Enterprise Navigator

Although late in arriving, the familiar triple-digit summer heat of central Texas has been bearing down on us consistently for several weeks now, and there is no imminent forecast of relief. But despite this, before you know it, temperatures will begin to drift back down to more tolerable levels and all of the great things we love about Fall will be upon us, including new hope for your favorite football team and a new season of shows to replace the inescapable reruns on TV (I can't wait to see Shatner in his new show, and new episodes of "The Big Bang Theory" and "Sons of Anarchy").

Fall also brings a more reinvigorating tempo at work. This time of the year it seems even the pace of business gets lethargic from the Summer doldrums. People take time off in droves, and summer hours kick in. For those actively managing projects, increased staff absences poke holes in the best laid resource plans and hamper progress. Fortunately, sponsors, stakeholders and decision-makers also head off on vacation (or in Europe, 'on holiday'), reducing the level of scrutiny you have to contend with -- perhaps at least delaying the inevitable pressure to catch up. Various approvals slow to a crawl as well because "so-and-so is out until the end of the month." Business at the speed of molasses.

Then comes September. The increase in activity is palpable, as if the entire organization begins to march double-time. Meetings regain full attendance and vigor. The work day gets longer as the days get shorter. Co-workers arrive with a harried look, already full of adrenaline from the added burden of packing lunches and dropping off kids at school. Everyone tries to make up for lost time as an entire quarter of business gets compressed into the month. October brings even more activity as people suddenly realize that the end of the year has (yet once again) managed to sneak up on them.

I like the flurry; it's exciting! Here at Planview we have a lot of things quickly heading our way. We will start out September celebrating a new product release containing some significant new capabilities and improvements. This also marks the beginning of the high season for industry events, which means I finally get to roll out from behind my desk and hit the road to meet some of you -- at PMI chapter events, the PMO Symposium, PDMA, and CampIT.

November also brings us the Planview Horizons 2010 Annual User Conference; face-to-face again after a brief hiatus. Replacing last year's virtual venue, the 2010 conference will be held in downtown Austin at the AT&T Conference Center, situated on the venerable "40 Acres;" the epicenter of college football for so many; the Land of the Longhorns; yes -- the University of Texas campus. How appropriate that Horizons be held at a place whose motto is, "What Starts Here Changes the World." Greg Gilmore, our president, is an Aggie (a.k.a., Texas A&M; constituting one of the great college rivalries), so how this got approved is beyond me -- oh, wait; it must have been while he was on vacation.

Hook 'em Greg.

While going through my innumerable files in preparation for our recent office move, I came across an old copy of Murphy's Laws of Combat (don't ask), which lists any number of axioms gleaned from various skirmishes over the years.

As I reacquainted myself with their wisdom, it struck me that sometimes managing a PMO can seem like a battle as well, as you try to win over the hearts and minds of the organization. What follows are corollaries to a handful of these laws for your consideration.

"You are not Superman or Rambo."

In much the same way that you do not really have the uncanny ability to stand out in the open unscathed during a raging battle, the inspirational case study provided by the seminar speaker will be much harder to replicate in actual practice than the session might suggest. Conspicuously absent from most such presentations are the multitude of conflicts, sharp glares and bruised careers that just go along with these initiatives.

"If the enemy is in range, so are you," along with the popular "Tracers work both ways."

Always remember that when using facts and figures to sway opinion or present a case for action, anticipate that that someone will retort with equally convincing and contradictory analysis or data. This also brings to mind, "Liars figure and figures lie."

"Anything you do, including nothing, can get you shot."

This little rule is useful to illustrate how vulnerable most PMOs are within organizations; see chapter 16 of Taming Change for more about that subject. Overachieving can get you shot. Trying and failing can get you shot. But, without question, doing nothing is the fastest way to get shot; snipers love a stationary target. Hardened warriors will tell you that the best way to survive is to keep moving towards your objective without drawing attention to yourself.

"When in doubt, empty the magazine."

When faced with a problem, it is better to attack the issue with all of the energy you can muster, rather than timidly 'almost' resolve it with incremental actions.

"There is always a way -- and the easy way is mined."

This law is a close cousin of, "If it seems too good to be true…" Be suspicious of those who are too quick to agree to your requests; chances are they are simply trying to get you out of their office, with little or no intention of actually taking action. Worse yet, they could be preparing a counter-insurgency.

"Important things are very simple, and simple things are always hard."

This speaks specifically to the need to build a strong but basic foundation of processes, measures and accountability. This is an important and simple, yet very challenging thing to accomplish.

"If it's stupid but it works, it isn't stupid."

'Nuf said.

"Never forget that your weapon was made by the lowest bidder."

Despite what the selection committee for a new supporting system might recommend, all bets are off once the procurement and contract folks go to work.

"No inspection-ready unit passed combat" and, "No combat ready unit passed inspection."

Worry less about standards and certifications and more about practical application.

"No battle plan survives first contact with the enemy."

If I had a nickel for every time I have used this quote over the years, I would be retired in the Keys. Always stay flexible with your improvement initiatives; apply the Marine approach of adapt and improvise. This also means you have to be vigilant to situational dynamics. To blindly follow a plan come hell or high water is to march right into an ambush. This is further supported by this law: "The enemy diversion you are ignoring is the main attack." Listen to opposing viewpoints! Which leads us to:

"If it's too tough for the enemy to get in, you can't get out."

OK, so your constituents aren't the enemy; but this law speaks volumes about the importance of open, bi-directional lines of communication. Too often PMOs become the organizational equivalent of walled fortresses instead of remembering they are a service provider.

And last, but not least, one final law and universal law to always bear in mind; "Professionals are predictable; it's amateurs who are dangerous."

"Hello it's me, I've thought about us for a long, long time…"

Name that tune.

OK, maybe that's not much of a challenge (duh, given the first three words are the title). How about, name that singer/songwriter/producer?

Yes, it's been a long, long time indeed since my last post, so lots of things to catch you up on.

So, here we are, one month after the publication of Taming Change with Portfolio Management. Most of you probably received an email from me announcing said release and encouraging your purchase. Did I mention lately that marketing a book is at least as much work as writing one? For any potential authors out there, don't forget to consider this as a major aspect of your planning (and budgeting). This also explains why you haven't heard much from me on this page the last few weeks.

We are getting great interest and response from initial readers and reviewers. There are several links on the book website where you can listen to interviews (be sure to check out the two-part interview I did with Cornelius Fichtner on the PM Podcast, Episode 149, read reviews, and download supporting content. We have also started posting excerpts of some videos that Pat and I taped which further explain some of the key topics; find them on the Resources tab.

There you will also find a listing of upcoming engagements I'll be doing related to topics from the book, including the following:

Silicon Valley Chapter PMI Annual Symposium
September 20-21, 2010
Santa Clara, CA

Tearing Down the Wall! Integrating Portfolio Management Across the Life Cycle of Change
Ultimate In Success
September 21, 2010
Santa Clara, CA

CampIT Project and Portfolio Management Symposium
September 30, 2010
Chicago, IL

34th Annual Global Conference on Product Innovation Management (PDMA)
October 16-20, 2010
Orlando, FL

Yes, there are two events listed in Santa Clara; I'm not sure yet which day I will be speaking at the PMI symposium, however, for those in the area who are not attending the Silicon Valley chapter event but are interested in portfolio management, Harish Chinai has asked me to do a 90-minute evening presentation and book signing at his facilities. If you are in the San Jose/Bay area and are even remotely involved with project or portfolio management, then you probably know of Harish. It's a free event, so please register and come by (BYOB).

If you have never attended one of the CampIT one-day mini symposiums, I would encourage you to check it out, especially if you are in the midwest; Dan Horwich runs a pretty good program, and it is a great value.  'PDMA' is the Product Development and Management Association 2010 Global Conference on Product Innovation Management; no presentation at this one, but I will be helping out.

I bet some of you are thinking, "Book, schmook. Great info but it's static; what I need is something more interactive where I can go get specific answers to my unique questions." Ah, such a deal I have for you! For readers and those otherwise interested in portfolio management the PMO and business process development, we have launched a LinkedIn Group, titled the same as the book.  The whole purpose of the book is simply to get a conversation started, so the LinkedIn group is where you can "continue the conversation" with others who have the same topical interests as yourself. Please join us, ask questions and share your insights with others.

As for other things going on (that aren't book-related!), if you didn't get a chance to watch it live, please check out the on-demand version of the webcast we did last week with Nick Boxall, the MIS Manager at Best Buy Europe. We explore the topic of how to extract critical information from your PPM system. Hopefully the link will be up on the Resource Center of planview.com by the time you read this, and I think you will find it much more upbeat and informative than a song about almost breaking up with someone over the phone.

Taming Change with Portfolio Management is now officially published and available at Amazon and other retail outlets. You can obtain it as a traditional hardbound book or download it in electronic Kindle format. Follow the link to look inside, see the reviews and purchase it at a very inviting price point compared to most business management titles.

Please note that we are launching a significant media campaign today for the book, so do not be alarmed if it is listed as "out of stock." We will replenish their supplies quickly and get a copy on its way to you in short order. Pat and I look forward to your reviews and feedback, and we hope to see you soon as part of the Taming Change community.

Hello after a busy week in London. I am pleased to report it continues to be both jolly and old, as well as undeniably charming. A few topics to cover, including the recent Gartner PPM & IT Governance Summits in Orlando and the UK, the associated 2010 Magic Quadrant Report, and Taming Change.

First, a quick update on the book; Taming Change with Portfolio Management is now shipping from Amazon.com, and I'm sure other retailers are following suit. We handed out several copies at the Gartner events and to those attending our European Advisory Board meeting. Interest in the title continues to grow, but now market response will give us a real measure.

I have begun a LinkedIn Group named the same as the title to provide some continuity for readers who have comments, thoughts or questions. We invite readers and anyone else interested to join us to 'continue the discussion.' Our goal is to create an active community around the topic of managing change using portfolio management. Expect forum activity to ramp up in mid-July after people have had a chance to get a copy and read the book, but it is now live and accepting members if you want to go ahead and join.

On to the Gartner PPM & IT Governance Summits. While I was not personally at the Orlando event, I did get a chance to attend the summit in London. Comparing notes with others, I think the general tone and content were consistent in both locations. Although most of the messaging from Gartner served to reinforce what they are already publishing through their various reports, the live events give their analysts more time to better explain the basis for trends and the recommendations they offer, and a chance for the audience to ask questions.

We were pleasantly surprised by the robust attendance in London, which included more than 60% who came over from continental Europe and elsewhere outside of the UK. I understand that the numbers were double the original target for the event. It seems that practitioners in EMEA are hungry for more opportunities to learn, share and interact.

One session in particular is worth specifically noting, as it featured someone outside of the Gartner organization. Gregory Balestrero, the President and CEO of the Project Management Institute (PMI), was featured in a general session at both events, answering questions from Gartner senior staff and attendees. Among other things, he outlined PMI's plans for future growth and expansion.

I submitted a question to ask how PMI plans to better respond to emerging practices and incorporate these changes into their certification process and body of knowledge. The gist of the response was that works to a 3-year turnaround time, citing how they were now addressing Agile practices as an indicator of their responsiveness.

So, now I have to ask you -- are you OK with that?

On a different note, several people I talked with at the UK event were quick to point out that their interests lie well beyond the specific needs of IT, but they had nowhere else to turn for information and insights. With that in mind, I'll ask the question out loud -- where do we go to for an Enterprise PPM focus? For example, I find it curious that IT PPM is still the primary community discussing the idea of the Enterprise PMO. Clearly, the idea of independently "running IT as a business" is now past tense, in favor of a more inclusive, integrated approach. I would like to suggest that forward-thinking practitioners and industry leaders are now extending their attention beyond the realm of the CIO; isn't it time that we all escape the IT paradigm and adopt a more broad view of the subject? Just imagine what could be accomplished if we could get everyone involved in the cycle of change talking together.

Finally, the 2010 Gartner Magic Quadrant for IT Project and Portfolio Management was unveiled in Orlando, and again presented in London. For those who have seen the report, then the case of the mysterious t-shirt from my last entry is now solved.

We here at Planview are big on custom logo shirts. I remember when I first joined the company over a decade ago that we were in the middle of our Hawaiian shirt phase. Many shirts have since been designed and handed out, some cryptic, some more overt. Here is our latest one:

If I may say, it is an elegant, yet stylish and understated fashion expression that speaks volumes. But, just what does it mean? Look for the 'spot on' press release coming soon from a major analyst group that will help you unravel the mystery of the curious shirt!

While taping a PM Podcast interview with Cornelius Fichtner earlier, we brushed against the topic of risk and how to measure it. The subject had also come up a few weeks ago in a different conversation; in both cases, it seemed to stir some interest in how to quantify risk in financial terms.

Monetizing risk is nothing new conceptually, but I want to share some thoughts about it. Now, I know that certain standards talk about the existence of 'positive risk' but I am more inclined to treat such occurrences as rare and pleasant surprises (pessimists might consider positive risk as a product of overly conservative revenue forecasting).

Maybe I am just stubborn, but I find it much more useful to consider risk in strictly negative terms, as a form of cost. This enables risk management to be a function of cost management and it allows you to readily factor it in as part of the overall value equation.

The basic concept can be illustrated using a one dollar lottery ticket for the weekly mega-million drawing. Without the risk factor, the idea of spending a buck to gain a return of millions of dollars looks pretty sweet. But, when you factor in the probability of not winning at 99.9999 percent and impact of the risk as losing your total investment, then the net risk adjusted potential payback of 1 ten thousandth of a cent makes it a much less attractive opportunity. The bottom line is that it's probably not going to clear the steering committee's hurdle rate.

I submit that any risk, potential or actual, represents a cost of some kind. It might be reflected as extending the time to market, reduced potential revenue, the cost of increased resources, more capital, the cost of redesign, or the expense of mitigating actions. The way I figure it, if you can't put a monetized estimate on an identified risk, then you are not through researching yet. If it has no cost, then it isn't a risk; it's just an odd curiosity or mild distraction of some sort.

So, with that in mind, the next question becomes how to fairly value it. For example, let's say you have identified a risk that is estimated to have an impact of $100,000 in rework costs if it occurs. The probability of the risk occurring is anticipated to be 50%. Therefore, the cost of simply accepting that risk is $100,000 x 0.5 or $50,000. Now, what if you knew you could spend $10,000 to reduce the probability of occurrence by half? Now the cost of the risk is valued at ($100,000 x 0.25) + $10,000 in mitigation costs, or $35,000 total.

So, the cost of this particular risk is now defined in monetary terms, and can be treated as you would any other cost when assessing the potential value of an investment.

Things get much more philosophical when you start to consider whether you should further devalue an investment opportunity initially. Should you attempt to account for the potential costs of 'known unknown' risks that will undoubtedly emerge as the initiative progresses? That is a conversation best had after hours, over a tasty beverage.

If you consider taking this approach, don't forget to also adjust how you are doing valuation calculations if you are currently risk adjusting via discounted cash flow. If you risk adjust using a defined cost approach, then don't double-dip by generically risk adjusting again when you set discount rates, etc.

This approach actually makes both risk management and valuation a little simpler. Risk is no longer hidden in DCF calculations, and risk is defined in a way that makes it easier for everyone to comprehend. Finally, because risk is quantified in the same manner as the key parameters it is most likely to be associated with (labor costs, material costs, revenue, etc.), it now becomes a directly comparable and independent measure, rather than some amorphous 'relative risk factor' like 0.65. See section 4 of Taming Change with Portfolio Management for additional thoughts on investment valuation and managing investment risk.