Managing Complex Projects A New Model Managing Complex Projects A New Model K athleen B Hass, PMP 8230 Leesburg Pike, Suite 800 Vienna, VA 22182 (703) 790-9595 Fax: (703) 790-1371 www.managementconcepts.com Copyright © 2009 by Management Concepts, Inc All rights reserved No part of this book may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording, or by an information storage and retrieval system, without permission in writing from the publisher, except for brief quotations in review articles Printed in the United States of America Library of Congress Cataloging-in-Publication Data Hass, Kathleen B Managing complex projects : a new model / Kathleen B Hass p cm ISBN 978-1-56726-233-9 Project management I Title HD69.P75H3757 2009 658.4’04—dc22 10 9 8 7 6 5 4 2008027192 3 2 Praise for Managing Complex Projects: A New Model Kitty’s book is refreshing, insightful, and on-target This is a serious look at the challenges we face today in managing complexity on projects Though it is serious, it is a delight to read Her research is impeccable, her sources current, and her ideas original Managers who listen to her arguments and follow her advice will be at a great advantage in dealing with the 21st century’s brave new world of complex project management J Davidson Frame, PhD, PMP, PMI Fellow Academic Dean, University of Management and Technology author of The New Project Management : Tools for an Age of Rapid Change, Complexity, and Other Business Realities “Using breakthrough thinking, Kitty unravels the mysteries of project complexity and offers a proven model to succeed in the chaotic marketplace For those who are lost in a tangled web of challenged projects, this book not only offers a way out but a way to thrive It is a welcome breath of fresh air and cure for the (common) complex project.” B Michael Aucoin, D Engr., PE, PMP President, Leading Edge Management, LLC author of Right-Brain Project Management : A Complementary Approach “Projects today operate in the midst of constantly changing business conditions and complex technologies Combine that with things like distributed delivery and other complicating organizational factors—and project managers are faced with dramatically increasing complexity on their projects Kitty’s approach gives these managers a framework and tools to handle this increasing complexity that nicely supplement their formal project management training and work experience.” Sanjiv Augustine President, LitheSpeed author of Managing Agile Projects “Today’s complex projects—characterized by ambiguity and uncertainty, and fueled by high speed and high change—require a new model to succeed Kitty’s groundbreaking, standard-setting book gives us not only the rationale, but also the essential leadership and management practices for success on nine varieties of complex projects Don’t start or continue a complex project without consulting this book It’s a gem.” Doug DeCarlo Principal, The Doug DeCarlo Group author of e Xtreme Project Management : Using Leadership, Principles, and Tools to Deliver Value in the Face of Volatility “Kitty succeeds in making the management of complexity simple but not simplistic This new model makes a significant contribution to meeting the growing challenge of complex projects Following this approach will maximize the value that organizations can achieve from undertaking complex projects—try it and see.” Dr David Hillson, PMP, HonFAPM, FRSA Director, Risk Doctor & Partners author of Practical Project Risk Management : The ATOM Methodology “Anyone facing the challenging task of managing one of today’s complex projects will find much in this book to aid them in their efforts to carry out successful projects.” Gerald M Mulenburg, DBA National Aeronautics and Space Administration About the Author K athleen (Kitty) B Hass is the Senior Practice Consultant for Management Concepts She is a prominent presenter at industry conferences and is an author and lecturer in strategic project management and business analysis disciplines Her expertise includes leading technology and software-intensive projects, building and leading strategic project teams, and conducting program management for large, complex engagements Kitty has more than 25 years of experience in project management and business analysis, including project portfolio management, business process reengineering, IT applications development and technology deployment, project management and business analysis training and mentoring, and requirements management She has managed large, complex projects in the airline, telecommunications, retail, and manufacturing industries as well as in the U.S federal government Kitty’s consulting experience includes engagements with multiple federal agencies, including USDA, USGS, NARA, and an agency within the intelligence community, as well as industry engagements at Colorado Springs viii • M a n a g i n g C o m p l e x P r o j e c t s utilities, Toyota Financial Services, Toyota Motor Sales, the Salt Lake Organizing Committee for the 2002 Olympic Winter Games, and Hilti US Inc Kitty is Director at Large for the International Institute of Business Analysis (IIBA®) and has served as a member of the IIBA® Business Analysis Body of Knowledge™ committee She holds a BA in business administration, summa cum laude, from Western Connecticut University To My brilliant husband, whose thinking permeates these pages My amazing children, Patrick, Sally and Dave, Joey and Christy— I love watching them soar And my even more amazing grandchildren, Alec, C.J., Madeline, and Liam— I can’t wait to see them take wings 284 • M a n a g i n g C o m p l e x P r o j e c t s elicit positive emotions in all those touched by it, and we want these positive emotions to linger long after the project is closed This is the ultimate critical success factor for a project This is the legacy we aspire to leave when we complete a project.”2 Aucoin goes on to state that the perception of a product long after it is introduced is one indication of a project’s legacy If the product is highly regarded, it follows that the project will be as well, along with all those people who were associated with the project It is imperative that the right product be delivered for a project to be considered a success However, the right product is often difficult to determine at the beginning of a complex project The team must be allowed to work on the edge of chaos for that enduring product to emerge As you strive to become a strong leader of complex projects, keep in mind that conventional project management techniques are based on decomposing work into simple, easily managed components Yet sometimes, the most creative solutions emerge from teams operating on the edge of chaos The trick is to know when to apply conventional project management techniques and when to live on the edge Through complexity thinking, project leaders can learn to diagnose a project’s complexity dimensions and then to apply appropriate management techniques notes Jim Collins, Good to Great (New York: HarperCollins Publishers, Inc., 2001), 17–40 B Michael Aucoin, Right-Brain Project Management: A Complementary Approach (Vienna, VA: Management Concepts, 2007), 270 Bibliography Aucoin, B Michael 2007 Right-Brain Project Management: A Complementary Approach Vienna, VA: Management Concepts Augustine, Sanjiv 2005 Managing Agile Projects Upper Saddle River, NJ: Prentice Hall Professional Technical Reference Collins, Jim 2001 Good to Great: Why Some Companies Make the Leap…and Others Don’t New York: HarperCollins Publishers DeCarlo, Doug 2004 eXtreme Project Management: Using Leadership, Principles, and Tools to Deliver Value in the Face of Volatility San Francisco: Jossey-Bass Frame, J Davidson 2002 The New Project Management: Tools for an Age of Rapid Change, Complexity, and Other Business Realities San Francisco: Jossey-Bass Garrett, Gregory A 2004 Managing Complex Outsourced Projects Chicago: CCH Incorporated Hadden, Rita Chao 2003 Leading Culture Change in Your Software Organization Vienna, VA: Management Concepts Hass, Kathleen B 2008 The Business Analyst as Strategist: Translating Business Strategies into Valuable Solutions Vienna, VA: Management Concepts 286 • M a n a g i n g C o m p l e x P r o j e c t s Highsmith, Jim 2004 Agile Project Management: Creating Innovative Products Boston: Addison-Wesley Hillson, David, and Peter Simon 2007 Practical Project Risk Management: The ATOM Methodology Vienna, VA: Management Concepts Hillson, David, and Peter Simon 2007 Practical Project Risk Management: The ATOM Methodology Vienna, VA: Management Concepts Irwin, Brian 2008 Managing Politics and Conflict in Projects Vienna, VA: Management Concepts Johnson, Jim 2006 My Life is Failure: 100 Things You Should Know to be a Successful Project Leader West Yarmouth, MA: The Standish Group International Jones, Capers 1996 Applied Software Measurements: Assuring Productivity and Quality New York: McGraw-Hill Katzenbach, Jon R., and Douglas K Smith 1993 The Wisdom of Teams Boston: Harvard Business School Press Kolb, David C 1999 Team Leadership Durango, CO: Lore International Institute Kotter, John P 1996 Leading Change Boston: Harvard Business School Press Kotter, John P 2002 The Heart of Change Boston: Harvard Business School Press Lewin, Roger, and Birute Regine 1992 “On the Edge in the World of Business,” afterword to Complexity: Life at the Edge of Chaos by Roger Lewin Chicago: University of Chicago Press Lissack, Michael R., and Johan Roos 2002 The Next Common Sense: The e-Manager’s Guide to Mastering Complexity London, UK: Nicholas Brealey Publishing Bibliography • 287 Mooz, Hal, Kevin Forsberg, and Howard Cotterman 2003 Communicating Project Management Hoboken, NJ: John Wiley & Sons Morris, Peter W G 1998 Key Issues in Project Leadership: Project Management Handbook San Francisco: Jossey-Bass Morris, Peter W G., and Jeffrey K Pinto 2004 The Wiley Guide to Managing Projects Hoboken, NJ: John Wiley & Sons Poppendieck, Mary, and Tom Poppendieck 2003 Lean Software Development: An Agile Toolkit Boston MA: Addison-Wesley Porter, M E., 1985 Competitive Advantage New York: Free Press Project Management Institute 2004 A Guide to the Project Management Body of Knowledge, Third Edition Newtown Square, PA: Project Management Institute Shenhar, Aaron, and Dov Dvir 2007 Reinventing Project Management: The Diamond Approach to Successful Growth and Innovation Boston: Harvard Business School Press Virine, Lev, and Michael Trumper 2008 Project Decisions: The Art and Science Vienna, VA: Management Concepts Waldrop, M Mitchell 1992 The Emerging Science at the Edge of Order and Chaos New York: Simon & Schuster Williams, Terry 2002 Modelling Complex Projects West Sussex, UK: John Wiley & Sons, Ltd Wysocki, Robert K 2007 Effective Project Management, Traditional, Adaptive, Extreme, Fourth Edition Indianapolis, IN: Wiley Publishing, Inc Zook, Chris 2007 Unstoppable: Finding Hidden Assets to Renew the Core and Fuel Profitable Growth Boston: Harvard Business School Press Index A acquisition standards, U.S Department of Defense, adaptive management approaches, 258 adaptive project cycles, 76 agile methods, 204–207 agile model, 100–102 agile project management, agile teams, 162 agility, need for, 255–256 ambiguous business problems or opportunities case study, 183–184 complexities, 195 determining clear business objectives, 184–185 professional business analysis, 186–187 uncertainty, 182 ambiguous solutions case study, 188 clarifying, 187 complexities, 195 cross-functional enterprise solutions, 192 edge-of-chaos management, 189 emotional intelligence, 192–193 feasibility, 182 feasibility studies, 189–191 fostering creativity, 192–193 innovation team, 188–189 innovative decisions, 189–191 leading your team into the zone, 193–194 metaphors, 193 pattern discovery, 193 root cause analysis, 192 storytelling, 193 B Bain and Company, 11, 27 bottom-up estimates, 125 BPM See business process management 290 • M a n a g i n g C o m p l e x P r o j e c t s business objectives, 184–185 business practices, 12 business process management (BPM), 273, 275–276 C case studies ambiguous business problems or opportunities, 183–184 ambiguous solutions, 188 change initiatives, large-scale, 228, 231 large, long-duration projects, 120, 129 project teams, 163 requirements volatility and risk, 199–200 risk, 240–241 strategic projects, 213–214, 221–222 urgent projects, 174 CCPM See critical chain project management Certified IT Architect, 264 change, effects of, 1–2 change initiatives, large-scale case study, 228, 231 change management framework, 229–230 commercial practices, rules and regulations, 234–235 common mistakes, 227–228 complexities, 226, 236 definition, 12–14, 225–226 emotional response to change, 227 groundbreaking commercial practices, 232 internal motivation to change, 232 managing, 229 prototyping to obtain market feedback, 233–234 resistance to change, 226–227 rigorous industry analysis, 233 CHAOS research, 4, chief information officer (CIO), 7–8 Clinger-Cohen Act, 7–8 co-evolution, 23 COBIT See Control Objectives for Information and Related Technology collaboration tools, 166–167 collaborative planning, 166 commercial-off-the-shelf (COTS), 199 commercial practices, 232, 234–235 communication layer, outsourced projects, 250 communities of practice, 261–262 comparison estimates, 125 competitive advantage, 256–258 complex adaptive systems, 22–25, 140–141 complex project manager characteristics of, 60 competencies, 60–61 skills, 60–61 complex systems, 20 complex versus complicated, 20–21 complexity, definition, 19–20 complexity-reducing design techniques, 270 complexity theory basic concepts, 22 edge of chaos, 22 equilibrium to chaos spectrum, 22 history of, 21 importance of, 20 complexity thinking applying to projects, 50–52 Index context, 27–28 project management, 34–38 right-brain versus left-brain activity, 33–34 using to assign project leaders, 72 complicated versus complex, 20–21 connectivity, 23 continuous innovation, 257 contractor teams, 157 Control Objectives for Information and Related Technology (COBIT), 8–9 core project leadership team, 62–64 COTS See commercial-off-the-shelf creativity, 22, 192–193 critical chain project management (CCPM), 82 cross-functional enterprise solutions, 192 culture of discipline, 155–157 D Defense Systems Management College, delaying design decisions, 133 delivery schedule, 257 designing for people and building for change, 271–272 DHS See U.S Department of Homeland Security discipline, 155–157 discipline and agility, balancing, 267–270 Distinguished Certified IT Architect, 264 distributed leadership, 63 divergent thinking, 193 DoD See U.S Department of Defense • 291 E edge of chaos importance of, 24, 286 leadership, 160–161 management, 189, 260 emergence, 22, 23 emotional intelligence, 192–193 emotional response to change, 227 empowering customers, 259 enabling solution design tools, 271 enterprise project management (EPM), 167 enterprise requirements planning (ERP), 199 estimating, 124–127 evolutionary prototyping model, 108 expectations, 222–223 experimentation, 193 experts, 73 extreme project cycles, 76 eXtreme project management model, 109–110 F feasibility studies, 189–191 Federal Emergency Management Agency (FEMA), 142 Federal IT Project Manager Initiative, firm basic requirements, 122 five-stage team development model, 150 formal project management methodology, 164–166 function point estimates, 126 functional managers, 219 292 • M a n a g i n g C o m p l e x P r o j e c t s G GAO See Government Accountability Office General Accounting Office See Government Accountability Office governance layer, outsourced projects, 249 Government Accountability Office (GAO), Guide to the Project Management Body of Knowledge (PMBOK® Guide), 31, 46, 59, 122–123, 242 H heuristic estimates, 125 highly complex projects definition, 103–104 evolutionary prototyping model, 108 example, 105 eXtreme project management model, 109–110 formula, 106 models, 107 profile, 104–105 project cycle approaches, 107 hub organizational structure, 154 I IIBA See International Institute for Business Analysis incremental delivery model, 96–97 incremental project cycles, 76 incremental solution development, 208 independent projects characteristics, 79 complexity profile, 80 critical chain project management, 82 example, 81 modified waterfall model, 85 project complexity formula, 81 rapid application development model, 86 Vee model, 87–88 waterfall model, 82–84 independent software vendors (ISV), 273 industry analysis, 233 innovation team, 188–189 innovation teams, 175 integrated project management team, 248–249 International Institute for Business Analysis (IIBA), intuition, 193 ISV See independent software vendors IT application development projects, failure of, 4–5 IT architects certification, 264–265 importance of, 263 role, 262–263 IT complexity, projects with adaptive management approaches, 258 agility, need for, 255–256 business process management, 273, 275–276 communities of practice, 261–262 competitive advantage, 256–258 complexities, 280 complexity-reducing design techniques, 270 Index designing for people and building for change, 271–272 discipline and agility, balancing, 267–270 edge-of-chaos management, 260 empowering customers, 259 enabling solution design tools, 271 impact on project, 253–254 independent software vendors, 273 IT architects, 262–265 last-responsible-moment decisionmaking process, 261 limited solution component dependencies, 270 managerial complexities, 255 micro projects, 261–262 partnerships, 265–267 service-oriented architecture, 273–275 skunk works teams, 259–260 system integration teams, 267 technical complexities, 254 technologies, change-enabling, 272–273 IT Governance Institute (ITGI), IT Projects in the United States, 2006 Survey, IT Service Management (ITSM), ITAC See Open Group IT Architect Certification iteration, 24 iterative development, 94 iterative project cycles, 76 ITGI See IT Governance Institute ITSM See IT Service Management J just-in-time planning, 122 • 293 K knowledge management system, 203 L large, long-duration projects case study, 120, 129 constant change, 118 definition, 117–119 delaying design decisions, 133 developing and delivering solution, 130–134 estimating, 124–127 lean development techniques, 134 managing, 136 minimizing scope, 132–133 planning and structuring, 121 progressive elaboration, 122–123 rapid application development, 133 rigorous risk management, 128–129 selecting appropriate management approach, 121–122 size, 118 stage-gate management, 128 structuring, 130–131 team fatigue and staff turnover, 119 team members, 134–136 time and cost management, 127–128 last-responsible-moment decisionmaking process, 261 lean development techniques, 134 leaving a legacy, 285 limited solution component dependencies, 270 linear project cycles, 75–76 294 • M a n a g i n g C o m p l e x P r o j e c t s M management layer, outsourced projects, 249–250 managerial complexities, 255 market feedback, 233–234 Master Certified IT Architect, 264 MBTI® See Myers-Briggs Type Indicator® metaphors, 193 micro projects, 261–262 milestone, 123 mind mapping, 193 minimizing scope, 132–133 moderately complex projects agile model, 100–102 definition, 91 example, 93 incremental delivery model, 96–97 iterative development, 94 management practices, 95 profile, 92 project complexity formula, 93 project cycle approaches, 95 modified waterfall model, 85 Myers-Briggs Type Indicator®, 60 N National Aeronautics and Space Administration (NASA), 41–42 NCTP See Novelty, Complexity, Technology, and Pace model nested systems, 24 nongovernmental organization (NGO), 143 nontraditional project start-up methods, 172 Novelty, Complexity, Technology, and Pace model (NCTP), 41–42 O Office of Management and Budget (OMB), Open Group IT Architect Certification (ITAC), 264–265 outsourcing, 239, 247–250 P parametric estimates, 126 partnerships, 265–267 pattern discovery, 193 planned urgent projects, 174 PMBOK® Guide See A Guide to the Project Management Body of Knowledge PMI See Project Management Institute political management plan, 217 political management strategy, 216– 217 product adaptability, 257 professional business analysis, 186–187 professional service automation (PSA), 167 progressive elaboration, 122–123 project complexity IT projects, 40 models, 41–42 sources of, 40 visualizing, 48–49 Project Complexity Assessment Tool, 47 project complexity formula, 46, 81, 93 Index project complexity model formula, 46 importance of, 39–40 management guide, 49–50 overview, 42–43 rationale for, 46–47 using, 43–45 project cycle definition, 75 models, 75 types, 75–77 project cycle approaches, 107 project leader certification levels, 69 characteristics, 70–72 competency model, 69 complex career progression, 68–70 traditional career path, 67–68 project leadership capability maturity model, 72 project management adaptive, 31–33 attitudes towards, complexity theory, 30 complexity thinking, 33–38 conventional, 28–29, 31–33 organizational analysis, 30 purpose, reductionism, 29 reinventing, 53 Project Management Institute (PMI), 9, 30 project performance past failures, reasons for improvement, 10 success rates, 6–7 project profiles, 139 Project Sizing Grid, 46 • 295 project teams agile teams, 162 approaches for managing, 168–169 building, 151–152 case study, 163 collaboration tools, 166–167 collaborative planning, 166 competent staff, 152–153 complex adaptive systems, 24–25, 140–141 contractors, 157 culture of discipline, 155–157 edge-of-chaos leadership, 160–161 empowering members, 155 experienced managers, 147–151 five-stage team development model, 150 formal project management methodology, 164–166 harnessing wisdom of, 145–146 Hurricane Katrina response, 142– 143 leadership, 141, 147 leveraging power of, 144 potential, 144 project profiles, 139 structuring, 153–155 virtual teams, 157–160 prototyping, 108, 233–234 PSA See professional service automation R rapid application development (RAD), 86, 133 Recipe for Project Success: The CHAOS Ten, 10–11, 46–47 296 • M a n a g i n g C o m p l e x P r o j e c t s reductionism, 29 reliable results, 258 requirements definition techniques, 207 requirements integration teams, 202 requirements volatility and risk agile methods, 204–207 case study, 199–200 complexities, 198, 210 customer involvement, 203 deficient requirements practices, 198–199 incremental solution development, 208 insufficient stakeholder involvement, 199 interdependencies, 199 knowledge management system, 203 overview, 197 professional business analysts, 202–203 requirements definition techniques, 207 requirements integration teams, 202 rigorous enterprise analysis, 201–202 visualization techniques, 207 requisite variety, 23 resistance to change, 226–227 resource assignment, 175 resource sharing, 135 right-brain versus left-brain activity, 33–34 rigorous enterprise analysis, 201–202 rigorous risk management, 128–129 risk case study, 240–241 change, 245–247 complexities, 238, 251 constraints, 240 dependencies, 240, 244–245 governance layer, 249 importance of, 237 integrated project management team, 248–249 integration issues, 240–241 interventions, 239 managing, 242–244 outsourcing, 239, 247–250 reaction to change, 238–239 supplier partnerships, 247–248 uncertainties, 242–244 risk management, 128–129 rolling wave planning, 122 root-cause analysis, 192 S scope, 132–133 self-organization extensions, 154 self-organizing, 24 senior project leaders, 57–59, 60–62 service-oriented architecture (SOA), 273–275 shared leadership, 63 simple remedies, estimating, 127 simple rules, 23 skunk works teams, 259–260 SOA See service-oriented architecture social software, 167 software crisis, Software Productivity Consortium See Systems and Software Consortium, Inc Software Technology for Adaptable, Reliable Systems (STARS), spider chart, 48 spiral model, 98–99 Index SSCI See Systems and Software Consortium, Inc staff turnover, 119 stage-gate management, 128 stakeholder analysis worksheet, 218 stakeholder involvement, 199 stakeholder management, 219–221 Standish Group Project Resolution History, 10 Standish Group Recipe for Success, 2001, 131 STARS See Software Technology for Adaptable, Reliable Systems steering committees, 215–216 storytelling, 193 strategic projects business benefits, 216 case study, 213–214, 221–222 changing expectations, 212 complexities, 212, 224 customer and user involvement, 221 definition, 211 executive support, 214–216 expectations, 222–223 functional managers, 219 political management plan, 217 political management strategy, 216–217 politics, 212 promotion, 218–219 stakeholder analysis worksheet, 218 stakeholder management, 219–221 steering committees, 215–216 virtual alliances, 222 sub-optimal, 23 system integration teams, 267 Systems and Software Consortium, Inc (SSCI), • 297 T team development model, 150 team fatigue and staff turnover, 119 team health, 134–135 team members, 134–136 team self-discipline, 154–155 technical layer, outsourced projects, 250 technologies, change-enabling, 272–273 time and cost management, 127–128 time-boxing, 175–176 top-down estimates, 125 traditional project team configuration, 63 transformation, 12–13 U UC See unified communications uncertainty, 182 unclear business objectives, 181–182 unified communications (UC), 273, 277–278 United Kingdom project failure statistics, urgent projects adapting to situation, 176–177 case study, 174 complexities, 172, 180 definition, 171 high stakes, 172–173 implementing proven critical practices, 177–179 innovation teams, 175 leading, 173–174 298 • M a n a g i n g C o m p l e x P r o j e c t s nontraditional project start-up methods, 172 planned urgent projects, 174 resource assignment, 175 time-boxing the effort, 175–176 unexpected, 176 U.S Department of Defense (DoD) acquisition standards, Software Engineering Institute, Software Technology for Adaptable, Reliable Systems, U.S Department of Homeland Security (DHS), 142 use case point estimates, 126 V Vee model, 87–88 virtual alliances, 222 virtual teams, 157–160 building trust, 159 communication, 159 definition, 157 discipline, 159–160 managing results, 159 practices of effective leaders, 158–159 rules of responsiveness, 160 visualization, 48–49, 193, 207 W waste, driving out, 13 waterfall model, 82–84 WBS See work breakdown structure Web 2.0 development, 273, 276–277 wicked problems, work breakdown structure (WBS), 125 work distribution estimates, 125 ... diagnosing complexity on a wide variety of projects, ranging from small, independent, short projects, to medium size and medium complexity projects, through large, highly complex, longer projects. .. required to manage complex projects, discuss strategies for developing managers of complex projects, and make recommendations for applying complexity thinking to select leaders of complex projects Part... Applying Complexity Thinking to Projects with a High Level of IT Complexity 253 What Makes Projects with Significant IT Components Complex? 254 Techniques to Harness IT Complexity