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Watch that Basket-Seven Ways to Identify Troubled Projects

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Though the traditional advice is “don’t put all of your eggs in one basket,” the celebrated author Mark Twain is famous for saying, “…put all of your eggs in one basket and — WATCH THAT BASKET.”

Whether you’re a an entrepreneur leading a small business , a C-Level executive (CEO/CFO/CIO/CTO) at a mid-sized business, the head of the Project Management Office (PMO), or a business manager watching out for your department, you are often stuck in the position of having to “watch that basket” with your most critical projects.

Even worse, many times you’re never truly sure if one of your key projects is in trouble until it’s too late.

Fortunately, there are some signs that can help you identify a troubled project early, so that you can intervene and put it back on track. I polled our project recovery services specialists at Cedar Point Consulting, and we thought of seven effective ways to identify a troubled project:

  1. Perpetual Green Lights, Little Activity. Many of us are familiar with the approach of labeling projects green when they are on schedule and budget; yellow when the project is falling behind; and red when the project is far behind and/or over-budget. Perhaps your key project has been reporting green for the last three months, but oddly there’s been very little activity related to the project. This is probably a good signal that the project is actually in trouble.
  2. Lot’s of TBD’s. Effective risk and issue management are critical to the success of most projects, yet they are often ignored. If your key project is well past the early stages, but is reporting back a lot of TBD’s (to be determined) in the “resolution” column for risks and issues, then it’s probably a troubled project, even when the schedule doesn’t show it.
  3. Avoiders. The leader in charge of your key project may be a formal project manager or a manager of a business line, but regardless of who they are, you are getting the unsettling feeling that they are avoiding you. Perhaps they are missing at meetings, they’re head the other way down the hall when they see you, they’re not returning phone calls, or they’re not providing status reports. Unless you have a problem bathing, the project leader is likely avoiding you because the project is in trouble.
  4. Troubling Trends. Experienced project managers are familiar in using techniques like earned value management (EVM) to identify project progress by comparing actual to planned results for work completed, costs incurred and time spent. Though you may not be using EVM on your projects, you can watch for dramatic increases or drops in spending, dramatic changes to the work being delivered or sudden changes to schedule with no new schedule dates. In many cases, your key project is in a free-fall.
  5. Non-Progress Reports. You’re wise, so you have asked your project manager to provide status reports on a weekly basis. However, they’re more like “Non-Progress” reports than progress reports because no progress has been made. In particular, if you have received two weekly status reports where no progress has been made, you’re well on your way to having a troubled project on your hands, if you don’t already.
  6. Inability to Show Tangible Results. Well in to your project timeline and knowing that interim reviews are a good idea, you ask for a review or demonstration of work completed thus far. However, your review meeting is repeatedly delayed and rescheduled, sometimes by a few days and sometimes by weeks. Even worse, you’ve tried a quick visit by the desk of the project leader and it resulted in the person shoving documents in their desk instead of sitting with you to review tangible results. If so, this is likely a troubled project.
  7. Spidey Senses Tingling. Like Peter Parker in the Spiderman comic book series, you know which projects are highest risk and every time the subject of your key project comes up, it sets your spidey senses tingling, though you’re not certain why. While I’m a big believer in science over emotion, there is surely something very scientific that you’re reading so trust your instincts. Your likely to find something amazingly like trouble in your key project.

Of course, identifying a troubled project is one thing, but recovering that project is a completely different challenge. I provided some tips to recover troubled projects in a previous article that may be of help.

However, particularly if you don’t have experience recovering troubled projects and the stakes are high, it might be time to consider getting some help.  Our firm provides project recovery services and we’re proud of our success rate, but other competent firms do, as well.

Donald Patti is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in project management, process improvement, and small business strategy. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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Product Pricing: Avoiding the Dead Zone

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I was talking to an entrepreneur-friend recently about product pricing for business products, and the fact that there’s a dead zone between the $1000 and $5000 price range that most successful products avoid. That dead zone exists for a reason and it’s important to avoid it, as I will explain here.

For most businesses – even large ones – a purchase under a $1000 can typically be made by a first-level manager and even by a staffer. In some cases, they put it on a corporate credit card and in others they use a discretionary budget, but when the user wants your product, the sale is usually pretty quick and simple.

In contrast, a sale of $1000 or more often requires a mid-to-senior level manager’s approval, a signature from purchasing and even a formal purchase order and invoice. In some cases, I’ve even seen $1000 plus sales rise to the VP level for approval, so this can become heck of a hurdle to clear to close a sale.

As a result of these restrictions, it makes sense to stay below $1000 if possible. But, why might your product need to be priced at $5000-plus instead of, say, $1500? The answer is the sales person. Over the $1000 price range, you not only have more hurdles to clear before closing a sale, you often have to use a one-on-one selling approach to close the deal, which requires a sales person. This sales person earns a small salary, makes commissions, generates expenses and only closes a portion of their leads, so suddenly a $1000 sale becomes very unprofitable.

It turns out that, in most cases, a sale through a salesperson is not profitable until the price reaches over $5000. Hence, the dead zone between $1000 and $5000.

So, if your business product or service is priced in the dead zone, there are things you can do about it.

  1. If possible, move your product below the dead zone. Find a way to lower the price just below the $1000 threshold, break the purchase up in to multiple payments across multiple months, or sell a service-based subscription that generates monthly revenue.
  2. If going lower is not possible, rise above it. Consider ways to bundle your product with others so that you can charge more and justify a salesperson, sell maintenance or support along with the product, or sell your product to someone else who can bundle it.
  3. Stay in the zone. While this is the least appealing option, this option can work. Instead of using an outside salesperson, consider online ad campaigns with inside sales representatives at lower costs. Or, consider a multi-tiered marketing approach that allows for slack labor (college students, work-at-homes) to sell your product. Or, a viable option for a small business may be to sell the product yourself.  (Hey, I already said it wasn’t very appealing).

Interestingly, a dead zone exists to some degree for consumer products and services just as it does for business products, though the zone for consumer products is a good deal lower and it doesn’t appear to be quite so “dead” – it’s probably between $100 and ending at $500. It may be coincidental, but $100 is about the point at which I start running purchases by my wife and she runs purchases by me. Hmmhh.

Donald Patti is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in project management, process improvement, and small business strategy.  Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

VoIP, Virtual Teams and the International Pause

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The Internet is making us all a little more rude these days and there’s a good chance we don’t even know it.  This has nothing to do with texting while driving or blogging about gossip – it’s much more insidious. It is related to using Skype, Vonage and other types of Voice-over-IP (VoIP) on international calls, so if you’re using VoIP phones or you lead virtual teams, there’s a good chance you’re at risk.

As you probably know, the Internet and major telecommunications systems use fiber optic cables, wireless networks and satellite systems that travel near the speed of light, yet they are still limited by distance, the number of hops and the speed of the equipment to determine how long it takes for information to reach your computer. Loosely speaking, this is called latency, and its higher over longer distances and lower over shorter distances.

Because of latency, on a good day, it takes about 1/5 of a second for a single piece of information containing your voice, called a packet, to travel from New York City to Los Angeles and 1/3 of a second from the U.S. to India (Verizon SLAs)– theoretically not too bad if you’re looking to hold a conversation. Unfortunately, the problem is that you’re not just sending one voice packet when you talk, you’re sending thousands. Those thousands of little bitty packets take multiple directions to reach their destination, once they reach the destination they’re reassembled into your voice, and only then are they heard by the person on the other end. This all adds up to between a ¾ and 1½ second delay between when you speak and when your voice is heard. Of course, it can be quite a bit worse when there are bottlenecks on the Internet, so a 2 or 3 second delay is not out of the question, as this article about latency posted at Sat Magazine concludes.

Latency alone is just a technological problem, and not a very big one – until you add human beings into the mix.  A 1½ second delay might not seem like very long, but there is a magic threshold at around 1 second that dramatically changes the shape of human conversations, according to Maryam Alavi, who conducted pioneering research into technology-aided learning in the 1990’s. Consider that, in a typical conversation between two people in the same room, interrupting that person mid-sentence is considered to be rude, while a 1 second pause is usually a signal to the other person that you’re opening up the opportunity for them to respond to your last statement. Similarly, if you have been speaking and the other person does NOT respond within a few seconds, it becomes a pregnant pause.

Conclusion:  Latency + human conversation = unintentionally rude behavior.

For better understanding, here are a some examples of how VoIP conversations, particularly conference calls, have been misread:

  • During a conference call, no one speaks for a full second, so I started to talk. Unfortunately, three other people on the call heard a 1-second pause and started to speak, as well. Suddenly, four people are speaking at once – which is often interpreted as disrespectful.
  • During another conference call, I don’t hear anyone speak for nearly two seconds, so I start to talk. However, the person speaking didn’t actually pause — their voice packets were delayed — so they haven’t finished speaking. When I chimed in, their speech suddenly continued, and I appeared to be interrupting them.
  • During a VoIP call, a person in the room with me spoke for around thirty seconds and then waited for a response. A second, two seconds and then three seconds passed, yet nothing was heard on the other end. Were they offended by what you said? Was it so earth-shattering that they couldn’t think of a response? Did the line suddenly drop?
  • During a conference call, four people in a remote location are in a single room and are using a half-duplex speaker phone (described by HelloDirect). They speak and speak within their conference room, never pausing to allow communication to flow the other direction.  On your side, people are practically yelling in to the phone, but nothing they say can be heard. As a result, the people onyour end think they are being ignored by the other group.

The bad news about all of these situations is that centuries, if not millennia, of human communication have wired us to interpret interruptions and long pauses in speech as rude, but the technology is in many ways introducing the problem.

The good news is that there is a way we can deal with the problem – the international pause. The international pause means pausing for an extra second or two before speaking on a VoIP call, particularly on international conference calls, in order to avoid interrupting someone else speaking.  In short, it’s a way to counteract the effects of latency that occur on IP telephone calls crossing international boundaries.

Using the international pause is simple:

  1. When you start a meeting that uses VoIP or crosses international boundaries, remind people that there are often lags in communication due to the Internet and that it may be a good idea to wait a little longer before jumping in on a conversation.
  2. As a meeting facilitator, remind people to take more frequent pauses when speaking, so that others will have an opportunity to ask questions or make comments. In addition, consciously ask all participants if they have comments or questions before moving on from one subject to the next.
  3. Take an international pause yourself – before speaking, count an extra second or two, then start to talk.

While we could all wait for technology gurus to overcome the problems of latency with VoIP, there’s a great deal of benefit in IP telephone products like Skype, which dramatically reduce communication costs and enable virtual teams to function effectively while spanning the globe. In order to use this new technology effectively without causing strife among virtual teams, however,  it’s important to take an international pause on your VoIP phone calls.

Donald Patti is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in project management, process improvement, and small business strategy.  Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

From Chaos to Crisis to Calm – Nine Tips to Recover a Troubled Project

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Brendan Moore, a fellow Principal at Cedar Point Consulting, recently reminded me that, “You can’t manage chaos, but you can manage a crisis.” These are very wise words, but they reminded me of the early stages of a trouble project — one which is far behind schedule, well over budget, not delivering results, or all of the above.  If anything, a troubled project is chaos waiting for a strong leader to transition it to crisis, and then ultimately to calm.

Whether you’re a C-level executive, an entrepreneur or a project manager, you may not have encountered very many troubled projects in your career, so you may not be familiar with how to transition from chaos, to crisis, and finally to calm. We consultants are often brought in to deal with just such problems, so I have a few tips that should help:

  1. Don’t Panic! Douglas Adams references aside, you may have just learned that a key project is in trouble, but it’s important that you not panic. First of all, panic spreads, so you create chaos from crisis, and it won’t be long before your co-workers and your subordinates are panicked, too.Second, panicked people don’t reason effectively – they make “fight-or-flight” decisions instead of rational ones, so you’re far more likely to make a bad decision or push others to do so.
  2. Be Methodical. At Cedar Point Consulting, we have a 5-step process that we follow to recover projects – Review, Recommend, Respond, Transition, Close. While this is not the only way to recover a project, it does consistently work – by step three, the project is making progress once again. Regardless of the technique or methodology that you choose, don’t attempt to solve the project’s problems until you have an understanding of their causes. Do take measures to stop the bleeding, until you’ve effectively identified root causes.
  3. Read the Tea Leaves. Whether well run or not, nearly all projects have documents that tell you where the weaknesses are and whether they are being managed well. At minimum, even the smallest project should follow a standardized process ( project methodology); a charter (with a project goal); a project plan that includes a schedule, a budget, and assigned staff; regular meeting minutes and regular status reports. If these exist, review them to assess where problems are occurring. If they don’t, find out why.
  4. Be From Missouri (“Show Me”). Reading current project documents is a good start, but what if someone is fudging the numbers or painting a rosier picture than reality? For select documents, like staff hours, project schedule and project budget, confirm that they are reasonably accurate independently. Which brings us to the next tip…
  5. Use an Independent Third Party. Whether you hire a consultant or have someone in another part of your business lead your project recovery effort, they should be an independent third party. Having a friend of the Project Manager, the Project Manager’s immediate superior or one of their subordinates jump in to help is unlikely to be successful.
  6. Change Leadership or Change Process. At the most basic level, projects most often fail because either the project manager is not up to the task or the project management process is preventing them from succeeding. A good project manager controls time, scope, cost and quality on a project. If they don’t control at least two of these and influence all four, then they are likely to fail. Conversely, if they control all of these but the projects headed off a cliff, you probably need to switch project leadership.
  7. Increase Communication. When you’re trying to identify problems with a project, it helps to increase communication within the team. Schedule and require participation in regular meetings – daily, if necessary, like Stand-ups or Daily Scrums. Finally, increase the frequency of status reports to key parties, such as the client, the sponsor and key stakeholders, even if the reporting is informal.
  8. To Thine Own Self be True. There’s always a need for optimism in every situation, but good leaders are also honest to themselves and to others about the current state of a project. Depending upon how far behind the project truly is, consider reducing scope or resetting the schedule. Failing to do so may doom the project and the project team to yet another failure – one from which they may not recover.
  9. Start Small, Review Frequently.  After you’ve planned your recovery, be sure to start with small deliverables and shorter milestones, reviewing the project’s progress frequently to make sure the conservative short term goals are being met. While this is not normally the best approach with a project, starting small enables the team members to practice working together as a team before they have to tackle the larger, more challenging deliverables of the project.

The list above isn’t a comprehensive recipe for solving all the problems of a troubled project or for complete recovery, but it is a good start.  In a subsequent post, I’ll provide a list of ways to minimize the possibility of troubled projects altogether.

Donald Patti is a Principal Consultant with Cedar Point Consulting, a management consulting practice based in the Washington, DC area, where he advises businesses in project management, process improvement, and small business strategy.  Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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