PPM NEXT LEVEL: driving capacity for major changes in organisations

With staff shortages and rising demand for products and services pushing workloads to unacceptable levels in many organisations, it is more important than ever to carefully and effectively manage capacity deployment during major changes.

Project Portfolio Management (PPM) ensures that we do the right projects to change and improve the organisation while executing them in the right way - taking into account the deployment of scarce people and resources. The focus is on the prioritise of projects and the allocation of budget. Increasingly, we find that when projects are realised, the chosen priorities cannot be maintained, due to a lack of the right people. What can be done about this? How can we ensure that priorities are better maintained, from a capacity perspective?

Challenges in capacity management of projects and portfolios

Before we get to solutions to this problem, we want to zoom in on possible causes for this. We identify six of them, but that surely does not make us complete, namely:

• Stacking projects
• Run-out of projects
• High workload
• Personal diaries
• Change fatigue
• Unable to say 'no'

Stacking projects

Starting projects in advance, without agreement on what exactly the intention is and without the necessary commitment and resources being arranged. Resulting in double deployment of the same capacity. This increases the chances of getting stuck, with the necessary stress, irritation and disappointment.

Run-out of projects

Projects regularly adjust their planning and, with that, resource planning regularly changes. The challenge is to reallocate this change in resources appropriately to the projects.

High workload

Caused by all kinds of reasons, work and the effort required for it are difficult to predict and plan, especially if professionals on the shop floor are working on different assignments at the same time, which are planned separately from each other. It is then impossible to show or express in hours whether someone overflows in work or has room for a new assignment.

Personal diaries

Say A and do B. Wiping your own street clean first and then someone else's is so obvious if your own department's problems are urgent enough. Consideration frameworks at department or team level, for instance for prioritising between line and project activities, if they exist at all, are not consistently adhered to.

Change fatigue

The 'umpteenth change in a short time' is a seed of demotivation for professionals. And all the more so if changes often drag on or regularly fail. Stagnation lurks, faith in yet another change is lacking. It then becomes difficult to keep everyone on track and personal agendas take over during implementation of the next changes.

Unable to say 'no'

This is more common than we might think. Professionals in the workplace are often personally approached to do something and, under pressure of the moment, they agree. As a result, they get caught up with their other, previously made commitments.

Capacity solutions for project portfolios

PPM provides tools to position major changes in organisations in such a way that they can be successful with minimal stress and workload. After all, these changes can never be executed entirely according to plan. Overview and insight, linked to a clear set of choices, are elements of PPM that will create more peace and space, and thus flexibility in the realisation of the (project) portfolio. In order of impact, possible measures are:

1. Stopping projects. If the workload is so high that the water runs over the shoes, another solution is to (temporarily) stop some projects. A good stop decision also means a success and may be celebrated. And helps motivate professionals for future changes. Stopping can be done in various ways, at the completion of projects that are finished, or prematurely of projects that no longer turn out to be needed or of projects that have already produced sufficient results (but not all). A pause button or parking space for projects can also help make space and reduce workload.
2. A (central) capacity planning or resource planning, with different levels, viz:
3. Tactical, 6 to 24 months ahead. This involves matching required and available roles and competence profiles. This is linked to strategic personnel planning: what qualitative and quantitative movements in competence profiles do we expect and how will we respond to them?
4. Operational, 1 to 6 months ahead. Insight for team leaders and individuals into what people are working on (in certain roles/expertises), what projects are being worked on, and for portfolio management to be able to see where bottlenecks are going to arise.
5. A Stage Gate or funnel process at the project and/or portfolio level: at milestone moments, ensure that the necessary checks and balances are in place, so that decision-makers can be sure that agreements on the deployment and availability of professionals have been made with the right people, are secured in team schedules and will not lead to conflicts with other projects or with operations in advance.
6. A Work-In-Progress (WIP) limit in portfolio control: ensuring that no more projects are in a phase at the same time than is optimal for the organisation and the portfolio. This number of projects can be determined in advance as a kpi[1] to start steering on this. If the WIP limit has been reached, first complete (stop) a project before a new project can start in the phase.
7. Co-budgeting for the use of own staff. Only budgeting the so-called 'out-of-pocket costs' of projects gives a distorted picture of the business case of a project and reinforces the reasoning that own people 'just do it on the side', which often leads to disappointments and project delays. A common variant for co-budgeting own efforts is to reimburse teams and departments for 'substitute efforts' for supplying people to projects.
8. Working with 'fixed project teams', so portfolio deployment planning is then done by team and not by role or individual. Since there are far fewer teams than individuals, this planning is simpler and more stable. Also, the learning ability of permanent project teams is greater than that of temporarily assembled project teams, allowing better value to be created for the organisation.
9. Teaching other behavioural principles, such as addressing each other and giving feedback. For instance, when professionals are not asked for commitment to jobs or projects via the existing capacity planning. Being able and daring to say 'no' when that is not the culture requires effort from both management and professionals.

Examples 1, 3 and 4 are relatively easy to apply in principle. The other examples require preparation time before impact is noticeable - unless they exist in parts of the organisation.

The common thread in the solutions to be introduced is working towards an ever better 'portfolio mindset'. As managers become more willing to act in the joint interest instead of their own, the (joint) management of capacity will start to work better. However, this requires trust, or patience and perseverance. In times of crisis, this trust can quickly disappear and managers are more inclined to go for self-interest.

[1] Kpi: critical performance indicator

Case study

The above may sound simple, but practice is unruly and cannot easily be captured in a few measures. Success comes from a combination of measures. Also because the actual effect of a measure is not always clear in advance. Two practical examples illustrate this.

Care institution ICT department: capacity planning i.c.w. Stage-Gate

The ICT department of a healthcare institution has a multitude of projects and every day something is added. Projects involving ICT run out unpredictably, leading to irritation in the organisation. The water is on the lips. Hiring external professionals unfortunately helps only to a limited extent. The problem is that when requests are received from the institution, the ICT people immediately start running and a new project is created. There is no insight into who is working on what and whether there is room for more. As a result, any communication about the delivery of projects is unreliable and delivery dates often shift - and the fingers are then often pointed at ICT. Added to this is the desire to realise a digital strategy, which adds to the workload within the ICT department. Where to start? After an analysis with ICT's management team, it was decided to implement 3 key changes:

1. Clear communication on the agreed projects with the platform of representatives from care and staff departments, in which the discussion on prioritisation and planning of the portfolio takes place every four-month period.
2. Setting up a 4-monthly capacity planning for all teams within the ICT department, in which it is clear per week for each professional how many hours of project time are available and for which projects this time is reserved.
3. Monthly decision-making by ICT's management team on capacity planning and portfolio progress via a Stage-Gate process for phase-by-phase release of projects for execution and completion.

This approach already led to significant improvements in project communication and decision-making in the short term. It seems a lot of work to get the capacity planning of 50 or 100 professionals into a planning system, but if you are smart about it, it is not so bad. The challenge lies in keeping the capacity information up-to-date and actually using it for management purposes. Setting up in MS Excel is possible; fortunately, to support this better, there is a lot of professional tooling available in the market in the form of standard software.

i-Portfolio large municipality: permanent project teams

Five different domains, with a total of some 25 departments within them, make substantial demands on the change capacity of the ICT and IV departments of a large municipality. There is an i-Portfolio board in which available capacity is prioritised and counted. However: projects regularly run out of time, the list of projects yet to be started gets longer and longer and the workload of specialists in the i-domain increases. After analysing the situation and prioritising problem areas and solutions, it was decided to start implementing 'fixed project teams'. By placing certain expertise combinations in a fixed team and focusing on mutual cooperation, the pressure on the specialists is significantly reduced and the quality of the projects increases. Step by step, permanent project teams are set up within all domains to provide and safeguard the change knowledge. During implementation, a budget will be made available for the development, training and coaching of the new permanent project teams.

Summary

With PPM, an organisation gains a better overview and insight into what is going on and management can see in time where potential capacity bottlenecks are going to occur. As a result, concrete actions can be taken in time and the effect of those actions is easier to oversee. This creates space and prevents unnecessary pressure on capacity to realise ambitions.