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Describes the process and criteria for selecting IT projects in a depressed economy. Slides are based on experience of PMO at NCI Building systems. Speakers were Chris Chambliss, VP of PMO at NCI, and Bill Yarberry, President of ICCM Consulting.
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Evaluating Projects in the New Economy
Evaluating Projects in the New Economy
Chris Chambliss and Bill Yarberry
AgendaAgenda
• Setting the Stage
• The PMO and Business Alignment
• The Bottom Falls Out
• Project Evaluation Here and Now
• Tips and Techniques
• Questions
Setting the Stage:
NCI Building SystemsSetting the Stage:
NCI Building Systems
Setting the Stage:
PMO…The Early Days at NCISetting the Stage:
PMO…The Early Days at NCI
• Only 28% of projects started ever reach their time / cost / quality targets*– 32% - Inadequate project management
and improper use of PM tools– 20% - Lack of communication– 17% - Lack of understanding of scope
• Did some hiring, firing, laughing and crying
* Standish Group Chaos Report
Setting the Stage:
PMO…The Early DaysSetting the Stage:
PMO…The Early Days
PMI Methodology
PMBOK Processes
Resource Management Scope Control
Requirements Gathering
PMO and Business Alignment:
PMO CompetencyPMO and Business Alignment:
PMO Competency
Stage One:Project Office
Independent project offices and project managers
Applies project management techniques
No program level authority
Stage Two:Basic PMO
Provides standard and repeatable PM methodology for all projects
Develops common tools for all projects
Emphasizes the foundation of a viable PM environment
Stage Three:Standard PMO
Improved PM capabilities and maturity
Introduce project reporting tools and collaboration techniques
Interface between the business, executives and project teams
Full set of PMO functions in use
Stage Four:Advanced PMO
Focuses on integrating business objectives into the PM environment
Applies common practices to projects and business; a “projectized” organization
Can be a separate business unit
State of the art PM practices and tools
Advanced staffing
Stage Five:Center of Excellence
Direction and influence for enterprise project management
Manage continuous improvement and cross-department collaboration to achieve strategic business goals
Continues to build relationships with stakeholders, customers and vendors
Oversight and control to other PMO units
Strategic Alignment
Business Maturity
Process Support
Project Oversight
Process Control
* The Complete Project Management Office Handbook
The Bottom Falls Out:
What Goes Up Must Come DownThe Bottom Falls Out:
What Goes Up Must Come Down
The Bottom Falls Out:
Why Do I Need You?The Bottom Falls Out:
Why Do I Need You?
• A new vocabulary was introduced– Value Proposition– Strategic Alignment– Value-Driven ROI– Elimination of Suboptimization
• Autonomous decisions being made• PMO adaptation and flexibility
becomes key• Enterprise perspective of the PMO
function is part of the answer
Project Evaluation:
Tools & TechniquesProject Evaluation:
Tools & Techniques
• What the PMO brings to the table
• Financial evaluation
• Objective enterprise view
• Risk assessment
• Not a standard book approach; case by case
Project Evaluation:
Tools & TechniquesProject Evaluation:
Tools & Techniques
PMOLC / SDLCRisk Assessment Model
Project DashboardBusiness Value / ROIProject Request Form
Project Life Cycle
Risk Level
High High
High Medium
Medium High
High Low
Medium Medium
Low High
Low Low
Low Medium
Medium Low
Tier
1Ti
er 2
Tier
3Ti
er 4
Project Evaluation:
Project Request FormProject Evaluation:
Project Request Form
• Getting Executive management to the table
• Look at it from their perspective• Understand what they’re going to
ask• Find a way to make it work in your
size company• Utilize a project dashboard that’s
clear and concise
Project Evaluation:
Executive ManagementProject Evaluation:
Executive Management
Project Evaluation:
Project DashboardProject Evaluation:
Project Dashboard
Project Evaluation:
Risk AssessmentProject Evaluation:
Risk Assessment
• Impact and complexity drive the risk level
• Risk level results in Tier 1 – Tier 4 project
• Project tier drives level of project management
• Depth of deliverables, amount of testing, Internal Audit participation
• Determine if the project is capital or expense
• Major cost categories:– Software / Hardware– Consulting Services– Employee Labor– Expenses
• Often overlooked cost categories:– Training– SOP 98– Capital Interest– Sales Tax– Maintenance
Project Evaluation:
Financials – Cost EstimatesProject Evaluation:
Financials – Cost Estimates
• Utilize the financial experts in your company
• NPV, IRR, ROI, Payback Period; what else do you need to know?
• Every project now demands financial justification
• Benefit categories from the Project Request now come in to play
Project Evaluation:
Financials - JustificationProject Evaluation:
Financials - Justification
• Compare planned to actual costs• Show project completion statistics• Build metrics history and use for action
Project Evaluation:
Benefit Realization & MetricsProject Evaluation:
Benefit Realization & Metrics
Tips and Techniques:
Building AlliancesTips and Techniques:
Building Alliances
• Alliances can be the key to continued success• Working with IT, Accounting, Audit can have its rewards• Gaining understanding of each other’s objectives can help
move everyone’s projects forward
Tips and Techniques:
FastTrack ModelTips and Techniques:
FastTrack Model
Request It
Scope It and Do It
Deliver ItRequest It
Scope It and Do It
Deliver It
• Streamlined approach• Agile response to the business• Uses the project request process• Reduces the quantity of deliverables• Timeline is generally 1-3 months
• **Goal: To deliver smaller, quick-win projects faster
Tips and Techniques:
Growing the CultureTips and Techniques:
Growing the Culture
• Choose quick win projects to show success
• Educate your peers
• Understand the maverick / cowboy mentality and how to help
• Wear multiple hats
• Today’s economy demands higher performance and results
• Get senior management involved
• Tailor the approach to your company
• Adopt a methodology…but plan to be flexible
Closeout:
Elevator SpeechCloseout:
Elevator Speech
QuestionsQuestions
• Chris Chambliss
• Ph: 281-897-7611
• Bill Yarberry
• Ph: 713-582-6275