Project management dynamics
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This document discusses using a balanced scorecard (BSC) approach combined with system dynamics to improve project management and organizational performance. It identifies key factors that impact outcomes like margins, such as costs, customer satisfaction, efficiency, and innovation. These factors are interrelated and must be balanced. The document recommends identifying metrics related to projects, the organization, performance, finance, and quality to measure these factors. Setting targets and tracking performance indicators and key goals will provide knowledge to learn and improve over time.
![Project, a dynamic organisation
Projects do have a balance, with several dynamic factors
interfering on each other;
• Cause and effects;
• Enforcing factors
• On a positive manner
• On a negative manner
• Are managed by stakeholders: (according applicability:)
project organisation, owner, Customer, management
• Focus on ultimate target / purpose of the organisation
• In this case: „margin%‟ [ %]
• Identify all factors having impact on :” margin % “:
• Learning, people, growth
• Internal business processes
• External / Customer
• financial
• Balanced scorecards (Kaplan)
• System Dynamics (Senge) December 2012
Project management Dynamics
BVBA](https://image.slidesharecdn.com/projectmanagementdynamics-130109071559-phpapp02/85/Project-management-dynamics-3-320.jpg)
![consider re-use of existing
KISS apply KISS principle equipment/work
publish KISS principle always
KISS is not opposite of innovation
timely discovering of mal-
quality process review of engineering work&solutions functioning engineering
create & establish state of the
peer to peer art solutions
eases/enable re-use of
guru approach solutions
avoid rework (in late project phase)
due to time constraint, ME-
drawings are sent to supplier,
avoid rework (in late project phase) without proper quality review
establish baselines (enable
phase gate approach scope change mgt) [€]
metrics
SPI , baseline , collecting spent
project management manage planning hours, …
predictability of project
deliverables % on time
assign the right skills, at the
manage resources right moment
scope management, introduce
manage scope scope change management
define work, outcome and
manage quality results (scope, urs, testing)
risks value should decrease (in
manage risk time)
number of issues should
decrease, not too late open (not
manage issues solved)
define clear (customer)
manage expectations expectations, quantify & qualify
budget management, overrun,
manage budget re-work, scope change mgt,…
manage EV milestones met on time
milestones met EV
product mgt output / productivity) kg/hr
(part of URS) innovation
PIR
evolutive mgt
requirement performance
solution should 100% satisfy
output the requirements
switch from one recept to another (within expected/set time)
number of scope changes per
scope management phase
number of scope changes per
user-friendly project
resources planning resources planning accuracy
Project management Dynamics December 2012
BVBA](https://image.slidesharecdn.com/projectmanagementdynamics-130109071559-phpapp02/85/Project-management-dynamics-10-320.jpg)
Project management dynamics
- 1. 03-23-05 December 2012 BVBA Project management : BSC & dynamic organisations Presented by Jan Biets [email protected] +32(0)477 32 90 11 Mechelen - Belgium page 1 • BSC & Dynamics
- 2. Project management dynamics An approach, together with BSC (balanced scorecards), metrics, and (graphical) reporting, to improve the outcome and quality of your strategic projects/programs. Project management Dynamics December 2012 BVBA
- 3. Project, a dynamic organisation Projects do have a balance, with several dynamic factors interfering on each other; • Cause and effects; • Enforcing factors • On a positive manner • On a negative manner • Are managed by stakeholders: (according applicability:) project organisation, owner, Customer, management • Focus on ultimate target / purpose of the organisation • In this case: „margin%‟ [ %] • Identify all factors having impact on :” margin % “: • Learning, people, growth • Internal business processes • External / Customer • financial • Balanced scorecards (Kaplan) • System Dynamics (Senge) December 2012 Project management Dynamics BVBA
- 4. margin % new Customer (revenues) cost overrun satisfaction policy/SLA cost prediction (sales) efficiency PM method policy KISS innovation processes roles&responsabilities improve performance (staff) template project management product mgt training staff PM skills innovation engineers employee satisfaction EVA Project management Dynamics December 2012 BVBA
- 5. Project management Dynamics December 2012 BVBA
- 6. FINANCIAL cost perspective new customer margin % (revenues) overrun policy / CUSTOMER‟s satisfaction SLA perspective QA PM project processes methodology management policy business&process KISS + roles & responsibility + efficiency tools product perspective Think- Internal management tank cost prediction performance re-use / (improvement) template innovation People,learning, perspective training PM growth Employee satisfaction innovation EVA Project management Dynamics staff skills 2012 December BVBA
- 7. Project BSC , KPI & KGI’s Project management Dynamics December 2012 BVBA
- 8. Project KPI, KGI Measurement is knowledge… Identify all factors having impact on the – pre set – result / goals •Project related metrics •Organisation related metrics •Performance related metrics •Finance related metrics •Quality related metrics Project management Dynamics December 2012 BVBA
- 9. actual internal business process "what , why , when , who , how" project measure after each project the variances between budget cost prediction define workmethod based on experiences and best practices compositions % red lack of profit, due to low pre-cost calculations learn , adapt next pre-calculation % green lack of project management improve output % yellow lack of design phase gate process (applied) design phase is not finished lessons learned no proper process keep on changing the layout excellence delivery (even without feedback of installation customer) use of template, or set of instructions/process set baseline of budget respect the authority of functional leads within Company efficiently produce & deliver project review cycle's of pre-cost calculations leasson's learned re-calculate after finishing project na identify overrun items, and reason's behind cost follow up during project correct information , correct expectation mgt clear definition what, how , measure the number of non- policy define project execution policy who will execute the project conformities after audit % red description of project publish policy execution (project charter) % green maintain policy % yellow organise internal audit review policy measure the number of non- processes define PM execution processes conformities after audit % red publish processes % green maintain processes % yellow organise internal audit review processe measure the number of non- PM method implement PM method conformities after audit % red publish PM method % green train PM % yellow organise internal audit review PM method measure the number of non- template identify templates (based on process desciption) conformities after audit % red publish templates % green train the use of templates % yellow organise internal audit review & life cycle templates based on selected tools, improve efficiency of Company's efficiency output (project delivery) decrease overrun of budget decrease overrun of timed training of staff schedule selecting templates, methods, processes,… decrease rework decrease number of late effectively apply set of measures & objectives (closed) issues decrease number of risks guard the application of above (points) in time margin (customer's satisfaction) will be know in advance decrease number of non- (predictability) conformities (audit results) do things right, the first time customer satisfaction (tbd) Project management Dynamics December 2012 BVBA
- 10. consider re-use of existing KISS apply KISS principle equipment/work publish KISS principle always KISS is not opposite of innovation timely discovering of mal- quality process review of engineering work&solutions functioning engineering create & establish state of the peer to peer art solutions eases/enable re-use of guru approach solutions avoid rework (in late project phase) due to time constraint, ME- drawings are sent to supplier, avoid rework (in late project phase) without proper quality review establish baselines (enable phase gate approach scope change mgt) [€] metrics SPI , baseline , collecting spent project management manage planning hours, … predictability of project deliverables % on time assign the right skills, at the manage resources right moment scope management, introduce manage scope scope change management define work, outcome and manage quality results (scope, urs, testing) risks value should decrease (in manage risk time) number of issues should decrease, not too late open (not manage issues solved) define clear (customer) manage expectations expectations, quantify & qualify budget management, overrun, manage budget re-work, scope change mgt,… manage EV milestones met on time milestones met EV product mgt output / productivity) kg/hr (part of URS) innovation PIR evolutive mgt requirement performance solution should 100% satisfy output the requirements switch from one recept to another (within expected/set time) number of scope changes per scope management phase number of scope changes per user-friendly project resources planning resources planning accuracy Project management Dynamics December 2012 BVBA
- 11. learning , staff , growth training staff & engineers % project results (based on malfunctioning / underachieving (project related only) define roles & responsabilities improve efficiency resource) % turnover of employees define clear function description improve performance (specific project , reasons) define assessment tool improve loyalty innovate, improve and learn define HR policy decrease turnover employees identify gaps (employee skills vs job description) improve compentencies define training plan (per employee) na execute trainng plan na evaluate employee's performances (skills based) na PM skills select & assign PM improve efficiency technology leadership training improve performance product & solution focus see 'training staff & engineers) decrease project risk PM select PM methodology improve outcome & quality of project lower risk of margin decrease within 1 year, all PM are PM certified (Prince2, or other methodology) certified not certified training staff&engineers engineering degrees education & training courses (potentially, degrees,or certificates) innovation empower employees to innovate motivate to innovate create incentive to enable innovation (initiatives) sustainable success is virtuous cycle: financial success allows EVA Company to invest in its future (growth) Project management Dynamics December 2012 BVBA
- 12. best added value to Vertex customer's perspective product/service/installation is according URS. Both tangible satisfaction as in-tangible number of matching URS user friendly number of non-qualifications (after testing) / FAT output is according contract (kg/hr) operationability versatibility added value to Vertex policy / SLA project management policy is known and 'respected'; policy is aligned to Collette's policy clear description of communication lines swift response on mutual questions (for approval / for information) on time delivery delivery as promised/planned, and stick to it number of milestones/deliverable on time (%) (quality and performances are IMPLICIT) (both internal , as external) internal customers are also customers Project management Dynamics December 2012 BVBA
- 13. financial perspective margin % profit % by all sub-linked objectives, margin % is kept business leadership & say no more profitability remains, as pre-calculated due to positive response (project success) , other customers create revenu revenu growth new customers growth (sales / customer's satisfaction) profit cost overrun defined project cost/budget must be respected Project management Dynamics December 2012 BVBA
- 14. Think - tank • Initiate approach on a thorough manner; • All concerned topics: project, innovation, processes, and solutions, product management (high level); • Output: – Recommandations (with solid pros & cons!); • Members: – „Business‟-Guru‟s, sales, R&D, PM, engineers, The Company‟s management; • Pittfall : – >< project Steering Committee ! Project management Dynamics December 2012 BVBA
- 15. engineering & solutions : solutions provider product / application management • Product life cycle management – R&D effort and solution driven approach – Buy or make assessment of components; • Based on well thought assessment to reduce risks, and uplift the margin • Market competition; – The Company should be “engineered solutions provider”, or will not be; Project management Dynamics December 2012 BVBA
- 16. People, learning, and growth Employee satisfaction – Assessment to „measure‟ employee satisfaction; – Will increase performance (1th degree) – Training – Courses, provide & share information , involvement in company‟s management, feel good programme, pleasant working environment,… Project management Dynamics December 2012 BVBA
- 17. People, learning, and growth trainin g staff • Training staff: – Assessment/identify of needed / required skills to perform specific role – Will increase performance, and efficiency (1th degree); – Secondly, will improve drastically the motivation of the staff member, with will improve the performance, and efficiency; the result is a more motivated staff – Compose individual training / career path; • CAD , management , technical skills, depending on career path • Self-education, company organised training. “training staff‟ is typically a “self- enforcing‟ dynamic Project management Dynamics December 2012 BVBA
- 18. People, learning, and growth PM skills • PM skills: – Could be part of „training staff‟, but in project driven environment, can be specifically threatened; – Assessment/identify of needed / required skills to perform PM role, based on individual profile; – Will increase performance, and application of PM methodology within the project (1th degree); – Secondly, a PM is functionally a managing director of a SME, having attention for all aspects of managing a project (incl soft-skills) – Compose individual training / career path; • Output must be certification in a acknowledged project methodology (Prince 2, PMI/PMP), management , technical skills, depending on career path, and previous experience; • Self-education, company organised training. “PM Skills‟ is typically a “self- enforcing‟ wheel/dynamic Project management Dynamics December 2012 BVBA
- 19. Internal business&process efficiency • Efficiency: – Core of project organisation, with multiple elements supporting efficiency, or at least having impact on; – Re-enforcing circles: 1. processes, kiss, tools, performance 2. Innovation, re-use, product management 3. Project methodology, project management, roles and responsibility – Efficiency has direct impact on MARGIN % • Less „efficiency‟ costs margin%; – Focus and management of the re-enforcing circles to manage and improve „efficiency‟; Project management Dynamics December 2012 BVBA
- 20. Internal business&process Product / service management • Product / service management: – Important to compose engineered solutions: • Product life cycle management, or • Purchased product / applications – Sign strategic contracts with suppliers (incl. SLA), or; – Competition on market; • Assess and balance which to make, and what to buy; – Define cost of ownership (TCO) for each product / application – Product life cycle: • List all applications; • Define (-end of-) life cycle; • Prepare „next generation” (by Engineering‟s management, R&D, and sales) – Assign budget, and timing (incl. testing); – In general, projection of life cycle is possible; Most important for Company is to enable strategic advantage Project management Dynamics December 2012 BVBA