The Money Files

One of the things that project managers get involved with from time to time is preparing business cases. Even if you don’t have to write the business case from scratch, there is a possibility that you will be asked to put some of the data together, or to review the final version. And, of course, at the end of the project you’ll have to go back and compare the project results to what the business case said, so it is a useful document to understand. You can keep a copy with your project files.

Here is some more information about this important project document.

Why bother with a business case?

There are three main reasons why you should make sure that your project has a business case (even if it isn’t written by you). They are:

1. To identify the business need (problem) for the project and fully describe it
2. To justify why it is worth spending the money and time on this problem
3. To provide enough information about costs and benefits to allow the work to be prioritised along with everything else that the team or company is doing.

Essentially, a business case answers the following questions:

What? What are we doing? What problem are we trying to solve?

Why? Why is this a particular issue right now? Why should we bother working on it?

How? How will we fix the problem? How will the work be carried out?

Who reads the business case?

It’s important to think through who is the target audience for a business case if you are writing one or providing information to go into one. The business case will end up being used by a number of different people or groups, so it should include information at different levels to suit their varying needs.

Think about who will read it:

• The project manager and project team will read it in order to find out what they are expected to do. It will provide key information to help with project planning such as when the benefits are expected to be realised, any fixed dates etc. It can also be used in project communication such as sharing the vision with others.
• The senior management team at the company or in that department will read it. They will be using it to help prioritise the work and to check that it fits with the current strategy. The project sponsor may fall into this group. They may be influential in deciding whether or not the project should be approved, but equally they may just be reacting to the third audience….
• The decision makers. This could be a strategy group, the board of directors, a Portfolio director or some other group that gets together to discuss upcoming projects and makes a final decision about whether something should go ahead.
• Future project team members may read the document if they go back through historical records because they are working on something similar. They will need the document to be well-written and clear because they won’t have the immediate business context that goes with it and all the day-to-day information that you have now.

What format does the business case take?

Typically project business cases are documents. Even today, when so much of our project work is done online and via a range of different tools that support project planning and document sharing, the business case is still a document that is formally put together in its own right, outside any project collaboration software. You can still upload the business case to your document store, if the project goes ahead, but at this point you are probably looking at putting together a document.

The document is likely to include links to or an embedded spreadsheet, or this could be included as an appendix. The spreadsheet elements cover things like more detailed assessments of costs and benefits, and maybe a resource plan. You could also include screenshots from project planning software if your business case includes high level milestones or any scheduling information. This can be useful so that decision makers can see the overall length of time that the project is planned to run for, and make their decision based on how long resources will be occupied working on the project.

Next time I’ll be looking at the major elements that go in to the document itself. In the meantime, who reads the business cases on your projects? Let us know in the comments.

About the author: Elizabeth Harrin is Director of a project communications company, The Otobos Group. Find her on Google+ and Facebook.

“There are two kinds of measures of use in managing a system: permanent and temporary,” writes John Seddon in Freedom from Command & Control: A better way to make the work work. “Permanent measures, those that are related to purpose, are the guiding measures for all performance-improvement work. Temporary measures are those that are useful in ascertaining the nature and size of a problem before action is taken.”

Seddon is an occupational psychologist who has spent his career trying to improve systems by taking the waste out of processes. One of the ways he has done this is by focusing on what gets measured, a kind of ‘What gets measured gets done’ approach to improvement. His work has no doubt resulted in a lot of projects, particularly those that relate to continuous process improvement, but his book doesn’t cover project environments particularly. Still, I think that the way he splits measures into these two types is relevant to project managers – and we are focusing on governance this month at ProjectManagement.com. Let’s take a closer look at the types of measures Seddon explores in his book.

Permanent measures

Permanent measures, are, as you have probably guessed by the name, permanent. As nothing much is permanent on a project, these are the kind of measures you are likely to find in your Project Management Office or Portfolio Office. They are the measures that help manage the work overall. Some examples of permanent measures are:

Capacity and demand. This can help with resource scheduling on an ongoing basis. It helps to know what work is due to complete and when project managers will be free to take on other projects.

End-to-end time. This is how long it takes to complete the work from the customer’s perspective. As not many projects are repetitive, this is a bit of a pointless measure on projects. However, if you are repeating similar initiatives over a period of time (such as rolling out new software to an office at a time), it can be very useful to know how long it takes to complete one implementation.

Accuracy. In a project environment, this would be covered by project audits. The ‘accuracy’ of a project could equate to scope items covered, fit with requirements or how customer-centric you are and how much value you create for customers.

Temporary measures

Temporary measures are those that don’t last long. They aren’t permanently built into the fabric of how companies report projects. As such, you could have temporary measures on your project, especially if your project has a RAG status of Red and is in trouble. If you are trying to rescue a failing project, you will want to gather some data on what has been done to date and how best you can recover the situation.

It’s less easy to see how Seddon’s examples of temporary measures relate to projects. Here they are.

Type and frequency of demand. This could be a PMO measure, especially if you are looking to recruit an additional project manager or more staff in other capacities. You could measure the type and frequency of demand over a short period of time to check that you really do have cause to hire someone. Equally, on your project, you could use this type of metric for resource management. For example, as you move into the testing phase your resource needs will change. This is something that you won’t measure when the project is over as staffing up to support the product is a task for the operational team.

Type and frequency of ‘dirt’ in input. Seddon is mainly writing about service organisations like call centres, so he means incomplete application forms, letters that don’t have enough information in and so on. In the world of projects, this could be things like project initiation forms that don’t have enough information in for the stakeholders to sign off the scope, incomplete business cases, requests for projects that appear in the form on an email with a good idea rather than a thought-through assessment for a new project etc. He recommends that a few small changes could make a big difference, such as changing the forms or template letters used. For example, you could amend the form on your company intranet so that it is rejected unless someone enters all the detail required to submit a new project for consideration.

Type and frequency of waste. ‘Waste’ to Seddon means steps in the process that don’t add any value. These could be things like handovers between teams, lost time, rework and errors. There are probably numerous places on a project or in your project management processes where things get lost or handoffs between teams are not as slick as they could be.

I’m a big believer in taking what we can from other areas of management practice and applying them to projects, so I think it is worth considering what we can learn from the type of metrics used in service organisations and the like. Do your project or PMO metrics fit any of these categories?

In this installment of my series on estimating, I look at what bottom up estimating is in a short video.

Today I talk to Dr Andrew Makar, IT program manager and author of Project Management Interview Questions Made Easy, about getting a new job.

Why is preparing for a new job more than just about practising responses to interview questions?

Preparing to find the next opportunity requires a lot more preparation than futility trying to memorize an exhaustive list of project management interview questions. The majority of the “interview tip” websites seem to think providing over 50 interview questions is a useful resource a candidate can apply in an interview setting.

It isn’t realistic to memorize questions that may never be asked.  This is why finding new opportunities and preparing for upcoming interviews is a reflective one much like a project management lessons learned session or retrospective.

I advocate thinking about past scenarios rather than memorizing questions.  Reviewing your resume, reflecting on the lessons learned from those past projects and positions provides a much better background than rehearsing the perfect answer to a question that may never be asked.

You talk about a career contact matrix in your book. What is that?

The career contact matrix is a tool I’ve used to help me identify opportunities, leads, and follow up on active conversations for the next career opportunity. It’s a simple matrix that can track active opportunities and identify contacts for professional networking and follow up over a three- to six-month time period.

I developed a career contact matrix using a variety of formats including spreadsheets and mind maps. The career contact matrix consists of 9 simple columns including:

• Opportunity Status
• Opportunity Title
• Company
• Contact Name
• Contact Phone
• Contact Email
• Contact Job Title
• LinkedIn Profile
• Next Steps

The matrix is managed like a project manager’s issue log where opportunities turn into qualified leads and other opportunities don’t meet your need or interest. By keeping in touch with your contacts, new opportunities can occur frequently and a timely phone call can open up an entirely new job opportunity. Another key benefit of an updated matrix is it becomes your emergency unemployment rescue kit. There is a template for the matrix in my book, Project Management Interview Questions Made Easy.

If you do find yourself unemployed, employers often use phone interviews as a way of cutting down the number of candidates they invite in to the office. What's the biggest difference between a phone interview and a face to face interview?

Phone interviews can be difficult because of the lack of subtext. You only have the benefit of the interviewer’s tone rather than seeing non-verbal communication signals. Most phone interviews tend to be screening interviews when there recruiter is vetting your profile for both skills and salary range. It is difficult to develop rapport with one phone call. The face to face interview is much better because you can look a person in the eye and determine if the opportunity is the right fit.

Remember, you are evaluating them just as they are evaluating you.

That’s  a good tip. Do you have any others?

For the job seeker, developing your personal network and promoting your personal brand is a key factor to creating a career safety net. I use the career contact matrix to maintain an action plan for professional networking and building better relationships. I always dislike receiving an email from someone seeking a job when I haven’t spoken to them in a year. By developing better relationships and “checking in” from time to time, your job search becomes easier as opportunities pop.

My past 3 jobs have all come from a professional network instead of a job posting system. As project managers, we can spend over 40 hours a week delivering projects. Take at least one hour a week to focus on your career including networking, opportunity prospecting and directing your own career.

Is the interview the best time to ask questions about salary and benefits? If not, when should you ask about these?

The interview is the best time to sell yourself. The hiring decision is usually the interviewer’s decision. The salary and associated benefits is an HR decision. Focus on positioning yourself as the desired candidate and obtain the hire decision. Once HR makes an offer, you can negotiate the salary and benefits.

In my experience, the initial phone screen or the job description will help identify the position title. You can usually find out about benefits and salary ranges incomparable positions from others in your professional network or using tools like salary.monster.com or glassdoor.com

What happens if the interview includes other things like tests or a presentation? How can people prepare for those?

I’ve asked candidates to demonstrate their skills in an interview by providing situational questions or even asking candidates to draw a small data model. In a project management interview, you want to provide specific actions taken using the processes, tools and techniques to manage a project. If you indicate on your resume that earned value management is a skill, be prepared to share how you’d apply earned value on a project or better yet how you would do it in Microsoft Project. Reflecting on your past job scenarios, providing real world examples with the techniques to support your responses will help you pass any test or presentation.

About Andrew Makar

In this instalment of my occasional Ask the Experts column, I spoke to Kevin Baker (pictured), Head of Project & Programme Management Operations at Airbus, about the work he has been leading to improve project management standards and culture at the company, including the improvement of project financial controls.

Kevin, you've enhanced the project management culture at Airbus. Has any of this work been around standardising project financial control or risk management? If so, what?

At Airbus we have been working to standardise all aspects of project management, and of course this includes financial control and risk management. Together with schedule management and quality, these form the pillars of a robust project management approach.

What have we actually done? The principles of financial management and risk management have been known in Airbus for many years, there is nothing really new here. What is new is to have a standard set of methodology and tools, so that all actors in the company start to work in the same way, and to use the same language. Over a period of a few years, and with a strong push from the senior management, this starts to embed the new way of working into the company.

Yes, it is really important to have that senior management support. Have you implemented any common tools for project managers to use for managing project budgets or project risks?

In Airbus we have a number of very large projects, like our new aircraft – the A350XWB. Their size and complexity requires a special treatment and we have developed our own toolset – it is called Unified Planning. This takes the schedule status and the cost status at work package level and then aggregates this up to give the overall picture at total project level, that is the status for the complete aircraft development. We also compare cost to schedule achievements to produce an Earned Value indicator. This gives the managers at all levels the visibility of where they are, and how they are performing. And it makes sure that everyone is working to the same information.

Do smaller projects use the same tools?

We also have many hundreds of smaller projects, and we have adopted a simpler toolset for these. But it follows the same basic principles – monitor cost vs budget, and schedule progress vs plan, then calculate earned value.

We cannot say that these new tools will overcome all the difficulties on our projects, but they make sure that we know where we are so that the project managers can quickly start a corrective action if necessary. We are not steering ‘blind’.

Data is a key part to making the right decisions. In order to get there, you’ve had to change the culture at Airbus. What was the biggest challenge in trying to get the company to embrace project management as an intrinsic part of how everyone works?

Airbus is just over 40 years old, and its strength comes from a determination to build the best performing products to the very highest standard of safety. The challenge now is to promote a project management culture alongside these existing strengths. That is to make sure that we not only build fantastic products which perform well but also that we make sure that we do it on time, and within the budget.

We know that the culture change is a long process. It is about making sure that we all think ‘project’. We have made good progress, but the journey will never end. So what is next? – it is more of the same. We keep pushing for a common way of working, a common mindset, a common language. We are deploying some levers to help here. For example we have a project management career path, which is linked to an internal project management certification process. This will help to make project management into a real profession in Airbus – to make more people want to be project managers, to be more proud to be project managers. We are also expanding our range of PM training focussing more now on soft skills.

Thanks, Kevin!

About my interviewee: Kevin Baker is Head of Project & Programme Management Operations at Airbus. He spoke at Project Zone Congress in Frankfurt last month about this programme of work to enhance project management culture at the company.