Tag: Business Analysis

Four Steps to Align Your Organization to its Strategic Plan

Written by Richard Lannon on March 10, 2015. Posted in Articles. 99 Comments on Four Steps to Align Your Organization to its Strategic Plan

Often we want all the moving parts to connect together in our business. We want everything and everybody rowing in the same direction together. This is not always easy to accomplish.

In today’s competitive climate with global competition we need to break down internal barriers and align the strategic thinking and goals and objectives of our departments.

The starting point is to ensure that you have developed the key strategic vision and mission along with our strategic agenda items. Once that is complete alignment planning as part of the strategic planning process can be embraced.

Alignment planning as part of your strategic planning initiative seeks to accomplish three main objectives:

ensure strong connection among the organization’s mission and its operational resources
fine tune departmental goals and objectives and discover implementation gaps
address issues that may exist around internal efficiencies and effectiveness.

There are generally four steps to the Alignment Planning Process for the strategic planning team to engage in. These include:

Outline the organization’s mission, programs, resources, and needed support areas
Identify what’s working well and what needs to be adjusted
Identify how these adjustments should be made and determine the best approach
Include the adjustments as strategies in the strategic plan and roadmap with an alignment path

The challenge with the Alignment Planning is that you require a solid model to follow prior to applying it. You must have gone through a proper strategic planning approach to ensure your have identified and defined the direction of the organization.

If that work is done then you can benefit from bringing your strategic plans to the department and management level. You can engage them in the process of aligning the organization. Your management can help you engage the employees to avoid disconnects between your business strategy and operational reality. The final objective is to link the strategic and operations to establish employee commitment and motivation.

Alignment planning is part of the overall process when making plans for your organization. It is important that you embrace the need to establish business alignment.

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2015 Trends in Business Analysis and Project Management

Written by Elizabeth Larson on January 13, 2015. Posted in Articles. 9 Comments on 2015 Trends in Business Analysis and Project Management

Each year we like to reflect on what’s happened in the business analysis, project management, and Agile professions and make our predictions for the upcoming year.

To summarize the trends we saw in 2014:

Continued excitement about Agile projects with more informal communications and documentation and use of modeling tools to get from high-level user stories to detail needed to estimate and build them
Focus on Design
Cloud computing
Greater interest in business analysis by project managers.

Below are the seven new trends we see in the Project Management and Business Analysis fields for 2015.

Making Agile work for organizations. As the Agile bandwagon continues to grow, some organizations, previously reluctant to jump aboard, are running to catch up. Sometimes, though, Agile is implemented without much thought to unintended consequences of not having enough organizational commitment when adopting Agile. Although such things as not having dedicated teams, a dedicated business product owner, or extending time boxes to fit more work into an iteration sometimes works, there are often related issues, such as:
1. 1. Team burnout
  2. Less work being implemented
  3. Unmet customer expectations
We predict that organizations will find a way to make Agile work for them by becoming more purposeful in how they choose to adopt it. As a related trend, we think that some of the Agile purists will become more flexible, softening the “my way or the highway” approach in favor of one that is more collaborative. It means that organizations will have to articulate the business problem they are trying to solve by adopting Agile. In addition, those coaches who are accustomed to dictating what must be done will need to seek more organizational input.
Distributed leadership. Leadership will become more distributed and will be increasingly as much about tapping into the leadership of those around us as it is about a single visionary, decision-maker, and communicator. This idea isn’t new, but as organizations and project teams struggle with the adoption of Agile, coming to terms with what it means to be a self-organizing team will highlight the value of everyone stepping up to the role of leader.
In addition, the idea of leading for the purpose of developing relationships is going to be the focus of team building. Leadership is more than getting people to perform for the benefit of the bottom line. It’s about the people and connecting with them. Leaders are selected, recognized, and evaluated for their ability to sincerely tap into the human experiences their people represent. The intrinsic value of understanding others in order to establish meaningful relationships among team members, particularly those who are often physically distant, will be emphasized.
Innovation and entrepreneurship on the rise, and morphing. One can’t help but see books, articles, and blog posts about innovation these days. Not only our own industry outlets, but other media seem to have discovered the innovation “bug.” Many organizations will innovate through process improvement, and in some cases there is not much difference.
To go beyond mere process improvement, organizations will need to become more entrepreneurial. Innovation centers and hubs are on the increase, and companies are investing in their own incubators away from their main operations to help spur the creative process. Smaller, more isolated teams of “intrapreneurs” will provide the kind of “disruptive” break-throughs needed for true innovation and market leadership to take place. Savvy business analysts and project managers will step up to take on these entrepreneurial roles in organizations.
Business analysis as design work. As we mentioned in last year’s trends, the upcoming release of the BABOK Guide version 3.0 will awaken the “inner designer” in people doing business analysis work. There has long existed a gap between requirements and physical design. Organizations who start providing “logical design” outputs as part of building apps and business processes will shrink that gap and create better products faster. They will realize less rework by using standard models such as business process maps, use case models, prototypes and wireframes, state-transition, and sequence diagrams to name a few.
We have been promoting “logical modeling” for years and have been surprised that many organizations have not supported the design capabilities of business analysis. We see hope in the new BABOK and predict that organizations will at least consider changing their development processes to encompass more logical design. Smart companies will actually embrace the new design paradigm.
Struggle between centralized and distributed project governance. Organizations will continue to struggle to find balance between the extremes of project chaos and centralized project governance. We predict that in the near future organizations will continue to adopt an “all or none” approach to project governance. We see the era of centralized project governance, such as PMOs and Centers of Excellence, giving way to a more distributed governance, with some organizations letting individual project teams decide how much governance to employ. However, we know that when organizations move to one extreme to solve their problems, others are created. We predict that in the future organizations will take a more balanced approach and apply more governance for certain types of projects and less for others.
Schizophrenic approach to BA and PM credentials. We predict that both the trend to become certified and the trend to reject certifications will play out in 2015. With the increased popularity in MOOCs (Massive Open Online Courses), some from prestigious universities like Harvard and University of Michigan, learning about new topics and acquiring new skills at a low or no cost will appeal to many BAs, PMs and their organizations. To the extent that these new learning channels provide “just-in-time training,” they will reinforce the notion among some BAs and PMs that certifications and professional designations like PMP and CBAP are not an indication of competency and therefore not worth having.
At the same time, however, many PMs, BAs, and their organizations around the globe recognize that these credentials show knowledge gained and are an example of the initiative and hard work needed to get certified. We have seen large numbers of BAs eagerly awaiting the release of IIBA’s BABOK v.3, and many others are racing to be certified under the current release before the exam changes. In the PM space, we have seen a rise in the number of PMs interested in business analysis. PMI’s PBA as well as their ACP certifications are generating lots of interest that we think will continue to grow. Finally, there seems to be no slowing of interest in Agile certifications such as the CSM.
Team-based Agile training. Agile training will be geared toward entire teams rather than individuals. Agile is going to drive organizations to seek more effective ways to generate a change in project practice. The notion of sending an individual to training to become the internal evangelist is too much for a single person to do when it comes to the far-reaching culture changes required to implement A. Plugging into existing processes, tools, and infrastructure after traditional PM training is entirely different than expecting someone to come back from training and single-handedly explain and implement the why, what, and how of Agile. Expect more interest in generating internal momentum for change by sending teams to training who learn the why and how of self-organization. Training for entire intact teams is how organizations will get out of the gate and it’s more likely to be augmented by coaching and a follow-up with on-site presence to help as organizations figure out how to make Agile work for them.

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About the Authors:

Andrea Brockmeier, PMP, CSM, PMI-ACP, is the Client Solutions Director for Project Management at Watermark Learning. She has 20+ years of experience in project management practice and training. She writes and teaches courses in project management, including PMP® certification, as well as influencing skills. She has long been involved with the PMI® chapter in Minnesota where she was a member of the certification team for over eight years. She has a master’s degree in cultural anthropology and is particularly interested in the impact of social media and new technologies on organizations and projects.

Elizabeth Larson, PMP, CBAP, CSM, PMI-PBA is Co-Principal and CEO of Watermark Learning and has over 30 years of experience in project management and business analysis. Elizabeth’s speaking history includes repeat presentations for national and international conferences on five continents.

Elizabeth has co-authored three books: The Practitioner’s Guide to Requirements Management, CBAP Certification Study Guide, and The Influencing Formula. She has also co-authored chapters published in four separate books.

Elizabeth was a lead author on the PMBOK® Guide – Fourth and Fifth Editions, PMI’s Business Analysis for Practitioners – A Practice Guide, and the BABOK® Guide 2.0, as well as an expert reviewer on BABBOK® Guide 3.0.

Richard Larson, PMP, CBAP, PMI-PBA, President and Founder of Watermark Learning, is a successful entrepreneur with over 30 years of experience in business analysis, project management, training, and consulting. He has presented workshops and seminars on business analysis and project management topics to over 10,000 participants on five different continents.

Rich is a frequent speaker at Business Analysis and Project Management national conferences and IIBA® and PMI® chapters around the world. He has contributed to the BA Body of Knowledge version 2.0 and 3.0, the PMI BA Practice Guide, and the PM Body of Knowledge, 4th edition. He and his wife Elizabeth Larson have co-authored three books, The Influencing Formula, CBAP Certification Study Guide, and Practitioners’ Guide to Requirements Management.

Business Acumen as an Integral Part of Project Management, Part I

Written by Erich Kreidler on October 28, 2014. Posted in Articles. 7 Comments on Business Acumen as an Integral Part of Project Management, Part I

Project management’s conventional wisdom leaves substantial opportunities to deliver business value.

The project management profession has gone through a tremendous evolution over the last three decades. Major trends, such as globalization, access to resources across the planet and the sheer complexity of projects, have pushed project managers to a level of sophistication never seen before. To adapt, project managers have developed new methodologies, standards, processes, and generally accepted best practices. While extremely important and required for success, these new norms are not sufficient to ensure projects remain relevant to the organization through their life cycle. In fact, recent studies performed by Gartner and other analysis firms are consistent in their reports that more than half of the projects do not meet expectations of the business. Why?

The answer is relatively simple. The missing ingredient in the standard project management practice is the systematic understanding and adjustment of actual value creation as the project is executed.

Why is managing the triple constraint not good enough?

Most of the tools that project managers (PMs) employ in their daily activities are designed to balance the project’s classic triple constraint: cost, scope and time. Typical project management metrics include comparing estimates created during the planning phase against the actuals incurred during execution. None of these metrics provide an accurate representation of the actual value the company is gaining in the execution of the project. They are a mere compilation of tactical numbers that, while very important, they do not paint the whole picture of value creation.

Metric Answers the following question(s)

Schedule variation (estimated duration – actual duration)

What is the duration of a particular activity?
Are we executing faster, slower or at the same pace as we had planned?

Percent completion (planned completion – actual completion)

What percentage of the work has already been completed?
Are tasks taking more, less or the same effort to complete as we had planned?

Cost variation (estimated cost – actual cost)

Is the project on budget?
If not, which areas contribute to the highest variation of in costs?

For instance, consider the following two scenarios:

A project is “on budget” and “on schedule”, but the product it intends to build has been rendered obsolete by a competitor. Are the efforts and investments of this project of real value?
A project is 20% over budget. This project included additional functionality that is expected to increase the project’s ROI by 50%. Should the project be flagged as mismanaged?

Does the triple constraint ensure that the day-to-day decisions are made following the true spirit of what the project is intended to deliver?

Bridging the Gap

Project managers are responsible for initiatives that are critical to the business. Therefore, project managers should have a solid foundation built on business acumen. Business acumen can be simplified as one’s ability to deliver tangible business value (i.e. make money). This is not the same thing as just managing costs – any mediocre project manager can do that. Making money requires additional fundamental skills. In his bestseller book “What the CEO Wants You to Know”, Ram Charan provides a simple, yet powerful framework for creating the building blocks of business acumen.

Here are some of the fundamental business acumen questions every project manager should be able to answer:

Cash
1. Does the execution of the project increase or decrease the company’s cash position? Is there a difference in time between the receipt of additional cash created by the project and the payment of its costs?
2. If the project is burning cash (decreasing the cash position), what is the criticality of this cash to the organization and how can it be optimized? Is there a possibility to negotiate contracts that are aligned?
3. What is the difference between the project costs and their net result to the company’s cash flow on a monthly basis? Is this causing a problem or an opportunity for the CFO?
Margins
1. What is the direct impact of the project toward the margins of the company’s products or services?
2. My project can reduce the cost of producing a widget, but can it increase the revenue (price) it brings to the company?
Velocity.
1. How will the project enable the organization to increase its speed to market and therefore increase the company’s return on assets?
2. By how much? (Yes, a PM should be able to calculate this number).
Growth
1. Is your project going to increase the quantity of products or services that the company offers?
2. How are the project’s contributions aligned to enable such growth?
Customer
1. Everything around customer service: What are the major sources of client dissatisfaction? Is the project addressing them by reducing opportunities for failure, automating lengthy manual processes?
2. Now the hard question: Is your project aligned to increase the customer base for your company? For instance, can I take an existing product or service that works well in an industry and use it in a similar industry?
  As important, are you willing to be accountable for moving the needle in any or all of these five areas?

The job of the organization?

Projects are typically preceded by a business case, project charter, project concepts and similar artifacts, where executives document the business decisions that affect the 5 business levers described above. These artifacts generally do a good job to baseline the spirit for initiating the project and are expected to serve as the compass to move forward. However, this approach has a fundamental flaw: a business case is already outdated the date after its release. We live in a world that is moving too fast for static business plans. A business case may be irrelevant 6 months into a 2-year project, but the triple constraint must not be disturbed to ensure good project management. Nonsense!

Therefore, whether formally charged with this task or not, project managers have to make daily, tactical decisions that will have a direct impact on the company’s bottom line. Why not equip them with the right knowledge and skills to make the right decisions as the projects get executed?

Business acumen skills can be learned.

In my many years executing projects and training project managers, I have found that business acumen skills can be learned in a systematic manner, just like you would learn the mechanics of building a Gantt chart. It starts with the awareness that business acumen is an integral part of project management and the open mind to learn about the exciting world of business. As a first step in this journey, I recommend you to read Ram Charan’s book (please see above), but there is no substitute for practicing. If you are currently managing a project, actively find ways to improve the business levers by tweaking the triple constraint. If you are working for a public company, read the annual report (10-K) in detail and find opportunities to improve its business fundamentals – maybe even by sponsoring and leading new projects. Practice will make your very comfortable linking business to project management and will increase your relevance to the organization exponentially.

Conclusions

Managing time, cost and scope is just the basic. To excel, project managers must go beyond the current project management practices and ensure that their projects bring full business alignment.
Project managers must have a solid understanding of the fundamentals of the money making machine. They must be able to make relevant business decisions as the project gets executed.
Business acumen is a skill that can be learned and subsequently applied systematically across projects.
Project managers must be comfortable with accountability beyond ‘the triple constraint’ that reflects the actual business value delivered

A Business Analyst’s Best Friends: The Project Manager

Written by Angela Wick on July 15, 2014. Posted in Articles. 5 Comments on A Business Analyst’s Best Friends: The Project Manager

FeatureArticle Jan22 Wick Successful BAs position themselves in the eye of the project storm. They are the calm, center point of a complex group of interrelated people, roles and processes. BAs are in a prime position to ensure—when the project storm settles—that all pieces are connected and aligned to maximize value to the organization. In order to do this, BAs rely on strong relationships with many friends.

Last month, I set the stage for a series that describes the BA’s best friends. Each month, using the following questions, I will explore the relationship between the BA and one of their key stakeholders.

How does this stakeholder benefit from the BA?
What makes a top-notch BA from their perspective?
What frustrates this stakeholder most regarding the role of the BA?
How to say “no” to this stakeholder?
How to influence this stakeholder to give you what you need?
How to communicate the value of the BA to this stakeholder?

Without further adieu, please allow me to introduce THE PROJECT MANAGER.

Obviously, the BA’s relationship with the project manager can vary based on the structure of the organization; the project size and structure, and the experience level of the BA or the PM.

Despite these variations, the key components of the BA/PM relationship are collaboration and communication. The BA and the PM must work closely together to manage solution scope, risks and stakeholders.

How does a PM benefit from a BA?

Scope, schedule and cost are the Project Manager’s primary concerns. PMs rely on BAs to provide timely information about anything that might impact scope, schedule and/or cost.

Because the BA is positioned at the center of an active and evolving project, they are the eyes and ears of the project manager. BAs see details that the PM may not—connections between people, processes, products and timelines.

The key word here is timely. BAs need to understand when to communicate potential scope, schedule and cost impacts to the project manager. In most cases, sooner is better than later. Proactive communication gives the BA and the PM time to plan an approach.

Obviously, collaboration and communication are two-way streets. The PM needs to communicate context and details with the BA. I often hear from PMs that their biggest fear of BAs is “scope creep.” Fearing that BAs will promise things to stakeholders that increase the scope of the project beyond what the PM has planned. There is a balance here that I hope each BA takes very seriously. The balance is value vs. scope boundaries. The BA role needs to collaborate with the PM and champion scope changes where the value of the solution is at risk, while ensuring that scope changes that do not add value are kept at bay.

What makes a top-notch BA from the PM’s perspective?

The PM wants timely information from the BA. Top-notch BAs will do more than present a problem. They will present the issue and an approach, or a few potential approaches. Top-notch BAs keep the PM informed, ask for help when they need it, stay connected to other BAs and project teams to help PMs see impacts, build great relationships with stakeholders, build trust and ease users into changes.

Top-notch BAs have a broad vision. They can focus on the detailed requirements, but they understand how their piece of work fits into the larger project and organization at large.

Top-notch BAs offer strategy. They understand how pieces of the organization connect and how they align them to give the organization value.

Top-notch BAs use the PM’s time well. They come prepared to meetings with a list of questions and concerns and approaches. Be efficient with the PM’s time. If you don’t have a regularly scheduled team meeting with your PM, then set a recurring appointment with them so that you have time each week to touch base. Provide a simple, concise status update each week, indicating things that might impact schedule, scope and cost.

What frustrates a PM about the BA role?

Scope creep is arguably the biggest fear PMs have about BAs and their work. Successful PMs deliver projects on time and within budget. Scope creep is the biggest threat to project management success.

In many cases, project managers are pressured to give firm cost estimates and implementation dates before the scope of the project is clearly defined. This means PMs need to understand how the elicitation and requirements process is evolving. Are BAs uncovering issues that could impact timeline? Are new business needs being uncovered? Are risks avoidable without impacts to time and cost?

A great BA knows the scope and objectives of the project and gathers requirements that link back to them. Through the requirements process, the BA ensures that users asking for other requirements (not in scope) are managed effectively, and requirements gathering sessions are not reeling in “features” that are not in the scope of the project.

The BA understands when scope should be changed in order to ensure the success of the project and communicates these concerns to the project manager in a timely manner.

How to say no to a PM?

Sorry to answer a question with a question, but — why would a BA need to say no to a PM? Here are a few examples:

The PM sets an unreasonable deadline for the completion of the elicitation process.
The PM only budgeted half of the BA hours needed to effectively support the project.
The PM asks you to prioritize her project above the work you are doing on another project.
You discover a new feature that is required for the project to be successful but the PM says you need to move forward without the scope change.
You uncover a risk that needs to be addressed. Proper mitigation would delay the project and add significant cost. Your PM does not agree and directs you to move forward.

So how do you say no?

Well, we all want to be successful. One way to say no to a PM is to help them understand the situation in the context of their definition of success. For many project managers, a satisfied project sponsor is the definition of success. For other project managers delivering the project on time and within budget equals success. I have even worked on some project teams where success involved convincing the stakeholders to cancel a project.

Ask questions or provide information that helps the PM key in on how his ability to be successful might be affected; focus on the risk:

If my requirements elicitation or analysis time is cut, critical requirements will be missed that will delay user acceptance or cause issues at implementation that would be extremely costly to the project in terms of customer satisfaction, cost to fix issues and value ultimately delivered.
I need to focus on this project right now, but I will meet the deadlines we agreed on for your project.
The project sponsor will not be satisfied with our product if we move forward without this feature.

As I said before, timely communication is the key. Don’t wait to tell the PM two days before a deadline that you need more time. Don’t fully elaborate requirements for a new feature before you notify your PM. Communicate your version of no as soon as it makes sense.

How to influence a PM to get what you need?

As a BA, the primary things you need from the PM are support and information. BAs need to understand the expectations and priorities of the larger project team and the organization. The PM is a key resource for this information.

The PM also offers support and back-up for the BA, often in the capacity of protecting scope and timeline. PMs can help the BA get key stakeholders to participate and is an escalation point for helping the BA resolve issues that are impeding progress.

A BA needs to help the PM see consequences if the needed information of support is not provided. The consequences should be in terms of scope, cost and schedule. That is the language of the project manager.

In order to clearly define the scope, I need to get some quality time with this key stakeholder.
In order to meet my deadline, I need your help to escalate this issue.
If we don’t find a way to mitigate this risk, the product delivery will be delayed by three months.

How to communicate the value of the BA role to a PM?

Ask them what success looks like for each project and then tell them how you can help them be successful.
• Build trust with stakeholders
• Keep open communication on schedule, risks and issues
• Help manage scope

Your Thoughts?

BAs: How do you build trust and promote collaboration with PMs?
PMs: What are the characteristics and skills that the best BAs bring to a project team?

This article is the second in a 13-part series about BAs and their best friends. Next month’s friend: The QA Lead

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Lagging vs. Leading Business Indicators – Do you know the difference?

Written by Richard Lannon on May 27, 2014. Posted in Articles. 4 Comments on Lagging vs. Leading Business Indicators – Do you know the difference?

In strategic planning it is important to discuss key performance indicators (KPI). Key business indicators are a type of measurement. They are essential for business leaders to understand what is happening in their business. The first step to determining your KPI is to understand the difference between lagging and leading indicators. The second step is to define and monitor your business indicators.

Lagging and Leading Indicators

Lagging indicators are used to measure performance and allow the business leadership team to track how things are going. Because output (performance) is always easier to measure by assessing whether your goals were achieved, lagging indicators are backward-focused or “trailing”—they measure performance data already captured. Just about anything you wish to monitor will have lagging indicators: returns on investments, a budget to plan variances, number of sick days, bags moved per day, equipment support incidents, etc.

Leading indicators, on the other hand, change quickly and are generally seen as a precursor to the direction something is going. For example, changes in building permits may affect the housing market, an increase in new business orders could lead to increased production, interest rate changes will impact spending and investments, a diminishing of demands for natural resources will often indicate work slowdowns, and aging baby boomers may indicate future stresses on the healthcare system. Because leading indicators come before a trend, they are considered business drivers. Identifying specific, focused leading indicators should be a part of each business’s strategic planning.

Consider These 7 Tips When Defining Your Indicators

Though are some guidelines that can be used, there is no “one” way to define the key performance indicators for any particular business. It is as unique as your approach to strategic planning.
Review your strategic planning process, in particular the assessment section of the various questionnaires and the environmental scan. Identify what you are already measuring and determine if it provides value to your business in your backward and forward thinking.
Review your strategy map and roadmap to identify the key areas of focus. Identify the indicators that will tell you whether you have achieved your desired outcome(s) (lagging), as well as the indicators that tell you the direction of the market and where you should focus (leading). Be specific.
Step outside your core senior management team and get additional leadership and external business stakeholders involved. An outside perspective can often help you determine what your lagging and leading indicators are, as well as help in recognizing the key leading indicators for your market that will drive your business.
Always keep an eye on your lagging indicators–they will continue to provide insight into your business. Poor lagging indicators generally translate into poor leading indicators. A performance indictor survey might assist you in the process of ensuring the indicators are appropriate. The challenge is to ensure you have the correct indicators, and that your management team understands how they can be used to align your business impact zones.
Choose your leading indicators carefully. The leading indicators should be unique to your business environment, originate from your key strategic initiatives and work elements, and ultimately be used to drive your business. Try not to be too ambitious. Keep focused on the business key impact zones represented in your strategic plan.
Train your leadership team in understanding key indicators and how to use them to improve the business. It is important that your team can not only identify KPI’s, but also recognize the potential business impact indicated by them.

Ensuring that you have the correct indicators may be a challenge, yet is vital to the ongoing health of your business. Make sure your team’s strategic planning process includes determining your indicators and that everyone understands what they are and why they are important. Key performance indicators are either lagging or leading. They are either relevant or they are not. There should be no in-between. Remember, what gets measured gets done.

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