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		<title>Planphoria Principal Interviewed by Project Management Trade Magazine - Notes on Project Manager Networking</title>
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		<pubDate>Sat, 17 Jan 2009 08:38:25 +0000</pubDate>
		<dc:creator>srosenberg</dc:creator>
		
		<category><![CDATA[Career and Culture]]></category>

		<category><![CDATA[Leadership and Culture]]></category>

		<category><![CDATA[Networking]]></category>

		<category><![CDATA[PMI]]></category>

		<category><![CDATA[Project Management]]></category>

		<category><![CDATA[Web 2.0]]></category>

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		<description><![CDATA[<p>This past November (yes, I am late getting this story to the blog), I was published in the Project Management Institute sponsored &#8220;PM Network Magazine&#8221; on the topic of Project Management Networking.  Surely this was an ego boost for me, and an opportunity to flex my PMP muscles by contributing what I knew to benefit the Project Management Industry.</p>
<p>Here is the article:  <a href="http://www.planphoria.com/wp-content/uploads/2009/01/PM Network Magazine - Connect the Dots.pdf" >PM Network Magazine - Nov 2008 - Connect the Dots (PDF)</a></p>
<p>Interviewed for the article by Neil Hodge via trans-atlantic phone call between the UK and the USA, I offered Neil a wide perspective of how project managers could benefit by expanding their network and by leveraging their networking tools.  Unfortunately Neil only took a minor fraction of what we discussed for his article, as he had other subject matter experts who provided input and all this good advice had to fit into 2 1/2  magazine pages.  The good news (and I appreciate this tremendously) is that Neil gave Planphoria a really good plug within PM Network.  (This is Planphoria&#8217;s first industry trade mag shout out!)  Despite this, much of what was said was lost as it never made it to the article, so I thought it prudent to clean up some of the notes that I had prepared for the interview and offer them here.</p>
<p><strong>Key Benefits of Project Manager Networking </strong></p>
<ul>
<li>Projects, by definition, are temporary and good people are sometimes hard to come by. Knowing who they are before you need them and where they are is important.  The circle of people you know is only so big and that is where networking is important.</li>
</ul>
<ul>
<li>In many circumstances, we know where the bodies in our buried within our management style and we do the same thing over and over, because it is the system that we know and nothing yet has burned us bad enough to change it.  Networking with a mentor offers an opportunity to break from these habits and use a new technology or process.</li>
</ul>
<ul>
<li>It is important to get an unbiased, objective opinion from other Project Managers. I am aware that CEO&#8217;s use this technique with other CEO&#8217;s to gain situational clarity.  I believe that it is helpful for PM&#8217;s to have the same thing.</li>
</ul>
<ul>
<li>We understand Project Managers to be self-starters, disciplined toward delivery.  We are the the ones who ensure fingers remain on keyboard (in the IT community) to produce value.  We are the Jungle Guides who machete&#8217; the vines and obstacles in front of our team so that work can progress.   We need to meet the leaders we can learn from.</li>
</ul>
<ul>
<li>All Project Managers should be on the path of learning their craft, some are farther along than others.   Like other professionals it is important for Project Managers to find a mentor the business term for guru, whether a favorite author, network and communicate with them on a regular basis.  Without them, it is difficult to grow beyond what we believe our potential to be and expose ourselves to  growth path oriented opportunities.</li>
</ul>
<ul>
<li>I like the word guru.  It represents mastery, while representing humility – traits necessary if you want to learn anything.   To be a guru I believe one has to be both a teacher and student in the same body, and at times teach oneself.  Therefore I believe that those who can achieve guru status have a responsibility to mentor in order to be a better student.</li>
</ul>
<p><strong>Project Managers and Networking Opportunities</strong></p>
<ul>
<li>There are Project Managers who make good use of networking opportunities, as there are those who find it difficult in their 60+ hour work weeks to find time for it.  For those managers, I think my colleague said it best, (quoting the nephew of Alexander Graham Bell) “anyone who works forty hours a week will never meet the people who will make him rich and famous”.</li>
</ul>
<ul>
<li>Many Project Managers have not learned the art of professional face-to-face networking other than to find a job, or as a night out away from family to eat a meal and drink with colleagues.  They do not question what they want out of it, and do not realize that it should not only be about work, but professional advancement.</li>
</ul>
<ul>
<li>On the virtual side, I have received numerous connections from services like LinkedIn from other PMP&#8217;s around the world.  I think that this is a valid service when it comes to meeting people, however I don&#8217;t think that managers have really figured out how to use it to its full potential.   Understanding and enhancing the value of networking with other PMs should be a cultural element of PMI membership, and a realized benefit of one&#8217;s own professional growth.</li>
</ul>
<p><strong> Networking Approaches - Internet  or Face-to-Face Contact?</strong></p>
<ul>
<li>To some extent project managers make this determination on if they are an introvert or an extrovert. I am an introvert so my natural bias is to say virtual is better.  However, even introverts need a good night out, and to some extent I believe face-to-face networking and virtual networking go hand in hand.</li>
</ul>
<ul>
<li>I think that the recent Web 2.0 technology Internet Networking paradigm, coined by O&#8217;Reilly and Associates, works well to help  organization members network for all the time they are not face to face, and allows us to identify, if not search for, synergy.</li>
</ul>
<ul>
<li>Back in the early days of the Web, web pages were static essays, faq&#8217;s and database driven row and column data.   Websites became stale because webmasters were the central point of update.  With Web 2.0, we create a sense of community, trusting visitors to contribute, and allow the virtual community of visitors to come down on those who contribute negatively, throw fire or who are otherwise out of line.</li>
</ul>
<ul>
<li>Web 2.0 is a new way of using the internet allows us to use two different kinds of computers during our surfing experience, the electronic kind on which you type to discover information sources and data,  and the organic computer within your head that you use to interpret the data, develop a position, formulate an opinion and post it to the collective organic Web 2.0 mind.   Different from the old ways of the web which was more like a cluttered bulletin board, Web 2.0 networking is an organic networking ecosystem where visitors are encouraged to  contribute their interpretation of the topic in the name of discovering truth or fact.</li>
</ul>
<p><strong>So You Think Virtual Networking is Better&#8230; Can you prove that?</strong></p>
<ul>
<li>Before I  select the “best” way to network, my opinion should have basis by being the networking method that contains the most value to the person networking.  Let me take you through that.   When I think of an organization of people, whether it in a network, association, company, or project team, I imagine it as a big box into which talented people are placed and on which the leader has drawn the name of the organization with magic marker.  Without people, the box is empty, bearing just the name and the cardboard sides and from the outside appears to hold little value.   As the box fills with people, talent, opinion, decision and experience - the box begins to increase in value.</li>
</ul>
<ul>
<li>As a Project Manager, I am a metrics guy, so I tend to seek metrics that describe the value of a box containing people networking.  I call this metric: Potential Network Power.  To identify Potential Network Power, I use a simple formula (based on the communication interface formula found in the PMI PMBOK) that identifies the number of interfaces between people communicating and then multiplies the number of interfaces against interaction frequency. The formula is: (n(n-1)/2) * a, where “n” are the total number of users networking and “a” is an assessment of interaction frequency  between people between 1 (smallest) and 10 (greatest).  In virtual networks such as MySpace, you will find Web 2.0 generates user loyalty to the point where  interaction frequency is quite high.  By comparison, the last PMI Chapter meeting I went to, there were approximately 350 people attending. This is a tremendous tunout.   It also means that if everyone shook hands least once, there would be 61,075 individual handshakes.  Despite this, I would have to rate the frequency of those handshakes at a 1 on the interaction frequency scale for the hour of networking time that was available before, after and between presentations.  In contrast, most virtual networks have greater interaction frequency in excess  of 5.  And that evening, I can&#8217;t say that I interacted with more than fifteen people.</li>
</ul>
<ul>
<li>Let&#8217;s  experiment.. If my goal was to meet all the people there individually and seek to understand what each person did and was about in order to advance my objectives, I would only be able to spend 10 seconds with each person. Consider that there are also precious seconds wasted approaching the next person,  seconds spent on handshake and greetings, and at the same time, they are trying to meet me, because after all, networking is a two way street.  Considering that all 350 of us are organized enough to make good use of the time, we each get 1-2 seconds to figure out what the other is about and what we can do for each other.  Of course, as we meet people, we tend want more time with the ones that can help us, and less with others that cannot.   This kind of face-to-face networking this scenario is ridiculous, and impossible to do without severely breaching professional rules of ettiquite!</li>
</ul>
<ul>
<li>Virtual Internet Networking is open 24&#215;7x365,  networking happens on your free schedule time, and saves time by discovering the people you want to meet face to face.   Virtual Networking is also a good way to do your homework and get more out of face to face networking.  Once you have limited a whole ocean of people to a small swimming pool, face to face meetings become much easer and productive.</li>
<li>Virtual Networking is better, but face to face networking includes beer.  There is a tradeoff.</li>
</ul>
<p><strong>Using Networking Within One&#8217;s Present Job to Improve Performance of  the Team or Organization<br />
</strong></p>
<ul>
<li>It&#8217;s not all about finding a new job.  I think that finding another job is one purpose of networking and one that has worked so well for so long that it is sometimes ill interpreted as all networking is good for.  At one of my previous jobs, I would throw on my suit in the morning, rather than my regular business clothes in support of my evening plans to attend a networking opportunity.  It was not uncommon for people at work to act surprised and ask me where I was interviewing.</li>
</ul>
<ul>
<li>I encourage Project Managers to consider networking, another form of training, or collaborative learning  and network to seek the synergies, information that can be adopted and enhanced or jointly arrive at a conclusion that advances the objectives or understanding of you and the person with whom you are networking.   Whatever you learn, can later be disseminated to the team, or organization and label you as the guru for that subject.</li>
</ul>
<p><strong>Top Networking Tips - Network as Effectively as Possible</strong></p>
<ol>
<li>Represent the company to which you are employed – even if you are job seeking.  You will come off as a better professional that they will want to hire, and will increase your value by being talent that is not so desperate to leave.  Carry business cards, and your own name tag.  You can do the name tag yourself with more flair which helps you stand out as a professional.  Remember, it goes on the right lapel of your suitcoat as this is your on your handshake hand.  As you shake hands, your tag is easily noticeable.  Your first name should be in big letters, last name under it in small letters.  Dress the rest up graphically if possible.</li>
<li>Remember that others may be using the networking event to find another job.  Have a firm understanding of available job opportunities within your company, and be on the prowl for new talent.  This empowers you with the people you meet as it gives you more creds as a “player” with your employer.</li>
<li>Start your own virtual networking clique&#8217;.  I receive business cards all of the time from a wide variety of sources.  If you don&#8217;t interact with people, you lose them.  Ning, at http://www.ning.com is an easy and free way to do this.  By working a virtual network, they new people can interact with other people you know.  When you need them, they will be there.</li>
<li>Let the other guy talk – then talk.  Let people you network with talk about anything they want to, and learn where it is appropriate to discuss your objectives, where you can talk shop, and where you should just talk about the weather.  Learn these words: <em>“Do you play golf?”</em> I heard a recent statistic that mentioned that 35% of American Business happens on the golf course.  I cannot say this is accurate, however sometimes, it is unfruitful to worry about some things.</li>
<li>Smile, be outgoing and introduce those you meet to others you know.  By doing so you share your influence and grants you referent power by making it easier on those you meet and those you know to meet new people.  If you get good at this, you can achieve “Godfather” status, where one day the people you meet can be called upon to perform a service for you.</li>
<li>Remember that while you are pursuing your objectives, the people you are networking with are pursing their own.  Assume a helpful stance, even if it is a matter of introducing them to someone who can help.</li>
<li>Don&#8217;t drink a whole lot.  You are there to meet new people, learn, influence, advance your objectives, and gain referent power.  It&#8217;s not a party – it is about advancing your project, your company, and your status.  Drinking has a tendency knock you off your game,make you seem like an ass, and make you ramble on like an idiot that nobody wants to talk to.   Remember, you only have a single chance to make a first impression!</li>
</ol>
<p>-Saul Rosenberg, PMP</p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=337" >Planphoria Principal Interviewed by Project Management Trade Magazine - Notes on Project Manager Networking</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<div style="display:block"><small><em>posted in <a href="http://www.planphoria.com/?cat=3">Career and Culture</a> by Srosenberg <a href="http://www.planphoria.com/?p=337#comments">Leave A Comment</a></em></small></div>]]></description>
			<content:encoded><![CDATA[<p>This past November (yes, I am late getting this story to the blog), I was published in the Project Management Institute sponsored &#8220;PM Network Magazine&#8221; on the topic of Project Management Networking.  Surely this was an ego boost for me, and an opportunity to flex my PMP muscles by contributing what I knew to benefit the Project Management Industry.</p>
<p>Here is the article:  <a href="http://www.planphoria.com/wp-content/uploads/2009/01/PM Network Magazine - Connect the Dots.pdf" >PM Network Magazine - Nov 2008 - Connect the Dots (PDF)</a></p>
<p>Interviewed for the article by Neil Hodge via trans-atlantic phone call between the UK and the USA, I offered Neil a wide perspective of how project managers could benefit by expanding their network and by leveraging their networking tools.  Unfortunately Neil only took a minor fraction of what we discussed for his article, as he had other subject matter experts who provided input and all this good advice had to fit into 2 1/2  magazine pages.  The good news (and I appreciate this tremendously) is that Neil gave Planphoria a really good plug within PM Network.  (This is Planphoria&#8217;s first industry trade mag shout out!)  Despite this, much of what was said was lost as it never made it to the article, so I thought it prudent to clean up some of the notes that I had prepared for the interview and offer them here.</p>
<p><strong>Key Benefits of Project Manager Networking </strong></p>
<ul>
<li>Projects, by definition, are temporary and good people are sometimes hard to come by. Knowing who they are before you need them and where they are is important.  The circle of people you know is only so big and that is where networking is important.</li>
</ul>
<ul>
<li>In many circumstances, we know where the bodies in our buried within our management style and we do the same thing over and over, because it is the system that we know and nothing yet has burned us bad enough to change it.  Networking with a mentor offers an opportunity to break from these habits and use a new technology or process.</li>
</ul>
<ul>
<li>It is important to get an unbiased, objective opinion from other Project Managers. I am aware that CEO&#8217;s use this technique with other CEO&#8217;s to gain situational clarity.  I believe that it is helpful for PM&#8217;s to have the same thing.</li>
</ul>
<ul>
<li>We understand Project Managers to be self-starters, disciplined toward delivery.  We are the the ones who ensure fingers remain on keyboard (in the IT community) to produce value.  We are the Jungle Guides who machete&#8217; the vines and obstacles in front of our team so that work can progress.   We need to meet the leaders we can learn from.</li>
</ul>
<ul>
<li>All Project Managers should be on the path of learning their craft, some are farther along than others.   Like other professionals it is important for Project Managers to find a mentor the business term for guru, whether a favorite author, network and communicate with them on a regular basis.  Without them, it is difficult to grow beyond what we believe our potential to be and expose ourselves to  growth path oriented opportunities.</li>
</ul>
<ul>
<li>I like the word guru.  It represents mastery, while representing humility – traits necessary if you want to learn anything.   To be a guru I believe one has to be both a teacher and student in the same body, and at times teach oneself.  Therefore I believe that those who can achieve guru status have a responsibility to mentor in order to be a better student.</li>
</ul>
<p><strong>Project Managers and Networking Opportunities</strong></p>
<ul>
<li>There are Project Managers who make good use of networking opportunities, as there are those who find it difficult in their 60+ hour work weeks to find time for it.  For those managers, I think my colleague said it best, (quoting the nephew of Alexander Graham Bell) “anyone who works forty hours a week will never meet the people who will make him rich and famous”.</li>
</ul>
<ul>
<li>Many Project Managers have not learned the art of professional face-to-face networking other than to find a job, or as a night out away from family to eat a meal and drink with colleagues.  They do not question what they want out of it, and do not realize that it should not only be about work, but professional advancement.</li>
</ul>
<ul>
<li>On the virtual side, I have received numerous connections from services like LinkedIn from other PMP&#8217;s around the world.  I think that this is a valid service when it comes to meeting people, however I don&#8217;t think that managers have really figured out how to use it to its full potential.   Understanding and enhancing the value of networking with other PMs should be a cultural element of PMI membership, and a realized benefit of one&#8217;s own professional growth.</li>
</ul>
<p><strong> Networking Approaches - Internet  or Face-to-Face Contact?</strong></p>
<ul>
<li>To some extent project managers make this determination on if they are an introvert or an extrovert. I am an introvert so my natural bias is to say virtual is better.  However, even introverts need a good night out, and to some extent I believe face-to-face networking and virtual networking go hand in hand.</li>
</ul>
<ul>
<li>I think that the recent Web 2.0 technology Internet Networking paradigm, coined by O&#8217;Reilly and Associates, works well to help  organization members network for all the time they are not face to face, and allows us to identify, if not search for, synergy.</li>
</ul>
<ul>
<li>Back in the early days of the Web, web pages were static essays, faq&#8217;s and database driven row and column data.   Websites became stale because webmasters were the central point of update.  With Web 2.0, we create a sense of community, trusting visitors to contribute, and allow the virtual community of visitors to come down on those who contribute negatively, throw fire or who are otherwise out of line.</li>
</ul>
<ul>
<li>Web 2.0 is a new way of using the internet allows us to use two different kinds of computers during our surfing experience, the electronic kind on which you type to discover information sources and data,  and the organic computer within your head that you use to interpret the data, develop a position, formulate an opinion and post it to the collective organic Web 2.0 mind.   Different from the old ways of the web which was more like a cluttered bulletin board, Web 2.0 networking is an organic networking ecosystem where visitors are encouraged to  contribute their interpretation of the topic in the name of discovering truth or fact.</li>
</ul>
<p><strong>So You Think Virtual Networking is Better&#8230; Can you prove that?</strong></p>
<ul>
<li>Before I  select the “best” way to network, my opinion should have basis by being the networking method that contains the most value to the person networking.  Let me take you through that.   When I think of an organization of people, whether it in a network, association, company, or project team, I imagine it as a big box into which talented people are placed and on which the leader has drawn the name of the organization with magic marker.  Without people, the box is empty, bearing just the name and the cardboard sides and from the outside appears to hold little value.   As the box fills with people, talent, opinion, decision and experience - the box begins to increase in value.</li>
</ul>
<ul>
<li>As a Project Manager, I am a metrics guy, so I tend to seek metrics that describe the value of a box containing people networking.  I call this metric: Potential Network Power.  To identify Potential Network Power, I use a simple formula (based on the communication interface formula found in the PMI PMBOK) that identifies the number of interfaces between people communicating and then multiplies the number of interfaces against interaction frequency. The formula is: (n(n-1)/2) * a, where “n” are the total number of users networking and “a” is an assessment of interaction frequency  between people between 1 (smallest) and 10 (greatest).  In virtual networks such as MySpace, you will find Web 2.0 generates user loyalty to the point where  interaction frequency is quite high.  By comparison, the last PMI Chapter meeting I went to, there were approximately 350 people attending. This is a tremendous tunout.   It also means that if everyone shook hands least once, there would be 61,075 individual handshakes.  Despite this, I would have to rate the frequency of those handshakes at a 1 on the interaction frequency scale for the hour of networking time that was available before, after and between presentations.  In contrast, most virtual networks have greater interaction frequency in excess  of 5.  And that evening, I can&#8217;t say that I interacted with more than fifteen people.</li>
</ul>
<ul>
<li>Let&#8217;s  experiment.. If my goal was to meet all the people there individually and seek to understand what each person did and was about in order to advance my objectives, I would only be able to spend 10 seconds with each person. Consider that there are also precious seconds wasted approaching the next person,  seconds spent on handshake and greetings, and at the same time, they are trying to meet me, because after all, networking is a two way street.  Considering that all 350 of us are organized enough to make good use of the time, we each get 1-2 seconds to figure out what the other is about and what we can do for each other.  Of course, as we meet people, we tend want more time with the ones that can help us, and less with others that cannot.   This kind of face-to-face networking this scenario is ridiculous, and impossible to do without severely breaching professional rules of ettiquite!</li>
</ul>
<ul>
<li>Virtual Internet Networking is open 24&#215;7x365,  networking happens on your free schedule time, and saves time by discovering the people you want to meet face to face.   Virtual Networking is also a good way to do your homework and get more out of face to face networking.  Once you have limited a whole ocean of people to a small swimming pool, face to face meetings become much easer and productive.</li>
<li>Virtual Networking is better, but face to face networking includes beer.  There is a tradeoff.</li>
</ul>
<p><strong>Using Networking Within One&#8217;s Present Job to Improve Performance of  the Team or Organization<br />
</strong></p>
<ul>
<li>It&#8217;s not all about finding a new job.  I think that finding another job is one purpose of networking and one that has worked so well for so long that it is sometimes ill interpreted as all networking is good for.  At one of my previous jobs, I would throw on my suit in the morning, rather than my regular business clothes in support of my evening plans to attend a networking opportunity.  It was not uncommon for people at work to act surprised and ask me where I was interviewing.</li>
</ul>
<ul>
<li>I encourage Project Managers to consider networking, another form of training, or collaborative learning  and network to seek the synergies, information that can be adopted and enhanced or jointly arrive at a conclusion that advances the objectives or understanding of you and the person with whom you are networking.   Whatever you learn, can later be disseminated to the team, or organization and label you as the guru for that subject.</li>
</ul>
<p><strong>Top Networking Tips - Network as Effectively as Possible</strong></p>
<ol>
<li>Represent the company to which you are employed – even if you are job seeking.  You will come off as a better professional that they will want to hire, and will increase your value by being talent that is not so desperate to leave.  Carry business cards, and your own name tag.  You can do the name tag yourself with more flair which helps you stand out as a professional.  Remember, it goes on the right lapel of your suitcoat as this is your on your handshake hand.  As you shake hands, your tag is easily noticeable.  Your first name should be in big letters, last name under it in small letters.  Dress the rest up graphically if possible.</li>
<li>Remember that others may be using the networking event to find another job.  Have a firm understanding of available job opportunities within your company, and be on the prowl for new talent.  This empowers you with the people you meet as it gives you more creds as a “player” with your employer.</li>
<li>Start your own virtual networking clique&#8217;.  I receive business cards all of the time from a wide variety of sources.  If you don&#8217;t interact with people, you lose them.  Ning, at http://www.ning.com is an easy and free way to do this.  By working a virtual network, they new people can interact with other people you know.  When you need them, they will be there.</li>
<li>Let the other guy talk – then talk.  Let people you network with talk about anything they want to, and learn where it is appropriate to discuss your objectives, where you can talk shop, and where you should just talk about the weather.  Learn these words: <em>“Do you play golf?”</em> I heard a recent statistic that mentioned that 35% of American Business happens on the golf course.  I cannot say this is accurate, however sometimes, it is unfruitful to worry about some things.</li>
<li>Smile, be outgoing and introduce those you meet to others you know.  By doing so you share your influence and grants you referent power by making it easier on those you meet and those you know to meet new people.  If you get good at this, you can achieve “Godfather” status, where one day the people you meet can be called upon to perform a service for you.</li>
<li>Remember that while you are pursuing your objectives, the people you are networking with are pursing their own.  Assume a helpful stance, even if it is a matter of introducing them to someone who can help.</li>
<li>Don&#8217;t drink a whole lot.  You are there to meet new people, learn, influence, advance your objectives, and gain referent power.  It&#8217;s not a party – it is about advancing your project, your company, and your status.  Drinking has a tendency knock you off your game,make you seem like an ass, and make you ramble on like an idiot that nobody wants to talk to.   Remember, you only have a single chance to make a first impression!</li>
</ol>
<p>-Saul Rosenberg, PMP</p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=337" >Planphoria Principal Interviewed by Project Management Trade Magazine - Notes on Project Manager Networking</a></p>
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		<title>Normalization of Deviance: A Formula for Predictable Surprise</title>
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		<pubDate>Thu, 04 Sep 2008 18:25:32 +0000</pubDate>
		<dc:creator>srosenberg</dc:creator>
		
		<category><![CDATA[Project Management]]></category>

		<category><![CDATA[Deviance]]></category>

		<category><![CDATA[Normalization]]></category>

		<category><![CDATA[Predictable Surprise]]></category>

		<category><![CDATA[Project Team]]></category>

		<category><![CDATA[Quality Assurance]]></category>

		<category><![CDATA[Risk Management]]></category>

		<guid isPermaLink="false">http://www.planphoria.com/?p=310</guid>
		<description><![CDATA[<p>Attending <a href="http://www.pmiwdc.org/" >PMIWDC</a>, I met former Astronaut and inductee into the International Hall of Fame, Colonel Mike Mullane. He is an author of &#8220;<a rel="nofollow" href="http://www.amazon.com/Riding-Rockets-Outrageous-Shuttle-Astronaut/dp/0743276825" >Riding Rockets</a>&#8220;, and &#8220;<a rel="nofollow" href="http://www.amazon.com/Space-Other-Surprising-Questions-Travel/dp/0471154040/ref=pd_bbs_1?ie=UTF8&amp;s=books&amp;qid=1205508953&amp;sr=1-1" >Do your Ears Pop in Space</a>&#8220;.</p>
<p>Col. Mullane conveyed that the responsibility and duty all project team members must have to contribute to project success, regardless of their position. He discussed that Astronauts share credit for their success with their team, and despite being the most visible part of the mission, the NASA team extends to the people that man mission control, to the engineers that build the spacecraft, to the specialists that develop and configure human life support systems, to the nutritionists that prepare the meals for the voyage, to the janitors who sweep the floors.  He describes that when it comes to preventing mission risk transforming into issues, the perception of ALL team members must be considered.  This philosopy is fully amplified and fictionally illustrated by the &#8220;West Wing&#8221; character, Toby Ziegler, who when hearing that the shuttle mission on which his brother was a specialist had problems with the shuttle bay doors remarked, &#8220;Mr. President, thank you for your concern, however in space, there is no such thing as a small problem.&#8221;</p>
<p>To counter these effects, he described that his first act working with any member of a team is to assure that they understand what Normalization of Deviance, in addition to the consequences that  occur.  Normalization of Deviance was the primary contributing factor to creating both Challenger and Columbia space shuttle disasters.  The technical reasons for both disasters are well documented and too lengthy to discuss here.  Mike Mullane&#8217;s reasoning for why both shuttles experienced catastrophic failure, coincides with my own understanding of why projects fail.  We seldom fail from the technical, we most always overlook management over the implementation.  For the most part this is because the technology is sexy, and we lead ourselves to believe the fallacy that technology works automatically, that it has been tested to work, and should be trusted to always work without failure.This is certainly the case of the &#8220;unsinkable&#8221; HMS Titanic.</p>
<p>Within a PMI project management approach, one of the core activities to performing Risk Management is Risk Identification. I have been in organizations where Risk Identification was generally overlooked as a point of normalized deviance.  The process requires that we perform a risk assessement, so we do. <em>&#8220;We don&#8217;t have the time to get our technical staff involved, they will only slow us down to fill out our risk register.&#8221;</em> How many times have you seen that?  Why do a risk assessment this way?  <em>&#8220;We have to be prepared for the audit.&#8221;</em> Who does the audit? Corporate Quality Assurance, who observes that indeed the risk register is up to date, and identified risks are being entered and monitored, and they checkmark the box.  This is a failure waiting to happen from habitual deviance from core principals of the established standard, which enables an organization to place their full trust behind the process in place, with complete disregard to its consequence.  Mike Mullane describes that the only result that comes from this practice is &#8220;Predictable Surprise&#8221;.</p>
<p>Col Mullane defines Normalization of Deviance as the working or mission environment created when established standards are subverted incrementally over time without consequence, by routinely rewarding shortcuts from the established norm.  As team members continue this practice (normalization), it leads to &#8220;predictable surprise&#8221;, incursion of risk, technical failure, and in the worst cases complete and catastrophic failure and loss of property and life. To demonstrate his point, Col. Mullane provided the detailed insight of an astronaut and engineer to explain the failures that caused the Challenger disaster, citing specifically that NASA knew that the O-rings had a specific temperature tolerance, and that recovered solid booster rockets were being recovered with burnt interior O-ring walls, something that should never happen. He also described how after recovery of the cockpit, it was discovered that all the panels had their switches in emergency position, meaning that the crew was still alive immediately following the explosion.  He also described that the space shuttle was the first NASA vehicle to not have an emergency egress, unlike former &#8220;rocket&#8221; style vehicles that had all had emergency capsule escape towers that would pull the capsule off the top of the rocket at nine G&#8217;s away from the catastrophic failure of the rest of the rocket.  With the shuttle, this could not happen as it was not part of the shuttle design as any attempt to escape would cause the astronaut to get hit by the shuttle wing.</p>
<p>NASA Engineers began seeking a new way to egress, using rockets.  NASA Engineers tested the &#8220;Emergency Egress Fixed Rocket Package&#8221; which pulls an astronaut from the shuttle by connecting a rocket, to a lanyard, to a parachute harness to the astronaut.  This apparatus was designed to fire astronaut horizontally from the shuttle door.  Engineers used rockets for this design because rockets HAD ALWAYS been used. It was a maddening and dangerous design.  It took a flight surgeon, not an engineer, playing his role as part of the bigger team to suggest a telescoping firepole, a design that they use on the shuttle today.</p>
<p>This stressed to me the importance of maintaining one’s team presence.  Col. Mullane distinguished the difference between team members who are team players, and those who have chosen to be passengers. He amplified this point by by describing one of his early flights over Vietnam where as a REO (TopGun “Goose” position) and he chose to remaining silent when his pilot called Bingo Fuel (point of safe return to base) and desired to continue to the next objective. Even as a rookie pilot, Col. Mullane knew this was a really bad idea, however he let his pilot’s longevity and experience influence his judgment, and by remaining silent, he chose to be a passenger and not a functioning member of the team. The consequence of this decision was a short landing where the pilot and REO ejected, and the plane crashed in pieces on the runway.</p>
<p>Col. Mullane helped me understand the relation between process and risk, to better understand the projects I manage, and reduce the potential for predictable surprise.  He an excellent keynote speaker with a terrific mastery of his topic. Col. Mullane&#8217;s highly inspiring and educational presentation was worthy of the standing ovation that he received from PMI. He is clearly an accomplished deutrolearner (student and teacher within the same body), and explains the traits necessary to use these talents within ourselves to reach the stars.  Within his presentation, he mixed autobiographical elements that demonstrated how we all have the capability to strive for the stars and how destiny was not the primary driver toward him becoming an astronaut. On this point he offered many self-deprecating examples from his high school yearbook where he showed what destiny had to work with. My favorite: the <em>only</em> autograph on the last page read, “You missed Korea, I hope you make Vietnam!”</p>
<p><strong>Web Site of Col. Mike Mullane:</strong> <a href="http://www.mikemullane.com/" >http://www.mikemullane.com/</a></p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=310" >Normalization of Deviance: A Formula for Predictable Surprise</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<div style="display:block"><small><em>posted in <a href="http://www.planphoria.com/?cat=65">Project Management</a> by Srosenberg <a href="http://www.planphoria.com/?p=310#comments">Leave A Comment</a></em></small></div>]]></description>
			<content:encoded><![CDATA[<p>Attending <a href="http://www.pmiwdc.org/" >PMIWDC</a>, I met former Astronaut and inductee into the International Hall of Fame, Colonel Mike Mullane. He is an author of &#8220;<a rel="nofollow" href="http://www.amazon.com/Riding-Rockets-Outrageous-Shuttle-Astronaut/dp/0743276825" >Riding Rockets</a>&#8220;, and &#8220;<a rel="nofollow" href="http://www.amazon.com/Space-Other-Surprising-Questions-Travel/dp/0471154040/ref=pd_bbs_1?ie=UTF8&amp;s=books&amp;qid=1205508953&amp;sr=1-1" >Do your Ears Pop in Space</a>&#8220;.</p>
<p>Col. Mullane conveyed that the responsibility and duty all project team members must have to contribute to project success, regardless of their position. He discussed that Astronauts share credit for their success with their team, and despite being the most visible part of the mission, the NASA team extends to the people that man mission control, to the engineers that build the spacecraft, to the specialists that develop and configure human life support systems, to the nutritionists that prepare the meals for the voyage, to the janitors who sweep the floors.  He describes that when it comes to preventing mission risk transforming into issues, the perception of ALL team members must be considered.  This philosopy is fully amplified and fictionally illustrated by the &#8220;West Wing&#8221; character, Toby Ziegler, who when hearing that the shuttle mission on which his brother was a specialist had problems with the shuttle bay doors remarked, &#8220;Mr. President, thank you for your concern, however in space, there is no such thing as a small problem.&#8221;</p>
<p>To counter these effects, he described that his first act working with any member of a team is to assure that they understand what Normalization of Deviance, in addition to the consequences that  occur.  Normalization of Deviance was the primary contributing factor to creating both Challenger and Columbia space shuttle disasters.  The technical reasons for both disasters are well documented and too lengthy to discuss here.  Mike Mullane&#8217;s reasoning for why both shuttles experienced catastrophic failure, coincides with my own understanding of why projects fail.  We seldom fail from the technical, we most always overlook management over the implementation.  For the most part this is because the technology is sexy, and we lead ourselves to believe the fallacy that technology works automatically, that it has been tested to work, and should be trusted to always work without failure.This is certainly the case of the &#8220;unsinkable&#8221; HMS Titanic.</p>
<p>Within a PMI project management approach, one of the core activities to performing Risk Management is Risk Identification. I have been in organizations where Risk Identification was generally overlooked as a point of normalized deviance.  The process requires that we perform a risk assessement, so we do. <em>&#8220;We don&#8217;t have the time to get our technical staff involved, they will only slow us down to fill out our risk register.&#8221;</em> How many times have you seen that?  Why do a risk assessment this way?  <em>&#8220;We have to be prepared for the audit.&#8221;</em> Who does the audit? Corporate Quality Assurance, who observes that indeed the risk register is up to date, and identified risks are being entered and monitored, and they checkmark the box.  This is a failure waiting to happen from habitual deviance from core principals of the established standard, which enables an organization to place their full trust behind the process in place, with complete disregard to its consequence.  Mike Mullane describes that the only result that comes from this practice is &#8220;Predictable Surprise&#8221;.</p>
<p>Col Mullane defines Normalization of Deviance as the working or mission environment created when established standards are subverted incrementally over time without consequence, by routinely rewarding shortcuts from the established norm.  As team members continue this practice (normalization), it leads to &#8220;predictable surprise&#8221;, incursion of risk, technical failure, and in the worst cases complete and catastrophic failure and loss of property and life. To demonstrate his point, Col. Mullane provided the detailed insight of an astronaut and engineer to explain the failures that caused the Challenger disaster, citing specifically that NASA knew that the O-rings had a specific temperature tolerance, and that recovered solid booster rockets were being recovered with burnt interior O-ring walls, something that should never happen. He also described how after recovery of the cockpit, it was discovered that all the panels had their switches in emergency position, meaning that the crew was still alive immediately following the explosion.  He also described that the space shuttle was the first NASA vehicle to not have an emergency egress, unlike former &#8220;rocket&#8221; style vehicles that had all had emergency capsule escape towers that would pull the capsule off the top of the rocket at nine G&#8217;s away from the catastrophic failure of the rest of the rocket.  With the shuttle, this could not happen as it was not part of the shuttle design as any attempt to escape would cause the astronaut to get hit by the shuttle wing.</p>
<p>NASA Engineers began seeking a new way to egress, using rockets.  NASA Engineers tested the &#8220;Emergency Egress Fixed Rocket Package&#8221; which pulls an astronaut from the shuttle by connecting a rocket, to a lanyard, to a parachute harness to the astronaut.  This apparatus was designed to fire astronaut horizontally from the shuttle door.  Engineers used rockets for this design because rockets HAD ALWAYS been used. It was a maddening and dangerous design.  It took a flight surgeon, not an engineer, playing his role as part of the bigger team to suggest a telescoping firepole, a design that they use on the shuttle today.</p>
<p>This stressed to me the importance of maintaining one’s team presence.  Col. Mullane distinguished the difference between team members who are team players, and those who have chosen to be passengers. He amplified this point by by describing one of his early flights over Vietnam where as a REO (TopGun “Goose” position) and he chose to remaining silent when his pilot called Bingo Fuel (point of safe return to base) and desired to continue to the next objective. Even as a rookie pilot, Col. Mullane knew this was a really bad idea, however he let his pilot’s longevity and experience influence his judgment, and by remaining silent, he chose to be a passenger and not a functioning member of the team. The consequence of this decision was a short landing where the pilot and REO ejected, and the plane crashed in pieces on the runway.</p>
<p>Col. Mullane helped me understand the relation between process and risk, to better understand the projects I manage, and reduce the potential for predictable surprise.  He an excellent keynote speaker with a terrific mastery of his topic. Col. Mullane&#8217;s highly inspiring and educational presentation was worthy of the standing ovation that he received from PMI. He is clearly an accomplished deutrolearner (student and teacher within the same body), and explains the traits necessary to use these talents within ourselves to reach the stars.  Within his presentation, he mixed autobiographical elements that demonstrated how we all have the capability to strive for the stars and how destiny was not the primary driver toward him becoming an astronaut. On this point he offered many self-deprecating examples from his high school yearbook where he showed what destiny had to work with. My favorite: the <em>only</em> autograph on the last page read, “You missed Korea, I hope you make Vietnam!”</p>
<p><strong>Web Site of Col. Mike Mullane:</strong> <a href="http://www.mikemullane.com/" >http://www.mikemullane.com/</a></p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=310" >Normalization of Deviance: A Formula for Predictable Surprise</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<img src="http://feeds.feedburner.com/~r/Planphoria/~4/aePjgMzNG9A" height="1" width="1"/>]]></content:encoded>
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		<title>The Blind Leading the Blind Into the Dark</title>
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		<comments>http://www.planphoria.com/?p=297#comments</comments>
		<pubDate>Wed, 03 Sep 2008 01:31:32 +0000</pubDate>
		<dc:creator>srosenberg</dc:creator>
		
		<category><![CDATA[Project Management]]></category>

		<category><![CDATA[Project Planning]]></category>

		<category><![CDATA[microsoft project]]></category>

		<category><![CDATA[ms project]]></category>

		<category><![CDATA[Planning]]></category>

		<category><![CDATA[planning team]]></category>

		<category><![CDATA[project management plan]]></category>

		<guid isPermaLink="false">http://www.planphoria.com/?p=297</guid>
		<description><![CDATA[<p><span style="font-family: arial,helvetica,sans-serif;"><em><strong>Microsoft Project Seems Synonymous with Project Management, But is It Really the Best Place to Start? </strong></em></span></p>
<p>We have all seen it, and have likely been there at one point or another.  A Project Manager is assigned a new project and instantly follows his impulse to crack open his laptop, start MS-Project and begin the planning process.  In doing so, he immediately, without hesitation, dives headfirst into his project and begins to waste time in the name of advancing it.   Realizing his own shortcomings while experiencing major difficulty developing “the plan”, he tries to include those more knowledgeable than himself in the process, which unknown to him, only serves to double, triple or quadruple the amount of time (effort) wasted.  His laptop is open, his two to four key people are around the board room table with the MS-Project “plan” up on the Proxima screen so that everyone can be on the same page.</p>
<p style="margin-bottom: 0in;">Producing an MS-Project Project Plan may seem like an appropriate goal to rapidly bridge between concept and execution, however I can assure you that in months to come as this project plan incurs several re-writes and the painful impact of a myriad of issues, the Project Manager in the scenario above, will likely develop a different opinion and wonder why his planning team didn&#8217;t develop the plan correctly the first time.</p>
<p>Within the scenario, I described a situation where the Project Manager became drugged by the technology, preventing him from doing three major things.  First, as he began his planning process, he forgot (or did not realize) that there is an actual process to planning.  He just opened up the laptop, and began typing stream of thought of what he thought the plan should be.</p>
<p>Second, he confused the activity process of Project Planning with its intended result called a Project Schedule.  In many circles the Project Schedule is inappropriately called the Project Plan, also known as Project Management Plan (PMP) which is a narrative based document developed to guide project operations.  Two entirely different things as you start the planning process with one and end with the other. Talk about doing things in a backward manner!  Such commonly bad usage of these terms by those who do not know the differences between a PMP and a schedule, often creates confusion.</p>
<p>The activity “guidelines” within the graphic below are defined by the Project Management Institute (PMI), Project Management Body of Knowledge (PMBOK). As you can see, <em><span>Develop Project Management Plan</span></em><strong> </strong>is the first activity that should be completed followed by 19 other activities before we are prepared with enough information to produce a project schedule, where MS-Project can be used.</p>
<div id="attachment_296" class="wp-caption aligncenter" style="width: 509px"><a href="http://www.planphoria.com/wp-content/uploads/2008/09/project-scheduling3.png" ><img class="size-full wp-image-296" title="project-scheduling3" src="http://www.planphoria.com/wp-content/uploads/2008/09/project-scheduling3.png" alt="PMI Project Scheduling Process" width="499" height="549" /></a><p class="wp-caption-text">PMI Project Scheduling Process</p></div>
<p>Aside from calling the Project Schedule the wrong thing, he also forgot that his desired result is not only to develop a Project Schedule, but to develop one that is realistic and achievable. Within the scenario, the manager was having difficulty building the plan because the plan definition was not defined and therefore, he was building it in a vacuum. This means that by doing most, if not all of the activities that occur before <em>Schedule Development</em> in the graphic above, we would stage our schedule (and therefore the project) for success, armed with enough information to develop the schedule correctly the first time.</p>
<p>Of all the things that the Project Manager did wrong, he did one thing correctly, albeit for the wrong reasons.  He eventually included his team in on the planning effort realizing his own shortcomings.  The purpose of a project manager is to lead the team through an optimum path through the project, clearing away the jungle vines and debris so that work can be done.  Though Project Managers often analyze the information available to make project critical decisions, they are not unusually intelligent people that know all and see all.  To other people this point is usually understood, although it may not be understood by the Project Manager themselves.  To prevent the planning process and project schedule from being developed in a vacuum, the project manager, must communicate with his team and and capture the result within a number of planning artifacts.  Typically, the project definition artifacts that result from these activities are too much work for one person, requiring a team to help fully define and plan the project.</p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=297" >The Blind Leading the Blind Into the Dark</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<div style="display:block"><small><em>posted in <a href="http://www.planphoria.com/?cat=65">Project Management</a> by Srosenberg <a href="http://www.planphoria.com/?p=297#comments">Leave A Comment</a></em></small></div>]]></description>
			<content:encoded><![CDATA[<p><span style="font-family: arial,helvetica,sans-serif;"><em><strong>Microsoft Project Seems Synonymous with Project Management, But is It Really the Best Place to Start? </strong></em></span></p>
<p>We have all seen it, and have likely been there at one point or another.  A Project Manager is assigned a new project and instantly follows his impulse to crack open his laptop, start MS-Project and begin the planning process.  In doing so, he immediately, without hesitation, dives headfirst into his project and begins to waste time in the name of advancing it.   Realizing his own shortcomings while experiencing major difficulty developing “the plan”, he tries to include those more knowledgeable than himself in the process, which unknown to him, only serves to double, triple or quadruple the amount of time (effort) wasted.  His laptop is open, his two to four key people are around the board room table with the MS-Project “plan” up on the Proxima screen so that everyone can be on the same page.</p>
<p style="margin-bottom: 0in;">Producing an MS-Project Project Plan may seem like an appropriate goal to rapidly bridge between concept and execution, however I can assure you that in months to come as this project plan incurs several re-writes and the painful impact of a myriad of issues, the Project Manager in the scenario above, will likely develop a different opinion and wonder why his planning team didn&#8217;t develop the plan correctly the first time.</p>
<p>Within the scenario, I described a situation where the Project Manager became drugged by the technology, preventing him from doing three major things.  First, as he began his planning process, he forgot (or did not realize) that there is an actual process to planning.  He just opened up the laptop, and began typing stream of thought of what he thought the plan should be.</p>
<p>Second, he confused the activity process of Project Planning with its intended result called a Project Schedule.  In many circles the Project Schedule is inappropriately called the Project Plan, also known as Project Management Plan (PMP) which is a narrative based document developed to guide project operations.  Two entirely different things as you start the planning process with one and end with the other. Talk about doing things in a backward manner!  Such commonly bad usage of these terms by those who do not know the differences between a PMP and a schedule, often creates confusion.</p>
<p>The activity “guidelines” within the graphic below are defined by the Project Management Institute (PMI), Project Management Body of Knowledge (PMBOK). As you can see, <em><span>Develop Project Management Plan</span></em><strong> </strong>is the first activity that should be completed followed by 19 other activities before we are prepared with enough information to produce a project schedule, where MS-Project can be used.</p>
<div id="attachment_296" class="wp-caption aligncenter" style="width: 509px"><a href="http://www.planphoria.com/wp-content/uploads/2008/09/project-scheduling3.png" ><img class="size-full wp-image-296" title="project-scheduling3" src="http://www.planphoria.com/wp-content/uploads/2008/09/project-scheduling3.png" alt="PMI Project Scheduling Process" width="499" height="549" /></a><p class="wp-caption-text">PMI Project Scheduling Process</p></div>
<p>Aside from calling the Project Schedule the wrong thing, he also forgot that his desired result is not only to develop a Project Schedule, but to develop one that is realistic and achievable. Within the scenario, the manager was having difficulty building the plan because the plan definition was not defined and therefore, he was building it in a vacuum. This means that by doing most, if not all of the activities that occur before <em>Schedule Development</em> in the graphic above, we would stage our schedule (and therefore the project) for success, armed with enough information to develop the schedule correctly the first time.</p>
<p>Of all the things that the Project Manager did wrong, he did one thing correctly, albeit for the wrong reasons.  He eventually included his team in on the planning effort realizing his own shortcomings.  The purpose of a project manager is to lead the team through an optimum path through the project, clearing away the jungle vines and debris so that work can be done.  Though Project Managers often analyze the information available to make project critical decisions, they are not unusually intelligent people that know all and see all.  To other people this point is usually understood, although it may not be understood by the Project Manager themselves.  To prevent the planning process and project schedule from being developed in a vacuum, the project manager, must communicate with his team and and capture the result within a number of planning artifacts.  Typically, the project definition artifacts that result from these activities are too much work for one person, requiring a team to help fully define and plan the project.</p>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=297" >The Blind Leading the Blind Into the Dark</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<img src="http://feeds.feedburner.com/~r/Planphoria/~4/09UJzL_UZmo" height="1" width="1"/>]]></content:encoded>
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		<item>
		<title>Earned Value Management, ANSI Style, In 32-Steps</title>
		<link>http://feedproxy.google.com/~r/Planphoria/~3/KlAdKYxKsHw/</link>
		<comments>http://www.planphoria.com/?p=105#comments</comments>
		<pubDate>Mon, 25 Aug 2008 01:09:46 +0000</pubDate>
		<dc:creator>srosenberg</dc:creator>
		
		<category><![CDATA[Earned Value]]></category>

		<category><![CDATA[32-Step EVM]]></category>

		<category><![CDATA[ANSI/EIA 748-a]]></category>

		<category><![CDATA[Change]]></category>

		<category><![CDATA[OMB Circular A-130]]></category>

		<category><![CDATA[Planning]]></category>

		<guid isPermaLink="false">http://www.planphoria.com/?p=120&amp;language=en</guid>
		<description><![CDATA[<p>ANSI/EIS 748-a (1998) is the widely adopted Earned Value Management System (EVMS) standard. Overall, it is about 32 pages long, 19 of which actually hold real content that is directly relevant to the standard.  The ANSI standard goes by other names, relevant to the 32-Steps described in the document, such as the 32-Step Earned Value Management Process.  This is confusing, and on a proposal a few years ago, I had to figure out what the RFP was talking about when it referred to the 32-Step EVM Process.  In short they wanted the ANSI standard without referencing it, and requested it without the understanding that the ANSI standard was not structured by the 32-steps.  For this reason, I thought it to be a good idea to pass this knowledge along.  Hopefully I have hit upon a few key words for those people frantically (and incorrectly) searching for the 32-Step EVM Process.</p>
<p>The steps below comprise the 32 &#8220;things you need to do&#8221; to support a Value Management System to be compliant with ANSI/EIA 748-a.  One should recognize that depending on the size of your project, typically these &#8220;steps&#8221; are tailored back  so that only 10 or so are used.  This is usually dependent on the total project value so that the cost of implementing Earned Value does not outweigh the cost of supporting all 32 elements of the standard.  Also, one should recognize that the wordl &#8220;system&#8221; equates to &#8220;structured process&#8221;, not necessarily &#8220;software&#8221;.  When it comes to establishing an Earned Value Management System, you should structure the software around the process, not the process around the software.  Back in 1999, people were Y2K happy, and everyone was trying to get an edge by making products Y2K compliant, from Y2K TV sets, to Y2K cement blocks. (I exaggerate.)  The same can be said about EVM software.  Though EVM software helps you be compliant, it is your process that makes you compliant, not the software.  In fact, ANSI/EIA 748-a, does not mention software, or a brand of software to use.  Beware of Snake Oil Salesmen who will claim to make you ANSI 748a compliant by selling you their software!</p>
<h2><strong>Standard 748-A-1998 EVMS Guidelines </strong></h2>
<table style="width: 561px; height: 2953px;" border="1" cellspacing="0" cellpadding="7" bordercolor="#000000"><col width="40"></col> <col width="538"></col></p>
<thead>
<tr>
<td width="40" bgcolor="#0000ff">
<p align="center">
<p align="center"><span style="color: #ffffff;"><span style="font-size: x-small;"><strong>No.</strong></span></span></p>
</td>
<td width="538" bgcolor="#0000ff">
<p align="center"><span style="font-size: small; color: #ffffff;"><span><strong>Standard 748-A-1998 Guidelines</strong></span></span></p>
</td>
</tr>
</thead>
<tbody>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.1 Organization</strong></span></td>
</tr>
<tr valign="top">
<td width="40">1</td>
<td width="538"><span style="font-size: small;">a) Define the authorized work elements for the program. A work breakdown structure (WBS), tailored for effective internal management control, is commonly used in this process.</span></td>
</tr>
<tr valign="top">
<td width="40">2</td>
<td width="538"><span style="font-size: small;">b) Identify the program organizational structure including the major subcontractors responsible for accomplishing the authorized work, and define the organizational elements in which work will be planned and controlled.</span></td>
</tr>
<tr valign="top">
<td width="40">3</td>
<td width="538"><span style="font-size: small;">c) Provide for the integration of the company’s planning, scheduling, budgeting, work authorization and cost accumulation processes with each other, and as appropriate, the program work breakdown structure and the program organizational structure.</span></td>
</tr>
<tr valign="top">
<td width="40">4</td>
<td width="538"><span style="font-size: small;">d) Identify the company organization or function responsible for controlling overhead (indirect costs).</span></td>
</tr>
<tr valign="top">
<td width="40">5</td>
<td width="538"><span style="font-size: small;">e) Provide for integration of the program work breakdown structure and the program organizational structure in a manner that permits cost and schedule performance measurement by elements of either or both structures as needed.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.2 Planning, Scheduling, and Budgeting</strong></span></td>
</tr>
<tr valign="top">
<td width="40">6</td>
<td width="538"><span style="font-size: small; font-family: Arial;"><span>a) Schedule the authorized work in a manner which describes the sequence of work and identifies significant task interdependencies required to meet the requirements of the program.</span></span></td>
</tr>
<tr valign="top">
<td width="40">7</td>
<td width="538"><span style="font-size: small; font-family: Arial;"><span>b) Identify the program organizational structure including the major subcontractors responsible for accomplishing the authorized work, and define the organizational elements in which work will be planned and controlled.</span></span></td>
</tr>
<tr valign="top">
<td width="40">8</td>
<td width="538"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>c) Establish and maintain a time-phased budget baseline, at the control account level, against which program performance can be measured. Initial budgets established for performance measurement will be based on either internal management goals or the external customer negotiated target cost including estimates for authorized but undefinitized work. Budget for far-term efforts may be held in higher level accounts until an appropriate time for allocation at the control account level. On government contracts, if an over-target baseline is used for performance measurement reporting purposes, prior notification must be provided to the customer.</span></span></td>
</tr>
<tr valign="top">
<td width="40">9</td>
<td width="538"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>d) Establish budgets for authorized work with identification of significant cost elements (labor, material, etc.) as needed for internal management and for control of subcontractors.</span></span></td>
</tr>
<tr valign="top">
<td width="40">10</td>
<td width="538">
<p style="margin-bottom: 0in;"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>e) To the extent it is practicable to identify the authorized work in discrete work packages, establish budgets for this work in terms of dollars, hours, or other measurable units.</span></span></p>
<p style="margin-bottom: 0in;">
<p><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>Where the entire control account is not subdivided into work packages, identify the far term effort in larger planning packages for budget and scheduling purposes.</span></span></td>
</tr>
<tr valign="top">
<td width="40">11</td>
<td width="538"><span style="font-size: small;">f) Provide that the sum of all work package budgets plus planning package budgets within a control account equals the control account budget.</span></td>
</tr>
<tr valign="top">
<td width="40">12</td>
<td width="538"><span style="font-size: small;">g) Identify and control level of effort activity by time-phased budgets established for this purpose. Only that effort which is unmeasurable or for which measurement is impracticable may be classified as level of effort.</span></td>
</tr>
<tr valign="top">
<td width="40">13</td>
<td width="538"><span style="font-size: small;">h) Establish overhead budgets for each significant organizational component of the company for expenses which will become indirect costs. Reflect in the program budgets, at the appropriate level, the amounts in overhead pools that are planned to be allocated to the program as indirect costs.</span></td>
</tr>
<tr valign="top">
<td width="40">14</td>
<td width="538"><span style="font-size: small;">i) Identify management reserves and undistributed budget.</span></td>
</tr>
<tr valign="top">
<td width="40">15</td>
<td width="538"><span style="font-size: small;">j) Provide that the program target cost goal is reconciled with the sum of all internal program budgets and management reserves.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"><strong><br />
</strong></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong><span>2.3 Accounting Considerations</span></strong></span></td>
</tr>
<tr valign="top">
<td width="40">16</td>
<td width="538"><span style="font-size: small;">a) Record direct costs in a manner consistent with the budgets in a formal system controlled by the general books of account.</span></td>
</tr>
<tr valign="top">
<td width="40">17</td>
<td width="538"><span style="font-size: small;">b) When a work breakdown structure is used, summarize direct costs from control accounts into the work breakdown structure without allocation of a single control account to two or more work breakdown structure elements.</span></td>
</tr>
<tr valign="top">
<td width="40">18</td>
<td width="538"><span style="font-size: small;">c) Summarize direct costs from the control accounts into the contractor’s organizational elements without allocation of a single control account to two or more organizational elements.</span></td>
</tr>
<tr valign="top">
<td width="40">19</td>
<td width="538"><span style="font-size: small;">d) Record all indirect costs which will be allocated to the contract.</span></td>
</tr>
<tr valign="top">
<td width="40">20</td>
<td width="538"><span style="font-size: small;">e) Identify unit costs, equivalent unit costs, or lot costs when needed.</span></td>
</tr>
<tr valign="top">
<td width="40">21</td>
<td width="538"><span style="font-size: small;">f) For EVMS, the material accounting system will provide for:</span></td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">1) Accurate cost accumulation and assignment of costs to control accounts in a manner consistent with the budgets using recognized, acceptable, costing techniques.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">2) Cost performance measurement at the point in time most suitable for the category of material involved, but no earlier than the time of progress payments or actual receipt of material.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;"><strong><span>3) Full accountability of all material purchased for the program including the residual inventory. </span></strong></span></p>
</td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong><span>2.4 Analysis and Management Reports</span></strong></span></td>
</tr>
<tr valign="top">
<td width="40">22</td>
<td width="538"><span style="font-size: small;">a) At least on a monthly basis, generate the following information at the control account and other levels as necessary for management control using actual cost data from, or reconcilable with, the accounting system:</span></td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">1) Comparison of the amount of planned budget and the amount of budget earned for work accomplished. This comparison provides the schedule variance.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">2) Comparison of the amount of the budget earned and the actual (applied where appropriate) direct costs for the same work. This comparison provides the cost variance.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40">23</td>
<td width="538"><span style="font-size: small;">b) Identify, at least monthly, the significant differences between both planned and actual schedule performance and planned and actual cost performance, and provide the reasons for the variances in the detail needed by program management.</span></td>
</tr>
<tr valign="top">
<td width="40">24</td>
<td width="538"><span style="font-size: small;">c) Identify budgeted and applied (or actual) indirect costs at the level and frequency needed by management for effective control, along with the reasons for any significant variances.</span></td>
</tr>
<tr valign="top">
<td width="40">25</td>
<td width="538"><span style="font-size: small;">d) Summarize the data elements and associated variances through the program organization and/or work breakdown structure to support management needs and any customer reporting specified in the contract.</span></td>
</tr>
<tr valign="top">
<td width="40">26</td>
<td width="538"><span style="font-size: small;">e) Implement managerial actions taken as the result of earned value information.</span></td>
</tr>
<tr valign="top">
<td width="40">27</td>
<td width="538"><span style="font-size: small;">f) Develop revised estimates of cost at completion based on performance to date, commitment values for material, and estimates of future conditions. Compare this information with the performance measurement baseline to identify variances at completion important to company management and any applicable customer reporting requirements including statements of funding requirements.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.5 Revisions and Data Maintenance</strong></span></td>
</tr>
<tr valign="top">
<td width="40">28</td>
<td width="538"><span style="font-size: small;">a) Incorporate authorized changes in a timely manner, recording the effects of such changes in budgets and schedules. In the directed effort prior to negotiation of a change, base such revisions on the amount estimated and budgeted to the program organizations.</span></td>
</tr>
<tr valign="top">
<td width="40">29</td>
<td width="538"><span style="font-size: small;">b) Reconcile current budgets to prior budgets in terms of changes to the authorized work and internal replanning in the detail needed by management for effective control.</span></td>
</tr>
<tr valign="top">
<td width="40">30</td>
<td width="538"><span style="font-size: small;">c) Control retroactive changes to records pertaining to work performed that would change previously reported amounts for actual costs, earned value, or budgets. Adjustments should be made only for correction of errors, routine accounting adjustments, effects of customer or management directed changes, or to improve the baseline integrity and accuracy of performance measurement data.</span></td>
</tr>
<tr valign="top">
<td width="40">31</td>
<td width="538"><span style="font-size: small;">d) Prevent revisions to the program budget except for authorized changes.</span></td>
</tr>
<tr valign="top">
<td width="40">32</td>
<td width="538"><span style="font-size: small;">e) Document changes to the performance measurement baseline.</span></td>
</tr>
</tbody>
</table>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=105" >Earned Value Management, ANSI Style, In 32-Steps</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<div style="display:block"><small><em>posted in <a href="http://www.planphoria.com/?cat=4">Earned Value</a> by Srosenberg <a href="http://www.planphoria.com/?p=105#comments">Leave A Comment</a></em></small></div>]]></description>
			<content:encoded><![CDATA[<p>ANSI/EIS 748-a (1998) is the widely adopted Earned Value Management System (EVMS) standard. Overall, it is about 32 pages long, 19 of which actually hold real content that is directly relevant to the standard.  The ANSI standard goes by other names, relevant to the 32-Steps described in the document, such as the 32-Step Earned Value Management Process.  This is confusing, and on a proposal a few years ago, I had to figure out what the RFP was talking about when it referred to the 32-Step EVM Process.  In short they wanted the ANSI standard without referencing it, and requested it without the understanding that the ANSI standard was not structured by the 32-steps.  For this reason, I thought it to be a good idea to pass this knowledge along.  Hopefully I have hit upon a few key words for those people frantically (and incorrectly) searching for the 32-Step EVM Process.</p>
<p>The steps below comprise the 32 &#8220;things you need to do&#8221; to support a Value Management System to be compliant with ANSI/EIA 748-a.  One should recognize that depending on the size of your project, typically these &#8220;steps&#8221; are tailored back  so that only 10 or so are used.  This is usually dependent on the total project value so that the cost of implementing Earned Value does not outweigh the cost of supporting all 32 elements of the standard.  Also, one should recognize that the wordl &#8220;system&#8221; equates to &#8220;structured process&#8221;, not necessarily &#8220;software&#8221;.  When it comes to establishing an Earned Value Management System, you should structure the software around the process, not the process around the software.  Back in 1999, people were Y2K happy, and everyone was trying to get an edge by making products Y2K compliant, from Y2K TV sets, to Y2K cement blocks. (I exaggerate.)  The same can be said about EVM software.  Though EVM software helps you be compliant, it is your process that makes you compliant, not the software.  In fact, ANSI/EIA 748-a, does not mention software, or a brand of software to use.  Beware of Snake Oil Salesmen who will claim to make you ANSI 748a compliant by selling you their software!</p>
<h2><strong>Standard 748-A-1998 EVMS Guidelines </strong></h2>
<table style="width: 561px; height: 2953px;" border="1" cellspacing="0" cellpadding="7" bordercolor="#000000"><col width="40"></col> <col width="538"></col></p>
<thead>
<tr>
<td width="40" bgcolor="#0000ff">
<p align="center">
<p align="center"><span style="color: #ffffff;"><span style="font-size: x-small;"><strong>No.</strong></span></span></p>
</td>
<td width="538" bgcolor="#0000ff">
<p align="center"><span style="font-size: small; color: #ffffff;"><span><strong>Standard 748-A-1998 Guidelines</strong></span></span></p>
</td>
</tr>
</thead>
<tbody>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.1 Organization</strong></span></td>
</tr>
<tr valign="top">
<td width="40">1</td>
<td width="538"><span style="font-size: small;">a) Define the authorized work elements for the program. A work breakdown structure (WBS), tailored for effective internal management control, is commonly used in this process.</span></td>
</tr>
<tr valign="top">
<td width="40">2</td>
<td width="538"><span style="font-size: small;">b) Identify the program organizational structure including the major subcontractors responsible for accomplishing the authorized work, and define the organizational elements in which work will be planned and controlled.</span></td>
</tr>
<tr valign="top">
<td width="40">3</td>
<td width="538"><span style="font-size: small;">c) Provide for the integration of the company’s planning, scheduling, budgeting, work authorization and cost accumulation processes with each other, and as appropriate, the program work breakdown structure and the program organizational structure.</span></td>
</tr>
<tr valign="top">
<td width="40">4</td>
<td width="538"><span style="font-size: small;">d) Identify the company organization or function responsible for controlling overhead (indirect costs).</span></td>
</tr>
<tr valign="top">
<td width="40">5</td>
<td width="538"><span style="font-size: small;">e) Provide for integration of the program work breakdown structure and the program organizational structure in a manner that permits cost and schedule performance measurement by elements of either or both structures as needed.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.2 Planning, Scheduling, and Budgeting</strong></span></td>
</tr>
<tr valign="top">
<td width="40">6</td>
<td width="538"><span style="font-size: small; font-family: Arial;"><span>a) Schedule the authorized work in a manner which describes the sequence of work and identifies significant task interdependencies required to meet the requirements of the program.</span></span></td>
</tr>
<tr valign="top">
<td width="40">7</td>
<td width="538"><span style="font-size: small; font-family: Arial;"><span>b) Identify the program organizational structure including the major subcontractors responsible for accomplishing the authorized work, and define the organizational elements in which work will be planned and controlled.</span></span></td>
</tr>
<tr valign="top">
<td width="40">8</td>
<td width="538"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>c) Establish and maintain a time-phased budget baseline, at the control account level, against which program performance can be measured. Initial budgets established for performance measurement will be based on either internal management goals or the external customer negotiated target cost including estimates for authorized but undefinitized work. Budget for far-term efforts may be held in higher level accounts until an appropriate time for allocation at the control account level. On government contracts, if an over-target baseline is used for performance measurement reporting purposes, prior notification must be provided to the customer.</span></span></td>
</tr>
<tr valign="top">
<td width="40">9</td>
<td width="538"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>d) Establish budgets for authorized work with identification of significant cost elements (labor, material, etc.) as needed for internal management and for control of subcontractors.</span></span></td>
</tr>
<tr valign="top">
<td width="40">10</td>
<td width="538">
<p style="margin-bottom: 0in;"><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>e) To the extent it is practicable to identify the authorized work in discrete work packages, establish budgets for this work in terms of dollars, hours, or other measurable units.</span></span></p>
<p style="margin-bottom: 0in;">
<p><span style="font-size: small; font-family: TimesNewRoman,serif;"><span>Where the entire control account is not subdivided into work packages, identify the far term effort in larger planning packages for budget and scheduling purposes.</span></span></td>
</tr>
<tr valign="top">
<td width="40">11</td>
<td width="538"><span style="font-size: small;">f) Provide that the sum of all work package budgets plus planning package budgets within a control account equals the control account budget.</span></td>
</tr>
<tr valign="top">
<td width="40">12</td>
<td width="538"><span style="font-size: small;">g) Identify and control level of effort activity by time-phased budgets established for this purpose. Only that effort which is unmeasurable or for which measurement is impracticable may be classified as level of effort.</span></td>
</tr>
<tr valign="top">
<td width="40">13</td>
<td width="538"><span style="font-size: small;">h) Establish overhead budgets for each significant organizational component of the company for expenses which will become indirect costs. Reflect in the program budgets, at the appropriate level, the amounts in overhead pools that are planned to be allocated to the program as indirect costs.</span></td>
</tr>
<tr valign="top">
<td width="40">14</td>
<td width="538"><span style="font-size: small;">i) Identify management reserves and undistributed budget.</span></td>
</tr>
<tr valign="top">
<td width="40">15</td>
<td width="538"><span style="font-size: small;">j) Provide that the program target cost goal is reconciled with the sum of all internal program budgets and management reserves.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"><strong><br />
</strong></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong><span>2.3 Accounting Considerations</span></strong></span></td>
</tr>
<tr valign="top">
<td width="40">16</td>
<td width="538"><span style="font-size: small;">a) Record direct costs in a manner consistent with the budgets in a formal system controlled by the general books of account.</span></td>
</tr>
<tr valign="top">
<td width="40">17</td>
<td width="538"><span style="font-size: small;">b) When a work breakdown structure is used, summarize direct costs from control accounts into the work breakdown structure without allocation of a single control account to two or more work breakdown structure elements.</span></td>
</tr>
<tr valign="top">
<td width="40">18</td>
<td width="538"><span style="font-size: small;">c) Summarize direct costs from the control accounts into the contractor’s organizational elements without allocation of a single control account to two or more organizational elements.</span></td>
</tr>
<tr valign="top">
<td width="40">19</td>
<td width="538"><span style="font-size: small;">d) Record all indirect costs which will be allocated to the contract.</span></td>
</tr>
<tr valign="top">
<td width="40">20</td>
<td width="538"><span style="font-size: small;">e) Identify unit costs, equivalent unit costs, or lot costs when needed.</span></td>
</tr>
<tr valign="top">
<td width="40">21</td>
<td width="538"><span style="font-size: small;">f) For EVMS, the material accounting system will provide for:</span></td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">1) Accurate cost accumulation and assignment of costs to control accounts in a manner consistent with the budgets using recognized, acceptable, costing techniques.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">2) Cost performance measurement at the point in time most suitable for the category of material involved, but no earlier than the time of progress payments or actual receipt of material.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;"><strong><span>3) Full accountability of all material purchased for the program including the residual inventory. </span></strong></span></p>
</td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong><span>2.4 Analysis and Management Reports</span></strong></span></td>
</tr>
<tr valign="top">
<td width="40">22</td>
<td width="538"><span style="font-size: small;">a) At least on a monthly basis, generate the following information at the control account and other levels as necessary for management control using actual cost data from, or reconcilable with, the accounting system:</span></td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">1) Comparison of the amount of planned budget and the amount of budget earned for work accomplished. This comparison provides the schedule variance.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40"></td>
<td width="538">
<p style="margin-left: 0.18in;"><span style="font-size: small;">2) Comparison of the amount of the budget earned and the actual (applied where appropriate) direct costs for the same work. This comparison provides the cost variance.</span></p>
</td>
</tr>
<tr valign="top">
<td width="40">23</td>
<td width="538"><span style="font-size: small;">b) Identify, at least monthly, the significant differences between both planned and actual schedule performance and planned and actual cost performance, and provide the reasons for the variances in the detail needed by program management.</span></td>
</tr>
<tr valign="top">
<td width="40">24</td>
<td width="538"><span style="font-size: small;">c) Identify budgeted and applied (or actual) indirect costs at the level and frequency needed by management for effective control, along with the reasons for any significant variances.</span></td>
</tr>
<tr valign="top">
<td width="40">25</td>
<td width="538"><span style="font-size: small;">d) Summarize the data elements and associated variances through the program organization and/or work breakdown structure to support management needs and any customer reporting specified in the contract.</span></td>
</tr>
<tr valign="top">
<td width="40">26</td>
<td width="538"><span style="font-size: small;">e) Implement managerial actions taken as the result of earned value information.</span></td>
</tr>
<tr valign="top">
<td width="40">27</td>
<td width="538"><span style="font-size: small;">f) Develop revised estimates of cost at completion based on performance to date, commitment values for material, and estimates of future conditions. Compare this information with the performance measurement baseline to identify variances at completion important to company management and any applicable customer reporting requirements including statements of funding requirements.</span></td>
</tr>
<tr valign="top">
<td width="40" bgcolor="#ccffff"></td>
<td width="538" bgcolor="#ccffff"><span style="font-size: small;"><strong>2.5 Revisions and Data Maintenance</strong></span></td>
</tr>
<tr valign="top">
<td width="40">28</td>
<td width="538"><span style="font-size: small;">a) Incorporate authorized changes in a timely manner, recording the effects of such changes in budgets and schedules. In the directed effort prior to negotiation of a change, base such revisions on the amount estimated and budgeted to the program organizations.</span></td>
</tr>
<tr valign="top">
<td width="40">29</td>
<td width="538"><span style="font-size: small;">b) Reconcile current budgets to prior budgets in terms of changes to the authorized work and internal replanning in the detail needed by management for effective control.</span></td>
</tr>
<tr valign="top">
<td width="40">30</td>
<td width="538"><span style="font-size: small;">c) Control retroactive changes to records pertaining to work performed that would change previously reported amounts for actual costs, earned value, or budgets. Adjustments should be made only for correction of errors, routine accounting adjustments, effects of customer or management directed changes, or to improve the baseline integrity and accuracy of performance measurement data.</span></td>
</tr>
<tr valign="top">
<td width="40">31</td>
<td width="538"><span style="font-size: small;">d) Prevent revisions to the program budget except for authorized changes.</span></td>
</tr>
<tr valign="top">
<td width="40">32</td>
<td width="538"><span style="font-size: small;">e) Document changes to the performance measurement baseline.</span></td>
</tr>
</tbody>
</table>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=105" >Earned Value Management, ANSI Style, In 32-Steps</a></p>
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		<title>What is the Value of Earned Value Management?</title>
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		<comments>http://www.planphoria.com/?p=102#comments</comments>
		<pubDate>Mon, 25 Aug 2008 00:04:20 +0000</pubDate>
		<dc:creator>srosenberg</dc:creator>
		
		<category><![CDATA[Earned Value]]></category>

		<category><![CDATA[ANSI/EIA 748-a]]></category>

		<category><![CDATA[Change]]></category>

		<category><![CDATA[Leadership]]></category>

		<category><![CDATA[OMB Circular A-130]]></category>

		<guid isPermaLink="false">http://www.planphoria.com/?p=116&amp;language=en</guid>
		<description><![CDATA[<div class="xg_module_body pad">
<div class="discussion">
<div class="firstpost">
<p>In order for me to answer this question, I have to first convey the importance of understanding the meaning of the word “Value”. If we were to look up the word in the dictionary, the word “value” is defined by its financial definition as the importance of a product or service has in relation to the money exchanged. From this we commonly tend to believe that the word “value” describIn order for me to answer this question, I have to first convey the importance of understanding the meaning of the word “Value”.es the relation between a product’s cost and the amount of value it provides. If this were correct, a person could expect to buy the best value car by finding a car that came standard with gold bumpers, a platinum engine block, and that ran on plutonium. Obviously, value cannot be determined by a product’s relationship with cost. Pearl necklaces, diamond rings and other luxury items seem to hold more value, however, if one were lost on a deserted island without food or water like Tom Hanks in “Castaway”, the value of these objects would diminish very quickly in favor of a Bic lighter and a good pair of ice skates. Value is environmental, and value is determined by how well the product or service addresses the functional need.</p>
<p>Therefore, when we talk about Earned Value we are not talking about the relationship of money burned for the effort worked, we are talking about the amount of money burned that directly contributed toward the functional value of the product or service. For instance, a brick has value to its use as a structural element of a wall. Many bricks (tasks) make up a wall (project/project activity) and each must be complete to provide effective structural support to the wall.</p>
<p>If within our process, to complete the wall we must first create the bricks, we need to know the functional value of the bricks we are creating in terms of their present value of completion, relative to cost and schedule. For a brick to be useful in our wall, it must be 100% complete to the specification set forth for each brick. Earned Value Management offers us status regarding delivery performance, variance, forecast budget, and completion estimates for a specific moment in the project life-cycle. These metrics help us better understand how our actions affect our performance as we build each brick, and help us understand how this effort supports the larger picture of what we are attempting to build, in this case, a wall. Earned Value helps us monitor the number of bricks used (Scope), the expenditure of equipment and raw materials used to make the bricks (cost), the duration of time it takes to build the wall (Schedule) while the wall is built to appropriate load bearing specifications (Quality).</p>
<p><strong>Why is this important?</strong> - I know a story of a local politician (I won’t say who), that budgeted and assembled a task force of all his good friends who were put on the task of solving one of the city’s problems. For a month, they met, they dined, they expensed, and expensed. At the end of the month, they consumed $70,000 of the taxpayers money and accomplished absolutely nothing. As a taxpayer, I want to know that my tax dollars are used wisely, accomplish intended goals, and achieve intended functional purposes. This is why the United States federal government has begun to mandate the use of value management systems in their government contracts, to assure that the taxpayers dollars are being used wisely.</p>
<p>The reason why Earned Value is important could end there, however that would be too easy. Not all project managers know Earned Value Management and not all organizations understand why they need it to protect their projects. Some organizations seek out project managers like a hunter would seek out a game tracker, or how a detective would seek a clairvoyant, and tell the project manager that their primary responsibility is to manage the project by assuring that people are on task. Of course, before they are hired, past successes are counted, and afterward the hiring organization depends upon the project manager’s gut instincts to tell us if the Change Request that we would like to approve can be approved within the project budget. They then gaze into the crystal ball and read the tea leaves, <em>“Boil, Boil, Toil and Trouble, we <span style="text-decoration: underline;">will</span> deliver the project within budget if we incorporate the change.”</em> They have a 50% chance of being correct. Either they will, or they won’t. Either way, by the end, they will be on to their next project.</p>
<p>If you hired a project manager to manage an addition to your house, and you had budgeted some extra cash to cover potential incidentals that might occur during the build, you certainly would like to get, if not demand, a straight answer when you ask whether the incidentals might break the budget when everything was complete.</p>
<p>Upon initial glance, based on use of Earned Value within the federal government, it can look no more important than a monthly audit system. However in the project environment, even Earned Value, has specific functional value depending on who you are.</p>
<p><strong><span style="text-decoration: underline;">Customer Viewpoint</span> </strong>- “I receive high level metric-based visibility through EVM Reporting on a monthly basis to assure that my contractor is performing, and is fulfilling the value of the product or service for which they are paid, in support of the program for which I am accountable.”</p>
<p><strong><span style="text-decoration: underline;">Executive Leadership Viewpoint</span> </strong>– “I require high level metric-based visibility of project performance to assure the effectiveness of my project manager, and that the contract for which my organization is accountable is running smoothly, is healthy, and that we profit by supporting our customer effectively in accordance with plan.”<br />
<strong><br />
<span style="text-decoration: underline;">Project Manager Viewpoint</span> </strong>– “I require immediate and detailed metric-based visibility into the dynamics of my project, how performance relates to project cost and schedule, how I may best leverage the resources at hand to sufficiently support task execution, issue resolution and risk mitigation. These metrics offer me the metric-based information that I need to rapidly correct or tweak the project environment for which I am accountable.”</p>
<p>Of these three viewpoints all are equally important, however only the Project Management Viewpoint has the means to instantly affect the project and use Earned Value Management as a tool, rather than as an audit system. This is because the project manager, with current trending information, has the ability to determine and correct negative influences within the project. The Customer and Executive Leadership usually do not see Earned Value information related to these negative trends for up to two weeks to a month after they have occurred.</p>
<p>Earned Value Management is the crystal ball that enables a project manager to be the first line of defense, able to forecast, trend performance, identify and fix project problems, and most important take action to affect the outcome. Earned Value is meant to assure that budget consumed is best used to advance the project’s functional value. By orienting an Earned Value Management System to <strong>FIRST</strong> support the data frequency and data granularity required by the project manager to produce and react to current EVM information. From this standpoint, the manager is in a better position to correct and communicate better metrics upstream to executives and the customer. Without introduction of this very important aspect of how Earned Value Management should be executed, a project manager can only be held accountable for negative project performance, without the ability to influence their project environment to a better result.</div>
</div>
</div>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=102" >What is the Value of Earned Value Management?</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<div style="display:block"><small><em>posted in <a href="http://www.planphoria.com/?cat=4">Earned Value</a> by Srosenberg <a href="http://www.planphoria.com/?p=102#comments">Leave A Comment</a></em></small></div>]]></description>
			<content:encoded><![CDATA[<div class="xg_module_body pad">
<div class="discussion">
<div class="firstpost">
<p>In order for me to answer this question, I have to first convey the importance of understanding the meaning of the word “Value”. If we were to look up the word in the dictionary, the word “value” is defined by its financial definition as the importance of a product or service has in relation to the money exchanged. From this we commonly tend to believe that the word “value” describIn order for me to answer this question, I have to first convey the importance of understanding the meaning of the word “Value”.es the relation between a product’s cost and the amount of value it provides. If this were correct, a person could expect to buy the best value car by finding a car that came standard with gold bumpers, a platinum engine block, and that ran on plutonium. Obviously, value cannot be determined by a product’s relationship with cost. Pearl necklaces, diamond rings and other luxury items seem to hold more value, however, if one were lost on a deserted island without food or water like Tom Hanks in “Castaway”, the value of these objects would diminish very quickly in favor of a Bic lighter and a good pair of ice skates. Value is environmental, and value is determined by how well the product or service addresses the functional need.</p>
<p>Therefore, when we talk about Earned Value we are not talking about the relationship of money burned for the effort worked, we are talking about the amount of money burned that directly contributed toward the functional value of the product or service. For instance, a brick has value to its use as a structural element of a wall. Many bricks (tasks) make up a wall (project/project activity) and each must be complete to provide effective structural support to the wall.</p>
<p>If within our process, to complete the wall we must first create the bricks, we need to know the functional value of the bricks we are creating in terms of their present value of completion, relative to cost and schedule. For a brick to be useful in our wall, it must be 100% complete to the specification set forth for each brick. Earned Value Management offers us status regarding delivery performance, variance, forecast budget, and completion estimates for a specific moment in the project life-cycle. These metrics help us better understand how our actions affect our performance as we build each brick, and help us understand how this effort supports the larger picture of what we are attempting to build, in this case, a wall. Earned Value helps us monitor the number of bricks used (Scope), the expenditure of equipment and raw materials used to make the bricks (cost), the duration of time it takes to build the wall (Schedule) while the wall is built to appropriate load bearing specifications (Quality).</p>
<p><strong>Why is this important?</strong> - I know a story of a local politician (I won’t say who), that budgeted and assembled a task force of all his good friends who were put on the task of solving one of the city’s problems. For a month, they met, they dined, they expensed, and expensed. At the end of the month, they consumed $70,000 of the taxpayers money and accomplished absolutely nothing. As a taxpayer, I want to know that my tax dollars are used wisely, accomplish intended goals, and achieve intended functional purposes. This is why the United States federal government has begun to mandate the use of value management systems in their government contracts, to assure that the taxpayers dollars are being used wisely.</p>
<p>The reason why Earned Value is important could end there, however that would be too easy. Not all project managers know Earned Value Management and not all organizations understand why they need it to protect their projects. Some organizations seek out project managers like a hunter would seek out a game tracker, or how a detective would seek a clairvoyant, and tell the project manager that their primary responsibility is to manage the project by assuring that people are on task. Of course, before they are hired, past successes are counted, and afterward the hiring organization depends upon the project manager’s gut instincts to tell us if the Change Request that we would like to approve can be approved within the project budget. They then gaze into the crystal ball and read the tea leaves, <em>“Boil, Boil, Toil and Trouble, we <span style="text-decoration: underline;">will</span> deliver the project within budget if we incorporate the change.”</em> They have a 50% chance of being correct. Either they will, or they won’t. Either way, by the end, they will be on to their next project.</p>
<p>If you hired a project manager to manage an addition to your house, and you had budgeted some extra cash to cover potential incidentals that might occur during the build, you certainly would like to get, if not demand, a straight answer when you ask whether the incidentals might break the budget when everything was complete.</p>
<p>Upon initial glance, based on use of Earned Value within the federal government, it can look no more important than a monthly audit system. However in the project environment, even Earned Value, has specific functional value depending on who you are.</p>
<p><strong><span style="text-decoration: underline;">Customer Viewpoint</span> </strong>- “I receive high level metric-based visibility through EVM Reporting on a monthly basis to assure that my contractor is performing, and is fulfilling the value of the product or service for which they are paid, in support of the program for which I am accountable.”</p>
<p><strong><span style="text-decoration: underline;">Executive Leadership Viewpoint</span> </strong>– “I require high level metric-based visibility of project performance to assure the effectiveness of my project manager, and that the contract for which my organization is accountable is running smoothly, is healthy, and that we profit by supporting our customer effectively in accordance with plan.”<br />
<strong><br />
<span style="text-decoration: underline;">Project Manager Viewpoint</span> </strong>– “I require immediate and detailed metric-based visibility into the dynamics of my project, how performance relates to project cost and schedule, how I may best leverage the resources at hand to sufficiently support task execution, issue resolution and risk mitigation. These metrics offer me the metric-based information that I need to rapidly correct or tweak the project environment for which I am accountable.”</p>
<p>Of these three viewpoints all are equally important, however only the Project Management Viewpoint has the means to instantly affect the project and use Earned Value Management as a tool, rather than as an audit system. This is because the project manager, with current trending information, has the ability to determine and correct negative influences within the project. The Customer and Executive Leadership usually do not see Earned Value information related to these negative trends for up to two weeks to a month after they have occurred.</p>
<p>Earned Value Management is the crystal ball that enables a project manager to be the first line of defense, able to forecast, trend performance, identify and fix project problems, and most important take action to affect the outcome. Earned Value is meant to assure that budget consumed is best used to advance the project’s functional value. By orienting an Earned Value Management System to <strong>FIRST</strong> support the data frequency and data granularity required by the project manager to produce and react to current EVM information. From this standpoint, the manager is in a better position to correct and communicate better metrics upstream to executives and the customer. Without introduction of this very important aspect of how Earned Value Management should be executed, a project manager can only be held accountable for negative project performance, without the ability to influence their project environment to a better result.</div>
</div>
</div>
<p>Are you ready for an easier path?  If you have already been thinking you are ready for an easier way, please contact: <a href="mailto:srosenberg@planphoria.com">Saul Rosenberg</A> or <A HREF="mailto:dick.davies@planphoria.com">Dick Davies</A>.  Perhaps we can show you some things will work better.
Web Site: <a href="http://www.planphoria.com" >Planphoria, LLC</a></p>
<p><a href="http://www.planphoria.com/?p=102" >What is the Value of Earned Value Management?</a></p>
<hr />Copyright © 2008, Planphoria, LLC. This Feed is for personal non-commercial use only. If you are not reading this material in your news aggregator, the site you are looking at is guilty of copyright infringement.<img src="http://feeds.feedburner.com/~r/Planphoria/~4/uhnglvj2N5I" height="1" width="1"/>]]></content:encoded>
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