The Money Files

According to recruitment company Robert Half, interim project managers are in high demand. For those of you who aren’t familiar with the term, interim is a bit like contract but generally longer term and more invested (contractors, feel free to call me out on that if you don’t agree!).

The Robert Half team asked 200 UK CFOs and Financial Directors about how they evaluate the success of an interim manager, and it isn’t all about the successful delivery of a project (although that comes in at 34%). I put this infographic together to explain how the survey respondents measure the success of one of their interim managers. They were allowed to respond to several answers, which is why the results don’t add up to 100%, and you can see the full survey results here.

In this video I talk about what to look out for when you are hiring someone. It can be expensive to bring people on to the team, so it's definitely worth getting it right first time! Here are some tips for making sure that your recruitment efforts don't go to waste.

Experienced project managers will agree that complex projects are a headache for lots of reasons. Complexity adds all kinds of challenges and cost. But if you can reduce that complexity then you can take some of the stress out of your project.

“If you can understand it, you can move on to reduction.”

Harvey Maylor

Here are 3 ways to reduce complexity, once you know what is making your projects complex.

1. Resolve It

Just fix it. Make it go away. Use a different technology that is tried and tested. Add more time to the schedule. Throw money at the problem. Whatever it takes.

Unfortunately, many project complexities can’t be resolved like this, but it is definitely worth a try in the first instance.

2. Reduce It

Make the complexity less severe, with less of an impact on your project. This really does rely on you fully understanding what’s behind the complexity so that you can unpick it and come up with some strategies to chip away at it.

Harvey Maylor gave a presentation at a PMI Global Congress where he shared the results of some work he had done in this area. He talked about running 43 workshops with 1100 managers and in those sessions they were asked what percentage of the identified complexities in their projects they would be able to resolve or reduce.

I was surprised that they reported that they could reduce 82% of project complexities. Even if they were wrong by a factor of 2 that’s still 40% of complex issues that could be managed down.

What’s left when you reduce complexity is residual complexity (like residual risk). That might need a different approach or strategy to address, but it’s likely to be less of a headache to put in place than having to deal with the complexity in its entirety.

Having said that, the third complexity reduction technique isn’t really a reduction technique at all…

3. Live With It

You’ve identified it. You can choose to manage it and run with it, working out a practical response to dealing with rather than passively doing nothing.

One strategy that Maylor talked about is actively choosing the right person to sponsor and lead the project when complexity is involved. Different types of complexity issues require different skills at the top.

For example, a project that is complex for socio-political reasons needs a charismatic leader who can work with stakeholder groups to share the vision and sell the benefits. A project that is structurally complex needs a sponsor with great technical skills, someone who can juggle multiple parts and bring them back together as a whole. A project that struggles with emergent complexity requires a strategic thinker, someone who can see the bigger picture and make connections.

Getting the right team in place and framing their involvement in the project in the right way can help mitigate the impact of complexities if you can’t manage them out in any other way.

In this video I talk about the costs of hiring a new employee. There are a lot of elements involved in hiring and they are all an investment!

Steve Jenner gave a presentation at the PMI Power Talks recently – a set of TED-style short presentations hosted in the centre of London by the PMI UK Chapter. He spoke about portfolio management and benefits.

Benefits, he explained, are not just one dimension of project portfolio management. They are the rationale for the investment of shareholders’ funds.

Often, he said, benefits are used as the way to justify the project. He pointed out that isn’t correct: benefits are the rationale for the project. We “go looking for benefits to justify what we want to do anyway,” he said.

Then people are surprised that they didn’t realise the predicted benefits. How could the project have done that? The benefits were made up anyway.

“Strategic alignment means nothing,” he went on to say. You can align anything with anything. Anything can be aligned up front. It’s what happens later that matters. Strategic contribution, he said, is where it’s at.

When you can’t justify a project by any other means, people call them “strategic projects”.

So how do you get round the problem of fictional benefits?

Don’t treat all projects the same way

Steve explained that it’s foolish to treat all projects the same way. Tailor the investment criteria: don’t try to rank and assess projects that relate to keeping the business functioning in the same way that you would innovation projects.

If you are investing to save money or increase revenue then it makes sense to do a cost benefit analysis.

If you’re doing it to make a strategic contribution, then benefits aren’t always clear in cost terms.

For projects that are mandatory, there is only one question that matters: Do we really have to do it? If it’s a $200m mandatory project with justifiable benefits of $300m and the project cost goes up, then we won’t worry if it now costs $250m. But if we are doing the project to be cost effective, and it isn’t really mandatory, then the cost increase matters. A lot.

Avoiding Fictional Benefits

Here are some tips that Steve gave for making sure your projects are adequately justified.

1. Be clear about the benefits you are buying

Financial benefits can be cash releasing: you can use the money elsewhere for other things, or non-cash releasing: they save money but you can’t actually access the money.

An example of that latter category would be things like process improvements that might shave a minute off a process. You aren’t going to make a staff saving on that. Saving staff time is only a benefit if you do something with it, so Steve argued that these aren’t real benefits at all.

2. Link gate reviews to funding

If your project gate reviews – the steps you go through at the end of each project stage to validate that it’s OK to move to the next point in the project – are not linked to funding or project performance then they don’t serve a purpose.

All they’ll do is just slow projects down and add bureaucracy. Unless they are meetings and project reviews with teeth i.e. that they can stop your project, what’s the point? Your portfolio, Steve said, should be a funnel not a tunnel. In other words, you need to be stopping projects, or delaying funding, and taking those hard decisions because that’s your job and how you protect the funding.

3. Expect improvement

This was an interesting point: expect things to get better and they will. Create a culture where project improvement is expected. Where project control is expected. Where generally you just expect things to be better week on week, year on year. And don’t let lack of improvement go unnoticed.

I’m looking forward to the next PMI Power Talks: I think the quality of speakers was exceptional and it was a really well-organised event. This session by Steve was very thought-provoking.