Who Benefits From Digital Transformations?

 

As GTIM Nation is aware, my litmus test for Management Information Systems’ validity (including the PM variety) is that they have three characteristics:

1. They must be timely. Regardless of the exact information stream, it’s going to have a shelf life, often measurable in days if not hours.
2. It must be accurate. Wrong information stemming from poor data or wrong-headed processing techniques is worse than a simple waste of time and energy – it’s almost always misleading.
3. It must be relevant. Since information takes time and energy to produce, irrelevant data is automatically a waste of time, though it can possibly be of value, the same way a broken clock is correct twice a day.

So, when the discussion turns to the effect of digital transformation on PM (ProjectManagement.com’s theme for February), I take such transformations to mean their effects on the information streams that guide optimal managerial decision-making. Here another one of Hatfield’s Indisputable Laws of Project Management comes into play, specifically that the 80^th percentile best managers with access to only 20% of the information needed to obviate a given decision will be consistently outperformed by the 20^th percentile worst managers who have access to 80% of the information so needed (my little PM derivative of the Pareto Principle). Taken together, the PMIS Litmus Test and Hatfield’s PM Variation of the Pareto Principle form the basis of an assessment of the beneficiaries of digital transformation in Project Management.

Let’s start with evaluating advances in data processing with respect to PMIS’s accuracy. Does it help, or hinder? I would assert neither, really, save an ability to more promptly detect when serious inaccuracies creep into the data. The creation of the original scope baseline remains largely unaffected by digital advances, save the leap from using typewriters to word processors in the generation of the documents that hold the scope. Yes, estimators haven’t had to use ledger paper for decades, but their basic arithmetic remains largely unchanged. Also, when the Project Controls Analysts collect status, actual start and finish dates are what they are, and estimations of percent complete are similarly unchanged since the early days of Earned Value and Critical Path Methodologies.

Has digital transformation had an influence on the relevance of Project Management Information Systems? Yes, but not necessarily a good one. While the EVM and CPM-based reports retain their relevance from the days that computers received their instructions from punched cards (and if you GTIM Nation whippersnappers out there have no idea what I’m talking about, I don’t want to hear from you), other so-called information streams have been making inroads into the commonly-accepted PM codex, though they should not have. Running three or four highly speculative alternatives to the planned course of a given project through a Monte Carlo analysis (made much easier through the digital transformation of PM) does not render its output any more relevant. If the output curve is pre-selected, as it is in almost all risk management (no initial caps) software systems, then the number of “random” data points added is truly irrelevant – the outcome has already been decided. The added data points are just there for show.

Which brings us to timeliness, which is where the greatest amount of added value to PM can be seen. In the distinction between feedback and feed-forward Management Information Systems, each type has its advantages and vulnerabilities, specifically:

• Feedback systems use only verifiable, objective data, meaning that they are more accurate. However, since data takes time to collect and process into usable information, Feedback systems are vulnerable to delays in delivering their information (see bullet #1 in the first paragraph).
• Feed-forward systems, conversely, are predicated on highly subjective data, like the perception of historical trends continuing into the future, or even more suspect methods such as risk analysis (no initial caps). This type of system is more timely, but significantly less accurate.

With the digital transformation of PM delivering processed information far faster than was possible previously, the hands-down winner of the most-benefitted award has to be the Feedback systems. Helping Feedback systems overcome their timeliness vulnerability was always something that could be accomplished by advances in more advanced data processing, but nothing in such advances could ever lend accuracy (or, if we’re being honest, even relevancy) to the Feed-forward systems. Which brings us back to the question posed in the title, Who benefits from the digital transformation of PM? Ironically, it’s those of us who have been stressing the primacy of Earned Value and Critical Path Methodologies-based information streams.

In other words, it’s largely the members of the PM community who know what a computer that uses punched cards looks like.