Showing posts with label budget. Show all posts
Showing posts with label budget. Show all posts

Saturday, August 15, 2020

The Portfolio Management Dream: How to Stop it from Becoming a Nightmare!

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VoiceAmerica  0:04  
One problem facing people at many levels of business is how to make time for a work life and a personal life. Do you find that one seems to keep getting in the way of the other? This is the work life balance with Rick Morris. Even if you're not involved in the business world, you'll have a lot to gain by tuning into today's show. Now, here's your host, Rick Morris.

Rick A. Morris  0:26  
And welcome to another edition of the work life balance on this Friday afternoon. So excited to have you guys along. And, you know, I've been very, very blessed with this radio show been blessed by you as an audience. And because of that, we're now booked out to the end of the year, which is really, really cool. It's the first time in the five years that I've done the show that we've been booked out that far in advance and that's a testament to you guys and a testament to the quality of people that are wanting to come on and talk to us about the work life balance. But having said all that it's been a little while since just I've been with you. So I thought I would take the opportunity today and just talk through some of the things that's happening here in our lives and then go through one of my, my newest content deliveries that we're talking about, which is called a portfolio management dream, and how to stop that from becoming a nightmare. So just, you know, on the personal front, there's there's a ton of activity that's been going on, you know, COVID has impacted us all. And being a serial entrepreneur and somebody who works from home. My consulting business, really just kind of went away, and so did the speaking business. And so I was faced, you know, in February in March of looking at my pipeline projections and just seeing them go down to nothing, almost. And so it's always time to pivot in I always say, these are the times that make the entrepreneur and these are the times that we really need to focus on what's important, but it's also not the time to take a break, I think The people that are working the hardest right now to reinvent and reinvigorate are the ones that are going to come out of COVID just fine. So to that end, we've started actually three different companies. Right now one super excited about we're calling milestone melodies. We're actually making custom songs. So we've got an entire group of Nashville Songwriters, musicians in really looking to create a unique, I hate to even say gift but a unique moment or so it could be, you know, wedding, anniversary, birthday, anything like that. And we're creating custom music fully produced. So there's a couple of other groups out there that do that, but they don't have the production level or certainly the talent that's available to us in Nashville. So super excited about that. There'll be probably a whole show, I'll bring the CO owners, which is Jennifer McGill, who's former Mickey Mouse Club, and Jeff bohannan is her Ben who does a lot of the production as well and we'll have them on and talk about their why and that business that's going to be really cool. We started a new organization as well called social RX which is spinning up which is more of a prescription for social media and how to do social media total Social Media Marketing Agency. And of course, you know, the pm tribe has been going on but the latest announcement is radio MMC, which you can go to radio MMC calm, but it is now a radio station that's internet based, that plays solely music of those artists and people that are connected to the 90s version of the Mickey Mouse Club. So that just launched this week. It actually launched August 12. So we're super excited about that. You can go to radio MMC comm and check that out. So let's get into today's topic. So in my consulting career and working with a lot of organizations, I've worked with almost 150 or so organizations now implementing what we call project portfolio management software. In the sole reason that most organizations buy this level of software in they can spend anywhere from, you know, 20,000 a year up to 200 $300,000 a year. So, I know several clients that have millions of dollars

invested in a platform like this, but they all buy it so that they can generally make better decisions when it comes to portfolio management. And so for those of my audience that may not fully understand what portfolio management really is, it is managing the entire project inventory for an organization in managing that to strategy as well as cost. And so the first question I always like to ask when we're doing any kind of portfolio management work is, are you picking projects based on what you can spend, or what your resources can realistically achieve? So let's explain that most organizations have some sort of capital budget planning process. Guess what they do? Is that the beat, you know, somewhere in September, October, they start a list and they essentially just say, hey, what are other projects that we need to complete next year? And this huge list? And they asked about how much is that going to cost? And then, of course, that list gets sent up somewhere, and, you know, goes through some magic formula, and essentially, they pick the project. And we've done a whole series on, you know, making sure that projects aligned to strategy and all those other things. So we won't get into that at this point. But my question is, is during that process? How do we ensure that when we pick all these projects, that we have a reasonable staff to be able to complete all those projects? And I would say between 90 and 95% of companies out there, have some sort of an idea. They'll say, you know, how many resources do you think you'll use? How many hours do you think this will be? Some kind of rough estimate? But it really doesn't timescale those estimates and show how the resources are being utilized whether or not they're gonna be overloaded or have enough time to actually complete the project work. So that's a huge question. And so as organizations start to become aware of this need, or really want to start to understand, and especially I think now in terms of COVID, you know, with reduced staffed and work at home and all those things, that it's forcing all these companies to challenge all their assumptions. And I wonder what that process is like if you don't have something that's automated, or something that can assist you in understanding that. And it's far too complex to keep this kind of information in your head or even via a spreadsheet. Because the moment you finish the spreadsheet, it's out of date. So essentially, an organization then has this dream, that they're going to buy some portfolio management software, and off they go. So what I want to do is talk through kind of three different Dreams. And then the nightmares that I see get created through those dreams. And then I'll finish this episode with some practical tips and tricks from a real world perspective. So that's what we're doing today. So the first dream is again, they buy a piece of software, it automatically somehow ranks projects through data, and then automatically communicate that information through the enterprise. So everybody knows the ranking of the projects and whether or not we have enough people to do them. And off we go. Now it's true. Most of the software on the market can do that. But here's how these things become nightmares very, very quickly. First and foremost, the first mistake most people do when they're looking at implementing a system like this any kind of automation system really, is they overcomplicate the software. When you start to see the potential of what software can automate, you start picking more and more and more processes to bring in and then essentially becomes this huge behemoth that takes forever to test for everything. Training is so disruptive to the enterprise. It's just too big. And so, by overcomplicate I can tell you I can't tell you how many times that when we we sold the software, we started working with the organization, we had something very simple like we want to do portfolio management. By the end, what you're arguing about is these 30 reports that nobody's going to read. And it's about colors and fonts and things, things like to me that I'm sure they matter to some people, but at the end of the day, those aren't decision making things. And those aren't things that really are driving those types of decisions. So becomes way over complicated. We're trying to do way too much and bite off more than we can chew. I think that second thing is that while this software does rank things, it has to have the data underneath to rank them. So for instance, if I want to know whether or not I have the resources available to do this project, and I have to have some sort of thought of what type of resources I need for how long and And how much of them that I need. So for instance, any 50% of a project manager for six months, and then that has to be compared with all the existing projects, and those have to have at least some sort of resource estimation.

Beyond that, a lot of people like to look at return on investment, net present value and, and total costs and things like that. But if we're not inputting that data consistently, in the system, then when it ranks the projects, it's ranking based on incomplete data. I think the third major thing that I see when people buy the software is that computers and software aren't going to replace human conversation. So for instance, one of the big ones is like, Okay, if I input my resources there, I want to be notified every time somebody updates a resource in the system. And I really see you know, do you do you really want to be notified because at some point, the These notifications is just going to clog your email box, and nobody's really going to want to look through them, and then it's going to lose its effectiveness and value anyway. So why would you want to be notified? And ultimately, the conversation comes down? Well, I don't want, you know, project manager or somebody going in there and messing up my resource forecast. So I get that. But even if they do, right, the system isn't going to prevent that or being notifying you isn't going to prevent that there's still got to be some sort of human conversation. There's still has to be talking that goes on and you know, jacking for the best resources for a project and no system, no matter how well automated or how well crafted is going to replace human conversation. And also the whole notification thing. Well, I see value in that being notified immediately. Whenever I'm talking to somebody in a meeting and they say something like that. I say, okay, hang on real quick. You just got notified. What are you going to do with it? Now that you've been notified, what's the next step? You're in a meeting You don't have the access to the data. So now it's just another email in your box that you got to get back to. So why couldn't we just create something like a weekly digest that says, you know, here's all the things you said you cared about, you know that, that if they were updated or changed in the system you wanted to know. But we give that to you in a consolidated format that says like, here's all the resource changes, here's all the project date changes, here's all the issue updates, you know, those types of things. But kind of a weekly digest instead of notifying you every time something like that happens. And most of my clients will take that option. But the point being is you lose the effectiveness of the software. If you overcomplicated, you don't have complete data. And you think that this system is going to replace the human conversations that are necessary to move business along. So that's how dream number one becomes nightmare. Number one. So we're going to go through a couple more of these. I've got two more dreams and nightmares to talk about and then we'll get into some practical tips but we're going to take a break right here. Are you listening to Rick Moore's on the work life balance?

VoiceAmerica  12:05  
Are you aware that 80% of project management executives do not know how their projects align with their company's business strategy? Are you aware that businesses identified capturing time and costs against projects as their biggest project management challenge? Are you aware that 44% of project managers use no software? Even though Price Waterhouse Coopers found that the use of commercially available project management software increases performance and satisfaction? Now, imagine that you could have the ease of entry like a spreadsheet and a software tool set up and running within two to four weeks. Imagine within two weeks being able to see clearly where all of your resource conflicts are. Well, you don't have to imagine because PD ware has already created it. pd ware can give you real time access to KPIs easily updated views of what your teams are working on. And immediate feedback to some of project management's toughest questions like when can we start this project. What happens if we delay this project? Can we do this in time? How does this new project impact our current portfolio? Find us at PDX where calm at imagine not manually compiling endless reports again, are you getting the most out of your project management software. In many cases, it is not the software that is failing, but the implementation limitations or processes surrounding the use of that software. r squared can analyze your current use and help improve your return on investment. r squared can also suggest the best software for your organization and goals and assist in the selection implementation and training. Allow r square to ensure that you are getting the value of your investment. Visit r squared today

from the boardroom to you voice America business network.

You want to tuned into the work life balance to reach Rick A. Morris or his guest today, we'd love to have you call into the program at 1-866-472-5790. Again, that's 1-866-472-5790. If you'd rather send an email, Rick can be reached at our Morris at r squared Now back to the work life balance.

Rick A. Morris  14:25  
And we're back to the work life balance on this Friday afternoon. We're talking about the portfolio management dream and how to stop that from becoming a nightmare. So this really comes from years and years of experience doing portfolio management working with organizations. The first one that we covered was, you know, buying software that we think is going to solve all the problems and while software does accelerate a lot of the decisions and makes a lot of the decisions easier. Certainly we have the ability to mess up how we implement the software and thereby make the nightmare happen. So our second dream that I want to talk about is where people will convene a PMO. And ultimately a portfolio management committee. The dream is that we're going to get the executives in the room, we're going to give them some criteria, they're going to look at all of our projects, and rank them with only one number one.

Not like one, a, one, B, one C, one D, but truly have a number one project. You know, a lot of times when when I'm starting the consulting with an organization, I'll ask them, who do you think is making the strategic decisions of the company? And of course, you know, they say, well, we do, right. We're the Executive Council, we do, and I'll say, Okay, do you have a prioritized list of projects that's, that's actually accessible, and everybody understands where they fit? And if the answer's no, then I said, well, you're really not making the strategic decisions. And they asked me how that can be. And I said, because what you're doing is essentially by not having a prioritized list of projects. You're deferring the decision. And that decision will continue to get deferred until it has to be made, which is generally at the lowest level. So for instance, it's it's not you making the strategic decision. It's that database administrator who just got asked to do three different things. Whatever they choose to do first is now the number one priority, at least to them. And of course, if everybody's operating that way, then you've got 500 priorities being worked on, and no consolidated effort towards that major project. And so how you combat that is then how do you decide what's the number one project and most people will do that through a council. So that's the dream is that we're going to convene this council. They're going to make decisions. We're going to have a prioritized list of projects and how we go. Now the first qualifier I want to give before I get into the nightmares, those one of the biggest things that I look at from a maturity perspective of not only Portfolio Management Council, but the project management office, the PMO, I was asked how many projects did Did you kill in flight or cancel outright as part of this committee? And if the answer is that they haven't, then they're not a very mature committee. Because the committee is just now becoming a rubber stamp or roadmap through in order to, you know, greenlight the project. But if they're really not stopping projects, or looking at projects that are performing poorly in them from that point, then they're not really making these portfolio management type decisions. That's really the goal. The goal shouldn't be which project should we approve? It really should be which projects aren't worth our time are we not going to do so how these then councils become a nightmare is first, how do you actually come up with a ranking for a project. And so what they'll do is they'll design a formula to rank projects, right the but then the argument then becomes about the formula. So instead of deciding you This project should be higher than this project we're arguing about, you know what, that ROI should be five times the revenue coming in or, you know, the NPV should be two times as important as the overall cost, you know, things of that sort. And the reason that that that formula becomes an argument is because based on the ranking of using the formula, the projects that they felt were most important, weren't showing up. So the answer must be let's tweak the formula so that we can get the expected result versus taking a really hard look at the what, what the formulas doing. So that's one way it can become an absolute nightmare. The second one and this one, this one I see more often than anything is that the council itself breaks down. So the decisions are really hard to make, but then that's why it's part of an Executive Council. The executives are there to make really hard decisions, and a very hard decision is we're going to do this Project and not do that project. And so I was contracted for for a government agency. And they had eight divisions that were using a centralized it. And everybody was upset that it wasn't doing the projects fast enough and wasn't producing enough so on and so forth, because everybody had a number one, and it was just bogged down. And my my challenge to them was, Why does it have to make the decision because at the end of the day, it for the most part, for the most part, I know I'm being generous here. So please don't be offended. But for the most part, it doesn't care what project we're doing. What we care about is that we have enough time to do that project with quality and be able to to put out the best results possible. But whether we do project a or project B really doesn't matter because we're going to end up doing them both. It's just give us the time to complete project day before we move on to project beat. So I worked with the the eight divisions and I can to counsel with them. And one of the first things I had them do was I asked them to come up with a list of criteria they feel they would need to have answered, in order for them to make a decision as to which project was going to be number one versus number two. And so we worked for weeks on that all kinds of data points, they were saying, and all this other stuff. When we were done with this exercise, the first thing I asked them to do was let's go ahead and rank our existing projects against this criteria. So that, you know, we could just see how it works, right kind of a test case. And they couldn't answer. They didn't have enough information to answer all the things that they say we're required in order to get a project approved to their Council. And I remember saying, doesn't that scare you? It doesn't scare you as the slightest bit that you're saying this is the minimum information you need in order to be able to rank a project. You can't produce that information for projects that are running right now. How does like how does Does that make you guys feel? And so what ended up happening is that it was too hard to get the data that they wanted. So we suggested to pare down the form and they disagree. They're like, no, we're just gonna disband the council. So it was a perfect example for me. And I've seen many organizations do that, that the decisions are that difficult. And in light of making the difficult decision or showing some leadership and taking that on, the response was simply we're going to push the decision back down to it and then we're going to yell at them if they're not making the decision we want them to make and that's essentially what I see in a ton of organizations.

The third one is nightmares is kind of the same under the same thing, but you can never make a decision due to insufficient data. So really nightmare. Scenario number two in this dream is is where they just the decisions too hard to make they disband but The third one is insufficient data. What this one really is, is what I call the decision delay tactic. So this is when they say, okay, we do want this set of information, go get it, you provide that information. Of course, a lot of people are doing this in spreadsheets, and it takes a ton of time to compile the information. And then somebody else on the council will say, Well, I really need to understand this piece of data in order for us to make these decisions. So obviously, you can't make the decision in that meeting. So you send everybody off, they create the new data point, they load it all up, they bring it back into the organization and somebody who go you know, that's really good, but now that I'm seeing that I want to know this piece of information. And while they say they do want to know it, it takes a lot of maturity in in somebody who's running the process to go, that's great. We'll rearrange the projects when we have that information, but we need to rank these projects based on the information we have today. That way, you have that opportunity to go ahead and start making some of the key decisions that need to be made. And you're not pushing it off. Just because of a data point. When you start to feel that kind of happening, that's when you want to challenge the organization or the council itself, to start to really come to terms with this decision has to be made. And it has to be made for the betterment of our people. And we talked about that for just a second. You know, decision making is what I feel the executives are paid the amount that they're paid for that that's that is their job is to make decisions. And but if you look at it from a human nature perspective, human nature says we don't really like or want to make tough decisions and a tough decision means it's not a compromise. Generally, somebody wins, somebody loses. And so when you're trying to maintain relationships, and you're trying to You know, make everybody happy and lead an organization successfully, those decisions are really hard to make. And I am not undermining that by any mean. But at the same time, no decision means the decision becomes deferred to a lower level. And so that now falls to your middle management, middle management doesn't make it that it falls down to your people and your people end up making strategic decisions, just for the mere fact that nobody else would. And so I just want you to think through that. And think about just something simple. Like if you're, you're asking for a team to collaborate on, you know, some copy that was being written an email was going to go out or a newsletter or something of that sort of something as simple as that. You ever send that email out and says, Hey, you know, provide me feedback. And you just don't get any information. Then of course, once it's published, everybody has their feedback ready for you? Well, some of these decisions That that are being deferred could cost millions upon millions upon millions of dollars. I remember

working with a bank, and they had something that they call this security scan. And it was supposed to just scan to see if any ports were open and they would close them before you know this, this thing would go into production. And there was there was a couple of projects that went out where a port was open, and it left them vulnerable to some sort of attack or hacking or something of that sort. And the CIO just came down with fury just beat everybody up around them. And so, next thing you know, as a project manager, when you go to do a security scan, they say, well, the security scan teams really overloaded. We said why they said well, we require three security scans for every project. I was like, what does that mean? And they said well, we got to scan it when the it is done building the server, we have to scan it after the vendors installed. software and we have to scan it after user acceptance testing, so that we can confirm if any ports were open. And if the ports were open, who, who opened them. And so then it became 10 days to schedule a security scan 10 days to perform it and 10 days to get the results. So you're looking at 90 business days or four and a half months, just so that we could say whether or not ports were open and who was to blame. And that was the kind of key thing see the executive needed to know who and was blowing everybody up, not the fact that the ports were open, but who did it. And so the question became, who made the decision to do three security scans? Well, nobody did. So the security scan team did, because they didn't want to get yelled at because they didn't know who opened the port. And so the question becomes, well, what was more important than the fact that we caught a port and we closed it before it went live? Or is it more important to know Who opened the port so we can yell at him and blame him. And when when I finally challenged the executive with that information, the answer was clear that no, we just want to make sure the ports are closed. But my that was a perfect example of how every single project in that bank, for as long as those process were in play, we're getting delayed by up to two and a half to three months. For no logical business reason, other than we wanted to know who to blame. That's a perfect example of when an executive decides to blow something up or yell at somebody or not make the the decision, how it gets hand checked down, and other people will then make the decision in absence. So that's our dream number two convenient counsel and make decisions and how those become nightmares. We're going to come back with nightmare number three right after this break and listening to Rick Morris and the work life balance.

VoiceAmerica  27:57  
Are you frustrated with the overall productivity Have your project management processes Do you lack consistency and project delivery? Our squared consulting provides end to end services to assist companies of all sizes in realizing and improving the value of project management. Whether you want to build a project management office train project managers for learn how to bring the oversight and governance to your project processes, r squared has tailored best practices to help you in all areas of project management, visit r squared At the work life balance, we like to ask simple questions to our executives and portfolio managers. Are you picking your projects based on what the organization can spend? Or is it based on what your resources can realistically achieve? This question is not answered properly can cause great strain on your staff limiting the return on investment. When creating project selection criteria. Does your organization attempt to understand the amount of resources needed to complete the work? Is this done in spreadsheets or in a while level. What if we told you there was a simple and easy solution that was built with resource planning in mind? We call it resource first from PD where resource first was built with resource planning as its foundation. We have years of experience that proves before a company fine tunes its project and portfolio management processes without a process for resource planning. The best processes and algorithms can fall flat resources should be first when deciding the strategy of taking an organization forward. Find out more at PD were calm. Put your people first with resource first from PD where join us at PDX were calm.

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You are tuned in to the work life balance to reach Rick A. Morris or his guest today. We'd love to have you call into the program at 186 64725790 Again, that's 1-866-472-5790. If you'd rather send an email, Rick can be reached at r Morris at r squared Now back to the work life balance.

Rick A. Morris  30:17  
And we're back to the work life balance on this Friday afternoon talking about the portfolio management dream, how to stop them from becoming a nightmare. So we've covered two dreams already. Let's get into the third one and then we're going to get into tips and tricks that I have several clients that pay big money to hear so that's that's what's coming. So hang on with us and we'll get into some tips and tricks on some practices that are surprisingly successful. So dream number three is to institute a gating process. So, gating process is a series of gates where you want to have some sort of check where a project goes from initiation into planning, planning and execution, execute In closing, so on so forth, the goal is to validate that the team itself is ready that all the due diligence has been done. And we really understand what we're getting ourselves involved with. It's also, though should be a key point in which we look at the project and decide whether or not to continue the project. So it's not just a rubber stamp. So a lot of organizations, again, state that they want that they state that they want some sort of gating process, they want some control. They want to make sure that everybody's thought through everything that they're supposed to do. But the reality of the situation is it becomes a process for the sake of process. And before I get into that, let me explain that like, for instance, for instance, one of the biggest process I think, is misused in project management is that of lessons learned. Not saying that lessons learned is invaluable. It's just that people haven't really thought through the process. So then it just becomes something that we do for the sake to say that we did add a checkbox for the PMO that says yes, we completed the lessons learned what I mean is most of the time lessons learned is handled with the project team. It's tracked in some sort of spreadsheet and then it goes out to like a SharePoint site. And then the intent is that all the project managers are supposed to read all of the lessons learned so that we can plan for that and avoid making the same mistake twice now in theory, phenomenal. But we do have a system of how do we take those lessons learned and actionable so that people can really learn? haven't thought through how to do that, then we're just doing a bunch of wasted effort. So again, it's it's not that lessons learned is invaluable. It's just the process in which we do it. If you want a great system of how you can actually turn lessons learned into a real risk assessment I suggest my book project management that works I have an entire chapter devoted to how you take the lessons learned turn that into a questionnaire that can that is in central English for Your project managers to be able to answer and then it tells you what to plan into the project based on how they answered that questionnaire. And it's all based on lessons learned. But coming back then to gating, right, a lot of people end up having gates, just for a process I had of Fortune 50 client I worked with. And when we calculated the cost of their gating process, it was $18 million. It cost them to run their gating process per year $18 million.

And so

that became a great test case for the nightmares that we talked about. So nightmare number one is that gates become really complex and they use too much time. In this case, it would take 88 hours for a project manager to gather all of the data. And of course, then there's all these rules that come with it, right? So you got to fill out this massive PowerPoint, you get to go query all these different systems and you get all this information and You're supposed to have that done a week ahead of the meeting, so that the committee can review it. Well, of course, the committee is going to be reviewing like seven or eight projects, they did not look at all of those spreadsheets, they didn't read all that document beforehand, which is what they're supposed to do for the coming to the meeting. So when they get in the meeting, you end up just, you know, rattling off a bunch of information, and then you get a rubber stamp, and off you go. So we've got to make sure that when you're looking at a gating process, that it's not complex, it's super easy to kind of get through but you have the right amount of control within it. The second big nightmare that comes with the gating process comes around, again, decisions not being made. So you present it and then they defer decision in the gate because they want more information or they don't understand. And so therefore, the project essentially goes on hold until you can go through that next gate. Even more so. You know, when you when you have the council that's looking at the gating, a lot of times they'll say well You know, we're only going to meet every other Tuesday, something of that sort, which means if I'm ready to go through a gate, I've got to wait until a certain amount of time, so I can go present and get a rubber stamp and move forward. So that's another huge nightmare that we see when we're looking at the gating process. But the biggest one and my challenge to this fortune 50 client, my challenge to most of my clients is, once we understand what the total cost of the gating process is, then what is the value of doing that? Can we attribute the value? Did we cancel a project? Did we save a project that was gonna lose a ton of money? And, and, you know, revamp them? And when we start looking at processes like this, you know, some of these are very necessary. Some of these are regulatory, and that's fine. But the question becomes, is the value does the value outweigh the cost or is the cost tremendously outweighing the value? So in the case of that fortune 50 client, my question is, can we address Repeat like 35 to $40 million of gains from running this $18 million process. Because if not, then we need to kill the process and reinvent it. Right. And, and that's so I don't understand why it's so scary for organizations, but they're like, Oh, no, we got to do gating. Okay, but the gating hasn't produced any kind of results for your organization the way that you've chosen to do it. So why do it? Well, because, you know, we have to or because, you know, an audit finding or because, you know, our consultant said, so something of that sort, but making sure that we're getting twice the value out. If not, then everybody needs to be re diverted to revenue generating activities instead of these activities that are just clogging up the wheel and not producing results. So that that's how that becomes a nightmare. Number three, so let's get into some tips then for dreams instead of nightmares. So those are the things that can go wrong. Based on the assumptions that most organizations make,

so how do we how do we make these things, actual dreams? How do we make this stuff come true? So my first tip is that all of these things work gating works, project management software and how that work, you know, that works. Having a portfolio decision committee, it works, but they all have to start simple and then become built upon. So for instance, in the project management world, focus on each one of your roles kind of doing one thing, well, I call this the three rings of focus. So the three rings of focus is okay, I want portfolio, our project managers to write a good schedule. I want resource managers to give me utilization statistics, at the minimum Give me the percentage of resources used against the project over a length of time. And the team members just validate those assumptions. They can do that through time tracking or just validating the percentages that They're their resource manager put in. If each one of those roles just focuses on doing those things, well, then you have all of the pillars that you need to make great portfolio management decisions. We'll know how well the projects are trending, what percentage of resources are available to take on the next project. And we'll understand that the resources know where they're supposed to be and what they're supposed to be doing. And so if we do that, then it works. Once you have that down, then you can start to add onto some automation and some workflows and notifications and all those other things that a system can provide. But what I end up seeing happening more than anything, is when you overcomplicate it, then you stent, you start to doubt the tool and not the implementation of the tool or the configuration of the tool. And then it just becomes this large time tracking kind of database Whenever you try to use the data as a point of decision, people don't trust the data so they don't do it. That's, that's horrible. So, they are all of these things work, but they need to be kept simple and they need to be built upon. Under that same kind of tip though, I want you to have the concept of enter once use many. So I I see a lot of organizations who like one time tracking in their portfolio management tool resource management tool, but then they also have SAP or some other HR kind of tracking system in which they have to answer time so now it becomes duplicate entry of time. That's the biggest thing I always caution my my companies and clients to look at is to say, we need a time tracking system of record. And then whatever other system needs that information, we can feed it. So generally that means the portfolio management software is the best place to track time because it's generally at a lower level. When you're looking at like SAP and HR systems. They just kind of want time rolled up to the front project level, not necessarily at the task level. And then of course, you've got you know, just number of hours worked PTO time, that kind of stuff, you can roll that up and send that to other systems. In the same with like financials. So if you're running SAP financials, then let's not create a whole separate tracking spreadsheet in our portfolio management system. Let's find a way a way to feed the relevant information from the system of record into this, you know, into the system where you want to use the data but not have any kind of duplicate entry. All of the all of the systems now have open API's, they're super easy to start to integrate with. And there's ways that you can design that process so that you're entering once and using many. That's a huge tip. Think through the process. From your resource perspective, think through the process of the people that you're asking to do. You know, the so yes, you want the information to make better decisions. But if we make it cumbersome to enter it in or they're entering it in, twice, it's To lower the quality, then you're going to be into the nightmare of the data quality doesn't add up. So therefore we don't trust it. And now we're just doing again process for the sake of process. Very, very important that a well designed thought process of implementation of what's the system of record? What's the information do we need? What are we going to ask our people to do? And how are we going to utilize that data? That's how you prevent that from becoming a nightmare. So I've got four more tips that I'm going to share with you when we come back, but we're going to take our final break right here you're listening to Rick Morris and the work life balance.

VoiceAmerica  41:38  
Are you aware that 80% of project management executives do not know how their projects align with their company's business strategy? Are you aware that businesses identified capturing time and costs against projects as their biggest project management challenge? Are you aware that 44% of project managers use no software even though PricewaterhouseCoopers found that they use commercially available project management software increases performance and satisfaction. Now imagine that you could have the ease of entry like a spreadsheet and a software tool set up and running within two to four weeks. Imagine within two weeks being able to see clearly where all of your resource conflicts are. Well, you don't have to imagine because PD ware has already created PD where can give you real time access to KPIs easily updated views of what your teams are working on, and immediate feedback to some of project management's toughest questions. Like when can we start this project? What happens if we delay this project? Can we do this in time? How does this new project impact our current portfolio? Find us at PDX were calm and imagine not manually compiling endless reports again, Are you frustrated with the overall productivity of your project management processes? Do you lack consistency and project delivery? r squared consulting provides end to end services to assist companies of all sizes sizes and realizing and improving the value of project management. Whether you want to build a project management office, train project managers, or learn how to bring the oversight and governance to your project processes, r squared has tailored best practices to help you in all areas of project management, visit r squared

When it comes to business, you'll find the

experts here voice America business network.

You are tuned in to the work life balance. To reach Rick Morris or his guest today we'd love to have you call into the program at 1-866-472-5790. Again, that's 1-866-472-5790 if you'd rather send an email Rick can be reached at our Morris at r squared Now back to the work life balance.

Rick A. Morris  44:00  
And we're back to the work life balance on this Friday afternoon, the final segment as we go through my tips now for how to keep your portfolio dream from becoming a nightmare. So we already talked about, you know, keeping things simple, the three rings of focus and enter once use many. Here's a very, very popular one we talked about earlier in the nightmare about how when you create a ranking algorithm to rank your projects, that a lot of the arguments become about the algorithm and not the projects themselves. So what I do is I find the five or six pieces of information that they're saying is important. So you know, ROI, NPV, total resource utilization, length of project, those types of things. And I rank all the projects by single statistic, each one so if there's five things I five separate lists and then I look for essentially the waterline or you know what we think we can do 30 projects, so which projects appear in the top 30 and all five of those categories. And generally there's about 10 to 12. In doing so, then we can say those 10 to 12 are in, regardless of who you know, if you think ROI is more important, or if you think total utilization is more important doesn't matter. That's it. And so now we're just we've made our decisions on the top 12 right out of the gate. And now we just start talking about the bottom 18. At that point, it moves things along a lot faster. And even if we come to a stalemate on the bottom 18 we still have ranked the top 12 and off we go. So that's a huge point in time saver for a lot of portfolio committees. probably my biggest tip that's utilized and in most of my most of my clients companies. The next one is what I call the 10% rule. This one, this one is is huge, especially when you start talking about lowering the amount of gates and things like that that you need. So essentially, the 10% rule works this way. So when you pitch a project and you have an initial budget, you automatically get 10% of that budget approved to go plan the project to really go plan out how much this thing is going to cost. And then if you're within 10%, plus or minus of your original estimate, you're automatically approved to go into execution. So the beauty of that is it's reducing the amount of gates that are just rubber stamp, and now gates just become about the outliers. But also it gives you the ability to move things along very, very quickly. So for an example, if it's a million dollar project, you get $100,000. To go plant it, you find out it's going to be a you know, 1,000,001 point 5 million, and then that means you you've got the green light to go into execution. So that's a very, very popular one as well. I've seen several organizations streamline their processes to where the only the gates that you're talking About are falling outside of that 10%. So therefore, there's real decisions starting to get made as to whether or not that project still valuable enough or whether it's still worth enough to go after.

And my next tip can go hand in hand with the 10% rule. And this is pmis term. It comes from the Pim Bock. And it's one that I remember kind of having a reaction when I first saw it, but once I saw one of these inaction, it's called a board. And that sounds horrible. But it essentially, is that the committee is convened to shoot down the project. And if you can, if you can then get the project through that committee, then it's a really good project to do. But otherwise, if it's a flimsy project, it's a pet project is one that's not really going to generate ROI, that kind of stuff. Those get cancelled and shut down in this committee. So the intent isn't to come to the committee to approve the intent is for the committee to come in and decline And make the sale of that project be so good, that it's irresistible. And we have to do this project. It's just it's a little bit of a flip of connotation, but it really is, is a powerful tool to say, you know, we understand we have limited resources, we understand we have limited budget, we're going to make sure that we're not going to waste any of those on projects that don't deserve, really to be considered by our staff. And my final tip, in this series is to talk about, again, value. If a process doesn't provide double the value, then it's time to redesign the process. And that really goes for any of our processes. It's amazing how much money that that I call low hanging fruit is available when I go into a consulting client. And all I have to do is looking at the processes that they're doing and question why do we have that process And I'll tell you that 90% of the time I'm talking 90% of the time, people will tell me Well, that's just the way it's always been done here. And that's that I hate that statement. Because that's not true. It's not the way it's always been done there. It was just the way that you were trained and you've never questioned or look to improve the process sense. And so when you're when you're looking at a process, I'll give you a perfect example something a question I asked a client that they'd never been asked before is that they, they deal with a lot of regulatory a lot of regulatory projects and regulatory generally means you have to do it, or there at least has some consequences for not doing it could be loss of reputation could be a financial fine in most times. It's a financial fine. But there was a new regulation came out everybody scrambling the project was gonna cost about $200,000 do and my question was, what's the fine? I go? What do you mean? I said, Well, we're doing this to avoid a fine, what's the fine, the fine was $10,000 For the first year, and I was like, Look, this is obviously a project we need to tackle, but it's going to be a nightmare to try to tackle it now. So why are we going to spend $200,000 to avoid 10? Where we'll just take the $10,000 lump. And now we don't have to do it as an emergency project, and it's gonna cost you no way less to do. And that's what we did. But nobody had ever really asked that question to the client before like, Alright, so that caused me and my portfolios when when I have a checkbox that says this is critical, or it's regulatory, like I want to see, like, Where's the regulation, I show me the document, show me the phrase, and show me the fine so that we understand that this is good business for us to do. So, if a process doesn't give you double that value, then it's time to absolutely redesign the process. So that's how we make portfolio management dreams. actually become dreams and avoid nightmares. If If you have any questions about any of those, you can reach me at r Morris at r squared consulting COMM The software that I recommend that you use right now, if you're looking at any kind of portfolio management type software is a company called PD where it is the first one that was built with resource planning in mind and makes the resource planning essentially the power of a project portfolio management tool with the ease of a spreadsheet, it's really really cool software, really inexpensive, and does a phenomenal job.

Coming up next week, we're going to start a series of entrepreneurs and real entrepreneurs. And we're going to have john tablets on who is the founder of books, which is Bo u q s and it is one of the fastest growing flower retailers out there, the largest company and one of the biggest successes ever to come out of shark tank and just a phenomenal entrepreneurial stories. So we're going to be visiting with john. Next week, and we've got tons of those coming up. We've got Wes, who actually was our reschedule. We missed an appointment before but he's a marketing guru got Travis Bell coming up. And just on and on Adam Mendler. Steve gave it tours. And then even if you missed last week, a fascinating conversation that we had with Doug vermeeren who's is considered the the modern day, Napoleon Hill. He's He's interviewed over 300 of the most successful people in the world, and is gleaned insights. And he talked to us about his movie, how thoughts become things so that was last week's episode. If you missed it, you definitely want to go back and catch that one. Otherwise, gang, we thank you so much for always being a part of the show, always the feedback that I get on social media and via email. I certainly appreciate it. So keep that coming. And until next Friday, we hope that you live here. Your own work life balance will talk to you that

VoiceAmerica  53:06  
thank you for joining us this week. The work life balance with Rick Morris can be heard live every Friday at 2pm pacific time and 5pm eastern time on The Voice America business channel. Now that the weekend is here, it's time to rethink your priorities and enjoy it. We'll see you on our next show.

Transcribed by

Tuesday, November 12, 2019

Net Operating Value - A New Way to Look at Project Costs

Let’s take a step back and look at the historically most common path of projects.  During the budgeting process usually the year before an idea for a project is suggested.  Then this idea goes through some cycles and an estimated budget gets placed on the project list for the coming year.  When the project is kicked off, the budget is set to the estimated budget.  Few organizations go through a true project costing and just artificially constrain themselves to the suggested budget.

However, let’s say we are a forward-thinking organization that does a full project estimate and sets the budget.  Most projects run into delays, issues, and missed assumptions that inevitably puts a strain on the budget.  There is a fear to go over budget.  The project team compresses training, testing, or both to come in on the budget suggested.  This then leads to rework and enormous costs to repair something in production instead of fixing it right the first time. 

An additional issue is how the project is pitched in the first place.  It is pitched with a 5-year savings, ROI, NPV, IRR, or a payback period.  However, many companies do not validate if the project did in fact deliver the numbers suggested.  Does your company validate project savings for 5 years and report back? 

These are all antiquated problems and have been the way projects are done since I have been in the industry (over 25 years).  Yet we rinse and repeat.  Then comes Agile which throws organizations for a loop in how to track and report costs.  So far, I have not suggested anything new.

The business suggests numbers and does not always measure results and the project team suggests costs and must constrain something or blow the budget.  What if we applied a different mindset to tell the story?  What if there is a single number that could govern the decisions?  Enter Net Operating Value.

Net Operating Value makes budgeting a project a little more ancillary.  All the budgeting methodologies and controls still apply; however, the question becomes framed a bit differently.  Net Operating Value (NOV) is simply 12-month project benefit subtracted by project costs.  From a business context, what are we gaining for 12 months (revenue, cost savings, etc) minus the cost of the project?  If a project takes longer than a year than expand the benefit.

Taking this concept through a case study, let’s say there is a project that the business feels could generate $1M of revenue in the first 12 months, however, do not have the resources necessary to complete the project .  They could hire a vendor to complete the work for $100,000.  It can be painful to have to suggest the added cost of $100,000 to the budget if it was not planned for.  However, if we frame the conversation differently, then NOV comes into play.  Instead of what it would cost to do the project, we ask what is the net gain in the next 12 months of the project?  In this case, the net gain is $900,000.  The question becomes what are we willing to risk for $1M rather than what will it cost?  The answer could be $200,000 for a NOV of $800,000.  This aligns business and the project team.  The project team is signing up for getting the $1M of revenue and the project team is signing up for $200,000 in cost.  This changes how we approach change requests, scope creep, etc.  If the NOV is known and widely displayed, then decisions would be represented in the NOV instead of over budget.
For example, if an unknown was uncovered that would cost $50,000.  The question becomes is $250,000 acceptable to spend to get $750,000 of NOV?

What do you think?

Tuesday, February 6, 2018

Radio Show Transcript - Agile Almanac Vol. 2 - Nichole Tubiolo - Recorded January, 26, 2018

Agile Almanac Vol. 2 - Nichole Tubiolo - Recorded January, 26, 2018

To get to the web page of the radio show, click here.

To download the mp3 file, click here.

To subscribe to the podcast on iTunes, click here.

FULL TRANSCRIPT (with timecode)

00:00:05;00 - 00:00:27;01

00:00:27;03 - 00:00:38;26
Rick Morris: And welcome to another Friday edition of The Work/Life Balance we're so excited to have you guys along with us as we've got a very special show planned for you today. Very excited about our guests that we have with us. It's been another crazy week.

00:00:38;28 - 00:02:18;13
Rick Morris: As always, we started actually Sunday this week with a couple of keynote presentations to Civitan International. They had a group of governors coming in that is a service organization. We were the keynote speaker to their planning sessions as they are planning some fantastic service projects for their different organizations in their communities. We had a great time being able to spend some time with them Sunday doing some fellowship and some leadership training and with them we are their keynote speaker Monday night. So they were a fantastic organization. We had a great time with them and we value their patronage and was very happy that we had an opportunity to spend some time with them. We were in Memphis on Tuesday spending some time with some clients and some community leader organizations there and finally back home for a short time before we spend all week next week in Nashville. So for our listeners in Nashville, reach out to us because we're going to be there in Nashville Tennessee all week next week before we head out back to Memphis the following week and then leading right into the big international Maxwell certification in Orlando Florida which is happening the 16th through the 22nd. We will be there. We'll be excited. We'll be welcoming all of our new people into the John Maxwell team as we always do. And then right after that, we alluded to this a little bit, but for those of you that have been following the show, John Maxwell's passion has been transforming countries and we have accepted an invitation as part of the John Maxwell team from the president of Costa Rica.

00:02:18;28 - 00:02:37;12
Rick Morris: And I have accepted invitation from John to participate in some Leadership Roundtable trainings in Costa Rica which is happening in March as we go to transform that country through leadership and leadership training. So there will be a lot more to come about that. But let's get into today's show.

00:02:37;24 - 00:03:04;22
Rick Morris: We have an incredible guest, fast friend of mine, somebody who I was introduced through a project that we were working on which was the almanac book too as you guys know I've been talking about that my great friend John Steinbeck. He runs and he and I have talked quite a bit about Agile, Agile transformations hybrid project management.

00:03:04;22 - 00:05:39;29
Rick Morris: He's a great friend to the show's been on the show many times and he had spearheaded this project to bring out Agile Almanac book to which I had accepted an opportunity to collaborate. And so it became what we called the Dirty Dozen, that was kind of our inside joke, of 12 different authors who collaborated in producing that book and really trying to you know try to take Agile and really scale that to the program an enterprise level. And so it was a great collaboration of 12 incredible people to really lend next level thinking into this into this book. And so when I went out to Las Vegas as part of CAWorld, we did a large book signing and for those of you that follow me on Twitter we posted a video about the book signing in about the speech that John and I did out there and this person was in that video with us and she's currently a project manager for Willis Towers Watson in Buffalo New York. She leads an operational support team with the main focus on CRM customer relationship management and Confluence data management and previously she was a project manager for MNC Bank in Buffalo New York leading a digital banking program team with a main focus on mobile application development. She has led enterprise level projects for over eight years that spanned from back end upgrades to customer facing applications and she started working as a freelance writer trainer and Agile coach in her spare time. She's a member of the PMI Buffalo chapter in New York and previously held the director of community outreach position within the chapter. And as a director of community outreach she was responsible for running a project management for nonprofits program which was a program of training mentoring and in each toolbox of forums and templates designed to bring project management best practices to western New York charitable organizations. She's a member of the buffalo Junior League which is a philanthropic organization committed to volunteerism developing the potential of women and of course improving the community through effective action and leadership. She's certified by PMI as a project management professional which is PMP and Agile Certified Practitioner which is the PMI ACP and she also holds the certified Scrum Master designation from the scrum alliance. She graduated from Empire State College with a B.A. in administration economics and she now also holds the distinction of being an Amazon number one best seller along with the rest of us. Let's welcome to the show Nichole Tubiolo. How are you?

00:05:40;02 - 00:05:51;15
Nichole Tubiolo: OK read Rick thank you. I'm doing well. I'm extremely grateful to be a guest on your show today and to be reconnecting. So thank you very much for having me.

00:05:51;16 - 00:06:03;29
Rick Morris: It has been a little while since we've seen each other in Vegas and again that was a video that we posted out on Twitter or what. What a fantastic time that was. The book signing the excitement around the launch of the book talked to the audience a little bit about that.

00:06:04;22 - 00:06:06;13
Nichole Tubiolo: Yes they were an excellent experience.

00:06:06;14 - 00:06:29;13
Nichole Tubiolo: And you know being at CA World were all than having so much interaction with everyone there. The book signing the launch itself it was really just a great weekend. A couple of days there CA World for you when John had a great talk there and we also had the book signing which was excellent.

00:06:30;05 - 00:06:45;03
Rick Morris: And so you know this has been a culmination of a lot of work. And of course John spearheaded that. But you took a couple of these chapters within the book and made them your own. Why didn't you tell the audience which chapters you wrote. Just describe those for a little bit.

00:06:45;25 - 00:06:47;03
Nichole Tubiolo: Absolutely. Yes I did.

00:06:47;03 - 00:07:59;26
Nichole Tubiolo: I had the extreme fortune of working with this brilliant team of coauthors led by John and I did contribute to two of the 17 chapters one being risk management said the main focus there is talking about various risk management approaches used by Agile program teams ranging from the do nothing and let it become an issue approach to you know various tools and techniques to identify and mitigate risk. So a lot went into that that risk management chapter and the other chapter that I wrote was around budget management and exploring various thoughts and tools and different methodologies used to manage Agile program budgets. Certainly there's the traditional earned value management used for the traditional waterfall project and you know certain to seed teams and talk about having teams leverage more of an incremental cost management or looking at lean budgets and empowering teams with decision making and already. So there's a there's a lot there and there was a quick summary of both of those chapters but I was very fortunate to work with everyone and make those contributions to the Agile Almanac.

00:07:59;17 - 00:08:34;06
Rick Morris: And so we're going to deep dive on a couple of those topics but I always like to start broad with you know anybody that I have on in Agile. I'll hit them with a couple of things that I always got to hear and kind of the reason why I jumped into Agile in the first place. So when Agile started really hitting the marketplace I was running into Agile analysts that were saying things to me like, we can't tell you where we're going to be done because we're Agile and then specifically to your chapter. We can't tell you how much it's going to cost because we're Agile. What would you say to somebody who's trying to lead an Agile transformation and saying things like that?

00:08:34;20 - 00:08:43;14
Nichole Tubiolo: Those are great points and are actually right. I've heard those as well. And I think that there are there those sound to me to be Agile myths.

00:08:43;14 - 00:10:22;20
Nichole Tubiolo: That a project manager is not needed as a leader of a group but not be needed or that you don't necessarily know how much it costs because you're running Agile. It sounds to me that there are definitely practices and tools to be used to work with teams and really if you think about Agile and you think about this scrum master and that scrum master is really just another way of saying project manager. So maybe it's that you don't need the term project manager but you're replacing that with a scrum master who's more taking on that role of servant leader as opposed to perhaps you know in a traditional perspective on project management would be commanding control versus servant leaders. There might be some subtle differences there but there's still leadership in a leadership role from a project management perspective. Just taking a slight different view on that and then from the funding perspective you had made mention of we don't know how much it's going to cost. You know if you fund an Agile team you can determine how much a period of time would cost and then determine the value that would be brought forth in that period of time. And so you may not define how much a feature function or capability would cost in a certain period of time but you would be able to directionally provide that information or an estimate to that..

00:10:22;23 - 00:11:43;02
Rick Morris: I think that that really makes Agile what it is. If we look at what we've done traditionally as project managers that thought pattern that we actually could you know take an initiative and then we would try to plan out over the next two years. Everything that we were going to do up front and then turn around say it was going to cost this the fact that we were bold enough to think that we actually could plan that well. Of course you know we always get in to scope change like crazy and we always miss her budgets and time frames and that and that's what happened that's why people get frustrated. The other thing is by looking at it but an initiative by initiative by initiative we were overloading our teams and that is you know I think the issue that every company has in America is that you have too many initiatives not enough people and so therefore you have no idea what they're working on. And so they just keep approving new initiatives without understanding what is doing to their team. Thus I have a radio show called The Work/Life Balance. And so when we really start to look at Agile and you start looking at funding teams that really becomes a point that is not only a point of struggle but then you are starting to reverse that flow. You're basically saying here's a group of people we're going to fund them for a certain period of time and then we're going to start looking at the maximum they can produce. And I think it's reversing that funnel. Would you agree with that?

00:11:44;29 - 00:12:00;13
Nichole Tubiolo: Absolutely yes. I I would agree with that because that makes it such that the cost of the team is fairly consistent over time and the variable there is the amount of features functions or capabilities that that team can produce.

00:12:00;29 - 00:13:10;25
Nichole Tubiolo: And you know that team will in some sprints or some months or some quarters that team may produce a higher output or higher quality based on the team members and where they are in their cycle of being a team and it allows the organization to know how much that team will cost and the unknown then becomes the deliverable and how many how much you know the quantity of the delivery that will be produced in that time period. So it is it’s taking that thought and kind of flipping it on its side upside down as opposed to saying this is how much money this will cost. And then you know taking those change requests as you said you know how would we possibly know over the period of two years how much it will cost us to produce a feature or a function over time. So instead we would take that and baseline the cost at a flat rate if you will assuming you have the same number of dedicated individuals on a team and you change the amount that's produced each sprint or in any given time box.

00:13:11;12 - 00:13:13;09
Rick Morris: And I think that that's the biggest struggle.

00:13:13;09 - 00:13:37;16
Rick Morris: So we're actually going to dive into that right after we take our first break here and start talking about the concept of funding value versus and teams versus funding initiative. So we're going to talk about that right here when we come back. You're listening to The Work/Life Balance with Rick Morris..

00:16:26;16 - 00:16:41;29
Rick Morris: Now back to The Work/Life Balance. And we're back to The Work/Life Balance and you did hear the dial in number, we do welcome phone calls and questions and I actually have an over under bet going with how long it might actually take John Steinbech to dial in.

00:16:42;02 - 00:17:31;12
Rick Morris: So we're coming back with Nichole and talking the Agile Almanac right. Before break we were talking about funding of Agile teams. And this is something I'm actually going to Nashville next week and we're taking a client live in Agile and you know they're still struggling to cope with this whole thought pattern of yeah but don't we have to track time don't we have to allocate you know percentages to support projects and all of this other stuff? And you know really still they say they want to be Agile but they just can't pull themselves out of the hamster wheel and you know you have to really start walking them through truly funding Agile teams. So what really is a benefit of funding Agile teams over projects?

00:17:31;19 - 00:17:46;19
Nichole Tubiolo: Well Rick I would say that funding Agile teams at the team level provides the team some stability so that they can continue forward movement in providing value and producing those features and functions and capabilities.

00:17:46;20 - 00:18:14;16
Nichole Tubiolo: And really leave their focus there. I've seen teams that have not had that and you know the backlog then becomes anytime something that comes up new to go on the back lot of features functions and capabilities. Is there's a pause or there's you know take some time to put together a thought process around putting in and change your quest in order to receive funding for that particular feature.

00:18:14;17 - 00:18:29;29
Nichole Tubiolo: And really the value there is that we want our teams to be focused on producing value and focused on really just moving forward on what's the next best function.

00:18:29;29 - 00:19:51;26
Nichole Tubiolo: So let's empower our teams to make decisions on what feature function or what capability is the best next item on that backlog or next set of items on that backlog to pick up and put into the sprint and fund those teams and they can move forward accordingly. It allows for that team to feel empowered and to feel more ownership around what they're producing. But it also allows for less overhead. And my perspective and opinion there's less overhead there if a team is given say you know a quarter's worth of funding or even a month to test it out or two months to test it out and determine that it it's working well so the organizations that are having are challenged and really focused on that need to check time or the need to track the percent allocation. You know they can go hand and check time and present allocation. But it should be pretty flat. Assuming you have teams that are 100 percent dedicated efforts that you know you kind of move I would move one step at a time towards towards making that transition. You know by by saying you can you can check time but it will be the same flat lined across all of these months because we're going to dedicate you know X amount of dollars to fund this team and allow them to move forward.

00:19:53;21 - 00:19:55;10
Rick Morris: And that's exactly right.

00:19:55;12 - 00:20:38;16
Rick Morris: And I mean when you when you look at that and start to look at when we're talking about funding there's it's still a different mindset right because what you have to start to walk through with an organization is if you look at it the way they do things now is initiatives pop up you're pulling teams away from work. You're making him attend meetings you're making him do all these planning all this stuff. And you know I've laughed with several people but you know I want to make t shirts that you say don't touch my sprint right now because that's really what it comes down to. Don't touch my sprint and then really quickly I'm going to go ahead and say that I took the under bed and won a because we've got John Stenbeck on the phone. And let's welcome John to The Work/Life Balance. John how are you doing brother.

00:20:39;00 - 00:20:43;04
John Stenbeck: Hey Rick are you did you guys hear me. Oh great. Just fine.

00:20:43;06 - 00:20:50;21
John Stenbeck: So I heard the last word to call me out with the over/under bet because you know I always listen to your show and especially Nihcole.

00:20:50;21 - 00:22:06;10
John Stenbeck: So glad you're on the show. Good. Couldn't resist giving her a shout out there.

Nichole Tubiolo: Hi how are you?

 John Stenbeck: I'm good. So if I can interrupt the flow of the conversation there's two things I think that you guys really should talk about with the audience that are really important. One is that the common Agile myth now that I've said the word miss our co-author Joe Montalbano who's our myth mastro might be able to resist calling in too. But one of the myths is that a company is either you know needs to or wants to or must become 100 percent Agile or not. And yet our experience with most our Fortune 2000 and larger clients and agencies and military commands and stuff suggest that only about a third maybe 30 percent of what they're doing has the required amount of complexity and uncertainty right and very ability to justify the overhead that Agile causes. Whereas the other 70 percent is stable enough to not need it. And I think that was really you know Nichole and Rick when we all started talking about if you're scaling Agile how do you do budgeting and how does the whole factor in that was really a big breakthrough.

00:22:07;29 - 00:22:55;24
Rick Morris: That's a huge breakthrough. And so coming you know coming to that point you're not completely Agile you're not completely waterfall so the hybrid approach is where it's at. But I think that still changes the focus with introduction of Agile and the biggest shift I think I've made certainly in my consulting and my career over the last two years is still the shift of funding value and stop funding initiatives and started looking at things as in terms of the output of value that we're going to bring versus the amount of money we're going to spend. And I think that that Agile level of thinking also applying Agile principles across the board is something that's really been exciting for us to watch.

00:22:56;24 - 00:23:31;15
John Stenbeck:  And Rick I know in one of our conversations you'll probably remember you completely rocked my world when we started talking about them. I'm not sure if I'm going to get that name exactly correct. So help me out on the non-project investment objectives that you can do in the CAPPM app and how much flexibility that saves how much overhead it reduces how gives the AGilel folks the ability to be Agile and the management to get the reporting they need to do that without drive a lot of overhead. Have you shared that much with your audience?

00:23:31;22 - 00:26:27;29
Rick Morris:  Yeah we we've definitely done some shows on that. But I do want to give you an update and since we're going to take this topic for just a second. We actually applied this thinking just recently to pharmaceutical and pharmaceutical development and so we're very very excited. We won’t say the client but we've got a client that deals in wet labs and testing in pharmaceutical development. So what they do is receive samples and those samples come in and they do daily runs those daily runs are essentially basically sprints there daily. And you know every day we're going to do. We're going to run these instruments and these instruments are going to output. And however the lab are getting samples that can be generated by 10 or 15 maybe even 20 different projects. So the management and billing and invoicing and all that stuff is very difficult for them to track and there's a lot of you know potentially lost revenue and everything else. So by applying the same thinking where you have waterfall style projects that are generating the tasks or features which are being then fired into an Agile methodology where they can do their runs. So from a lab it just they have work. It doesn't matter which project is generating it. It's just a queue. And so now we have a whole queue and a combine style board that's generating the lab work. And as it completes its automatically updating the appropriate project so invoicing can be done. It's kind of revolutionizing that business and it's being done in the very same way. So it's very exciting to see that. So it's the same style. When you're looking at that from an I.T. perspective it is even if you're not 100 percent Agile you can still allow your teams to stay in and Agile methodology while multiple waterfall projects are just simply generating work multiple defects are coming in from your support staff and it's just generating work. They just complete their work and it's updating the appropriate systems. That's essentially the same theory but we're applying that same level of thinking across industries and outside of I.T. using the tool sets which is why when we've gone through writing the book we all thought that it was possible that Mikkola taking on two of the hardest chapters in the whole book because how do you come back then and budget still at that level. And that NPR show that you talked about the Nahm project investment objects was the ability for us to shave a slice of our budget to Agile teams. Right so I can say 60 percent of the budget is going to be to funding teams 40 percent of the budgets to funding initiatives or strategic projects and then still be able to report and roll that out because at the end of the day the CFO doesn't care that we're doing story points. They want to know we paid X amount of dollars and we generated x amount of revenue. Fair yeah right.

00:26:27;29 - 00:26:51;11
John Stenbeck: That just makes so much sense because you know the other myth I was going to bring up is this idea that somehow an internal or external either one other customer can give you imperfect specifications and somehow expect perfect schedules or budget kinds of forecasts. I mean who could actually believe that that's possible.

00:26:52;23 - 00:27:00;26
Rick Morris: And there's no way for us to do that. So coming back to the other other than Agile.

00:27:00;28 - 00:27:11;18
Rick Morris: And I think the two favorite words I ever saw come out in the PMBOK was progressive collaboration which is that so Nichole coming back to that.

00:27:12;04 - 00:27:26;19
Rick Morris: You know when we start talking about funding and you know how we're funding in that portion if funding is provided to teams and not to projects or scope then how do people then measure value.

00:27:28;02 - 00:28:53;02
Nichole Tubiolo: That's a great question. There are variables here when teams are funded it is what's being produced. So we have teams that have a backlog and that backlog story pointed and you can see the trends of how much is produced in any given sprint. And from there you can determine the value of that time period. As for what's been delivered. See you had measured almost in reverse as opposed to measuring how much money you're spending you're measuring the value of what is being produced from a feature function capability perspective. So again just kind of taking that traditional model and thinking of it a little differently and thinking of the variable there being what we know from a story you can use a story point perspective to roll that into what the value is. And Rick you made a great point that you know the CFO doesn't necessarily care about story points right and having the ability to measure and show the value versus the cost for that value is still there because you do know how much your team costs when you fund it from a team perspective. And then once the value is produced you know how what what's been produced for that money so it's just that you are showing the value after those features functions and capabilities are produced.

00:28:54;08 - 00:30:11;23
Rick Morris: Yeah and I think the biggest point in that too is a course correction. And so I think in the book and I believe it's John's graphic that does it when we start talking about going through the cone of uncertainty. And John just alluded to this as well is when we get imperfect requirements expect perfect results when we go through that cone of uncertainty in a standard project where at the end of the project already expended all of our funds before we've actually realized that we've missed the mark and that's generally you know 60 percent of the development projects that go that go on in a development world or is in an Agile methodology that when you're starting to release every two weeks and trying to release value and features and capabilities every two weeks then that feedback loop is so important where you can course correct. And so you're hopefully developing and coming out of that cone of uncertainty a lot faster and that's why that methodology seems to be taking off so well. We've got to take a break right here we're going to do that. We're going to let CA pay some of our bills in one of those checks should go to John Stenbeck for mentioning them first on the show this this week and we'll be right back on The Work/Life Balance here with Rick Morris.

00:33:21;04 - 00:33:24;24
Rick Morris: And we're back to The Work/Life Balance on this Friday afternoon.

00:33:24;24 - 00:33:39;20
Rick Morris: I hope everybody's doing well and wanted to say hello to John Watson who's also a longtime listener our great friend and shout out to him. Thank you for the text brother love you always. So coming back I to again.

00:33:39;24 - 00:34:38;20
Rick Morris: You we're still diving into this whole funding thing and since Nichole wrote the chapter on scaling Agile in as you know into budget management wanted to keep going down that topic and so what I see a lot of clients struggle with Nichole is again coming out still with that traditional we've got X amount of money to spend and we want to pick other projects that we're going to do and I think one of the biggest issues that most companies run into is that they pick projects based on what they can spend but now what they can reasonably accomplish and in this in this aspect if they are going to be switching to an Agile methodology as John just pointed out you know only 30 percent of their their budget could be going to Agile teams. So what is your suggestion or how do how do we start to look at teaching portfolio management program management and an Agile methodology to be able to divide those budgets.

00:34:38;20 - 00:35:56;02
Nichole Tubiolo: That's a great question. You know and and how are we dividing those budgets. Really it depends how many of those projects in the portfolio really require the Agile methodology. And you know John's made a good point that maybe 30 percent will go with an example 30 percent for the company. So you know that 30 percent of the budget is set aside and lets you know continue on with the theory that this 30 percent would go to funding Agile teams and not initiatives the Agile teams would then have a roadmap of features and capabilities that they're looking to produce that they would be focused on it wouldn't be that the funding will go directly to their functions but they would directionally be towards those functions that 30 percent of the budget for Agile and then the remainder of the budget towards those traditional projects that are really based on the scope and funding scope and funding you know what they have detailed in their requirements plans so that 30 percent goes towards Agile would would be managed a little differently in that.

00:35:56;03 - 00:36:25;22
Nichole Tubiolo: You know they would that the dollar amount would be net steady 30 percent. They've broken up into the four quarters and provided the funding to a team for the first quarter and they would take their roadmap and work towards achieving the functions on that road map. And then you would would certainly need to measure how much that was spent. And then you know roll that out to reporting on a regular basis be it weekly or monthly depending on what the governance structure required of the company required.

00:36:26;23 - 00:37:02;15
Rick Morris: Yeah I like to say you don't what I'm working with clients I kind of go let's just cut let's just cut through the red tape where he lead. Let's cut the jargon and crud and describe how it's being done today. And so how it gets done today is you define you know Project X and you say these are all the things that I want I want you know 150 things to be developed. So we say Great we sit down and estimate how long it's going to take to do those 150 things and we come back when we say it's going to take us two and a half years to do this and it's going to cost X amount of money they're going to come back and go we don't have that amount of money. You got six months right.

00:37:02;15 - 00:38:17;06
Rick Morris: So then the discussion is what do you want to cut and generally the answer. And again I'm being a bit facetious here but they're like well we're not cutting anything. You got six months. And so then we become the people that covertly degrade quality or whatever else. But that's general project management right. Right. Impossible timeframes impossible budgets that kind of stuff. What is what I keep telling everybody Agile is is just a better Covenant's a better contract. What we're saying here is we're giving an expectation upfront of what can be produced. Here's the team. You make your wish list and every two weeks you get to adjust your wish list and at the end of the quarter we'll know that we spent X amount of dollars and we'll show you what we delivered and will adjust from there. What I love about that is people get uneasy but at the same time I also said we also just now cut out the two months of haggling that we would have done if we approach this as a huge project. We just got to work and we just started doing it which saved you two months of non-productive time trying to figure out if we could do this in the first place in which you would have just told us to do it in the way. Is that fair. I mean is that a fair representation.

00:38:17;29 - 00:39:13;27
Nichole Tubiolo: Absolutely. And not only that saved the two months are you know planning an initiation where there isn't anything produced. It's also saved you know in that third or fourth month where execution is going on. And then the initial delivery takes place maybe six months out before a product owner or a business manager is seeing anything functional and providing feedback on it at which point it may not their requirement provided may not actually be what needed to solve the problem. The problem the business problem could have changed given that it's taken so long or you know maybe there you know once you see it once you see what's been built sometimes you have a different thought or a different way of building it. So it's saving so much more than those two months. By using that methodology you’re  getting producing value and putting it in your customers hands within potentially two weeks for feedback.

00:39:15;07 - 00:39:30;27
Rick Morris: Yeah. If you do it right you're tackling the hardest parts first. And we're finding out maybe six weeks into it we can't even do this thing so we scrap it after six weeks versus finding that out a year and a half into it and you save so much by finding out in six weeks.

00:39:30;28 - 00:39:35;27
Rick Morris: You say that that year and a half of maybe year and four months of work.

00:39:37;05 - 00:39:56;28
Rick Morris: So I want to I want to hire Jon Gruden just to follow me around with clients just so they can go. Come on man. Every time you know you have these conversations with clients are you just he just go. Come on man. Because I mean I don't like to oversimplify but that's somewhat of an oversimplification but that is the contract.

00:39:56;28 - 00:40:07;04
Rick Morris: That is what we're talking about. So right so when we start talking about funding teams we keep saying two weeks.

00:40:07;04 - 00:40:36;08
Rick Morris: But does it have to be two weeks

Nichole Tubiolo: no no it doesn't have to be two weeks and you know it's whatever the team has agreed upon as far as how frequently they're going to release it can be it could be a week it could be a day. I think that you earlier in the show you had an example of a company that has daily rounds that could be a daily sprint if you're producing something daily. So it really depends on what it is you're building and what your team makeup is and how quickly you can put something out.

00:40:36;15 - 00:40:44;18
Nichole Tubiolo: Could be weekly

Rick Morris: Now is Agile something that is something you're doing at your organization right now.

00:40:44;18 - 00:41:10;05
Nichole2: I'm not personally doing that.
And in my current role my previous role I did manage an Agile program. And we had a number of different teams that were working on various parts of producing an application. And so we've run into a lot of a lot of the challenges that we talk about in the book and had the ability to experience a lot of different things firsthand.

00:41:11;05 - 00:41:15;03
Rick Morris: Yeah. I mean again it's it's an incredible run.

00:41:15;03 - 00:41:37;29
Rick Morris: If you see it done properly but when you start to see people use that as the excuse and you know John I think as the person said it to me that you're used for cowboy coding or used to say that we don't need to document because we're Agile or things of that sort. It just becomes another methodology you can blame for things going wrong.

00:41:38;03 - 00:43:18;06
Nichole Tubiolo: Absolutely. And it's just it's unfortunate that in some instances it has been used as the excuse or the reason not to do things I think you never even take a look at. You know some of the some of the things that Agile is really kind of trying to draw forth it's not necessarily that you wouldn't document. It's just that we're we're saying we're favoring right. The Agile methodology favors working technology working features over documentation. So there really to me what that says is let let's get it working and then let's get it working right. And then let's document it where nothing the documentation is something that the documentation isn't important. Really more about you know getting your hands dirty getting in there making making some changes seeing what this changes look like and then providing the documentation and it's really and how the spirit of some of the Agile methodology is interpreted. And unfortunately in some cases I have heard that to be an excuse but it's really you know the spirit of that is let's produce some work and then and then we'll worry about documenting and that's really just taking that traditional methodology and really looking at it in a different way as opposed to let's write every every requirement and let's write every specification down and get all the documentation perfectly written to a team before we even write one line of code. You know it's just taking that and going and writing the code first and then documenting it.

00:43:19;05 - 00:43:52;25
Rick Morris: Yeah I think that stems from you know poor PMO practices where you know you've got these thousands of documents that you fill out that nobody ever reads. Nobody ever goes back and then they get under change control and you've got to change document first and you sit there and you go you're documenting for the sake of documenting because it's a checkbox on a process somewhere but is not providing any value to the business you know. So I think that that spirit of that you know we value working software over documentation comes from that. But he didn't say we value working software over it no documentation.

00:43:53;02 - 00:44:17;22
Nichole Tubiolo: So it really probably stems from those projects that are really documentation projects re the documentation itself becomes the project and that's unfortunate as well that's the that's the other extreme right but full agreement with you there Rick

Rick Morris: to me is always lessons learned as like we are we don't know what we learns these lessons and it's only going to go on SharePoint.

00:44:17;22 - 00:44:28;21
Rick Morris: Nobody's ever going to read it again. So why are we doing this being dead. That was mine as a project manager. Like am I the only one learning this lesson. Why am I having this meeting. All right.

00:44:28;25 - 00:44:34;15
Nichole Tubiolo: So we got an archive it, soo we can archive it and have it available.

00:44:34;18 - 00:45:00;11
Rick Morris: Sure nobody will ever open it again. I used to put all kinds of fun stuff in my lessons learned just to see if anybody would ever date me. And there are some doozies out there past organizations that's just why companies ever for. Go back there some nice nice tidbits of information in there. We're going to take our final break here on this Friday afternoon. The Work/Life Balance will be right back with the goal after this break us in The Work/Life Balance with Rick Morris.

00:48:02;06 - 00:48:37;27
Rick Morris: And we're back to The Work/Life Balance as you guys know that that music lead in music lead out music comes from The Party; it's a group that I've been involved with and managed over the last 20 years or so and got the sweetest call a couple of days ago from Damon Pampeluna. Part of that group I know heedlessness and the shows I wanted to shout out Damon tell him thank you for the call. Lifted my spirits as always brother and you'll always be a brother to me man. So coming back to the show. Nichole do you have anything you know website anything like that that you're participating in or that you'd like to promote.

00:48:38;13 - 00:48:45;29
Nichole Yes. Thanks Rick the part of the Agile Almanac book too we've also put together an Agile integration forum.

00:48:46;09 - 00:49:25;23
Nichole Tubiolo: You can get to that at great PM G.R. are the number 8 p.m. dot com. And really what that is. The forum provides in-depth discussion points on all of the chapters within the book. And so it's really a great tool if you're working through starting working with moving into Agile programs within your organization or if you're reading through the book and really just have some points that you want to discuss or just want to read what's out there on the forum. It's really a great tool and support for for anyone that that's working in Agile program management.

00:49:25;23 - 00:49:25;22
Rick Morris: That's fantastic.

00:49:25;22 - 00:49:48;09
Rick In fact I moderate the tools chapter are the tools portion of that. You're doing a budget risk and of course there's the other 16 chapters that are out there that are being moderated by those coauthors. And then you guys are doing a lot of exciting stuff too in terms of training and video development things like that would John talk a little bit about that.

00:49:48;28 - 00:50:34;26
Nichole Tubiolo: Absolutely yes. I'm actually coming up in February will be involved in coach teaching with John and ECP PMI ACP class and so that that's something that's provided by a great PM and then also we will be recording and have PD use available for each of the chapters starting with the first several chapters of the book. So there's a lot of recording going on of training related to each of those topics so if you're interested in some additional information after having read the book or have to having read some of the different chapters of the book those will be forthcoming we don't have a timeline quite yet but that those items are being recorded over the next couple of months here.

00:50:35;10 - 00:50:37;13
Rick Morris: And then how do people get in touch with you.

00:50:38;15 - 00:50:57;19
Nichole Tubiolo: You can reach me at my email address I don't know maybe correctly can have that spelled out somewhere but it's nichole.tubiolo @ gr8pm dot come are the number 8 p.m. dot com.

00:50:58;05 - 00:51:40;19
Rick Morris: And of course as a new service we announced this last week we did our first posting we're going to be a little bit behind so we caught up but as a new service to our listeners we are posting transcriptions of the show at my blog now So when we do announce websites or do announce contact information like that you'll be able to find it there at the transcription. Just look for the person on the show we also link to back to the podcast and we timecode it. So if there is something that you wanted to hear within the podcast you'll be able to advance directly to that and hear that portion of the show. Nichole we always ask all of our guests what is some of the best advice you've ever been given.

00:51:40;19 - 00:51:59;23
Nichole Tubiolo: First Beth that's a good question. I would say some of the best advice I've been giving is to really be outside of my comfort zone right. I've been you know just taught that if there's something that is uncomfortable it's probably where you need to be to grow.

00:51:59;29 - 00:52:20;19
Nichole Tubiolo: And so growing and learning and change even and a lot of the topics that we talked about today were around change and change management moving from traditional to Agile. That that's very outside of the comfort zone. And so I think that a lot of success can be found if you move outside of your comfort zone and just kind of kind of get used to being uncomfortable.

00:52:20;19 - 00:52:23;06
Rick Morris: I think that's great advice.

00:52:23;06 - 00:53:52;03
Rick Morris: One of the pieces of advice I'd like to give the listening audience as well something that I completed today but they brought me a lot of joy was volunteering with Junior Achievement so you can contact your local Junior Achievement wherever you guys are. But I taught I taught my sons class over the last several years I decided to teach a senior class here at Hoover High School in the entrepreneurial program and it was fantastic. Now you get all the materials. There's guided lessons but then you can infuse whatever you want to infuse with those lessons. And it literally just is one hour per week for six weeks. And so you actually work out the schedule with the teachers. It wasn't six consecutive weeks for me because of my schedule but I had a fantastic time. I learned a ton about those students have actually scheduled some follow on sessions because I want to stay involved with that class and just really you know got to know these kids. And it was a great way to give back. And so I challenge the audience to get involved. It's a great way to involve their community and you'll learn just as much as you give those kids and they need it. They need to hear from business leaders in our community. They need to hear from leaders in our community. And at the same time it was just it was a blast it was a ton of fun. I wanted to shout out my Hoover High Finance Academy students that I have had and a great opportunity to spend some time with.

00:53:52;03 - 00:53:56;05
Rick Morris: So Nichole thank you so much for being on the show. We loved having you.

00:53:56;25 - 00:54:00;27
Rick Morris: And I'm sure our paths are going across again here real soon.

00:54:00;27 - 00:54:09;22
Nichole Tubiolo: Excellent thank you so much. I really appreciate and extremely grateful for being a part of this show today and having a great discussion with you and John.

00:54:09;29 - 00:54:27;29
Rick Morris: Any time we may do a show where we get a bunch of us a bunch of the Agile Almanac and just have a free for all. So we'll see how that goes. Mainly just to drive Matt crazy but that will be fun just to see what happens. But be great. So next week gaing we have got Scott Ambler he's going to be joining us.

00:54:28;02 - 00:55:50;05
Rick Morris: If you guys don't know who Scott Ambler is he actually is a co-founder of the Disciplined Agile Delivery system and was really instrumental in helping IBM go down that Agile delivery path and is just an incredible person in the Agile world. We're so excited that he's going to take an hour of his very busy schedule to spend his time with us and The Work/Life Balance. The week after that we're going to have a revisit from Todd Nesloney. And if you guys haven't heard the first show with Todd Nesloney the need you need go back and listen to that because if we had more educators like Todd nestle in our in our environment everywhere we would be just fine. But Todd's going to be coming back he just released a new book called Stories from the Web. And he's going to be sharing those stories with us in just talking about what's been happening with him since he was on our show the last time he was on our show. Hurricane Harvey had just happened in Houston and he was sharing a lot of those stories with us but he's fantastic. You're not going to want to miss that show either. So please join us in the next coming weeks here on The Work/Life Balance as always we love spending our Fridays with you. Please stay tuned right here to the voice of America business channel. You can reach me at The Work/Live Balance. Find me on LinkedIn Facebook or anywhere else or at; we'll talk to you next Friday right here in The Work/Life Balance. We'll talk to you next Friday.