Leading Enormous and Complex Projects Professional Development Summit

Leading Enormous and Complex Projects © Professional Development Summit (PDS) 2018 April 2018 Halifax, Nova Scotia Charles Villanyi Bokor The CERP Group

Our Agenda • There are very, very large projects • Enormous projects are consequently complex, and different • Using the standard methodology, we fail large projects, by design • We need a new Framework 2

The Size of Projects Evolved • • • TRAILER LAUNCH GAS HANDLE STORE 3 Halifax- April 24, 2018 3

Super Size Projects© • • • TRAILER LAUNCH GAS HANDLE STORE 4 Halifax- April 24, 2018 4

Black Hole Projects© (BHP) • • • TRAILER LAUNCH GAS HANDLE STORE 5

Many projects today are enormous 6 Halifax- April 24, 2018

Examples of system development Black Hole Projects (BHP) • 2001 Mc. Donald – a $1 billion global, real-time digital network. Scrapped after $170 million was spent. • Apple Computer - the Copland system abandoned at around $200 M. • The Canadian Firearms Registration Project’s - cost $20 M $1 billion; $50 to $60 M every year to operate • Canada Health Infoway - funding for 294 projects across Canada; some $1. 6 billion; will cost between $10 - $12 -billion "when all is said and done, ". 7

Measuring the size of projects Resources Person-years to dev LOC Cost to develop Total to deploy Duration SSPs BHPs (problems) (paradigms) • • • > 25 > 60 > 100 k > $8 M 3 X $8 M > 2 years Plus qualitative differences Halifax- April 24, 2018 > 250 > 700 > 20 M > $50 M 3 X $50 M > 4 years 8 8

We are not doing well with enormous/complex projects “The failure rate of projects with budgets over $1 M is 50 % higher than the failure rate of projects with budgets below $350, 000. ” [source: Gartner, Project Management, 3/7/17] “Big projects fail at an astonishing rate”. [Matta & Ashkens, 2003] “No success was found above 2, 400 man-months. ” [Holgeid & Thompson, 2013] 9 Halifax- April 24, 2018

We are not doing well with enormous/complex projects The worldwide cost of failing very, very large projects costs between $3 [G. Kim & M Orzew] and $6. 2 [Sessions, 2011] trillion per year. 10 Halifax- April 24, 2018

Enormous projects/BHPs are different • Have significantly larger development and management teams and number of Sub-project managers • Have formal governance structure. • Have expectations for an outcome (a paradigm shifts in the organization’s operations); changing outputs. • They are too complex. • BHPs’ requirement to Manage Change, to Manage Risk, & to Communicate and Report, is unparalleled. • BHPs are not successful with standard methodology. • Exceed initial budget, schedule. 11 Halifax- April 24, 2018

We fail BHPs by design, because 1. They are too big (⇨ complex) 2. We tolerate stupidity 3. We believe we know and have adequately defined the solution 4. We have PMs; no/too many BAs 5. We do not know corporate or project capacity and/or capability 6. We use standard development methodology, and project governance. 12

We need to: MANAGE SIZE AND COMPLEXITY Limit the Size (⇨ complexity) – Reduce from: $100 M; 5 years; 150+ people – Reduce functionality (20, 50); – Reduce Teams and development time – Define HLBR to produce OUTCOME Don’t subdivide, assemble 13

We need to: AVOID THE STUPIDITY “… common sense is often ignored in systems projects. ” [12 - Dorsey, 2005] • We try $100 M + ; 5 years; 150+ people projects with standard approach • We tolerate stupidity – PM doing MBA; – Critical errors accepted before deployment; – $100 M & No schedule; risks are not managed 14

We need to: ACCEPT THAT WE DO NOT KNOW THE SOLUTION = Process + People + System + Policy/ Legislation Allow the solution to evolve – DBR HLBR – Focus on output Focus on outcome – CCPM 15

We need to: RECONSIDER the PM’S, BAs’ ROLES • We need a PL – Focus on people and relationships will be more important than processes • We need BAs with accountability; less overlap 16 Halifax- April 24, 2018

We need to: investigate organization’s CAPACITY and CAPABILITY • CAPACITY maximum number of projects an organization can attempt to undertake simultaneously and deliver successfully – portfolio that exceeds its capacity • CAPABILITY: A function of developers’ ability, the HR process, in-house training producing effective use of resources – project is beyond the capability of the Organization 17

We need: a NEW DEVELOPMENT FRAMEWORK “Do you have a standard shoe? ” Can we use our standard development methodologies? • BHPs need – PL – governance structure – A customized development methodology 18

We need: a Phased implementation • Vital Cycle I – Vital 20% pilot • Validation Cycle II – Needed 30% • Completion Cycle III – Requested and/or desired • Enhancement Cycle IV – make the solution easier Halifax- April 24, 2018 19

Summary • BHPs exist, and are complex • The size of the project matters • With a standard methodology, we cannot successfully develop BHPs • To develop BHPs successfully, we have to reduce their size, use a unique customized for the project methodology, and project governance structure, that reflects the organization’s capability, its capacity, the 20 project and the people involved. Halifax- April 24, 2018

Summary Accepting that a BHP will not be successful, is a precursor to success. We do not use what we know about developing enormously large and resulting complex systems, but as we think we know how, we attempt them and we fail them by design. 21 Halifax- April 24, 2018

Thank You Questions ? 22

The CERP Group Leading to Better Decisions • Name: Charles Villanyi Bokor Strategic Management Consultant • Email: Charles_Bokor@sympatico. ca • Phone: 613. 878. CERP • Session Number #PDS: HAL 418 23

Cursory examination If “Big projects fail at an astonishing rate”. [2 - Matta, Ashkenas, 2003] What must we do differently? 24

We fail BHPs because • • • They are too big and consequently complex We tolerate stupidity We do allow the solution to evolve The governance is inappropriate We do not know corporate or project capacity or capability • Use standard methodology 25

WHAT is the problem? 26

The Changes Needed to Develop BHPs • • People skills, at all levels, and accountability will rule 27

Lessons we have NOT learned But we know about, Auditor general’s report, We have put a man on the moon…. • We know but do not practice – Reducing their size, – Verifying corporate / departmental capacity & capability – using a unique customized, for the project, methodology, and project governance structure. – We may not be ready to accept that the current system development methodology, needs significant changes, and only a unique customized system development methodology and project governance structure can facilitate the successful Professional Development Summit (PDS) 2018 28 development of BHPs. The CERP Group