March 18, 2012 By Bill Schrier
The project mantra is clear: "scope, schedule, budget". But how we actually do the planning, estimating and getting approval to start a project … well that's the horse of a different color.
We promise the moon - "Project Widget will be the best thing for this department since sliced bread - it not only will slice bread, but will knead the dough and grow the yeast and self-bake itself". Then, of course, instead of delivering sliced bread we might end up delivering half-a-loaf, or maybe an electric knife or perhaps a chopped salad. This problem: getting the project’s scope right.
Then there is schedule. Of course every project is a "priority". We're going to get it done in the "next nine months". Why "nine” months? Because that's less than a calendar and budget year, but it is longer than saying it will be done tomorrow, which is patently ludicrous. But nine months is also ludicrous for anything other than incubating a baby - and even babies usually take years of planning and preparation. Furthermore, in the public sector almost every procurement has to be done by RFP, and preparing a request for proposals alone, plus contract negotiations with a successful vendor, cannot be done in less than a year. And the schedule needs to include minor components such as business process discovery and the work of executing on the project.
Then there's budget. Generally we'll make a pretty good estimate of the actual real cost of the project. The usual mistake is for someone (fill-in-the-blank - "department director", "Mayor", "county commissioner", "state legislator", "grand phooba") to say "we only have x number of dollars". So, as the next step, the project budget shrinks to the magic budget number, while scope and schedule are left unchanged. And generally the "magic budget number" is determined by some highly scientific means such as the amount of money left over in a department budget at the end of a fiscal year, or the amount of money the City of Podunk Center spent on a similar project, or the size of a property tax increase which voters might be reasonably persuaded to pass.
Why do we plan projects this way in the public sector?
First, we are largely transparent and accountable in government. That’s really good news, because we – government – are stewards of taxpayer and ratepayer money. Oh, I suppose we can hide some small boondoggles, but there are too many whisteblowers and too much media scrutiny to hide a major failure. That's not true in the private sector, where projects costing tens or hundreds of millions of dollars are failures or near failures, often hidden from public or shareholder view, with wide-ranging and sometimes near catastrophic economic effects. Some public examples include Boeing's 787 Dreamliner or the Microsoft Courier tablet (gee, will anyone every produce a Windows tablet?) The federal government’s project failuresare paramount examples of both poor project planning/execution and admirable transparency with an eye to reform.
Here are my top reasons for project mis-estimation:
And here are my top cures:
What's amazing is that, despite everything I've said above, we get an amazing amount of great projects completed. At the City of Seattle, we’ve tracked all our major projects. Since 2006, we’ve tracked 77 project through 2,071 project dashboard reports. We’ve found that, when they are completed, 75% of them are within budget. Of those 77 projects, 32% have been on time and 57% have delivered the scope they promised (i.e. a whole loaf of sliced bread). Clearly this record reflects our priorities – budget is the most important consideration, with scope second, and schedule lowest.
Not a bad record when compared with Standish group project failure statistics, but plenty of room for improvement.
This Digital Communities white paper highlights discussions with IT officials in four counties that have adopted shared services models. Our aim was to learn about the obstacles these governments have faced when it comes to shared services and what it takes to overcome those roadblocks. We also spoke with several members of the IT industry who have thought long and hard about these issues. The paper offers some best practices for shared government-to-government services, but also points out challenges that government and industry still must overcome before this model gains widespread adoption.