The Ghost of Projects Past

January is often a time of reflection; as we begin a new year, it forces us to look at what we achieved in the previous one against what we set out to do, and create plans for the year ahead. For many, this will come with a sense of good achievements, but for others, things have unfortunately not gone so well. 2014 was littered with examples of highly visible project failures…disasters in some cases, costing companies and tax payers millions, the repercussions of which will not only have a knock-on effect for 2015, but potentially years to come. A few high profile examples come to mind:

  • The SNCF train fail: In May, French railway operator, SNCF (Société Nationale des Chemins de fer Français) ordered 2,000 new trains that were too large for many of the stations they are due to serve. This failure in the verification process cost the operator in the region of $57 million, as well as making headlines worldwide – only not the kind you want. It demonstrates the huge potential impact that one oversight can have, not just in terms of embarrassment to the organization and the cost of replacement, but in the ripple effect it has across the business and massive reallocation of resources required to remedy the mistake.
  • Major Projects Authority Annual Report: In May, the UK government watchdog that oversees IT projects, the Major Project authority, released a report warning that several major IT projects in the UK are at risk of failure and need urgent action’. According to the report, four major IT projects were given a red light rating, which is the rating used by the MPA use to describe projects they consider to be unachievable. These included:  the Ministry of Justice’s (MoJ) Shared Services Program (forecasted costs for which have risen from $88.6 million to $191 million); two Ministry of Defense (MoD) projects, including the $7.5 billion Defense Core Network Services program, which will replace the MoD’s computers, telephones, video conferencing equipment and networks; and The $1.5 billion Watchkeeper intelligence project.  These failures and delays have largely been caused by a misunderstanding of the original requirements, underestimation of the resources needed, and miscalculations around the technical specifications.
  • Obamacare: Last but not least, over the course of 2014 we have seen numerous stories relating to the controversial Obamacare project, with multiple IT failures and rising costs. The computerized sign-up system is said to have quadrupled in cost from $56 million to more than $209 million between September 2011 and February 2014, while costs for the electronic backroom for verifying applicants’ information are said to have jumped from $30 million to almost $85 million. Added to this, a contract for fixes to the website also grew from $91 million in January to $175 million as of July. Overall, according to a Bloomberg report, the Obamacare website costs have exceeded $2 billion. Again, this is largely due to mismanagement.

These headline costs are pretty eye-watering, yet the real-world costs are even worse. Many organizations simply don’t have visibility to the tangible and opportunity costs of project failures as a whole: while they may calculate the immediate cost in terms of lost revenue and productivity, the longer term ripple effect across other business units and projects is rarely accounted for or easily calculable. This domino effect means that as one project fails or over-runs, human capital and other resources are then diverted, meaning other projects are then delayed or halted…thus further extending the ripple.

This is why it is so important to have a centralized, real-time view of the financial health of all of your projects at the portfolio level, as they are running. By looking at projects at a portfolio level, businesses can better foresee, estimate and isolate the fall-out from individual project failures. Visibility is critical to success; organizations have to be in control in order to be agile and make adjustments on the fly.

 

Multiple project management methods – but which one fits my group?

What’s the best way to manage project execution today?

There’s a ton of methods to choose from – Waterfall, Agile Scrum, Kanban, RUP, Agilefall, BPU. You name it, there’s a method out there. And that’s the point. These methods were developed for different types of project work. Agile methods have been proven to speed up delivery of software with reduced risk. Classic waterfall methods still do a great job for infrastructure work like building out networks and opening new offices. In order to appease the business leaders that don’t “get” Agile, a hybrid has been developed that still reports milestones and date targets while primarily executing in Agile fashion. Some call this hybrid approach “Agilefall” and there are combined software/hardware projects that employ Agile for the software component, Waterfall for the hardware, and program management over the whole thing to make sure they sync up.

So which one for your IT department? Well, let’s take a look at the type of work IT does. Software development? Yes. Application rollouts and integrations. Check. Network build-outs? Yep. Desktop/laptop refresh cycles? We do that too. Suffice to say, IT is a diverse place with a very heterogeneous set of work. Obviously, one size does not fit all here.

So, what to do? The answer is pretty simple – use the method for the job at hand.

But wait – doesn’t that create a free-for-all, with project managers picking their favorite execution method? Without governance that’s exactly what will happen. So, let’s add some governance.

First, establish a PDLC – project development lifecycle – with key control artifacts and processes. A common project selection and initiation process. A common set of high-level control artifacts such as status reporting (yes – an Agile status will look different from the others – but we still need status!), risk and issue logs. Then, setup standard methods within the PDLC for project managers and scrum masters to follow. The governance should also include a set of parameters that help you choose which method to follow.

While trying to establish a rigid SDLC that everyone in IT follow could result in gridlock, having multiple methods need not result in chaos. A little standardization and governance can go a long way.

The IT Outsourcing Market Is on the up, but How Can Professional Services Organizations Plan for Managed Growth?

The outsourcing research and analysis firm NelsonHall recently released a forecast around market developments and IT Outsourcing (ITO) contract data in their ITO Index. The report shows that the IT services market is finally picking up steam after years of uncertainty, with this year’s spending in IT services showing growth for the first time since 2012. In addition, the third quarter of 2014 was a landmark one for the ITO market. Due to improved economic conditions, corporate clients are finally getting back into ‘investment mode’ and the ITO market has stopped shrinking.

Dominique Raviart, ITO Research Director at NelsonHall, commented that he believes spending has grown because corporate clients are, “looking to invest in slightly higher-scope ITO contracts, as well as increasing spending on long-term contracts.” Dominique also sees more customers looking to increase new-scope contracts and expand their range of services. This essentially paints a picture of much higher market confidence – a welcome sign after a challenging few years!

Looking ahead to 2015, the report warns IT service providers may not be out of the woods just yet. In fact, there’s still room for improvement as offshoring continues to drive prices down which results in lower-spending. However, NelsonHall predicts that in 2015 we’ll witness IT services increase by three percent as economic conditions continue to improve.

Professional services companies are well positioned to take advantage of this new market confidence as long as they prepare themselves now and ensure they’re equipped to provide their customers with the best possible experience. In order to maximize this potential, companies must be sure they have the right platforms in place to improve business processes, as well as the right people to provide a first class service. Implementing these platforms, coupled with the economic growth impacting spending from corporate customers, will position professional services organizations for a profitable 2015.

Learn how one top business and IT outsourcing firm, Slalom, leveraged Changepoint solutions to manage growth by streamlining and automating their entire engagement lifecycle here.

Also, feel free to share your thoughts on how the growing IT services and outsourcing market is evolving by commenting below or engaging with us on our Twitter handle @Daptiv.

 

Tips for Time Tracking–the Foundation of Effective Project Resource Management

By Alan Crean, SME in Lead 2 Cash in Professional Services, SME in PPM & Resource Mgt within IT Shared Services Organizations

Many project managers find that, among their many other responsibilities, ensuring their team’s time sheets are properly filled out can be one of the most difficult to manage. However hard, ensuring these timesheets are regularly and accurately submitted is the crucial first step in effective resource management during a project. Even with a Project Portfolio Management (PPM) tool in place some employees get bogged down and either inaccurately or only partially input time. To combat this common issue here’s a short list of tips to encourage employees to fill out their time promptly and accurately which allows managers to better understand where their work-force and budget are allocated.

  1. Keep It Simple: Employees should not have to spend more than five minutes per day to complete time sheets.
  2. Make Submissions Easy: Entering time gets increasingly complicated and tedious when time tracking processes have multiple entry points or lack a mobile time entry capability.
  3. Gain Trust: Managers should be transparent when explaining how time sheet data is used (or not used).
  4. Don’t Penalize People for Being Honest: Rather than penalizing employees for spending time on non-project activities, use time sheets as an opportunity to understand how business processes are operating.
  5. Avoid the Penalty System: If threats are made they must eventually become a reality and team members will either stop trusting their managers or doubt their intent to follow through.
  6. Be Flexible about How the Time is Tracked: Employees will watch the clock and get creative with 15 minute excuses here and there if time tracking processes are excessively strict, therefore time sheets should not be precise to the minute when tracking non-billable or non-customer project activity.
  7. Show Value & Make It A Medium: Make metrics such as percent complete, time to complete, actions, and outcomes visible to team members to add value to their efforts on entering accurate time sheets.
  8. Limit the Number of Time Tracking Items: Auto feed time sheets with the specific projects team members are working on, remove completed projects, and bucket general items to decrease confusion and time.
  9. Automate Time Tracking Approval: Workflows save time and create speed – having time sheets approved is like getting a LIKE on Facebook.
  10. Use Automated Reminders: Alerting team members without the need for multiple email reminders increases the ability to collect time sheets on promptly.
  11. Pick Your Battles: If time sheets are used as data in an appraisal process, make it discrete. Hide or minimize raw data numbers from the conversation. This step stops any office rumors that eventually impact how teams input their time updates.

We would like to hear more about how your organization uses time sheets to manage work flow and accurately allocate time and assets to projects. Feel free to post your own time sheet tips in the comments section below, or reach out to us on Twitter at @Daptiv.

Gartner Report Underscores the Value in Strengthening Service Line and Portfolio Management Processes

A report, ‘The Gartner Scenario for IT Services Providers: The Future of IT Services’, published earlier this month, really struck a note with us at Changepoint. According to its authors, IT services leaders are slowly losing market share, largely due to their inability to respond to market forces quickly enough. This report highlights the shifting landscape for IT service providers including how buying patterns are changing as IT procurement spreads out across the enterprise, new technologies and delivery mechanisms are shifting, and user expectations are evolving as the empowered consumer starts to make waves in the workplace. Professional service providers need to keep pace with these changes or they will slowly become irrelevant.

For professional service providers, it is no longer enough to solely conduct annual reviews to decide which direction the company should move, what geographies to target, or what products and services to sell. These factors are ever changing and to stay ahead of the curve companies must be able to make improvements and streamline operations on a continual basis to allow them to offer cheaper, faster, and higher quality solutions to customers. In his accompanying webinar, Eric Rocco, Managing VP for Gartner explained it this way: “To capture future growth and be positioned on the right side of the fast-shifting IT services marketplace, IT service providers of every type need to bridge their legacy offerings and new delivery paradigms.” Professional service organizations must become increasingly agile and have the right data in place to support business decisions if they plan to respond to opportunities in real-time.

Rocco highlights that to do so providers must strengthen their service line and portfolio management processes in order to be successful. Professional Services Automation (PSA) and Product Portfolio Management (PPM) are two critical tools enabling them to do just that–respond to changing markets quickly and with greater accuracy. By providing easy access to actionable data about where demand is being generated and what requests customers are making, organizations using these solutions can make timely changes in their delivery of IT and business process services.

It is not only that; PSA and PPM also allow organizations to keep track of all the moving parts within their services businesses. As providers start to introduce new services and territories, it is easy to over-extend – having this control and visibility thus becomes invaluable. By understanding the cost of delivery, while managing resources and human capital in a more effective way, providers can build business models that deliver a streamlined service for the customer in a more cost-effective way; everyone’s a winner!

We would like to hear more about how your organization is using PSA and PPM solutions to stay ahead of the curve in your industry. Feel free to post your thoughts in the comments section below, or reach out to us on Twitter at @Daptiv.