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blog post, Methods, New product development, Project Management, Project management tools, Quality

80/20 Principle – The principle with ever increasing use cases

With the innumerable opportunities to get diverted from what is relevant, I have seen many successful and not that successful organizations, teams and individuals working very hard on the irrevelant and getting buried there. The 80/20 principle or the Pareto Principle is for those who are willing to pause a while before jumping into action. Though many have written about Pareto principle and analysis before, I thought of writing this blog post for the benefit of many who plunge into action on irrelevant projects, indicators than on the relevant ones. There is time for everything, if we can prioritize, eliminate, delegate and decide on the mosr relevant work we ahould be doing.

Pareto Principle or the 80/20 Principle

The 80/20 principle or the Pareto Principle by Vilfredo Pareto in the year 1896 is the one which is always heard in all walks of life, time and again even after a century of its discovery. Last week I heard it in our senior management review when one of the senior managers used 80/20 to highlight the need to focus on the 20% of the customers contributing to 80% of the revenues. The use cases of 80:20 or the pareto principle is innumerable. Here are some;

By eliminating 20% of the root causes we can eliminate 80% of the defects in a product
20% of the customers contribute to 80% of the revenue. It makes sense to focus on this 20% of the customers.
80% of the customers uses 20% of the features of the products. The remaining 80% of the features are used only by 20% of the customers.
By focusing on 20% of the project health indicators proactively, 80% of the problems can be eliminated / prevented.
20% of unhealthy practices contribute to 80% of the productivity loss. By controlling this 20% percentage of unhealthy practices, productivity can be improved phenominally.
20% of the workforce does 80% of the work. Remaining 80% does only 20% of the work
20% of the work we do produces 80% of the results. The remaining 80% of the work produces only 20% of the results.
During 20% of our worktime, we complete 80% of our work. During the remaining 80% of our work time, we complete only 20% of work.
Only 20% of the projects yield the desired results, 80% of the projects do not yield desired results.

Pareto analysis

Here are the steps involved in performing Pareto Analysis;

Identify the probable rootcauses – The best ways to do this is to brainstorm with the team to identify potential rootcauses leading to the situation. Ishikawa diagram or the Fishbone diagram can help to do structured brainstorming to arrive at the potential root causes.
Frequency of occurrence – With the help of data, identify how many times each rootcause occurred, resulting in the outcome.
Order on frequency – List the root causes based on the frequency of their occurrenece (in the descending order)
Prioritize and take action – Identify the 20% of root causes contributing to the 80% of occurrences. By controlling these 20% of the root causes, 80% of the problems can be eliminated.

80/20 at a personal level

Can be effectively used at a personal level to;

Eliminate unproductive activities
Focus on strengths
Finding time to work on Important and not urgent projects

Integrated project monitoring and control, Project management tools

Scoping the Project Management Information System (PMIS)

I am googling on the key word ‘Project Management Information System’ and the results were disappointing. That motivates me to write this article which will have answers for the following questions when completed;

What is the scope of project management information system (PMIS)?
Will one system cater to the needs of different types of project organizations?

Scope of the PMIS

A good project management information system should support the planning, monitoring & controlling aspects of;

Contracts
- With customer
- With Sub-contractors and suppliers
- Claims
Scope
- Change management
- Configuration management
Time (both schedule and effort)
- Planned Vs Actual
- Forecasts
Cost
- Planned Vs Actual
- Forecasts
Procurement
- Request for Information (RFI)
- Request for Bid (RFB)
- Request for Quotation (RFQ)
- Purchase orders
Resource management
- Human resources
- Machine, material and equipment
Risk management
Quality management
- Snag (defect) management
- Price of Conformance (POC)
- Price of Non Conformance (PONC)
Communications management

Well captured, accurate project data not only helps in managing projects but also provide the basis for planning and controlling of future projects. This aspect become all the more important for the application of artificial intelligence in project management.

Will one system cater to the needs of different types of organizations?

The answer is a definite ‘No’. Projects involve various stakeholders and their needs are different. Another key aspect to be considered is the type of contracts the organization is participating or intending to participate like;

Cost Reimbursable Contracts
- Cost Plus contracts
- Cost Plus Percentage Contracts
- Cost Plus Fixed Fee Contracts
- Cost Plus fluctuating Fee Contracts

Lump Sum Contracts (Also known as Fixed Price Contracts)
Piecework Contracts
Unit Pricing Contracts
GMP Contracts (Guaranteed Minimum Price Contract)
Rate Contracts
- Item rate contracts
- Percentage rate contracts
Target Contracts
Materials and Labor supply Contracts
Time and Materials Contracts
Operate, Maintain and Transfer (OMT) Contracts (popular in roadworks)
Build Operate Transfer (BOT) Contracts
Build Own Operate Transfer (BOOT) Contracts

Another parameter to be considered is the discipline. The project’s stakeholders come from various disciplines like Architecture, Electrical, Mechanical, Piping, Air conditioning, Structural, I.T, Product development, R&D etc. These parameters play a major role in while deciding on the PMIS.

Budget availability is another option.

Another parameter is the project segment.

Hence there is no single system which will meet the requirements optimally, as every system is aligned to a particular industry.

Project Management, Project management tools, Strategy, Trends in project management

Advanced Work Packaging (AWP)

In construction projects, during the construction phase, the actual time on tools is only 37%. 63% of the workers time is spent on activities like waiting for materials and tools, equipment movement, crew movement, early exits etc. This is primarily due to lack of integration of the pre-construction activities of engineering, procurement and construction.

Advanced Work Packaging (AWP), also known as construction-based planning, solves this problem by beginning with the installation work packages in mind and then working backwards through engineering, procurement and construction. According to Construction Institute study, AWP have helped projects to improve their productivity by 25% along with other benefits like reduction in rework, better safety, better cost control etc.

Application of questionnaires and surveys in projects

We use questionnaires based surveys for requirements collection, feed back collection, satisfaction surveys, competitors analysis. The list is incomplete as imagination and creativity is the limit for the application of questionnaire based surveys. In training projects we use questionnaires to assess the knowledge transfer effectiveness of the training programs.

The following sections are taken from Wikipedia

A questionnaire is a research instrument consisting of a series of questions (or other types of prompts) for the purpose of gathering information from respondents. The questionnaire was invented by the Statistical Society of London in 1838.

Although questionnaires are often designed for statistical analysis of the responses, this is not always the case.

Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as much effort from the questioner as verbal or telephone surveys, and often have standardized answers that make it simple to compile data. However, such standardized answers may frustrate users as the possible answers may not accurately represent their desired responses.

Basic guidelines for framing questions

Use statements which are interpreted in the same way by members of different sub-populations of the population of interest.
Use statements where persons that have different opinions or traits will give different answers.
Think of having an “open” answer category after a list of possible answers.
Use only one aspect of the construct you are interested in per item.
Use positive statements and avoid negatives or double negatives.
Do not make assumptions about the respondent.
Use clear and comprehensible wording, easily understandable for all educational levels
Use correct spelling, grammar and punctuation.
Avoid items that contain more than one question per item (e.g. Do you like strawberries and potatoes?).
Question should not be biased or even leading the participant towards an answer.

Reference – Wikipedia

PM-Tools

PM-Book

PMBOK, Project management tools

Application of market research for projects

Projects deliver unique product or services. How successful the product of the project after deployment determines the success and failure of the project from the owner’s perspective. Conducting a detailed market research will help to validate the assumptions made while justifying the investment into the product idea.

Market research is an organized effort to gather information about target markets or customers. It is a very important component of business strategy. The term is commonly interchanged with marketing research; however, expert practitioners may wish to draw a distinction, in that marketing research is concerned specifically about marketing processes, while market research is concerned specifically with markets.

Market research is one of the main factors used in maintaining competitiveness over competitors. Market research provides important information which helps to identify and analyze the needs of the market, the market size and the competition. Market-research techniques encompass both qualitative techniques such as focus groups, in-depth interviews, and ethnography, as well as quantitative techniques such as customer surveys, and analysis of secondary data.

Market research, which includes social and opinion research, is the systematic gathering and interpretation of information about individuals or organizations using statistical and analytical methods and techniques of the applied social sciences to gain insight or support decision making.

Examples of factors that can be analysed using market research are;

Market Information
Market segmentation
Market trends
SWOT analysis (Strengths, Weaknesses, Opportunities and Threats)
PEST analysis (Political, Economical, Social, Technology related external factors

Reference Wikipedia

PM Book

PM Tools

Project management tools

Application of Focus groups

Focus groups are a research method used to gather feedback and opinions from customers. Each person in the group is encouraged to participate in a discussion which is pre-planned by a researcher and is guided by a facilitator. Focus groups are typically used to gauge opinion and gather information from users about products, services, and features before they have been developed.

A focus group is a small, but demographically diverse group of people and whose reactions are studied especially in market research or political analysis in guided or open discussions about a new product or something else to determine the reactions that can be expected from a larger population. The use of focus groups is a research method that is intended to collect data, through interactive and directed discussions by a researcher.

Focus groups, or group interviews, is a technique used by sociologists and in different fields of study which include communication studies, education, political science, and public health. Marketers can use the information collected through focus groups to receive insights on a specific product, issue, or topic.It is a form of qualitative research consisting of interviews in which a group of people are asked about their perceptions, opinions, beliefs, and attitudes towards a product, service, concept, advertisement, idea, or packaging. Questions are asked in an interactive group setting where participants are free to talk with other group members. During this process, the researcher either takes notes or records the vital points he or she is getting from the group. Researchers should select members of the focus group carefully for effective and authoritative responses.

Online focus groups

Focus groups typically are conducted face-to-face, but the emergence of technology has enabled qualitative research to reach online approaches. There are two types of online methods; synchronous and asynchronous. Synchronous methods allows for researchers to conduct live chats which try to mimic in-person interviews. Asynchronous methods collect participant information through online communication such as forums and email lists. Challenges within asynchronous online focus groups include sporadic participation over time and a potential timely study. Within synchronous online focus groups, challenges include timing not working for participants and lack of accessibility. Online focus group benefits include no transportation necessary and ease of access, while online focus group complications include lack of technology and minimal technological skill .

Advantages to online focus groups allow those to participant who are geographically far from each other and increase participation by engaging with those who are more comfortable with internet use. Disadvantages of online focus groups include losing associated non-verbal behavior which could factor into assessing qualitative research.

Reference

Wikipedia

PM Tools

PM Book

Project management tools

Usage of Checklists

People use checklists for two reasons. One is because there is no room for error. Aviation industry uses the maximum number of checklists. Pilots do more than 150+ checks before every take off. They use checklists not because they do not know their job, but because there is no room for error.

People also may use checklists for preventing errors committed by those who are new to the job. Since no two projects are identical, during project planning, one need to plan for the check sheets to be used during the project management life cycle like;

Requirements review checklists
Contract review checklists
Design review checklists
Quality related checklists

There is a cost associated with designing check lists, training people to collect and analyse data, collecting data, collating data, analyzing data and then taking corrective / preventive actions. All these costs are part of the price of conformance and must be factored into project cost estimates.

PM Tools

PM BOOK