What would you do if you were given a super power…? No… not flying or saving the world…but rather…. the ability to say “yes” or “no” to the projects your company is working on…. And with each of your “yes’s”, there would be a resource allocation (money and people).
Because of your super power, or “super yes”, your company would be developing new products and 200 of the product developers (that you manage) would be working on the projects of your choice. Wouldn’t that be cool?
But then imagine that your company actually needs 500 product developers, and your budget is a quarter of what you really need. Imagine all of the angry BU Presidents sending you nasty messages (after you denied their projects and told them you don’t have any free resources to support their ideas).
And then finally, imagine that at the end of the year, you (and your team) are rated based on the projects you selected, productivity you delivered or the innovation that came out of your shop. And imagine that your and your team bonus depends on it!
Would you still like that?
How would you select the projects that your team would work on? Which projects would you reject? How would you manage angry BUs who are unable to deliver their targets because of your decision? How would you make this process “emotion-free” and objective, so you wouldn’t be the most hated man/woman in the company?
Last week, I was invited to a meeting with the head of R&D who asked me to come up with the matrix for the Stage Gate process and (human) resource allocation. In other words … I was asked to create a template that would help my company to decide if the project should obtain our “super yes” status.
During my research (yes, I wanted to know what KPIs other companies are using) I came across an article “Measuring Project Success Using Business KPIs” (http://www.projecttimes.com/articles/measuring-project-success-using-business-kpis.html). According to the author, good KPIs are
- Aligned—Agree with the specific organization’s vision, strategy, and objectives.
- Optimized—The KPIs should be focused on providing organization-wide strategic value rather than on non-critical local business outcomes. Selection of the wrong KPI can result in counterproductive behavior and sub-optimized results.
- Measurable—Can be quantified/measured.
- Realistic—Must be cost effective and fit into the organization’s culture and constraints and achievable within the given timeframe.
- Attainable—Requires targets to be set that are observable, achievable, reasonable, and credible under expected conditions as well as independently validated.
- Clear—Clear and focused to avoid misinterpretation or ambiguity.
- Understood—Individuals and groups know how their behaviors and activities contribute to achieving the KPI.
- Predictive—The KPI may be compared to historical data over a reasonably long time so that trends can be identified.
- Agreed—All stakeholders should agree and share responsibility for achieving the KPI target.
- Reported—Regular reports are made available to all stakeholders and contributors so they know the current status and are able to take corrective action if needed.
The author also mentions that there are about 75 measurements that performance experts use, but none of the measurements mentioned in this article is listing the one we decided to use…
In order to assign the resources to a proposed project, our team decided to use NPV/Man days. So… we will not picking/selecting projects with a high NVP but lengthy in time and with a high headcount requirement. We can’t afford to tie our resources for months in those projects.
Instead, we will be picking and approving projects that have high NPV, that will be easy (and quick) to implement, that will not tie our resources for months, and that will bring the highest return per resource.
Do you think I made the right recommendation?