From delivering on Cost to delivering Maximum Value and ...€¦ · 2013-02-19 · QualiScope 2013 AGENDA 1. Results and conclusions of the KPMG/TOP-BCG studies 2. Value, benefits

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Agile Project ManagementFrom delivering on Cost to delivering

Maximum Value and Benefits

Conference to the AACEI Montreal SectionTuesday February 19 2013, SNC-Lavalin

Claude Émond, BEng, MEng, MBA, rmc, CD, PMPLes Entreprises Quali•Scope Inc.

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• A Matane’s Shrimp…speaking like a Beauceron• Chemical engineer, BEng RMC, MEng McGill• MBA Queen’s/Ottawa...and PMP• Full time on project-oriented ventures since

1980• Co-founder of , trainer and project

management coach since 1995• Creator of «2-String Project Management»

• Creator and developer of «Changeboxing»• Co-writer of the 1st international standard for

portfolio management, «The Standard forPortfolio Management», PMI, 2006

• Renowned international expert on organisationalagility and «Agile» project management(Canada, USA, Europe, North Africa)

Claude Émond, BEng, MEng, MBA, rmc, CD, PMP

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AGENDA

5 years ago:

Benefits Realisation started its journeytowards becoming the main focus ofenterprise strategic management processes(upper management), replacing «LEAN –operational cost reduction» for the sake of it

Today:

«Agile» project management confirms itssuperiority in providing the right mindset andtools to enable and maximise the benefits andvalue of project deliverables through day-to-dayproject management activities (project teams),replacing schedule and cost control for the sakeof it

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AGENDA

1. Results and conclusions of theKPMG/TOP-BCG studies

2. Value, benefits and project success3. The Agile management mindset4. “Traditional” engineering-construction

project management vs «Agile» projectmanagement (Why, Who, What, When,Where)

5. From delivering on cost to deliveringmaximum value and benefits

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http://productivity.businessspectator.com.au/sites/productivity.businessspectator.com.au/files/THE%20PRODUCTIVITY%20IMPLEMENTATION%20CHALLENGE_0.pdf

1. Around 40% of projects fail to deliver anynet improvement

2. Of the remaining 60%:• More than half (55%) fail to deliver the

available business value in full….oftenmissing the target by more than 50%

Results and conclusions of the KPMG/TOP-BCG studies

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Source: THE CHOICE, Jed Simms and Alex Chapman, 2011


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Results and conclusions of the KPMG/TOP-BCG studies«

Trad

itio

nal

»P

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Ag

ile»

PM

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«Without a structured approach, such asBenefit Realisation Management, mostorganisations probably achieve between 10%and 25% of potential benefits»

Other studies

SOURCE: Gerald Bradley, «BenefitsRealisation Management», 2nd edition,

Gower, 2010

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AGENDA





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Current State

Desired State

Value

START FINISH

PROJECTZONE

Project success, value and benefits as per PMI?

PMI’s definition ofproject SUCCESS ?PMI’s definition ofproject QUALITY ?

The journey

The destination

Value, benefits and project success

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«Value and benefits» for WHOM and WHEN?

• For WHOM:• ALL stakeholders… this INCLUDES the project team

• WHEN:• AFTER project completion… sometimes over many

years, for the users of the deliverables• DURING project realisation both for the users of the

deliverables and those delivering them


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TIME

SELF-INTERESTPRECEDES COMMITMEMT

COMMITMEMT PRECEDESPROJECT PERFORMANCE

«PAYMENT» ENSURESLASTING PERFORMANCEAND PROJECT SUCCESS

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AGENDA





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4 values

1.Projects are realised byand for HUMAN BEINGS(V1)

2.Promote collaborationover control (V2)

3.Adapt, embrace andwelcome change (V3)

4.Produce benefits andvalue for ALL (V4)

10 principles

1.Responsibilisation«Empowerment» (P1)

2.Capacity (P2)3.Desirability (P3)4.Creativity (P4)5.Simplicity (P5)

6.Managing individualpromises (P6)

7. Integrated teams(P7)8.Togetherness (P8)9.No surprise (P9)10.Accelerate and maximise

benefits production (P10)

4 main techniques

1.Dynamic/Rolling-waveplanning (O1)

2.Frequent deliveries (O2)3.Frequent alignment

meetings (SCRUM) (O3)4.PPC (Percent promises

completed - «REALvalue» tracking) (O4)

«Agile»Mindset(rev01, 2012)

«Agile»Management

The Agile management mindset

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AGENDA





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a limited number of persons WHO

(A RESTRICTED AND NON-ALIGNED WHO)

realise in a highly conflictual manner, more often trhough confrontationthan through collaboration,

(output/input ratio subsequently sub-optimal)

(A HOW, WHEN AND HOW MUCH that are conflictual and chaotic)

things (deliverables and activities) for a «DIFFERENT WHO» that MUSTrespect given (initial) delays and costs that are not always realistic

(and/or not necessarily producing the RIGHT OUTPUT/OUTCOMES)

(A WHAT DELIVERED including as part of the WHAT a «FROZEN» WHEN andHOW MUCH, for a RESTRICTED FOR WHOM, often without knowing WHY)

A RESTRICTED AND NON-ALIGNED WHO=EXECUTING PARTY = Consulting firms, suppliers andcontractors who «materialise» given specifications,many not having congruent and converging individualand corporate objectives

.

- Constant disagreements and contractual litigations between stakeholders - «silo» deliveries, deliverables' integration ultimately occurring only on site with last-minute corrective actions impacting negatively both project schedules and project costs - The major stakeholders (The executing party-WHO differs from the receiving party-WHO) see one another more as an adversary than a partner and use a «winner-loser» approach to conflict resolution rather than a «win-win» mindset

The DELIVERED WHAT= - A solution delivered as per specifications not necessarily aligned with the needs (the WHY and FOR WHAT the deliverables are expected to be used) (any distortion between the WHAT and the WHY will result in a LOST of BENEFITS and inferior project value) - Deliverables realised «on time and on cost», the WHEN and the HOW MUCH

being perceived as TRUE additional deliverables, instead of being treated as CONSTRAINTS.A WHY=based on rigid specifications rather than on needs (requirements) that can evolvethrough time.A RESTRICTED FOR WHOM =The PAYING PARTY, NOT NECESSARILY THE END-USERS AND CERTAINLY NOTTHE EXECUTING PARTIES =Excluding both excuting stakeholders and other stakeholders impacted by theproject and its deliverables, the former perceived as adversaries, the latter justbeing ignored.

SUB-OPTIMAL EFFICIENCY (E1) AN EFFECTIVENESS WHICH IS IMPOSSIBLE TO MEASURE (E2) ????

«TRADITIONAL» Project Management is:

In response to the global and turbulent business environment that characterises the 2010s, the only one that exists,(very complex, highly competitive, uncertain, permanently changing, requiring great velocity as well as a high level of creativity to constantly innovate and adapt)

(WHERE)

PRODUCTIVITY = E1 X E2?? = NON MEASURABLE PROJECT PERFORMANCE/SUCCESSRESULTS/OUTCOMES: ??

«Traditional» engineering-construction projectmanagement vs «Agile» project management

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ALL the project Stakeholders

A COLLECTIVELY COMMITTED WHO

(An ALIGNED WHO)

realise successfully, meeting everyone's day-to-day expectations,SHOWING PROACTIVITY, CREATIVITY, GREAT REACTIVITY,

FLEXIBILITY AND ADAPTABILITY

(CONTINUOUS AGILITY OF THE HOW, WHEN, HOW MUCH)

THE right things, meaning DELIVERABLES OPTIMISING VALUE FOR ALL

(MAXIMUM BENEFITS «WHAT/WHY», FOR ALL)

ALIGNED WHO= An integrated project team (P7) =All Stakeholders, who, thanks to:

- shared values (V1,V2,V3,V4) - a shared vision of the project objectives

(its WHY, its «raison d'être») - converging interests (V4) - Shared success criteria (P10) - required knowledge and sufficient resources (P2) - collaborative behaviour (V2)are committed to succeed together (P3)

.

realise successfully, using AGILE approaches and tools (HOW, WHEN,HOW MUCH), in particular:

- openness and capacity to adapt to change (V3,P2) + a structure, an organisation, tools, technologies that are flexible and adaptable (P5, P6,O1,O2,O3,O4) and sufficient resources

(P2) + responsible and autonomous human resources (P1, P2),

reactive, flexible and adaptable + continuous change communication and management (P8,P9) + continuous learning and capitalisation of lessons learned (P10) - monitoring and innovation practices (P4) for optimal value (benefits) creation (V4, P10) - practices valuing HR and encouraging collaboration

(V1,V2)

THE right things, meaning THE DELIVERABLES ALLOWINGMATERIALISATION OF THE PROJECT WHY (V4):

- NEGOTIATED DELIVERABLES (WHAT) (P3) - ACCELERATING (P10) MATERIALISATION AND MAXIMISING PROJECT EXPECTED BENEFITS (O4)

(WHY) - FOR ALL STAKEHOLDERS (V4)

(FOR WHOM)..

.

.

.

OPTIMAL STAKEHOLERS' ALIGNMENT (A1) OPTIMAL AGILITY IN PROJECT EXECUTION (A2) ACCELERATED BENEFITS (AB) AND OPTIMAL VALUE (V)

RESULTS/OUTCOMES:

«AGILE» Project Management is:

In response to the global and turbulent business environment that characterises the 2010s, the only one that exists,(very complex, highly competitive, uncertain, permanently changing, requiring great velocity as well as a high level of creativity to constantly innovate and adapt)

(WHERE)

PRODUCTIVITY = A1 + A2 = AB + V = OPTIMAL MEASURABLE PROJECT PERFORMANCE/SUCCESS

«Traditional» engineering-construction projectmanagement vs «Agile» project management

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AGENDA





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How do we measure «REAL value and benefits» ?

This 20 M$ bridge is 70%complete.

What is its «earned value» ?

What is its «REAL value» ifwe never complete it ?

«REAL value and benefits» come from USING the projectdeliverables at least as anticipated

From delivering on cost to delivering maximumvalue and benefits

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How do we measure «REAL value and benefits» ?

Sydney Opera House (Utzon)

1957 cost estimate: 7 M (Au)$Due date 1963 ??1973 completed for 102 M$ Au (10 years late)Among the busiest performing arts centres in the world,hosting over 1,500 performances each year attended bysome 1.2 million people.2012: «DIRECT» revenues of 177 M$ (Au) and netprofits(surplus) 37M$ (Au)

Payback period = achieved a long time ago

Montreal Olympic Stadium (Talibert)

1970 cost estimate: 134 M$1976 partially finished: 264 M$2006 final cost (including repairs, renovations,construction, interest, and inflation): 1 610 M$

Avg revenue since 1977: 20 M$/yr2011: «DIRECT» revenues of 39 M$ (50% fromsubsidies) and a deficit of 1,1 M$

Payback period = «infinite» ??


15 X more 12 X more

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COSTS

BENEFITS

Ag

ile p

roje

ct m

anag

emen

t

“A Project is a temporary structure created to deliver a set of agreed desiredbusiness outcomes, benefits and value….. It’s yourchoice whether you deliver ‘projects, programs and portfolios’ – the orthodoxview – or choose to deliver ‘strategy, business outcomes and value’ ”

Jed Simms

(AND INDIVIDUAL)*

*my addition

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Questions and discussion


Documents

From delivering on Cost to delivering Maximum Value and ...€¦ · 2013-02-19 · QualiScope 2013 AGENDA 1. Results and conclusions of the KPMG/TOP-BCG studies 2. Value, benefits