Performance based planning in a nut shell (V5)

V5.0

Performance-Based Project Management®

In A Nutshell

Principles, Practices, and Processes that

Increase Your Probability of Project Success

Performance Based Management(sm), Copyright ® Glen B. Alleman, 2012

Why Performance-Based Project Management®?

All successful projects must deliver capabilities:

Not the work efforts,

Not the cost expenditures,

Not the documentation, test results, or the processes.

All successful projects must deliver tangible beneficial outcomes, measured in units meaningful to the decision makers.

2/29


Principles, Practices, and Processes for

Increasing the Probability of Project

Success†

† Program Success Probability, John Higbee, Defense Acquisition

University, 9 May 2005


1. What Does DONE Look

Like?

2. What is the path to

DONE?

3. Do We Have Enough

Time, Resources, And

Money To Get To DONE?

4. What Impediments Will

We Encounter Along The

Way To DONE?

5. How Do We Know We

Are Making Progress

Toward DONE?

5 Principles of Project Success . . .

3/295 Immutable Principles of Project Management, Copyright ©, Glen B. Alleman, 2012

4 Performance Based Management(sm), Copyright ® Glen B. Alleman, 2012

Identify Needed

Capabilities

Indentify Baseline

Requirements

Establish Performance Measurement

Baseline

Execute Performance Measurement

Baseline

Define Capabilities

Define ConOps

Assess Needs, Cost, and

Risk Impacts

Define Balanced and

Feasible Alternatives

Fact Finding

Gather And Classify

Evaluate And

Rationalize

Prioritize Requirements

Integrate And Validate

Decompose Scope

Assign Accountability

Arrange Work

Develop BCWS

Assign Performance

Perform Work

Accumulate

Performance Measures

Analyze Performance

Take Corrective Action

Perform Continuous Risk Management (CRM)

Define the Measurable

Capabilities of each

Project Outcome

Assure All Requirements

Provided In Support of

Capabilities

Define Measures of

Performance and

Effectiveness

Ensure Cost, Schedule,

and Technical

Performance Compliance

Define the Work Breakdown Structure(WBS).

Identify the Organizational Breakdown Structure (OBS).

Integrate the WBS and OBS.

Schedule the work.

Identify the Products and

Milestones.

Set the time phased budget.

Record direct costs.

Determine variances.

Sum Data and variances.

Manage action plans.

Performance Analysis

Incorporate Changes.

5/29

† These 11 processes are a subset of the 32 Criteria of ANSI–748B Earned Value Management. While not all

projects can make use ANSI EVM, these process are the basis of all project management success.


6 Kavli Institute at Cornell for Nanoscale Science

5 Principles

Principles and Practices of Performance-Based Project Management®

5 Practices

Identify

Capabilities

Define

Requirements

Performance

Measurement

Baseline (PMB)

Execute the

PMB

Continuous Risk

Management

What does

done look like?

ConOps, SOO,

SOW

Technical and

Operational

Based Plan

Incremental

Maturity

Assessment

Physical Percent

Complete

Risk

Identification

What is the

path to Done? Integrated

Master Plan

(IMP)

Work

Breakdown

Structure Integrated

Master

Schedule (IMS)

Iterative and

Incremental

Delivery

Risk

Analysis

What resource

do we need

along the way?

Resource

Management

Plan

Future

Performance

Forecasting

Risk

Planning

What

impediments

will we

encounter along

the way?

4 Levels of

Uncertainty

Assessment

Technical and

Programmatic

Risks assigned

to all WBS

deliverables

Risk adjustments

to cost and

schedule

measures

Risk adjusted

Performance

Measurement

Baseline

Risk

Tracking

How do we

measure

progress?

Measures of

Effectiveness

(MoE)

Measures of

Performance

(MoP)

Technical

Performance

Measures

Earned Value

Management

Risk

Control

5 Practices

Practices and Processes of Performance-Based Project Management®

5 Processes

OrganizePlan, Schedule,

Budget

Account for all

costs

Analyze

Variances

Manage

Change

Identify

Capabilities

Project mission,

vision, and

deliverables

Value stream of

increasing

maturity

Top level

budget for

capabilities

Measures of

Effectiveness

Define

Requirements

Requirements

traced to

capabilities

Measures of

Performance

Performance

Measurement

Baseline

Resource

Management

Plan

Work Packages

with budget

Labor and

material costs

Technical

Performance

Measures

Baseline change

request

Execute the

PMB

Budgeted Cost

for Work

Scheduled

Work Package

Performance

Physical Percent

Complete

Technical

change requests

Continuous Risk

ManagementRisk Register

Risk impacts on

cost and

schedule

Risk adjustments

to PMB


Addresses The Critical Project Outcomes†

9/29

† Project Management Case Study, Pierre Bonnal, CNAM IIM MBA Program, June 2004

Traditional program management assumes technical and

program processes drive outcomes.

Focusing on process alone has failed in the past.

The

Problem

By their very nature, project are risky.

Successful project management is risk management.

Program management must be about avoiding surprises.

The

Situation

Program management is about avoiding surprises.

Measures of physical percent complete are mandatory.The Need

Organizations execute projects.

Adapting the organization culture to the project paradigm

increases the probability of success.

The

Context

Technical Performance of deliverables is a measure of

increasing probability of success.

Earned Value Management reveals surprises.

The

Solution


Practices produce Project Outcomes

10/29

The Outcome does not need to be the end product.

The Outcome is the result of Work Packages that increase

the measureable maturity of the product or service.

Outcomes are specified and measureable.

Design complete and verifiable.

Development complete and testable.

Testing complete and validated.

Installation and deployment complete and operational.

Work Packages consume time and resources.

Work Packages are owned by a single accountable person.

Work Packages produce outcomes.Project Management Case Study, Pierre Bonnal, CNAM IIM MBA Program, June 2004

Outcomes incrementally increase a capability’s maturity

Outcomes result from “units of work” – the Work Package


Five Practices Of Performance-Based Project Management®

Define the set of capabilities needed to achieve the project objectives or the particular end

state for a specific scenario. Using the Concept of Operations (ConOps), define the details of

who, where, and how this capability is to be accomplished, employed, and executed.

Identify

Needed

Capabilities

What capabilities are needed to fulfill the project goal, mission, or outcome?

Define the technical and operational requirements for the system capabilities to be fulfilled.

First, define these requirements in terms isolated from any implementation details. Only then

bind the requirements with technology.

Establish

Requirements

Baseline

What technical & operational requirements are needed to produce the capabilities?

Build a time–phased network of work activities describing the work to be performed, the

budgeted cost for this work, the organizational elements that produce the outcomes, and the

Performance measures showing this work is proceeding according to plan.

Establish

the Performance

Measurement

Baseline

What is the schedule to deliver products or services to produce the requirements?

Execute work activities, while assuring all Performance assessment represent 100%

completion before proceeding. This means – No rework, no forward transfer of activities to the

future. Assure all requirements are traceable to work & all work is traceable to requirements.

Execute

the Performance

Measurement

Baseline

What are the periodic measures of physical percent complete?

Apply the processes of Continuous Risk Management for each Performance Based

Management(sm) process area to: Identify, Analyze, Plan, Track, Control, and

Communicate projectmatic and technical risk.

Perform

Continuous Risk

Management

What are the impediments to success and how are they being handled?

11/29

Partition system capabilities into classes of service within operational scenarios.

Connect the capabilities to system requirements using some visual modeling notation.

Define Measures of Effectiveness (MoE) and Measures of Performance (MoP).

Define the delivery schedule for each measure of Performance and effectiveness.

Define

Capabilities as

Operational

Concepts

Define scenarios for each system capability.

Connect these scenarios to a Value Stream Map of the increasing maturity of the project.

Assess value flow through the map for each needed capability.

Identify capability mismatches and make corrections to improve overall value flow.

Define

Capabilities

through

Scenarios or Use

Cases

Assign costs to each system element using a value flow model.

Assure risk, probabilistic cost and benefit Performance attributes are defined.

Use cost, schedule and technical Performance probabilistic models to forecast

potential risks to project performance.

Assess Needs,

Costs, and Risks

of the Capability

Simultaneously

Make tradeoffs that connect cost, schedule, and technical Performance in a single

location that compares the tradeoffs and their impacts.

Use Measures of Effectiveness (MoE) and Measures of Performance (MoP) for these

alternative tradeoffs.

Define

Explicit,

Balanced, and

Feasible

Alternatives

Define the capabilities needed to achieve the desired objectives or a particular end state for a

specific scenario. Define the details of who, where, and how these capabilities are to be

accomplished, employed, and executed.Identify Needed

Capabilities

What capabilities are needed to fulfill the Business Case or project Mission?

1.1

1.2

1.3

1.4

12/29


What Does A Capability “Sound” Like?

We need the capability to pre‒process insurance claims at $0.07 per transaction rather than the current $0.11 per transaction. We need the capability to remove 1½ hours from the retail

ordering process once the merger is complete. We need the capability to change the Wide Field Camera and the

internal nickel hydride batteries, while doing no harm to the telescope. We need the capability to fly 4 astronauts to the International

Space Station, dock, stay 6 months, and return safely. We need the capability to control the Hell Fire Missile with a new

touch panel while maintaining existing navigation and guidance capabilities in the helicopter. We need the capability to comply with FAR Part 15 using the

current ERP system and its supporting work processes.13/29


Produce an overall statement of the customer need in the operational context.

Develop the overall operational and technical objectives of the system that meets the need.

Defined the boundaries and interfaces of the system.

Perform Fact

Finding

Gather required system capabilities, functional, nonfunctional and environmental

requirements, and design constraints.

Build the Top Down capabilities and functional decomposition of the requirements in a

Requirements Management System.

Gather

and Classify

Requirements

Answer the question “why do I need this?” in terms of operational capabilities.

Build a cost / benefit model using probabilistic assessment of all variables, their

dependencies, and impacts.

For all requirements, perform a risk assessment to cost and schedule.

Evaluate

and Rationalize

Requirements

Determine criticality for the functions of the system.

Determine trade off relationships for all requirements to be used when option decisions

must be made.

For all technical items, prioritize their cost and dependency.

Prioritize

Requirements

Address the completeness of requirements by removing all “TBD” items.

Validate that the requirements are traceable to system capabilities, goals, and mission.

Resolve any requirements inconsistencies and conflicts.

Integrate

and Validate

Requirements

Define the technical and operational requirements that must be present for the system

capabilities to be delivered. Define these requirements in terms isolated from any technology

or implementation. Assure each requirement is connected to a need system capability.

Establish Technical and Operational

Requirements Baseline What Technical and Operational Requirements are Needed to Produce the Capabilities?

2.1

2.2

2.3

2.4

2.5

14/29


What Is a Requirement?

A Requirement is …”A statement identifying a capability, a

physical characteristic, or a quality factor that bounds a

product or process need for which a solution will be

pursued.”

— IEEE Standard 1220–2005

15/29

The hardest single part of building a system is deciding

what to build …

... No other part of the work so cripples the resulting

system if done wrong. No other part is more difficult to

rectify later.

– Fred Brooks “No Silver Bullet,” 1987


Decompose the outcomes into a product based Work Breakdown Structure (WBS), then

further into Work Packages that produce these outcomes all traceable to the requirements,

and to the needed capabilities.

Decompose

Scope into Work

Packages

Assign responsibility to Work Packages (the groupings of outcomes) to a named owner,

accountable for the management of the resource allocations, cost and schedule baseline,

and technical delivery of all element in the Work Breakdown Structure.

Assign

Responsibility

for outcomes

Arrange the Work Packages in a logical network with defined outcomes, milestones,

internal and external dependencies, with credible schedule, cost, and technical

Performance margins.

Arrange

Work Packages

in Logical Order

Develop the Time–Phased Budgeted Cost for Work Scheduled (BCWS) for the labor and

material costs in each Work Package and the Project as a whole. Assure proper resource

allocations can be met and budget profiles match expectations of the project sponsor

Develop

BCWS for Work

Packages

Assign objective Measures of Performance (MoP) and Measures of Effectiveness (MoE) for each Work Package and summarize these for the Project as a whole.

Assign WP

Measures of

Performance

Build a time–phased network of activities describing the work to be performed, the budgeted

cost for this work, the organizational elements that produce the outcomes from this work, and

the Performance measures showing this work is proceeding according to plan.

Establish

Performance

Measurement

BaselineA Baselined Schedule that Produces the Products or Services that Meet The Requirements

3.1

3.2

3.3

3.4

3.5

Establish a Performance Measurement Baseline (PMB) used to forecast the Work Package and Project ongoing and completion cost and schedule Performance metrics.

Set

Performance

Measurement

Baseline

3.6

16/29


What Does a Credible Plan and

Schedule Look Like?

The Plan is the strategy to successfully complete the

project, described through Significant Accomplishments

and their Accomplishment Criteria.

The Schedule is the sequence of the work activities

measured by the Accomplishment Criteria, that follow

the Plan of the Significant Accomplishments.

A credible Plan and Schedule means there is a

statistical model of cost, schedule, and technical

Performance of outcomes as the foundation of the

credibility of the project’s probability of success.

17/29


Using the Work Package sequencing, release work to be performed as planned.

With the responsibility assignments, identify the accountable delivery manager to guide the

development of the products or services for each Work Package.

Perform

the Authorized

Work

Using Physical Percent Complete or Apportioned Milestones, capture measures of

progress to plan for each Work Package.

Report this Physical Percent Complete in a centralized database for each Work Package

and the project as a whole.

Accumulate and Report Work

Package Performance

Compare the Physical Percent Complete against the Planned Percent Complete for each

period of performance.

Construct cost and schedule Performance indices from this information and the Physical

Percent complete measures.

Analyze

Work Package

Performance

With Cost and Schedule Performance indices, construct a forecast of future

Performance of cost, schedule, and technical Performance compliance.

Take management actions for any Work Packages not performing as planned.

Take

Corrective

Management

Action

Record past Performance based on Work Package completion criteria.

Record past future forecast Performance estimates in a historical database.

Forecast next future Performance estimate against the Performance Measurement Baseline.

Report this next future Performance estimate to the project stakeholders.

Maintain

the Performance

Baseline

Execute the planned work, assuring all work is 100% complete before proceeding to the

next planned work package. No rework, no forward transfer of activities or features.

Assure every requirement is traceable to work and all work is traceable to requirements.

Execute

the Performance

Measurement

BaselineHow long are you willing to wait before you find out you’re late?

4.1

4.2

4.3

4.4

4.5

18/29


How Do We Know We Are Achieving

Our Planned Progress?

The Only measure of progress is the assessment of

physical percent complete.

This measurement Must be in units meaningful to the

customer.

These units can be:

Planned capabilities,

Planned capacities,

Planned features and functions,

Planned quantities.

Done is evidenced by the production of outcomes, on

the planned date, for the planned cost, with the planned

technical performance.

19/29


Identify and classify risks in a Risk Register.

Manage this Risk Register through a Risk Management Board.

Connect these risks and their handling in the Master Schedule.

Identify Risks

Convert risk data into risk decision‒making information.

Use this analysis information as the decision basis for the project manager to work on the

“right” risks.

Analyze Risks

Turn risk information into decisions and actions (both present and future).

Develop actions to address individual risks, prioritize risk actions, and create an integrated

risk management plan.

Plan Risk

Response

Monitor the status of risks and actions taken to ameliorate risks.

Identify and monitor risks to enable the evaluation of the status of risks themselves and

of risk mitigation plans.

Track the

Risk

Management

Activities

Risk communication lies at the center of the model to emphasize both its pervasiveness and

its criticality.

Without effective communication, no risk management approach can be viable.

Control or

Accept the Risks

Continuous Risk Management starts the underlying principles, concepts, and functions of

risk management and provides guidance on how to implement risk management as a

continuous practice in projects and the organizations that management projects.

Apply

Continuous Risk

Management at

Every StepWhat are the impediments to success and what are their mitigations?

5.1

5.2

5.3

5.4

5.5

20/29


Continuous Risk Management†

I d e nt i f y

A n a l y ze

P l a n

Tra c k

C o n t ro l

Identify Risks, Issues, and

Concerns

Evaluate, classify, and

prioritize risks

Decide what should be done

about each risk

Monitor risk metrics and

verify/validate mitigations

Make risk decisions

Subproject and partner

data/constraints, hazard

analysis, FMEA, FTA, etc.

Risk data: test data,

expert opinion, hazard

analysis, FMEA, FTA,

lessons learned,

technical analysis

Resources

Replan Mitigation

Program/project data

(metrics information)

Statement of risk

Risk classification, Likelihood

Consequence, Timeframe

Risk prioritization

Research, Watch (tracking

requirements)

Acceptance Rationale,

Mitigation Plans

Risk status reports on:

Risks

Risk Mitigation Plans

Close or Accept Risks

Invoke contingency plans

Continue to track

For Each Risk…

21/29† Continuous Risk Management, Audrey J. Dorofee, Software Engineering Institute, Carnegie Mellon University, 1996

How is Performance-Based Project

Management® different from traditional

approaches to project management?

22/29

All work activities are traceable to and from the needed

business or mission capabilities†.

All activities are focused on Outcomes rather than Output.

Performance is measured as Physical Percent Complete,

not the consumption of resources and the passage of time.

All planning and measurement is risk adjusted.

Performance-Based Project Management ® never

confuses effort with results – the customer only bought

results.

† A Metric Framework for Capability Definition, Engineering and Management, Seventeenth Annual International

Symposium of the International Council On Systems Engineering (INCOSE) 24 - 28 July 2007


How is Performance-Based Project

Management® the same as traditional

approaches to project management?

23/29

Founding principles based on US DoD program

management processes, PMBOK®, and Agile project

management methods.

Planning assures incremental progress measured in units

meaningful to the buyer.

All project participants integrated with each activity

providing full visibility into progress to plan.

Continuous risk management embedded in each detailed

process step.


Performance-Base Project Management (sm)

1. Identi fy Needed Systems Capabili t ies – Define the Measures of Ef fect iveness (MoE) for each Capabi l i ty

DEF INE OPERAT IONAL CONCEPTS THROUGH SCENARIOS OR USE CASES

Partition system capabilities into classes of service within operational scenarios

Connect capabilities to system requirements using sysML

Define Measures of Effectiveness (MoE) for these capabilities in units meaningful to the customer

Define in the master schedule the achievement of measure of Technical Performance

DEF INE CAPABIL IT IES NEEDED TO IMPLEMENT THE OPERATIONAL CONCEPTS

Define scenarios for each system capability

Connect these scenarios to the Value Stream map

Assess value flow through the map for each needed capability

Identify capability mismatches and make corrections to improve overall value flow

ASSESS NEEDS , COST , AND R I SK S IMULTANEOUSLY

Assign costs to each system element using a value process model

Assure risk, probabilistic cost and benefit performance attributes are defined

Use cost, schedule, and technical performance probabilistic models to forecast potential risks to project performance

DEF INE EXPL IC IT , BALANCED , AND FEAS IBLE ALTERNATIVES

Make tradeoffs that connect cost, schedule, and technical performance in a single “trade space” model

Measures of Effectiveness and Measures of Performance are the raw materials for these tradeoffs

2. Establish Requirements Baseline – Define Measures Of Performance (MoP) for each requirement del iver ing a Capabi l i ty

PERFORM FACT F INDING

Produce an overall statement of the problem in the operational context

Develop the overall operational and technical; objectives of the target system through Measures of Performance (MoP) for the requirements

Define the boundaries and interfaces of the target system

GATHER AND CLASS IFY THE REQUIREMENTS

Gather required operational capabilities, functional, nonfunctional, and environment requirements and design constraints

Build a Top Down Capabilities and Functional decomposition of the requirements in a flow down tree using a requirements tool

EVALUATE AND RATIONALIZE THE REQUIREMENTS

Answer the question “why do we need this?” in terms of operational benefits

Build a cost / benefit model using probabilistic assessments of all variables and dependencies

For technical requirements, perform a risk assessment to the cost and schedule

PRIORIT IZE THE REQUIREMENTS

Determine the criticality for the functions for the system’s mission

Determine tradeoff relations for all requirements to be used when option decision are made

For technical items, prioritize the cost and dependencies

INTEGRATE AND VALIDATE THE REQUIREMENTS

Address completeness of requirements by removing all TBD items

Validate the requirements agree and are traceable to capabilities, goals, and the mission

Resolve any requirement inconsistencies and conflicts

Chapter I 24

Performance-Base Project Management (sm)

3. Establish Performance Measurement Baseline – Define Technica l Performance Measures (TPM)

DECOMPOSE REQUIREMENTS INTO WORK PACKAGES AND PLANNING PACKAGES

Decompose the project scope into a product based Work Breakdown Structure (WBS)

Decompose the WBS into Work Packages describing the production of all outcomes and processes traceable to the requirements

ASS IGN ACCOUNTABIL ITY FOR THE OUTCOME FROM EACH WORK PACKAGE

Assign accountability for Work Packages to a named owner for the management of resource allocation, cost baseline, and technical delivery

ARRANGE WORK PACKAGES IN A LOGICAL ORDER

Arrange Work Packages in a network with defined outcomes, milestones, internal and external dependencies, appropriate schedule and cost margin

DEVELOP THE BUDGETED COST FOR WORK SCHEDULED (BCWS) FOR EACH WORK PACKAGE AND PLANNING PACKAGE

Develop a time‒phased Budgeted Cost for Work Scheduled (BCWS) for labor and material costs in each Work Package

Develop a time‒phased Budgeted Cost for Work Scheduled (BCWS) for the project as a whole

Assure proper resource allocations can be met and budget profiles match expectations of the project sponsor

ASS IGN WORK PACKAGE MEASURES OF PERFORMANCE (MOP) , KEY PERFORMANCE PARAMETERS (KPP) , AND TECHNICAL PERFORMANCE MEASURES (TPM)

Assign an objective Measure of Performance (MoP) for each critical Work Package outcomes

Trace critical outcomes to the Measure of Effectiveness (MoE) defined in the Capabilities baseline

Summarize these Measures of Performance (MoP) and Measures of Effectiveness (MoE) for the project as a whole

Assign measures of Physical Percent Complete for each Work Package

Assign measures of Physical Percent Complete for the program as a whole

SET THE PERFORMANCE MEASUREMENT BASELINE (PMB)

Establish a Performance Measurement Baseline (PMB) used to forecast Work Package and Project ongoing and completion cost and schedule metrics

4. Execute the Performance Measurement Baseline (PMB) – Maintain Cost , Schedule, and Technical Performance

PERFORM AUTHORIZED WORK IN THE PLANNED SEQUENCE

Using the Work Package sequencing, release work to be performed as planned

With the RACI based RAM, the Accountable delivery manager guides the development of the products or service for each Work Package

ACCUMULATE AND REPORT WORK PACKAGE PHYS ICAL PERFORMANCE

Using Physical Percent complete or Apportioned Milestones, capture the measures of “progress to plan” for each Work Package

Report the Physical Percent Complete in a centralized system for each Work Package and he program as a whole

ANALYZE WORK PACKAGE PERFORMANCE

Compare the Actual Percent Complete against the Planned Percent Complete for each period of performance

Construct cost and schedule performance indices from this information and the Physical Percent Complete measures

TAKE CORRECTIVE MANAGEMENT ACT ION FOR ANY VARIANCE IN WORK PACKAGE PERFORMANCE

With the cost and schedule performance indices, construct a forecast of future performance of cost, schedule, and technical performance compliance

Take management actions for any Work Packages not performing as planned

MAINTAIN PERFORMANCE MEASUREMENT BASELINE ’S INTEGRITY

Record past performance based on Work Package completion criteria

Record previous future performance estimates in a historical database

Forecast future performance against the Performance Measurement Baseline

Report the future performance estimate to the program stakeholders

Chapter I 25

5 Principles of Project Success

What does done look like?

How do we get there?

Are there enough resources?

What are progress impediments?

How do we measure progress?Performance Based Management(sm), Copyright ® Glen B. Alleman, 2012

5 Practices Needed to Implement the 5 Principles

Identify Capabilities in units of

measure meaningful to the customer

Identify Technical & Operational

Requirements to deliver capabilities

Establish risk adjusted Technical, Cost,

and Schedule Baseline.

Execute baseline with measurements of

physical percent complete

Apply Continuous Risk Management


5 Processes Needed the Implement the 5 Practices Guided by the 5 Principles

Organize the deliverables and staff

doing the work

Plan, Budget, and Schedule in the

Performance Measurement baseline

Account for direct and indirect costs

against planned costs

Analyze performance for cost,

schedule, and technical variance

Manage revisions to Performance

Measurement Baseline


Performance based planning in a nut shell (V5)

Technology

Transcript of Performance based planning in a nut shell (V5)