Schedule. So looking at two extremes of the spectrum – one a software development method and the other a mega-program procurement method. Both share the same principles and outcomes. Something that is tangible and measurable at incremental steps along the way to “done.” The 5 Immutable Principles of Project Management 41/62
  • 42. Copyright ® 2010, Lewis & Fowler, All Rights Reserved For successful measurement of progress in a project we need to have:  Tangible evidentiary materials measure progress to plan.  Pre–defined existence of this evidence in meaningful units of measure established before starting work.  Progress is defined in these same units of measure. The 5 Immutable Principles of Project Management 42/62
  • 43. Copyright ® 2010, Lewis & Fowler, All Rights Reserved There are many opinions about measuring progress to plan. Here’s what some authors have said. The 5 Immutable Principles of Project Management 43/62
  • 44. Copyright ® 2010, Lewis & Fowler, All Rights Reserved Let’s talk a bit about a common fallacy in the project management world. The notion of the “iron triangle” has fallen into disrepute lately. We all should know about the iron triangle. It connects cost, schedule, and quality – or some 3rd element in place of quality. Actually the variable in place of quality is “Technical Performance Measures” (TPM). Technical Performance Measurement (TPM) is a technique for predicting the future value of a key technical performance parameter of the higher- level product based on current assessments of products lower in the system structure. Continuous verification of actual versus anticipated achievement of technical parameters confirms progress and identifies variances that might jeopardize meeting a higher-level end product requirement. Assessed values falling outside established tolerances indicate the need for management attention and corrective action. A well thought out TPM program provides early warning of technical problems, supports assessments of the extent to which operational requirements will be met. The 5 Immutable Principles of Project Management 44/62