Copyright © 2010, CVMark Consulting, All rights reserved.
My first question was, therefore, what the problem is and how big it is. I did not getappropriate answer to this. ‘Project performance is not satisfactory’, was not the rightanswer. I therefore told Anthony that the he needs to set clear objective and metrics, thatcould be a direct indicator of improvement through PROP-UP. It would then make sensefor everybody to effect the right inputs and evaluate performance of their efforts.His colleagues told me that they the center has two goals, 1. Obtain good Project DueDate Performance(DDP) and 2. Reduce Cost. This looked quite weird to me. The reasonbeing that firstly, an organization must have only one goal. Having two goals meansconfusion and conflicts galore, leading to misalignment down the rank. Secondly, thetwo goals are not mutually exclusively. That is, cost is a dependent quantity on DDP andhence, if DDP is kept under control, cost will automatically come under control. Thirdly,‘cost’ is normally not goal of an organization (even if it is a cost center) and is normally,not given as ‘performance target’ to managers. Why? Because, cost is a parameter, if taken as a target, managers start chasing it relentlessly, such that they are more often,detrimental to main purpose of the organization, that I believe is not ‘cost reduction’.Most importantly,
on cost reduction would invariably lead to poor DDP.Since, the center deals in projects, it can be called as a project based organization. Eachproject has a definite scope to be delivered within a cost and time frame. The truth is thata number of projects are abandoned incomplete, and a large number of projects are lateby huge margins compared to their first promised deadline.The normal tendency in project based organizations, is to cut down scope of the projects,in order to deliver them on time. Project managers are worried too much on cost of theproject and are involved in intense haggling with the sponsors about extra fee, when theprojects need to be extended. Thus, projects are actually dominated by scope and costfactors. When these two factors are some how adjusted, the negotiation hinges on thetime. In a majority of the projects, despite all good intentions and compromises on scope& cost, the due date is extended too far, for the reasons that are
not in thehands of either parties. Thus, when the project is delivered, the project team looks at the
due date of the project and comes out with a performance outcome, that lookslike following on its metrics:Metrics Delivered What it actually means ?Scope 100% Scope as readjusted and agreed (a few weeksbefore project was delivered), and in most casesit significantly deviate from originally agreedone.Cost 100% The extra cost compared to originally estimatedone was readily borne by the client.Time DDP=97% 97% within the ‘last agreed’ date with the client.In most of the cases, the last agreed data is over50% off the first agreed date.