The Money Files

One of the issues with managing multiple projects is that everyone thinks their project is top priority and they all have to show some progress by the end of the month. I wrote a book about that (inspiringly called Managing Multiple Projects) and there are lots of things I could teach you about keeping all the balls in the air.

However, today I want to focus on one thing: helping you understand what makes a project a priority.

You might think this is an odd subject, because your PMO creates prioritisation lists and everyone knows where they sit in the order. But there are many companies that don’t have that level of structure. Or they do… but everything on the list is a Priority 1.

Here are 5 signs that your project really should be a high priority project.

1. It contributes to a strategic objective

Does your project directly align to strategy? Does it deliver something, or a part of something, that is on the strategic roadmap? Can you link it to a corporate objective? If you can, then it’s probably high priority.

I believe that there is a place for non-strategic projects, as there are peaks and troughs in project work and time enough to get other things done. But if your project gets a mention on the strategy deck that was shown at the last corporate Town Hall, then it’s a high priority for the organisation.

2. It is documented as a priority

There’s an obvious way of checking: if your PMO has a priority list, where does your project fall on it? As I’ve said above, having a list isn’t always a sure-fire sign that prioritisation is actively happening. If you read through the list and see that everything is a High Priority, move on to the next criteria below to assess what your ‘real’ priority is!

3. It is an enabler

Wi-Fi upgrades, telephony, laptop replacement schedules, infrastructure projects… they might not sound top priority, but if they enable something else then they are critical.

You can’t launch a new sales portal on a creaking infrastructure. You can’t build a new office if the foundations aren’t in place. This kind of project might plod along in the background but it’s an important one.

4. It gets a lot of attention

Do you have execs dropping by your desk asking for updates? Does your project sponsor return your calls quickly?

Projects that get a lot of attention are high on management’s radar. If the senior leadership team thinks it is a priority, it probably is.

However, they might also think it’s important as it is their pet project. Check to see how many people are giving the project attention. If it’s just the one, it might be a vanity project, and not something that is important to the organisation overall.

5. It is adequately resourced

OK… this one isn’t a perfect sign. I know a few high priority, strategic projects right now that are struggling for resource.

But generally, priority projects have the budget and support to secure the resources they need. I’ve worked on projects where resources have been pulled off to go and do something else – that’s a sure sign that my project was not as important as someone else’s.

If you have the people, time, budget and other resources that you need, you can bet that someone is enabling that to happen and there are routing for the project to be a success.

Would you agree with this list? What other signs have you seen that point to your project being an important one? Let me know in the comments below!

You probably measure a range of things on your project. I’ve seen PMOs track number of open risks, projects closed this month and other numbers that are pretty much meaningless out of context. Here are 5 ways to make your metrics work better and give you more useful information, inspired by the Measuring What Matters report from PMI.

1. Measure more often

A study by PMI and PwC found that only 41% of PMOs were consistently measuring and reviewing performance. If you don’t measure regularly, how can you monitor trends?

They also found that around half of PMOs spent time communicating to the C-suite about milestones and project impacts. I know that in some organisations the PMO doesn’t have a direct line to the execs (although I think they should). Improving the perception of the PMO relies on the right people having the right information.

Action: Make sure you have a regular schedule for measurement so you can capture and track trends.

2. Collaborate up the organisation

Another thing highlighted by the PMO study was that metrics are often set by people who are not the PMO and who are not C-suite execs. Whether you are a project sponsor, senior leader or project manager, make sure you involve the right people in the conversation about what should be measured.

More collaboration between the PMO and delivery teams and the executives responsible for setting strategy should mean that you are measuring stuff that demonstrates whether the organisation is getting closer to the strategic goals.

Action: Check your measures are in line with the strategic vision for the company and that the right people were involved in coming up with them.

3. Focus on outcome-based measures

Outcome-based measures are those that reflect what was achieved on the project in terms of deliverables and change. They are different from the project management measures of time, cost and scope. (Note: those are still useful, but they aren’t the only thing you should be tracking.)

Projects exist to deliver change. That’s what is important: the impact that the work has on the organisation.

Action: Review the measures you are using to track your project and see which of them are outcome-based. Is that enough?

4. Review measures regularly – and with the right people

Once your measures are set up, keep them under review. Make sure to get input from a wide range of stakeholders: those who are collecting data for the measure, those who are using the measure for decision-making, the PMO and the project team, along with anyone else who has a stake in the outcome.

Reflect on whether the numbers or results are telling you what you thought they would. Do they provide accurate, reliable data that can be applied to different projects in a meaningful way? If not, why? Perhaps the measures need tweaking to make sure they properly serve their purpose.

Action: Schedule time to reflect on the usefulness of the measures you have in place.

5. Define success

Finally, define what success looks like. What parameters for your metrics represent a ‘good’ score? Below what level would you need management intervention? What are the red flags that would push the project into an Amber or Red status?

Capturing data is one thing – but being able to use it is something else entirely. In addition, some of the more ‘fluid’ desirable outcomes like cultural change or customer satisfaction are harder to grasp with a single number. You might need to combine several metrics to get a full picture of the current performance levels.

Action: Review the parameters that trigger action for your measures.

PMI and PwC did a survey on metrics and measurement on projects. You can read it online: Measuring What Matters.

I had a conversation about measurements recently with a PMO leader who wanted to understand how best to talk about what her team did. So are there any insights in the report that will help you if you are in a similar situation?

I think there are. Here are four of the key things that are worth looking at.

1. Measure more things

The survey points out that the top 10% of PMOs measure more than the average PMO. Quite a lot more: they tend to have 10 measures on average compared to only 7 in lower performing environments. Of those 7, generally the researchers found that 4 were linked to the classic project management iron triangle of time, cost, quality, scope.

Those metrics don’t really tell you anything about how the project landed in the organisation or whether the right project was done at all. Success in the eyes of strategic integration and execution is not often to do with whether you hit a budget baseline – especially if that budget changed during the project and was rebaselined to your new forecast anyway.

2. Make measures more effective

The research points out that there are two considerations for effective measures:

• Making sure you are using the right measures
• Implementing them appropriately.

The right measures for one project might not work on another project. Again, we see the fact the project management needs to be tailored in order to get the best results, and the PMO reporting is no different.

Some measures are worth capturing regardless: were you on time, did you deliver what was expected? But outcome-related measures like customer satisfaction, risk management and operational impact probably need to be tweaked for each project.

If you can’t tweak the measure itself, at least let project managers choose from a list of metrics so they can select how to report on the project in the most appropriate way.

3. Involve the right stakeholders

The PMI research shows that only 63% of organisations with a PMO use the PMO team as part of the development for metrics. Which begs the question: who is setting project measurements if it isn’t the PMO?

It seems to be middle management, as only 39% involve the C-suite execs. I think we can conclude that project sponsors or senior leaders decide what success will look like and what should be managed without linking into strategy or what’s actually practical and possible to measure as good practice (via the PMO).

When you adopt metrics on your projects, question where they came from. Are they part of an organisational standard created by the PMO with appropriate stakeholder input or did your boss just tell you to do it?

4. Use more tech-enabled solutions

The final takeaway from the PMI study into PMO metrics is about increasing the use of tech to measure effectively. Many online tools help you measure the impact. Whether you have advanced strategy execution tools or a simple online survey, tech opens doors to be able to repeatably and reliably collect data to help us assess success.

Many PPM tools collate data by virtue of the fact that we use them everyday for project management and scheduling. You can extract data about timelines, resourcing and budgets that helps inform future projects. However, it seems like budget is a barrier to investing in the tech that will help us do our jobs better. If you’re still stuck on spreadsheets, keep lobbying the powers that be for a better solution!

PMI has released a new 2022 jobs report, which provides some insights into how the profession is looking around the globe. It’s not terrible, which chimes with my own experience here in the UK. I often mentor project managers who are looking for jobs and after interview practice or a CV review, and the market feels pretty good.

But anecdotal feedback aside, what do the numbers say about the future of the jobs market? Here are my key takeaways from the situation in Europe according the PMI survey.

Issues with supply chain

I know of projects that are on hold at the moment due to supply chain issues. My projects are being affected by longer lead times. Even buying a sofa is affected by long lead times: we have been told our sofa will arrive in 16 weeks and we can’t order an armchair because there is no fabric in stock.

So project managers might feel like the job situation isn’t too bad at the moment, but projects are certainly not progressing at the pace they used to. According to the PMI study, the supply chain issues have contributed to an inflation spike of 5%, which is going to affect salaries and put people under more pressure as the cost of living rises.

Demand for IT professionals

The report says that IT is the area to focus on if you are job hunting. The talent gap in this sector is huge, and there is a lot of tech funding around. Plus our ways of working since the pandemic began have massively changed – along with our customers’ expectations of what they can do online. That’s changed the requirements for many long-term projects and no doubt boosted the need for more IT project managers.

Hybrid working

If you are a European project manager who wants to live the hybrid life, watch out for what your employer expects. My takeaway from the PMI survey is that employers want more of us back in the office – and we don’t want to go. Only 28% of employers believe that the model of work they are offering is aligned to their employees’ preferences.

Employees want more hybrid and remote; employers want more bums on seats in the office. I’m not sure how we reconcile that to be honest. However, it is worth spending some time thinking about how you can make hybrid work for your project team. Nearly 60% of people report that remote and hybrid work options result in increased job satisfaction, and that has to be good for project team morale.

However, only 34% believe that remote options lead to greater productivity. Perhaps there is a backlash against only seeing your colleagues as a tiny head on MS Teams. I think that hybrid certainly has a place, and I know of project managers who have turned down roles that were not hybrid or remote-friendly.

Overall though, the outlook for work in the project sector in Europe seems optimistic. There is still a lot of concern about job security and the cost of living – although I can only speak for what I see here – but globally money is being made available to reinvent and innovate where we can.

If you want to succeed amidst the current global economic situation and all the uncertainties that brings, it would be good to focus on adaptability, change, flexibility and resilience as there are all the signs that these skills are going to be in demand for many years to come.

Programmes (as we spell program here in the UK), are made up of various different projects and often BAU elements or non-project components too. The programme budget needs to reflect two things.

First, it should include all the costs relating to the components. These could come from detailed project budgets, contracts and the work involved in costing out the deliverables, outcomes and outputs that make up the programme overall. This aspect is going to make up most of the budget.

Second, it should include the costs involved in running the programme. These are most likely to be resource costs and any other operational support costs such as the fees involved with hiring a location to work from during the programme and things like that. This aspect is a not insignificant amount but in my experience it’s normally less than the costs of the projects.

The exact split of component costs and programme management overheads is going to depend on your exact project and how you account for people’s time.

The two schedules that come out of the cost budgeting for a programme are:

• The programme payment schedule
• The component payment schedule.

These two terms sound very similar so let’s briefly look at what they mean.

The programme payment schedule is about money in. It relates to the dates and milestones where funding will be made available. These could be payments from the client, or your internal decision points or gates where funding will be released for the next phase of work.

The component payment schedule is about money out. It relates to when contractors, sub-contractors and suppliers are going to be paid. I see it as a summary of the contractual payment dates as most of my supplier contracts for large projects in the past have a milestone-driven payment schedule. When the milestone is reached and signed off, the payment can be made to the vendor.

The milestones tend to be linked to delivery e.g. completion of design, delivery of functionality etc. When a component is completed, the component-related budget can be closed off.

Both of these schedules provide info to the programme budget baseline. The baseline will need to be revisited regularly if my experience is anything to go by. Prepare a forecast, review the estimates and actuals, and update as and when you need to, with the approval of whatever governance processes you have in place.

Then make sure any changes are trickled through to the relevant budget lines, and any other documentation is updated.

The programme and component schedules might be called schedules, but they aren’t the same as your main programme (or project) schedule. That represents the timeline of work; what we often call the project plan (even though technically speaking it is not the project plan – that’s a separate document made up of lots of plans…).

The budget-related schedules are timelines in their own right, and you could put the milestones or key dates into your main schedule. Personally, I think that’s confusing, but it’s up to you. I prefer to put payment dates in my normal calendar, with a note the week or so before to make sure I have the paperwork in place to get the milestone approved.

I also use that early warning action to let Finance know that a big payment will be due, and the supplier’s sizeable invoice will be coming through for payment. Having once been caught out by trying to get a large invoice paid at short notice, I’ve learned the lesson of giving my colleagues in Finance plenty of time for their approvals and related Treasury tasks. 

Do you have any other tips for managing the different aspects of a programme budget?