Changing the looking glass affects how we experience reality and the same holds true while managing projects–project reality continues to be stubbornly affected by blurry assumptions and misaligned goals. Even in the age of program management, selecting the right portfolio of projects continues to be an individual driven process—a process which is largely based on “gut feeling”.

Many organizations today are implementing a strategy formation process with a clear focus on defining metrics for success.  But the challenge lies in translating this into selection of investments and choice of projects to achieve the goals.  Project and especially Program managers make an important contribution to this process.  Given their delivery and execution background, these professionals rely on their problem solving capabilities to meet these challenges. They use the problem solving approach in the context of defining objectives for building effective metrics to demonstrate success.

Here’s how this approach works: problem solving focuses on eliminating undesirable results.  Its starts with identification of gaps—this means that we tend to concentrate on what is not happening. For example if the project has achieved 85% of the objective, the focus of the manager would be on the 15% missed.  So focusing on closing gaps becomes a full time business and if one cannot identify a gap and demonstrate the negative consequence of not filling it, then the manager is unlikely to succeed.

The measure of all things

There is a time honored expression that in management what gets measured gets done.  But the challenge is in ensuring what you measure is aligned to objective that endeavor is trying to achieve.  What is the use if you are measuring efficiency of execution when the goal is to achieve a strategic benefit?  Maybe we measure the things we can and not the things we should. Obviously we do this to achieve results that are perceived to be linked to success.  When was the last time your performance reports actually encouraged you and your team to improve performance except working more hours at work?

But this is more evidence of uncreative thinking which blurs the complexity behind the decision making process. Moreover, it leads to an avoidance mechanism (commonly known as risk aversion) that has a major influence on the type and quality of questions asked in the goal-question-metric process.

The Goal-Question-Metric Process

Basili et.al. offers a creative thought process for designing metrics by asking fundamental questions about the goals. The first step is to split the goal into its discernable component parts. These are purpose, issue, object and viewpoint.
Here’s an example:

Next is to identify underlying questions relative to the goal.  In this instance the question might be;
How many agents (variable cost) can each manager (fixed cost) manage and how can we increase the number of agents a manager can manage?  Answering the question points to the appropriate metric, such as span of control of manager (no. of agents per manager)

Based on the above goal-question-metric process the strategy becomes clearly defined in order to meet the metric, answer the question and achieve the goal.  In the process it becomes obvious which project investment will be necessary to execute the strategy. To illustrate:

If the goal remains the same and the question changes, the metric changes and project investment will change too:

Example:

So we see how the question that underlies the goal significantly affects the way metrics are constructed, how strategy is formulated and investments that are the results.  These investments are projects to be implemented.  So it should come as no surprise that after a successful project execution, benefits are still to be seen.

One way of looking at this problem is through AI—not artificial intelligence—but Appreciative Inquiry. It’s an organizational development process, a discipline, and a philosophy that helps reframe our old dilemmas anew.

What is Appreciative Inquiry (AI)

Understanding the basis of Appreciative Inquiry allows us to better contrast the goal-question-metric process against the conventional problem solving approach. Applied coherently, AI offers a greater insight into organizational goals and improves chances of success by taking the corporate spirit as a whole. In practice, it involves AI involves “asking questions that strengthen a system’s capacity to apprehend, anticipate, and heighten positive potential”.

When we start thinking about organizations in terms of living systems, then our paths of inquiry can involve

“the systematic discovery of what gives “life” to a living system when it is most alive, most effective, and most constructively capable in economic, ecological, and human terms.”

So the focus should not be on asking about what is not working but rather what is working as well and if we do more of what is working well then we will see more benefits.  This is the Appreciative Inquiry process and is a critical skill that capitalizes on what works to create a better set of results.

How AI Works

There is a cycle of 4 processes that Appreciative Inquiry utilizes:

1. DISCOVER: The identification of organizational processes that work well.
2. DREAM: The envisioning of processes that would work well in the future.
3. DESIGN: Planning and prioritizing processes that would work well.
4. DESTINY (or DELIVER): The implementation (execution) of the proposed design

When compared to conventional problem solving approaches, AI offers the kind of positive orientation and leverage that creates a whole new set of possibilities in terms of goal clarity and better choice of questions, leading to better metric design, clearer strategies and more appropriate project investments. AI enables organizations to focus on creating exceptional performance which occurs because its core strengths (people and organizational assets) are aligned.

Reference and adapted from:

Executing your strategy: How to break it down and Get it Done.
Mark Morgan, Raymond Levitt, and William Malek, Harvard Business School Press.
http://en.wikipedia.org/wiki/Appreciative_inquiry
You can find out more about Appreciative inquiry at http://centerforappreciativeinquiry.net/

On a rainy day this July, I got a call from a friend of mine. I was a bit surprised to hear from him back then and could barely comprehend the situation he was describing on the phone. What I ultimately managed to gather was that he’s busy fitting himself a new CxO level role these days and needs to put the final touches to his presentation to the corporate planning head. The question he posed was whether he should recommend a significant budget increase in his area of responsibility, or manage within the existing limited budgets. The real issue in his mind was how he could assure optimum alignment of spending with the direction of his organization. Moreover, if he acts either way, how can be sure of delivering the value he promised the organization on the basis of his strategic initiatives?

This question is all too familiar and the concerns are real and legitimate. Indian industries facing a shaky economy and fierce competition, find themselves in a position where they have to innovate for their survival and growth. Nearly every large organization across the globe is feeling the impact of this internal misalignment of priorities. In a nutshell, each company is struggling control its own catfish – its portfolio of projects (F. Warren McFarlan, 2003).

In this scenario, organizations are asking themselves the following questions:

• How does the enterprise ensure that its expenditures and resources are aligned with its key business goals?
• Is there a way for the enterprise to find out if the totality of its works is directed towards moving the business forward?
• What does the enterprise do when it has defined more projects than it has resources for, especially with cost pressures increasing every day?

The answer to these questions lies in the discipline of ‘Project Portfolio Management (PPM).

PPM is a disciplined process which enables enterprises to prioritize its various initiatives by understanding its business goals and balance multiple evaluation criteria. It enables enterprises to view and control their entire suite of investments as one set of interdependent activities in one place, as a portfolio, rather than one at a time. This way the project portfolio as a whole continues to address strategic initiatives, even as these initiatives change over time, thereby serving as the critical link between executive vision and the work of the enterprise.

Key steps involved in implementing a PPM process are:

1. Define the Funding and Budgeting Process: This step involves defining the crucial funding, budgeting and decision making processes. Critical questions on budget allocation, funding decision hierarchy, ownership and governance matrix are defined.

2. Define the Portfolio Management Process: This step involves defining the process of receiving, validating and approving new project requests along with the Portfolio management team and its responsibilities.

3. Define the PPM Framework and Prioritization Criteria: This step involves defining the criteria across different business domains along with project classification, prioritization criteria/parameters, weight ages, scoring anchors and ranking methods. All such criteria need to be aligned to the business strategy and articulation of the strategy is critical.

4. Determine the Project and Resource Capacity: This step involves determining the capacity in terms of resources that will be used for project work. This proves useful in prioritizing the projects vis-à-vis available resources and bandwidth.

5. Define the Portfolio Review and Updation Process

No process is complete without defining the updation and review process. The portfolio reports and communication process needs understanding from multiple stakeholder perspectives. A sound PM practice becomes critical for relevance of project performance information.