Project Intelligence

References

Introduction

Expected success

Project management is a challenging position demanding maturity, innovation, and intelligence. It requires applying project intelligence to allow ordinary persons to create extraordinary quality products, services, or results. The project manager must create a project environment where the norm expected is success.

This book is an overview of developing the project intelligence needed to understand, plan, manage, and control projects. It is about managing and meeting expectations and measuring performance, and then adjusting plans to meet project goals when necessary. The project team needs to have the project intelligence required to succeed.

A project is a temporary endeavor to create a unique product, service, or result (Project Management Institute, 2004). In many organizations, failure to meet the constraints of the project is all too common. It is almost expected for projects to be late and over budget. It takes a carefully designed project intelligence system to support the team, guide the project, help make decisions and succeed. To succeed should be the norm; failure the rare exception.

A measure of project intelligence is the ability of the project team to reason, plan, solve problems, think abstractly, comprehend ideas, use language, learn, and to succeed.

A measure of project intelligence is the ability of the project team to reason, plan, solve problems, think abstractly, comprehend ideas, use language, learn, and to succeed.

Expectations

Project management is all about managing expectations. Needs may be separate from customer wants, and the project manager may deal with unworkable (seemingly impossible) schedules and cost baselines. Building trust is a key; every chapter of this book is ultimately about how to use project intelligence to build trust by planning and managing expectations. No surprises, the client, project manager, and project team must understand the project status.

Constraints

A project is constrained by a specific scope, schedule, and budget. Logically, to succeed, that means the project manager must manage to stay within the boundaries described by the project's scope, schedule, and budget.

Regardless of how well built the project's product, great the service, or result created, if the project manager does not deliver the product of the project as defined by the constraints of the scope, schedule, and budget, the project manager fails a basic test of project quality.

The project manager must understand the information that goes with managing a project. Not only must he or she understand what happened last week and today, but comprehend what must happen next week, next month, and even next year to succeed.

Chapter 1.     Project Intelligence

No institution can possible survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under a leadership composed of average human beings.

Drucker, Peter. 1993

Introduction to Project Intelligence

Knowledge and intelligence

Knowledge is a dusty book on a shelf; intelligence is thoughtful action based on knowledge.

Knowledge is defined as:

(i) Expertise and skills acquired by a person through experience or education; the theoretical or practical understanding of a subject.

(ii) What is known in a practical field or in total; facts and information.

(iii) Awareness or a familiarity gained by experience of fact or situation.

For the project manager, success is delivering the product of the project in scope, on time, and at the cost expected

Intelligence is:

An umbrella term used to describe a property of the mind that encompasses many related abilities, such as the capacity to reason, to plan, to solve problems, to think abstractly, to comprehend ideas, to use language, and to learn. misterpoll

Project Intelligence

Projects are surrounded by information. The company and the project manager must develop the system that acquires and uses this knowledge. Like any other element of the project, it takes forethought and planning to successfully manage the project's information and to create and fully use project intelligence.

We acquire knowledge but must convert it to intelligence and then action. Information from yesterday and today is used to make decisions about the future. Past performance of the project team is used to forecast expectations of required future performance.

Talent wins games, but teamwork and intelligence wins championships. Michael Jordon

The Elements of a Successful Project

Routinely succeeding

A basic concept for project intelligence is recognition of the characteristics that create success. For the project manager, success is delivering the product of the project in scope, on time, and at the cost expected. Of course, the product of the project can be a success even if all the constraints are blown, but it is the job of the project manager to deliver the product within the constraints of scope, schedule, and budget.

What characteristics should a project have to routinely succeed?

1.   Defined objectives: The team develops, understands, and clearly communicates the scope of the project to all stakeholders.

2.   Work breakdown structure: A WBS that describes the scope with all the elements needed for creating the project's product. Each element of the WBS has a defined scope with responsibilities assigned.

3.   Defined risks: The risks associated with each element of the work breakdown structure are defined and understood.

4.   Project plan: Fit the plan to the needs required. A lack of adequate planning is the most common occurrence, but over planning is not to be a substitution for action. A rigid definition of a project plan may backfire.

5.   Committed co-located project team: A co-located project team helps develop a committed team. However, co-located team many not be possible or even practical. In these cases, a virtual team may be necessary. Virtual teams require careful examination of communication requirements and job descriptions.

6.   Team building: The project manager uses a deliberate process to develop and motivate the team.

7.   Communications: A successful project will have a developed, organized, and planned system of communication.

8.   Representation: The downstream people who will use and be impacted by the project should have input to the project objectives.

9.   Uses past experience: Project management is an applied science, thus success builds on past experience. A Lessons Learned process is a critical element of successful projects.

10. Training: Training builds on others’ experiences.

Failure

Failure as intelligence gained

Perhaps failing is essential to success because it is so easy to fail. Failure is that beast stalking us in the dark just at the edge of a prehistoric campfire. It's always there at the edge of darkness.

Failure should be our teacher, not our undertaker; failure is delay, not defeat. It is temporary detour, not a dead end. Failure is something we can avoid only by saying nothing, doing nothing, and being nothing. Denis Waitley

Failure itself is intelligence gained, but useful only if the reasons for failure are recognized, and not repeated. The Logic of Failure by Dietrich Dorner has a picture of a train wreck on the cover. What project manager hasn't had a train wreck or two? The ability to succeed must start with knowing how and why we fail.

As Dorner describes it, there is logic to failure,

Failure does not strike like a bolt from the blue; it develops gradually according to its own logic. (Dorner, 1989.)

We are all in a system that is so complex that human thinking can simply not understand or recognize all the ramifications of choice we make or choices made upon us. Our thought processes summarize requirements for possible actions. If we had to fully understand every possible outcome (that is action risk) of driving a car, we would almost be paralyzed at the wheel.

Defeat is not the worst of failures. Not to have tried is the true failure. George Edwards Woodberry

As project managers, we need to understand the complex nature of management and the fundamental inadequacies of human thinking. If we think of the concept of project management as a system, it is certainly complex. Our brains are made to economize input and generalize information. It is why we can operate complex equipment that a computer cannot even start to operate. That usefulness of the human brain to generalize with expected outcomes from the information at hand is also why it may not be able to recognize outcomes in complex situations. Project managers operate or function in a complex system of competing demands of time and attention needed. Sometimes we cannot see it (failure) coming. We must use project intelligence to help recognize the potential for failure.

After the fact, we investigate and all too often recognize the pattern or logic that led to the failure. How do we compensate for our failure to clearly see the outcome? Dorner's suggestion is to understand why we fail.

Why we fail

The project manager needs a support system of information for decisions—project intelligence. Recognize that action simply means at times we will fail, but planning does not substitute for action; it increases the probability of success.

There are four basic reasons why we fail:

Understanding: Some events require quick response and there may be difficulty in fully understanding the situation. Our minds are just too slow to think through all the possibilities of our actions.

Competence: We must have a feeling of competence in understanding the situation. We may plan or develop methods of operation without understanding the why of the method. Planning without understanding is a method of self-protection—not necessarily an effective one in every case

Memory: Our human memory has a relatively slow process of learning new things. When an emergency occurs, the recall of a newly and only partially learned process may be inadequate.

Out of sight: We do not think of problems we currently don't have. Why worry about a leaking roof when it is not raining?

Vision, Mission, Strategy

The definitions of vision, mission, and strategy overlap to some degree. Vision concentrates on the future, the mission is for now or in the near future, and strategy is how it gets done. In project management terms, to deliver the project within the constraints of scope, schedule, and budget is the vision, the mission is the how the team will accomplish the vision, and the strategy is descried by the project execution plan.

Project management is or should be a future-oriented profession. Its focus is on delivering a scope of work in the future with a set budget and a forecasted delivery date. Companies and projects need a vision, mission, and strategy. However, there is only one reason to have a vision, mission, and strategy to achieve them; competitive advantage. Figure 1.1 approximates the relationship between project and company vision, mission, and strategy.

Vision statement

A vision statement is a narrative description of a future state to help keep the company focused. It can be described as the goal, or desired intention. A company vision is often described in a few short sentences. The Wal-Mart vision statement, "To become the worldwide leader in retailing," is a great example; very focused, very clear, and the company certainly seems to be accomplishing their vision.

Any vision that is obvious or easy to obtain is no vision at all

To confine the concept of a vision statement to project management, an example could simply be, To consistently deliver the client's project in scope, on schedule, and to budget.

Mission statement

The mission statement is a short narrative description of the purpose and aim of the company or department. It will often describe the reason for the company, what it aspires to be, its key values and a statement of major goals. The mission statement is derived from the vision statement of the company or department. The mission statement is a stretching, guiding, and reinforcing statement of intent and commitment. The mission of the project team is to accomplish the project's vision.

Strategy

The strategy is the method for how the vision and mission of the company will be accomplished. The project execution plan is the strategy for how the mission and vision of the project is to be accomplished.

Competitive Advantage

Effective project management methodology can place the company at a competitive advantage.

Competitive advantage is the search for a favorable competitive advantage in an industry, the fundamental arena in which competitive advantage occurs. Competitive advantage aims to establish a profitable and sustainable position against the force that determines industry competition. (Porter, 1985)

Every company performs projects. For some organizations, performing projects is a primary function of the company.

If every company performs projects, and projects all too often fail in some manner, you should consider a project management system that delivers successful projects as the norm. Then, routinely delivering successful projects will be a competitive advantage. Using the knowledge earned (sometimes painfully) from past and current projects can create a competitive advantage for the company.

The ultimate competitive advantage is an organization's ability to learn, and translate that learning into action rapidly. (a Jack Welch quote, Slater R. 1999)

Achieving Competitive Advantage

There are but three ways to achieve competitive advantage:

Price: Price or cost advantage occurs when the firm is able to deliver the same service or product as the competition, but at a lower cost.

Differentiation: A differentiation advantage occurs when a firm can offer greater services at the same price as its competition. If a company routinely delivers project within scope, schedule, and budget, and the competition does not, it would be an example of a differentiation completive advantage.

Focus: This involves concentrating on a particular market niche. A company can concentrate on specific types of projects.

Customer centered

The competitive advantage must also be customer-centered. The competitive advantage must create value to the customer. The customer must perceive the competitive advantage as a value and there must be a way for the value to be recognized by the customer (a communication channel).

Regardless of the specific competitive advantage, for the competitive advantage to be worthwhile to the company, the creation of the advantage must cost the firm less than the value created for the customer. If the cost to obtain competitive advantage cost more than the value received, it is really no competitive advantage.

Competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firm's cost of creating it. (Porter, 1985)

Resource-Based View of Competitive Advantage

There are only three sources of the competitive advantages of price, differentiation, and focus.

The three sources of competitive advantage are:

Physical resources: Physical resources refer to the building, the equipment, the software, and the other physical tools available to the project.

Organizational resources: Organizational resources are the structure of the company that may contribute and support the project manager. A system of knowledge management is an example of an organizational resource. This includes an organization system that supports the accumulation and use of knowledge to create project intelligence.

Human resources: Human resources are the tools to use the physical resources and organizational resources to create and apply project intelligence. Human resources as a competitive advantage refer to both individuals and the team. To act as a project team, the intelligence created must be greater than the sum of its individual parts. The individuals and the team require development by the project manager.

An organization may have these three sources of potential competitive advantage, but they must have certain characteristics to have an actual competitive advantage. It can be the choice of the project manager to develop these resources as a competitive advantage.

The characteristics of potential key resources are that they are:

Valuable: Will the resource create value greater than the cost of creating it? A project intelligence system that creates highly valued reports that assist in project decisions and management is only a competitive advantage if the value created is greater than the cost to create the reports.

Rare: To be a competitive advantage the advantage must not be routinely available in the market

Inimitable: The resource will be a competitive if is not easily copied or simply purchased. A firm that builds up its skills in project management in a specific type may have a completive advantage with competitive firms requiring years to build up that level of expertise.

Non-substitutable: A resource can be a competitive advantage if it is not easily replaced by another resource. If the market places high value on project managers, having other strong departments will not make up for the lack of highly qualified project managers.

There is only on reason to have a vision, a mission, and a strategy to achieve them—completive advantage

Sustainable Competitive Advantage

The title sustainable competitive advantage might be a misnomer. In the highly competitive framework of business, can any competitive advantage truly be sustainable? Sustainable in the very long run (years), probably not. But as a sure bet, competitive advantage, sustainable or not, will never appear unless the company seeks it.

Competitive position

The company competitive position can be an advantage, at unity, or at a disadvantage when compared to its competitors.

Any competitive position is temporary or sustainable. It can be a permanent position, sustainable, or temporary.

Project Management as a Sustainable Competitive Advantage

Is the practice of great project management a sustainable competitive advantage? It can be.

There are recognizable characteristics of a sustainable competitive advantage. Depending on the company and the market it is operating in, strong project management practices can be a sustainable competitive advantage.

Characteristics of a sustainable advantage

1.   Social responsibility philosophy: Social responsibility is not being wasteful of natural resources while not wasting money. Maintaining a clean and safe work location is a social responsibility, regardless of actual law. Is social responsibility respected as a philosophy of the company and the practice of project management?

2.   Client value: The clients value the ability of the company to manage projects.

3.   Internal strength: Project management is an internal strength of the company. Internally, project management is recognized and encouraged.

4.   Employee value added: Does the employees’