Complex Project Management - What’s All the Fuss About?

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Complex Project Management (CPM) is the “next new thing” in our quest to achieve stronger project performance. Successful projects not only deliver on time, on budget, and with the full scope of features and functions. In addition, they deliver the expected benefits in terms of contributions to the bottom line of businesses. And projects today are complex, very complex. Our conventional project management tools and techniques alone are not adequate to successfully manage highly complex projects.

CPM is such a hot topic that the book published by this author, Complex Project Management, A New Model, was selected the receive the 2009 PMI David I. Cleland Project Management Literature Award to honor the best project management literature published in the last calendar year. The book presented a new project complexity model, developed as an outgrowth of significant research on topics such as complexity science, project risk management, project sizing and estimating, and project outcomes. The purpose of the model is to diagnose the complexity profile of projects, determine the complexity dimensions that are present on projects, and then examine management approaches to manage the complexities.

Initial Project Complexity Model

Version 1 of the model presented in the text looked like this: Exhibit 1 – Project Complexity Model, version 1.

Complexity Dimensions

Project Profile

 

Independent

Moderately Complex

Highly Complex

Time/Cost

< 3 months
< $250K

3–6 months
$250–750K

> 6 months
> $750K

Team Size

3–4 team members

5–10 team members

> 10 team members

Team Composition and Performance

  • Strong project leadership

  • Team staffed internally, has worked together in the past, and has a track record of reliable estimates

  • Formal, proven PM, BA, and SE methodology with QA and QC processes defined and operational

  • Competent project leadership

  • Team staffed with internal and external resources; internal staff has worked together in past, has track record of reliable estimates

  • Contract for external resources is straightforward; contractor performance known

  • Semi-formal methodology with QA/QC processes defined

  • Project manager inexperienced in leading complex projects

  • Complex team structure of varying competencies (e.g., contractor, virtual, culturally diverse, outsourced teams)

  • Complex contracts; contractor performance unknown

  • Diverse methodologies

Urgency and Flexibility of Cost, Time, and Scope

  • Minimized scope

  • Small milestones

  • Flexible schedule, budget, and scope

  • Schedule, budget, and scope can undergo minor variations, but deadlines are firm

  • Achievable scope and milestones

  • Over-ambitious schedule and scope

  • Deadline is aggressive, fixed, and cannot be changed)

  • Budget, scope, and quality have no room for flexibility

Clarity of Problem, Opportunity, and Solution

  • Clear business objectives

  • Easily understood problem, opportunity, or solution

  • Defined business objectives

  • Problem or opportunity is partially defined

  • Solution is partially defined

  • Unclear business objectives

  • Problem or opportunity is ambiguous and undefined

  • Solution is difficult to define

Requirements Volatility and Risk

  • Strong customer/user support

  • Basic requirements are understood, straightforward, and stable

  • Adequate customer/user support

  • Basic requirements are understood, but are expected to change

  • Moderately complex functionalitye

  • Inadequate customer/user support

  • Requirements are poorly understood, volatile, and largely undefined

  • Highly complex functionality

Strategic Importance, Political Implications, Multiple Stakeholders

  • Strong executive support

  • No political implications

  • Straightforward communications

  • Adequate executive support

  • Some direct impact on mission

  • Minor political implications

  • 2–3 stakeholder groups

  • Challenging communication and coordination effort

  • Mixed/inadequate executive support

  • Impact on core mission

  • Major political implications

  • Visible at highest levels of the organization

  • Multiple stakeholder groups with conflicting expectations

Level of Organizational Change;

  • Impacts a single business unit, one familiar business process, and one IT system

  • Impacts 2–3 somewhat familiar business units, processes, and IT systems

  • Large-scale organizational change that impacts the enterprise

  • Spans functional groups or agencies

  • Shifts or transforms the organization

  • Impacts many business processes and IT systems

 

Level of Commercial Change

  • Minor changes to existing commercial practices

  • Enhancements to existing commercial practices

  • Ground-breaking commercial practices

Risks, Dependencies, and External Constraints

  • Considered low risk

  • Some external influences

  • No challenging integration issues

  • No new or unfamiliar regulatory requirements

  • No punitive exposure

  • Considered moderate risk

  • Some project objectives are dependent on external factors

  • Challenging integration effort

  • Some new regulatory requirements

  • Acceptable exposure

  • Considered high risk

  • Overall project success depends largely on external factors

  • Significant integration required

  • Highly regulated or novel sector

  • Significant exposure

Level of IT Complexity

  • Solution is readily achievable using existing, well-understood technologies

  • IT complexity is low

  • Solution is difficult to achieve or the technology is proven but new to the organization

  • IT complexity and legacy integration are moderate

  • Solution is difficult to achieve or the technology is proven but new to the organization

  • Solution is likely to use immature, unproven, or complex technologies provided by outside vendors

  • IT complexity and legacy integration are moderate

Exhibit 1 – Project Complexity Model, version 1.

Validation of the Project Complexity Model

After an effort to validate the model with about forty (40) IT project managers, it was clear that the model was not yet comprehensive or complete. In addition, it did not appear to have effective discriminating criteria to correctly determine the project profile, resulting in almost every project being diagnosed as “highly complex” when clearly many were only moderately complex.

As a result, a new version of the model is emerging. At this point in the evolution of the model, it looks something like Exhibit 2 – Project Complexity Model, version 2. The key differences between the two versions of the model include:

  • The addition of a fourth project profile, Highly Complex Program or “Megaproject”

  • Rewording and tightening the verbiage that describes the criteria used to diagnose a project’s complexity for each complexity dimension.

Complexity Dimensions

Project Profile

 

Independent Project

Moderately Complex Project

Highly Complex Project

Highly Complex Program "Megaproject"

1. Size/Time/Cost

Size: 3–4 team members
Time: < 3 months
Cost: < $250K

Size: 5–10 team members
Time: 3–6 months
Cost: $250–$1M

Size: > 10 team members
Time: 6 – 12 months
Cost: > $1M

Size: Multiple diverse teams
Time: Multi-year
Cost: Multiple Millions

2. Team Composition and Past Performance

  • PM: competent, experienced

  • Team: internal; worked together in past

  • Methodology: defined, proven

  • PM: competent, inexperienced

  • Team: internal and external, worked together in past

  • Methodology: defined, unproven

  • Contracts:  straightforward

  • Contractor Past Performance: good

  • PM: competent; poor/no experience with complex projects

  • Team: internal and external, have not worked together in past

  • Methodology: somewhat defined, diverse

  • Contracts: complex

  • Contractor Past Performance: unknown

  • PM: competent, poor/no experience with megaprojects

  • Team: complex structure of varying competencies and performance records  (e.g., contractor, virtual, culturally diverse, outsourced teams)

  • Methodology: undefined, diverse Contracts: highly complex

  • Contractor Past Performance: poor

3. Urgency and Flexibility of Cost, Time, and Scope

  • Scope: minimized

  • Milestones: small

  • Schedule/Budget: flexible

  • Scope: achievable

  • Milestones: achievable

  • Schedule/Budget: minor variations

  • Scope: over-ambitious

  • Milestones: over-ambitious, firm

  • Schedule/Budget: inflexible

  • Scope: aggressive

  • Milestones: aggressive, urgent

  • Schedule/Budget: aggressive

4. Clarity of Problem, Opportunity, Solution

  • Objectives: defined and clear

  • Opportunity/Solution: easily understood

  • Objectives: defined, unclear

  • Opportunity/Solution: partially understood

  • Objectives: defined, ambiguous

  • Opportunity/Solution: ambiguous

  • Objectives: undefined, uncertain

  • Opportunity/Solution: undefined, groundbreaking, unprecedented

5. Requirements Volatility and Risk

  • Customer Support: strong

  • Requirements: understood, straightforward, stable

  • Functionality: straightforward

  • Customer Support: adequate

  • Requirements: understood, unstable

  • Functionality: moderately complex

  • Customer Support: unknown

  • Requirements: poorly understood, volatile

  • Functionality: highly complex

  • Customer Support: inadequate

  • Requirements: uncertain, evolving

  • Functionality: many complex “functions of functions” 

6. Strategic Importance, Political Implications, Stakeholders

  • Executive Support: strong

  • Political Implications: none

  • Communications: straightforward

  • Stakeholder Management: straightforward

  • Executive Support: adequate

  • Political Implications: minor

  • Communications: challenging

  • Stakeholder Management: 2–3 stakeholder groups

  • Executive Support: inadequate

  • Political Implications: major, impacts core mission

  • Communications: complex

  • Stakeholder Management: multiple stakeholder groups with conflicting expectations;  visible at high levels of the organization

  • Executive Support: unknown

  • Political Implications: impacts core mission of multiple programs, organizations, states, countries; success critical for competitive or physical survival

  • Communications: arduous

  • Stakeholder Management: multiple organizations, states, countries, regulatory groups; visible at high internal and external levels

7. Level of Change

  • Risk Level: low

  • External Constraints: no external influences

  • Integration: no integration issues

  • Potential Damages: no punitive exposure

  • Risk Level: moderate

  • External Constraints: some external factors

  • Integration: challenging integration effort

  • Potential Damages: acceptable exposure

  • Risk Level: high

  • External Constraints: key objectives depend on external factors

  • Integration: significant integration required

  • Potential Damages: significant exposure

  • Risk Level: very high

  • External Constraints: project success depends largely on multiple external organizations, states, countries, regulators

  • Integration: unprecedented integration effort

  • Potential Damages: unacceptable exposure

8. Risks, Dependencies, and External Constraints

  • Risk Level: low

  • External Constraints: no external influences

  • Integration: no integration issues

  • Potential Damages: no punitive exposure

  • Risk Level: moderate

  • External Constraints: some external factors

  • Integration: challenging integration effortPotential Damages: acceptable exposure

  • Risk Level: high

  • External Constraints: key objectives depend on external factors

  • Integration: significant integration required

  • Potential Damages: significant exposure

  • Risk Level: very high

  • External Constraints: project success depends largely on multiple external organizations, states, countries, regulators

  • Integration: unprecedented integration effort

  • Potential Damages: unacceptable exposure

9. Level of IT Complexity

  • Technology: technology is proven and well-understood

  • IT Complexity: application development and legacy integration easily understood

  • Technology: technology is proven but new to the organizationIT Complexity: application development and legacy integration  largely understood

  • Technology: technology is likely to be immature, unproven, complex,  and provided by outside vendors

  • IT Complexity: application development and legacy integration poorly understood

  • Technology: technology requires groundbreaking innovation and unprecedented engineering accomplishments

  • IT Complexity: multiple “systems of systems” to be developed and integrated

Exhibit 2 – Project Complexity Model, version 2.

The Significance of Version 2 of the Project Complexity Model

To use the model, members of the core leadership team of projects (the project manager, business analyst, business visionary, solution architect, lead developer, change management expert) collaborate to select the appropriate cell that most accurately describes most accurately describes the project for each complexity dimension. Then, the following formula is applied.

Highly Complex Program "Megaproject"

Highly Complex Project

Moderately Complex

Independent

Size: Multiple diverse teams
Time: Multi-year
Cost: Multiple Millions

Or

2 or more in the Highly Complex Program/Megaproject column

Organizational Change: impacts the enterprise, spans functional groups or agencies, shifts or transforms many business processes and IT systems

Or

3 or more categories in the Highly Complex Project column

And

o more than 1 category in the Highly Complex Program/Megaproject column

3 or more categories in the Moderately Complex Project column

Or

No more than 2 categories in the Highly Complex Project column and

No more than 2 categories in the Moderately Complex Project column

And

No categories in the Highly Complex Project or the  Highly Complex Program/Megaproject  columns

Try using the model to diagnose the complexity of your current project. In future articles, we will present strategies to manage the complexity dimensions that are often present on highly complex projects or programs.

Author: Kathleen B. (Kitty) Hass is the president of KHass and Associates, Inc., a consulting practice specializing in the business analysis, project management, and strategy execution. Ms. Hass is a prominent presenter at industry conferences, author and lecturer. Her expertise includes IT strategic planning, implementing and managing PMOs and BACOEs, facilitating portfolio management, leading technology and software-intensive projects, executive coaching, building and leading strategic project teams, and managing large complex programs.

Ms. Hass has over 25 years experience providing professional services to Federal agencies, the intelligence community, and various Fortune 500 companies. Certification include: SEI CMMI appraiser, Baldrige National Quality Program examiner, Zenger-Miller facilitator, and Project Management Institute Project Management Professional. Ms. Hass serves as Director at Large International Institute of Business Analysis.
Kitty has authored numerous white papers and articles on leading edge PM/BA practices, the renowned series entitled, Business Analysis Essential Library, a compilation of six titles on critical BA practices, the PMI 2009 Book of the Year, Managing Project Complexity - A New Model.

You can reach Ms. Hass by e-mail at kittyhass@comcast.net or by visiting here website:www.kathleenhass.com.

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COMMENTS

pietro posted on Saturday, January 30, 2010 5:35 AM
Hi,
very interesting read. I've only been once involved in megaproject according to your criteria. Most projects seem to rate in independent to moderate in scale.
However, i've seen trend that larger projects are disected into smaller and more manageable projects that are outsourced from various vendors. But that in turn usually leaves the co-ordination of the top project in very vulnerable position if there is no expereinced PM in place to overlook and manage things.

Petteri
Dombkins posted on Sunday, January 31, 2010 12:41 AM
Readers might like to look at books (Amazon.com) authored by Dr David Dombkins on Complex Project Management and Contracts for complex Programs

Dr Dombkins authored the international Complex PM Competency Standard and founded the College of Complex project Managers (now renamed the ICCPM)
zarfman posted on Thursday, February 11, 2010 8:05 PM

Hi:

what's all the fuss about?

Apparently secretary of defense Robert Gates has a lot to fuss about. He's actually holding managers accountable and "GASP" firing them if they don't produce. Phenomenal cost overruns, products that don't work on and on.

The problem I have with your paper is lack of definition. What exactly do you mean by low, moderate and high risk? Does it have anything to do with probability and statistics?

What do You mean by complex? Is complexity linear or nonlinear in nature? Or, is complexity in the eye of the beholder?

Regards,

Zarfman




undrkvabrtha posted on Wednesday, February 15, 2012 5:04 PM
Essentially, precise definitions of low, moderate and high risk or risk preceded by any combination of adjectives depends on the legislation / consititution governing the enterprise.

Zarfman's point is resonant - there is no 'standard' definition of such terms.

however, the example in the article does provide a starting point for new managers, or junior BAs charting out their project documentation.

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