Displaying topic: "Management & Economics"

September 26, 2011

Forgotten Dimensions of Risk

Earlier we discussed the difference between risks and issues.  In this post we’re going to talk about four aspects of risk you want to make sure and consider when dealing with risks.  We find these often missed in discussions about risk.  All of these help you determine the materiality of the risk and will help you prioritize the effort you put into responding to and managing the risk (more about managing risks in a later post).  The aspects to think about and capture are:

  • Impact: How big is the potential impact on the project?  We’ve seen this measured in a vague terms as “High, Medium, or Low” or as precise as a dollar amount or specific time the project will be delayed.  In our minds the more precise the estimate the better.  This is not necessarily because the more precise measure is more accurate but because the thought process required to come up with a precise estimate will help better define the risk.
  • Likelihood: What chance is there that this risk will turn into an issue for the project?  Are the “odds” high?  As with Impact, the more precise measurement the better, to a degree.  While high, medium, or low may be a bit light, 27.56% is an estimate that gives an illusion of precision.  Likelihood is predicting the future and false precision will give the impression you have a better handle on risk than you ever could.  In general we find risk expressed as a fraction with 4 or 5 in the denominator to be sufficient.  So for example theres a 1 in 4 (1/4) chance this risk will occur or a 4 in 5 chance.  This also provides sufficient detail should you choose to build a mathematical model for risk prioritization (more on mathematical models of risk in another post).
  • Immediacy: How soon will the risk occur?  Projects are often about prioritizing what’s important today.  Having a handle on when you think a risk will occur will help you prioritize when to start worrying about them.  This is the most difficult of the aspects to estimate and is the least precise.  Generally we think in terms of immediate (defined as within the next 3 months), mid-term (defined as between 3 and 6 months), and long term (greater than 6 months).
  • Triggering/Preceding Events: What visible events will precede the risk becoming an issue or indicate the risk is becoming an issue?  Be concrete, for example, if we see Milestone X is missed or have an indication it will slip it will indicate that the risk of late product delivery has turned into an issue.  Often risks will have several triggering or preceding events.  The biggest issue our clients sometimes have here is being too vague about defining the events.

There are, of course, other aspects of risk you want to capture when performing risk analysis and management on a project (for example: risk management strategy and tactics).  We’ll be more specific in a later post, but the aspects above are the most often missed on projects and some of the most beneficial in dealing with risks. Remember overall it’s less the list of risks you come up with in the end but the process of periodically identifying and analyzing risks that is of most value to the project.

April 9, 2011

State Budget Shortfalls – update

Mint.com has an interesting info graphic looking at recent and projected state budget shortfalls. Though the title is a bit alarmist what this shows is that the situation is improving in most states when compared with data from 2010. Have shortfalls peaked?


March 7, 2011

Project Zombies – 1

We’ve all seen them and maybe even been them.  The walking dead on a project.  We’re not talking about being tired because you’re on the last few weeks of a project and everyone is working hard to push it over the goal line.  We are talking about those projects where you can’t see the goal line but you continue to dazedly slog down field through the mud hoping that your efforts lead to something productive.  Or worse, just hoping the end is near irrespective of the outcome.

Symptoms

So how do you know if you have project zombies on your team?  Here are a few symptoms:

  • A measurable drop in individual or team performance;
  • A general drop in morale;
  • Long hours being put in on the project well before that final push;
  • Grumbling, complaining, or dead silence about assignments; and
  • Missed milestones and deadlines.

Causes

If those are the symptoms what are the real causes?  We’ve seen many but the top six in our experience are:

  • A high level of politics in a project (we’ve noticed a lot of this lately around anything to do with the Affordable Care Act!);
  • Unrealistic goals and desired outcomes for the project;
  • Unrealistic timelines and scope (asking people to do more than is possible in time allotted);
  • Working staff above or below their skill level (asking them to routinely perform tasks they feel overqualified to do or that they are not skilled enough to do);
  • Constantly changing deadlines or scope (moving the goal posts); and
  • Outside forces (vendors, management etc) pushing the use of “silver bullet” tools or techniques to justify unrealistic deadlines or outcomes.

We know there are more but there are always at least one of these on any project suffering zombies.

Impacts

So why care if your project is full of zombies?  Projects with even a single zombie can:

  • Miss milestones and deadlines;
  • Make good staff leave the project;
  • Result in poor quality work; and
  • Fail outright.

As a sponsor or manager of a project it is your job to cure project zombies.  We’ll discuss some cures to “project zombie-izm” in the second (and final) part of this series.   In the mean time you might want to read  Ed Yourdon’s book “Death March“.   Though targeted at software projects much of the insight it provides generalizes to any project.

November 17, 2010

Should Government Be In The IT Business?

We asked the Chief Information Officer (CIO) of a large state health and human services agency an interesting question recently: does he need a large information technology (IT) organization? We had been discussing the “core competencies” of a health and human services agency and wondered if IT was one of them. He granted it was a fair question. Here’s the context and summary of our discussion:

The CIO was engaged in the procurement of a Medicaid Management Information System (MMIS). The project was stretching his resources thin and he was relying on us (PK) to supplement his staff with MMIS procurement expertise. We were leading a discussion of procurement strategies and the question came up “Why can’t we just outsource the whole thing, why do we need to buy an MMIS – can’t we just rent one like other people rent applications like Salesforce?” The CIO had been reading a lot about Software as a Service (SaaS) and this seemed to make some sense to him. The potential benefits are large:

  • He’s already being asked to cut his capital (one time expenditure) budget and this could provide a significant reduction. It may even offer operating budget cuts as well;
  • He has been worried about getting and keeping the staff required to implement and maintain a large system. He has had a lot of staff attrition due to retirement and difficulty in recruiting and training new staff;
  • He has wanted to devote his staff efforts to more strategic projects (as opposed to the operational nature of an MMIS) that would better support the agency.

There were some obvious roadblocks:

  • A waiver from CMS would be required – the law technically says states have to construct and maintain an automated system to handle Medicaid claims;
  • Most MMIS vendors, despite what their marketing literature tells you, are not prepared to run Medicaid as a software service;
  • He believed vendors would try and create lock-in with their product through proprietary data formats and unique features. After some discussion the realization dawned this is the case with the way things work now.
  • There was a long discussion about privacy and security. How would that be ensured? The technical staff in the discussion assured us through the use of Virtual Private Network technology such a set up would be no less secure than their existing systems.

Overall it was a thought provoking discussion. Though we didn’t reach any definitive conclusions we all realized this approach has significant potential. The recent elections emphasized government agencies will have to live with less. This CIO is on the forefront of identifying ways to deal with these budget shortfalls and on effectively using technology to further the mission of his agency.  We’re continuing to work with the agency to flesh out the implications of this strategy.

August 27, 2010

Health Management: Improve Outcomes and Reduce Costs.

Health management is a system of coordinated health care and outreach activities targeted at disease focused populations with conditions where patients have significant self-care efforts.  The goal is patients become better-informed consumers of health care and gain an understanding of how to better manage their health care needs.  Health management often results in cost savings from the more efficient and effective use of healthcare.   The approach involves supporting patients and the physician/practitioner communities through care plans and evidence based practice guidelines, patient education, and disease monitoring support services.

Public Knowledge has a history of assisting its customers with the planning and development of Health Management Programs that improve quality of care, improve health outcomes, lower total costs, and better-educate providers and Medicaid clients.

Recently, we helped a State implement a unique Health Management program for its entire Medicaid population.  The program included even healthy Medicaid clients, who are usually ignored in traditional disease management programs.  The program itself consisted of:

  • A Disease Management component for certain chronic diseases such as asthma, diabetes, and others;
  • A preventive education and outreach component for all Medicaid clients; and
  • A comprehensive case management component for catastrophic/high risk medical cases.   The broad scope of this program is unique.

So what have the results been?  In its first 6 months of operation the program saved the State’s Medicaid program more than $15 million.   Greater savings are being realized in its first few years of operation.  Further, based on our regular reviews of the program, the quality of care to clients has improved.  Pretty much a win/win.

July 3, 2010

Vermont: Creative Thinking in Handling Budget Crisis

Vermont is using some creative thinking to handle its budget issues. Pensions (as you all know) are becoming one of the biggest burdens on State budgets. Legislatures are either cutting existing pensions (which is likely not legal) or creating multi-tiered pension systems where newcomer’s pension benefits are significantly reduced (This will have the effect of driving new people away from government). State employees we’ve talked to (and the unions that represent them) feel both undervalued and infuriated by these moves.

We recently ran across this article from stateline.org which describes how Vermont sat down with their unions to jointly resolve part of their budget crisis. A little outside the box thinking went a long way. Kudos to Vermont for thinking creatively and turning a potentially adversarial situation into a win for both parties.

Are you applying creative solutions to your problems?


April 30, 2010

Client Survival Guide: Downside of Full Time Consultants on Your Project

We’ve seen a trend lately of potential clients requesting we devote staff full time to projects. This seems particularly true of our IV&V and QA projects. We think the reasoning is probably based on at least three factors. Clients:

  • Are tired of consultant bait and switch strategies where superior resources are bid (and may even start) on the project but less experienced staff show up and do the bulk of the work;
  • Want rapid access to known consulting resources for projects; and
  • Want to make sure there’s continuity on project issues and tasks provided by the consultant.

There are however downsides to having consultants devoted exclusively to your project. Consultants:

  • Become myopic over time and miss critical issues and solutions a fresh pair of eyes might catch;
  • Are costly resources that should only be on board when they are needed, when they’re not fully utilized (and there are always those down times on projects) you don’t want to pay for them;
  • Stop bringing in new ideas and experience gleaned from other projects that might be just what you need to thrive; and
  • Become viewed as staff and their unique experience and voice is no long heard.

Of course we’re not suggesting the elimination of consistent consulting staff on your projects. You do need continuity and responsiveness. And we are also not suggesting consultants should be swapped out regularly. Just be aware there are hidden costs to demanding consultants be devoted full time to your project (particularly on longer projects) and benefits to having “fresh legs” in the marathon that projects can be.


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