Taking the Best Parts of Agile: Part 1 – Smaller Bites

Agile is getting a lot of great press lately as we see companies like Amazon thriving by leveraging the concepts. But we also see push back from other business leaders on why Agile won’t work for them, or companies that have tried going Agile but are not seeing the expected improvements. Instead of realizing Agile as an all or nothing idea, we should analyze each of the Agile principles, taking a pragmatic approach to leveraging Agile within our own organizations.

This focused segmentation on each Agile principle is key since no individual practice will provide a competitive advantage. If something is easy to replicate, everyone will do it. Also, what organizations do is not simple – each one is completing a complex combination of different tasks to create customer value.

That leads me to this – The secret sauce of Agile is: It’s a framework built on strong principles you adjust to fit your organization. The goal is to make the right adjustments while not losing the underlying strengths that Agile brings.

To do that successfully, you need to understand each of the principles in depth. The four key Agile principles we have identified are:

  • Breaking projects into smaller bites

  • Connecting with customers

  • Leveraging the power of teams

  • Building in continual learning

Join me over the next few posts, as we delve into each one of the principles throughout this Agile blog series. Today, we start with: Breaking Projects into Small Bites.

Best Parts of Agile

Smaller Bites

The first principle is breaking projects and initiatives into smaller bites, following the old adage that the way to eat an elephant is one bite at a time. As we think about how to break up projects, we need to also answer:

  • How will this project deliver value to the customer?
  • How will it deliver value to the organization?
  • How do we do it, including how long will it take, or how much will it cost?

If you think about construction, where traditional project management comes from, these questions are fairly easy to answer. If you are looking at building a new bridge, for example, to see if there is value, it’s easy to see what those who would use the bridge are doing today, and if they are willing to pay for a replacement. This answers the first two questions, so then the real focus is on how we do it. Since this isn’t the first bridge that’s been built, we can get a reasonable idea and estimates from previous projects to help us answer the last question. If we found ourselves without previous information, we would need to experiment. That’s much harder on these types of projects since there may not be an easy way to break the project up into smaller bites. We could start with a rope bridge, but chances are it’s not going to add any value till we have a four-lane highway ready to use, thus failing the first question.

Construction projects are not the only ones that may provide this complication. IT infrastructure or software upgrade projects are often similar and are quite a bit different from software projects – which is where Agile came from. Software projects are far more unique and have their own conditions to be considered. You see similar issues in marketing, educational design, business process changes, or any project where we don’t have a good, previous solution to copy.

The problem with these types of projects is:

  • We may know what people are doing today, but we don’t necessarily know the best approach to solve their problems or how much value the customer will get.
  • Without knowing the customer value, we don’t know the organizational value.
  • Without knowing the solution, we don’t know if we can build it, and if we do, what it would take.

Even with this complexity, there is some good news. Unlike construction projects, these projects are easier to break up into experiments where we can test our assumptions and reduce the risk to the organization. The key is to focus on breaking the project up into the right pieces, that will help answer these questions as quickly as possible.

How to Break Projects Into Small Pieces

Let’s talk about how to break that elephant up with a real-life example. A company I worked with had a hypothesis that they were paying generous benefits but employees weren’t seeing that value since they didn’t know what those benefits cost. For the three questions, the hypothesis was:

  • How will this project deliver value to the customer?

    If employees knew the cost of their benefits, they would be more satisfied

  • How will it deliver value to the organization?

    Satisfied employees would provide more value to the organization (in this case reduced turnover)

  • How do we do it, including how long will it take, or how much will it cost?

    We have access to the benefit information and can present it in the right format to make it easy for employees to understand.

Looking at how to break this project up, we would want to:

  • Present employees an example of a current benefit to see if this increases satisfaction. If possible, we probably want to start with the biggest benefit.
  • We don’t have time to wait for turnover, but we still need to measure satisfaction, perhaps with a questionnaire, targeting a group of employees that have the most turnover.
  • We need to test if we can get access to the data and test different ways to show the information to make sure it is easy to understand

As you lay out what you want to learn, it gets easier to understand how to break the project into the right pieces.

Value of Breaking Projects into Smaller Pieces

So whether you’re agile or not, let’s talk about the benefits of this approach:

As an organization – testing the value of ideas early lets you focus on the good ones. It also helps to uncover big technical risks quickly so you get a picture of the real effort projects will take. Finally, delivering the projects quickly, and in small increments lets you deliver value faster, speeding return on investment.

As a customer – teams are already testing on real customers today; all of them when they release. Smaller testing means you get to see what approach a team is considering early, provide meaningful input on finding the best approach, and only a small group of customers is impacted.

As a team – testing early means you waste less time on bad ideas. It’s demoralizing to put your heart into a project and then not find out till the end it didn’t deliver the value you expected.

By taking this approach, Agile is pushing an empirical tactic, pressing you to think like a scientist, understand what ideas are really theories, and find ways to test the theories early.

As you look at getting this same value with your own projects, think about the three questions around organizational value, customer value, and the approach. If you have good evidence to support your ideas, it may be more similar to the construction project example, and focusing on how to efficiently put the project in place could be the best approach. But, if there are a lot of assumptions like we described above, it’s worth the time to set up a quick experiment and validate them.

On our next post, I’ll be reviewing the second principle, Connecting with Customers.

 

Don’t forget to view our Agile Transformation Services to learn more about how Kolme Group can help!

Justifying a PPM Investment

Justifying a PPM Investment

Justifying a PPM Investment and running a project delivery organization is tough – and your organization is making this job even tougher if you don’t have a toolset. It’s hard to stay on top of the portfolio when your data is spread across dozens (or hundreds) of different spreadsheets, status reports, sharepoint sites and emails.

Fortunately, the current ecosystem of Project and Portfolio Management tools is a rich one – with over a hundred great tools available, every organization can find one that meets their needs.

But as with any great enabling tools, a good PPM solution requires investment. As we covered in our article “How much does a PPM tool cost,”  the investment can be substantial. But “how much does it cost” is just the first question – How much will it save me? How will this make my organization deliver better? How will it enable better decision making? And how will I get my organization to invest in this?

How Do You Get Investment?

Assuming you are already committed to getting a PPM, the first step in figuring out how to justify is to understand how your organization invests in new technology:

  • Who approves the investment? Is it a committee? If so, who is on it?
  • What is the process? Is there a formal submission process? Or is it more ad-hoc? Some organizations are shifting from an annual funding cycle to quarterly to support agility
  • How do they decide what to invest in? What criteria do they use to select investment? Strategic alignment; Time to market; Profit vs revenue; Cost, ROI, Benefits, Risk, Compliance, Resource Capacity management, Customer satisfaction, Employee satisfaction?
  • What are the things they deliberately do NOT invest in?

Pro Tip

Talk to stakeholders in the investment process 1:1, take them to coffee – what do they look for? Additionally, you can launch your own ‘grass-roots’ marketing campaign — Target influential people or groups in your organization. Get their buy-in quickly and count on them to use their influence to spread the word (evangelize) the PPM solution and the benefits to your organization 

Learn From The Past

If you have had a PPM implementation (or similar SaaS systems like time entry) that was successful or faltered, do some research and identify all the lessons you can learn.

Kolme Recommends that you look especially at the change management processes used for the previous implementation. What worked and what didn’t.


As you go through the process of looking at a PPM tool, you’re going to have to explain why your implementation will be successful.

  • Review past successful business cases
    • Note how they make their case, how they justify investment, how they describe the benefits and returns
    • Talk to people involved in past investments – get their advice
  • Ask the vendor
    • Ask them to provide case studies
    • Ask for customer references from other customers with a similar use case or similar industry or size

Strategic Benefits

As you start to investigate how a PPM can benefit your organization, the best place to start is the top, looking at the strategic benefits a PPM can provide

Project Alignment with Strategy

  • Projects not aligned to strategic priorities waste resources
  • PPM can:
    • Control project intake to ensure you only work on the most important work.
    • Force the deliberate evaluation of capital and resource investment over and over (quarterly) to ensure resources are spent on the most valuable work

For a recent engagement, we assisted a client in an analysis and approach of implementing a PPM tool.  In our analysis, we found that the client had nearly one initiative either in process or planned for every two employees, 75% of which were not even aligned to strategic priorities. Through this engagement, we two key focuses for their PPM implementation:

Help prioritize work to drive strategic priorities

Ensure selected initiatives are successfully implemented

 

  • This is for your organization if

    You are (or don’t know if you are) doing a lot of work that doesn’t align with strategic initiatives, or if strategic initiatives don’t seem to get met

  • Key ‘selling’ phrases include:

    We can ensure that our projects are all aligned with strategic initiatives

Organizational Agility

  • Ability to reprioritize and shift focus as organizational priorities change
  • Able to keep resources focused on current priorities
  • Understand impacts to the portfolio when changing priorities
      • “If we do this, how does that impact our other priorities?”
  • This is for your organization if

    You find you keep playing a ‘shell game’ with resources, moving them from one project to another. Or if you keep having new projects land all the time that have to be done ‘now’ and you don’t know how that impacts the rest of the portfolio

  • Key ‘selling’ phrases include:

    We will understand the impacts of new work as it comes in before we decide how to prioritize it

    • We will save money by being able to identify projects that are not going to achieve the return / present too much risk and kill them early

Resource Alignment

  • Internal resources are finite - work demand is infinite - so get them aligned
  • Identify skills gaps and manage resource levels
  • Ensure the team is scaled and skilled to meet the needs of the organization
  • This is for your organization if

    you keep hitting ‘choke points’ where a few skills or key resources are always over-allocated and it keeps you from getting projects done. Also if you feel like “my people are always busy, but I don’t know what they are doing / cannot justify more headcount.”

  • Key ‘selling’ phrases include:

    We will have a view of what our resources are working on and what capacity we have to take on new projects.

Automation and Simplification

  • Overall simplification of complex systems by consolidation into a centralized PPM
  • Most organizations use many tools, spreadsheets, manual processes to deliver - consolidating provides obvious benefits - but can be hard to quantify
  • Ensure the team is scaled and skilled to meet the needs of the organization
  • This is for your organization if

    if there is any project report in your organization that takes more than 1 minute to generate. You are wasting resource time – sometimes to the tune of hundreds or thousands of hours per year.

  • Key ‘selling’ phrases include:

    Complex, de-centralized and/or manual processes increase the chance of errors, reducing the value of data

Kolme Recommends using a spaghetti-bowl diagram if automation and simplification are key for your business case. Create a visual map of current vs future tool interactions

Spaghetti Bowl Diagram: Before and After

Spaghetti Bowl Diagram: Before and After

Strategic Benefits Summary

Savings Type Description

Benefit

Project alignment to strategy Projects not aligned to strategic priorities waste resource on less important work Get control of project intake

Deliberately evaluate capital investment and project work against strategic priorities

Organizational agility Ability to re-prioritize and shift focus as organizational priorities change Able to keep resources focused on current priorities

Understand impacts to portfolio when changing priorities. “if we do this, how does that impact our other priorities?”

Resource alignment Internal resources are finite – work demand is infinite – so get them aligned

Identify skills gaps and manage resource levels

Ensure the team is scaled and skilled to meet the needs of the organization
Automation and Simplification

Overall simplification of complex systems by consolidation into PPM

Most organizations use many tools, spreadsheets, manual processes to deliver – consolidating provides obvious benefits – but can be hard to quantify

Hard Costs Savings

Hard cost savings are the most valuable and demonstrable, if you can identify them. These are quantifiable cost savings you can directly use to offset the cost of your PPM investment. Often times these are hard to come by – many benefits are strategic or soft. Furthermore, some of the hard costs require some assumptions and calculations which you MUST make sure you have aligned with your investment team.

Elimination of Other Systems

  • Reduce cost by eliminating other tools – licensing and support costs
  • Project or financial management, time entry, reporting, integration/middleware, hardware
  • Be aware of contract termination clauses – some will have deadlines that may or may not line up nicely with your annual investment cycle. There may be termination fees. There may be costs for getting your data

Improved Project Budget Management 

  • Justify savings by providing better management of project costs
  • If we can save X% capital budget, what is that worth?
  • If you can, cite current deviations from budget
  • If you can import project actual cost data from external sources, this will provide the best data tracking and accuracy
  • MUST get alignment with investment team on what savings they would find credible

Improved Resource Utilization

  • Reduced administrative, more real work getting done
  • If you charge for resource time on projects, a PPM can help you improve billable utilization
  • +X% utilization = $$ revenu
  • Be conservative – as the team learns the tool, utilization may dip at first, but should improve over time<

An analysis for a customer building a case for a PPM tool showed that their Project Managers spent over 20% of their time updating spreadsheets, creating PowerPoint presentations, and updating the same information in disparate tools.

Time to Market

  • Especially for R&D / Product Development, PPM can demonstrate a faster time to market
  • Works if you can quantify value for speeding time to market. E.G., every month we delay, we lose x% market share / miss out on $X revenue

Delivery Quality

  • Some organizations can quantify the financial impacts of poor quality

Hard Costs Benefits Summary

Savings Type Description Considerations
Elimination of other tools or systems Reduce cost by eliminating other tools

Project or financial management, time entry, reporting, integration/middleware, hardware

Improved project budget management Justify savings by providing better management of project costs

If we can save X% capital budget, what is that worth?

If you can, cite current deviations from budget

If you can import project actual cost data from external sources, this will provide best data tracking and accuracy

Improved Resource utilization If you charge for resource time on projects, a PPM can help you improve billable utilization

+X% utilization = $$ revenue

Be conservative – as the team learns the tool, utilization may dip, but should improve over time
Time to market Especially for R&D / Product Development, PPM can demonstrate a faster time to market Works if you can quantify value for speeding time to market. E.G., every month we delay, we lose x% market share / miss out on $X revenue
Delivery Quality Some organizations can quantify the financial impacts of poor quality If your organization provides a warranty for work done; any work against that warranty is a hard cost, reducing the profitability of the project

Soft Cost Savings

Soft savings are very hard to quantify, but can provide very real benefit for investment.

Time Savings through Efficiencies

  • Works if you can quantify value for speeding time to market. E.G., every month we delay, we lose x% market share / miss out on $X revenue
  • Get alignment with your investment team on how they quantify labor savings. Some orgs won’t recognize $$ savings for labor unless you are reducing headcount
  • Saying you will “save time” is great, but in some organization that doesn’t count as a savings unless you are going to save enough to fire someone, or demonstrate that you are going to make money with the extra time people save. So, if you are going to try to quantify any benefits, be sure that the people judging your case agree with your quantification methods and the numbers you are coming up with
  • If you can import project actual cost data from external sources, this will provide the best data tracking and accuracy
  • MUST get alignment with investment team on what savings they would find credible

Context Switching

  • Utilizing multiple tools and/or processes introduces the impacts of Context Switching.
  • Context Switching is the impact of loss of focus by multi-tasking – juggling multiple applications, emails, conversations, etc., necessary to get a task done.
  • A study by Carnegie Mellon University found most people average only 3 minutes on any given task and only 2 minutes on a digital tool before switching (voluntarily or involuntarily).
  • The amount of time needed for context switching requires an operational overhead, of roughly 20% and potentially higher, for a person to figure out where they left off and/or what needs to be done next.
  • The efforts lost to context switching are not just time, but also quality.

Project Success

  • Can be easy or hard to quantify
  • Cite our PPM study that showed correlation between financial tracking and project success

Data Accuracy

  • Automation and governance provides more accurate project data – delivery dates, financials, etc.
  • Improves decision making and financial planning

Data Transparency

  • Provides real-time access to project data to decision makers
  • Flying blind is often a pet peeve of management – PPM solutions can provide full transparency and accountability

Lessons Learned

  • PPM can provide a structured method for capturing lessons learned and improving
  • Not all PPM are setup to do this – if you use this justification, make sure lessons learned evaluation is part of your selection process

Team Satisfaction

  • Better satisfaction for valuable resources, helps with retention
  • Satisfaction = adoption = better data and process compliance

Customer / Stakeholder Satisfaction

  • Easier access to information, better collaboration
  • Preparation and delivery
    • Socialize your presentation first to individuals
    • Always have the backup info (backup slides)
    • Be very clear on your ask

In our 2018 PPM Data Consumption survey, launched at the 2018 PMO Symposium, we found that organizations with high levels of process compliance have a 4x better ability to close out projects successfully – resulting in higher customer satisfaction.

Soft Costs Benefits Summary

Savings Type Description Considerations
Time savings through efficiencies & automation Gaining efficiencies – example, reduce status reporting time for each project by 15 minutes per week =

15 min * number of projects * number of weeks = time saved per year

Get alignment with your investment team on how they quantify labor savings. Some organizations will not recognize $$ savings for labor unless you are reducing headcount
Context Switching Context Switching is the impact of loss of focus by multi-tasking – juggling multiple applications, emails, conversations, etc., necessary to get a task done. The efforts lost to context switching are not just time, but also quality.
Project Success How likely are your projects to meet their goals? (Scope, Budget, Schedule, Strategic Alignment) Consider your metrics for success: Scope, Budget, Schedule, Strategic Alignment
Data Accuracy Automation and governance provides more accurate project data – delivery dates, financials, etc. Improves decision making and financial planning
Data Transparency Provides real-time access to project data to decision makers Flying blind is often a pet peeve of management – PPM solutions can provide full transparency and accountability
Lessons Learned PPM tool can provide a structured method for capturing lessons learned and improving Not all PPM are setup to do this – if you use this justification, make sure lessons learned evaluation is part of your selection process
Team Satisfaction A good task tracking system will make your team’s job easier Satisfaction increased adoption, which leads to better data and process compliance (and happier team members!)
Stakeholder Satisfaction Are your stakeholders satisfied with your portfolio and project progress? Organizations with high levels of process compliance have a 4x better ability to close out projects successfully

At Kolme Group we care and want to help you get the best out of your PPM Tool. Join Kim Essendrup, Kolme Co-founder, for a Free, 15-minute consultancy to discuss your PPM Tool needs and best steps forward

How Much Does A PPM Tool Cost?

How Much Does A PPM Tool Cost?

If you are a Project Management Leader, you have probably got a mess to clean up. Maybe things keep going off track, maybe you have no easy way to measure what’s going on, or maybe you are just tired of struggling through portfolio reports at midnight when you yell, “There has to be a better way!” The good news is, there is a wide variety of Project and Portfolio Management (PPM) solutions that can help you more effectively manage your project delivery. Better yet, these PPM solutions have become very accessible, are easy to use, and powerful. But of course, as soon as we start considering tools, the first question that comes up is: What is this PPM tool going to cost me?

Your ultimate bill for a PPM can be surprisingly low – or surprisingly high. Unfortunately, it can be difficult to get a clear bottom-line answer for the total cost of a solution – and even then, the costs you are probably thinking of are only part of the picture.

So, how much will a PPM cost me?

At Kolme Group, our team has built, run and helped to improve project management organizations around the world. In doing so, we have facilitated the selection and implementation of various PPM tools, we are well acquainted with the process of getting to the costs involved.

Like you, we have faced the challenge of trying to understand the true costs of implementing a PPM solution. That is why in this article, we are giving a straight and simple answer as best we can on this complex topic.

Keep in mind, there are many components that will impact your costs. So, we will walk you through the most impactful factors and a few examples. We will also share tips for managing your implementation costs and getting the most value from your PPM investment.

Please Note! These examples are by necessity general in nature, and will likely differ from your unique use case.

Furthermore, the cost estimates we will share in this article are very conservative – you will likely find that you can negotiate better pricing.

The simple (and incomplete) answer

PPM software and basic onboarding costs are a starting point but not the entire picture. Below, we’ve chosen two starting point examples, for each of the three tiers, but read on to discover the “true costs” you’ll be looking at.

An Enterprise Class PPM Solution

Clarizen, Clarity, Workfront, ServiceNow PPM, etc

Full-featured tools like these will likely cost $60-$100 per full-function user, per month for licensing. In addition, you should plan for a one-time services cost for basic configuration and onboarding assistance. This could range from $30,000 – $100,000 or more, depending on your organization’s complexity.

  • # of Licenses
  • 50
  • 150
  • Annual Licences
  • $42,000
  • $100k-150,000
  • One-Time Fee
  • $30,000
  • $100,000
  • First-Year Costs
  • $72,000
  • $200K – $250,000

 

Simple Task Management Tools

Asana, Trello, Monday.com

Tool such as these are used mostly to organize task activities with no integrations or customized reports. They will cost $16 – $25 per user, per month for licensing. These typically do not involve or even have options for external services for configuration or implementation. You should, however, factor in your own time to learn the tool and the resource time needed to train your team on how to use it.

  • # of Licenses
  • 50
  • 150
  • Annual Licences
  • $12,600
  • $37,800
  • One-Time Fee
  • $0
  • $0
  • First-Year Costs
  • $12,600
  • $37,800

 

Mid-Tier Systems

SmartSheets, MS Project O365

These fit somewhere in between the two types previously mentioned. These systems will run you around $25 per user, per month, though implementation costs can be highly variable in this tier. If you have the time and the experience, you can decide to implement it yourself, or engage an implementation partner and pay $10,000 – $50,000 for professional onboarding support.

  • # of Licenses
  • 50
  • 150
  • Annual Licences
  • $15,000
  • $45,000
  • One-Time Fee
  • $20,000
  • $50,000
  • First-Year Costs
  • $35,000
  • $95,000

Software cost estimates, above, reflect typical “list prices” which can often be negotiated down especially if you have larger volumes, have a pre-existing relationship with that particular software vendor, or commit to a longer contract (1-3 years).

Pro Tip

PPM license costs can be highly negotiable in certain circumstances. If you are able to negotiate lower costs, be sure those discounts apply to any additional licenses in case you need to grow.

The Basic Onboarding costs we have described so far are for relatively straightforward deployment of the solution and getting the team onboard. Costs in these ranges would not typically yield a fully customized solution for your organization (integrations, configurations for your specific business processes, etc.).

Basic Onboarding typically includes:

  • Initial setup and configuration of the system
  • User account import and permissions setup
  • Basic project lifecycle configuration
  • Basic financial configuration
  • Minimal report development
  • User training, onboarding and go-live support

Please Note! You can spend 10% or 10x this amount depending on your needs. As you will see below, there are a few key areas that can really increase or decrease inflate your costs.

But… I can get “free” or cheap bundled licenses!

Yes licensing costs, especially for the more full-featured PPM tools, can be highly negotiable depending on volume. This can be an important factor for tool selection and consideration, but be cautious! Unless you are a small shop using a freemium service, ‘on the house’ licenses are never really going to be “free”.

Many product companies use a bundling tactic to expand their software footprint. Software companies often bundle PPM software with other products or services to give you the impression you’re getting it for free, or at least at a steep discount. In these cases, a sweetheart license price structure can seem like a great deal…at first. In the long run, though, you may find you are better off paying more for a system that actually meets your needs rather than struggling with the wrong tool just because you got a “good” deal.

A previous client had gone through the pain of implementing not just one, nor two – but three different resource management tools before they found a good fit. The first tool was selected because it was an add-on to their ERP, and you guessed it!… licenses were offered at a steep discount. The second tool was “free” as part of a bundled enterprise software suite and they fell for the bundle tactic.

Unfortunately by the third tool, the time (both in duration and level of effort) coupled with the erosion of their credibility with their stakeholders, ended up costing them many times over the license discount they received. Not to mention, the lost opportunity costs during the 4-year journey to ultimately find the right tool.

The lesson here, is that while license cost is an important consideration, there are other costs to consider, both hard and soft. More importantly, if the tool does not meet your needs, you’ll never gain the value from it to justify those discounted licenses.

At Kolme Group we care and want to help you get the best out of your PPM Tool. Join Kim Essendrup for a Free, 15-minute consultancy to discuss your
PPM Tool needs and best steps forward

What really impacts your PPM Tool costs?

There are a few key areas that have the greatest impact on your overall PPM tool costs. Understanding these areas can help you identify which items on your PPM wish-list are going to cost you the most so you can start to understand your must-haves versus your nice-to haves from a cost perspective.

Key cost areas:

  • Licensing Types
  • Integrations
  • Customization & Automation
  • Unique Use Cases
  • Support and Enablement Approaches
  • User Training, Onboarding and Go-Live Support

Licensing

The license tier or license type you choose can impact your licensing costs by -50 to +100%. Take the time to figure out which license level you really need, rather than leaving it up to the supplier.

PPM licenses are typically broken out into different types/tiers depending on the user role in the system. These types will vary by PPM, but typically include:

License typeDescription
Requestor / ReportLimited access license allowing a user to request work, perform basic interaction or access reporting. This license type is usually the lowest price point.
Team Member / Time EntryAllows for project team members to access and update assigned work and log time.
Planner / FullFor project and portfolio managers, allows a user to edit, assign, and report on modules within the system.

Pricing can be dramatically different between the license types and this can have a huge impact on your costs. For example, Requestor or Team Member licenses can cost a fraction compared to those of the Planner tiers.

Pro Tip

When drafting out your PPM scope, take the time to identify each “persona” in your organization and what they need to do in the system.

Understanding each persona needed in your organization will help guide the conversation with prospective PPM suppliers and ensure the right license level for each of your personas. You will want to avoid moving through the sales cycle only to find out that you purchased the wrong license types.

We have had some customers who ended up having to push through a last-minute PO to increase their license counts right before go-live since they incorrectly assumed the permissions given available to the roles in the system. The sponsor was not pleased to learn a day before go-live their annual revenue was going to increase by double.

In the reverse scenario, we worked with a different customer that had surveyed stakeholders within the organization and largely inflated the number of licenses needed. It ended up taking 5 years of increased user-adoption throughout the organization to match the number of users in the system to that of the license counts in the contract purchased.

Below is a simplified version of a how you might map out a persona matrix to help quantify your license needs:

Figure 1 – Sample Persona Matrix to help quantify license requirements

 

Integrations

Integrations can add $10,000-$50,000 to your implementation costs, per integration. Very sophisticated custom integrations can be $100,000 or more

Integrations with external systems is another possible large impact to your PPM cost. Projects don’t live in isolation inside your organization and consequently neither does your project data. You can increase value when adding automation and centralized reporting by integrating your PPM with other systems, but it can get really expensive.

Typical integration points include:

  • Directory services for identity + access management automation
  • ERP for budgeting, actual costs, and revenue forecasts
  • File repository for document collaboration
  • Agile tools
  • Ticketing or IT System Management tools for project intake or reporting
  • HR systems for user data and time off
  • Data warehouse or reporting services

Integrations also vary highly in costs depending on the method used to build the connection. The right method for you depends on your budget but you’ll also want to assess the volume, frequency and uniqueness of your integration requirements.

Typical integration methods, from least to most costly, are:

  • File-based

    Are triggered manually for infrequent updates, or for frequent updates, use automated scripts, emails or basic automation. These are a good option for an inexpensive start and provides an opportunity for using the tool before investing time + cost for a complex integration.

  • Commercial Middleware

    These integration platforms are nice if you have simple requirements. Often, PPM providers will have favored platforms or may have their own middleware platform. Common platforms like Workato, Jitterbit, SnapLogic or Zappier can give you a reasonably quick start to getting your integration up and running. Keep in mind, you may still have some custom development + another platform added to your cost outline.

  • Custom API

    Typically require the most development resources, but they’ll grant the you powerful control over the integration. If you can build one without commercial middleware, that’s one less ongoing cost to worry about.

Pro Tip

Discover if your organization has the capability to develop in-house integrations. This will save you a significant investment in professional services, and also give you the ability to adjust/expand on that integration in the future.

Regardless of your approach, be sure you have a clear understanding of what you want from each integration, including what data flows, which direction, and how often. This will help ensure you get what you need and helps your provider give the most accurate cost based on those requirements.

Customization & Automation

Customizations and automation can add a little (~10%) or a lot (~2x or 3x) to your general onboarding costs

Full-featured PPM tools offer amazing levels of customization and automation to increase your organizations efficiency. In fact, the more important question is not can the tool automate this process, but should it automate this process.

Our advice: Start with the minimum amount of customization and automation – focus on critical simple processes and fundamental adoption of the tool. As your users become more comfortable with the system, you can add additional functionality and automation. This makes onboarding easier and increases your short + long-term adoption.

A common example of this “minimum lovable product” approach is seen during new project requests. Often, a PPM tool is implemented to support the consolidated project intake and review process across previously siloed departments. While providing enormous value to an organization, some get excited and roll-out too much, too early on.

Typically, clients add sophisticated workflow automations before the organization has adopted the simple concept of the aforementioned, this consolidated project intake process..

Pro Tip

It’s best to start simple and then add more after adoption is successful.

When considering your PPM needs, be aware – the more customization and automation you add, the higher the implementation cost.

You may also want to research how easy the tool is to learn from a configuration standpoint. This way, you can understand the administrative overhead required to enhance those configurations later on, whether it be the supplier, partner or even your own team.

Unique Use Cases

If each use case (additional department) you add is completely unique, estimate another +50% to +100% for each additional department you onboard.

Another possible significant impact on implementation costs are the number of unique use cases, or unique team processes, that are joining the tool.

For example, the configuration and onboarding effort may not be appreciably different if you have one common way of working for 100 people or 1,000 people. But, if you have five departments that each have their own unique project lifecycle, financial or resource management processes, that can be 5x more work to implement because it acts as if you’re really onboarding five different organizations.

This is why, implementing a PPM tool is a great excuse to apply some standardization across the organization. Even streamlining simple things like common project KPI tracking, status reporting templates or reporting can not only reduce the cost of your implementation but also provide value to the organization through standardization.

Pro Tip

If it’s not possible to standardize, then you can improve your implementation success by onboarding one business unit at a time. This gives you a chance to learn lessons from each successive department’s onboarding.

Support approach and involvement

Ongoing support and enhancements can be a likely impact to your implementation cost as you decide how involved you want your team to be. Most PPM tools provide various training mediums for project team members to learn system administration and configuration. This will allow you to successfully own the system and configuration after implementation. Some providers will even encourage an “enablement” approach during onboarding, allowing your team members to be hands-on during implementation, potentially reducing some of costs by taking on the less technical aspects of onboarding. This includes UI clean-up and user permissions.

Of course, the more resources you dedicate to system implementation plus ongoing support, the lower your supplier implementation cost. However, this can impact your timeline. Keeping the pros and cons in mind, understand that it will be a better long-term investment but you have to have the resources available on your team to focus on learning these skills and be ready to invest in them.

At Kolme Group we care and want to help you get the best out of your PPM Tool. Join Kim Essendrup for a Free, 15-minute consultancy to discuss your
PPM Tool needs and best steps forward

The hidden PPM tool costs that will get you

Although the costs described above can have the biggest impact on your overall PPM implementation budget, there are areas that can take a surprising amount of effort by your supplier or your team and cost you more than planned.

Data Migration

Migrating mass amounts of data for historical or in-flight work can be surprisingly challenging and time consuming. Even if the data is quality (which usually isn’t the case) you’ll need to transform and import it, in order to make that legacy data coexist with new data. That’s a lot of work!

If possible, use your transition to a new PPM tool as an opportunity to start clean with new project templates, fresh budgets and data.

For example, if your organization uses Microsoft Project Pro to track project plans and your PPM tool allows you to import those plans, this does not mean you should. Your old plans are likely not consistent across all your projects or they have issues with the resource data lining up with your new, clean, PPM resource pool. Besides,  most PPM systems have richer metadata on their projects that your old MS Project plan will not. So, although it may be attractive to import all your current plans, you will likely find that it is not worth the effort and best to start off fresh.

Process Development

Attempt to document your processes (project lifecycle, budgeting, etc.) in advance. If you need help developing or improving your processes, your PPM implementation partner should be able to provide assistance on best practices. Keep in mind, this type of consulting can add up quickly and deduct from your planned implementation budget. Be prepared with your processes, documented and ready to go, or with the expectation that you will need to invest in expert assistance improving your ways of working at the same time you implement your toolset.

Operational Costs

Likely, you will need to dedicate an amount of resources to administration, training, and maintenance of your new system. We typically advise to invest some amount of resource time to learn the configuration side. This way you can make configuration changes, develop reports, etc., rather than always relying on an outside partner. This is promising, but you will need to allocate ongoing resource time for these activities.

RoleKey Responsibilities Commitment (% of Time)
Executive SponsorProvide Overall PPM Implementation Goals and Objectives. Provides support for escalations.5%
Implementation & Product OwnerDay to day functional owner. Identify implementation team members. Provide clarity on user stories. Handles day to day analysis, questions and issue resolution. Ensures successful roll-out and user adoption. 25-50%
Implementation Project Manager Manage Implementation Team Members. Schedules and assists with discovery, requirements gathering, UAT, and training sessions.25-50%
Administrators Configure user interface (view, profiles). Configure reports and dashboards. Manage users and permissions. Assist with data loading of historical data. Configure and modifies business process rules. Provide technical assistance and support for integrations. Provides Tier 2 Support Participates in End-User Training25-50%

Support Costs

Be aware – different PPM providers approach and price support in different ways. Key areas to watch for are:

  • What are the support plans available, what SLA do they provide, and which one matches the criticality of this system in my environment?
  • Is administrative / configuration training free or cost money? Are vouchers available for signing up to different support levels?
  • Do I pay more for staging or development environments? Any required workflow or configuration tools? Or are those included?

Training Costs

Another cost that can be surprising is end-user training cost –  both in the time needed to train and producing the supporting documents. Because PPM tools are often configured to support your specific project delivery processes, you will need to develop end-user training specific to each persona in your organization.

Your PPM supplier may have a standard deck to get you started but you will also want to highlight areas the tool has been configured beyond out-of-the-box and tailored for that persona’s specific business processes.

This cost may or may not be included in the PPM implementation costs and when it is, it can be significant. To save cost, you can:

    • Go with a ‘train-the-trainer’ approach, where the suppler trains your power users or trainers, who then go on to train all your end-users.
    • Develop the training in-house. This can save a lot but requires you have involved team members in the implementation – enough so they can develop the material.
    • Lastly , you can record the trainings and making it part of the onboarding for new hires or for those that desire an On Demand option.

How do I keep PPM tool costs down and maximize return?

Kolme has implemented PPM tools for many clients and based on our experience, we wanted to share the following tips with you, as you prepare get to start, or re-engage, your PPM journey:

  • Moderate your expectations, simplify your needs

    Yes, it is exciting, but our main advice is to be pragmatic and temper your expectations. PPM tools can adapt to your organization, but they are only tools and won’t solve all your problems. If anything, they will help identify the problems in your organization.

  • Own It!

    Get involved, learn the tool and be active during the implementation. Start by documenting your own processes and invest in training your own people so they can be part of the solution, if possible.

  • Use An Agile Approach

    Start with a “Minimum Lovable Product.” If you try to implement too many features at one time you will fail. For example, if you roll out 50 features to users, they will be overwhelmed and will probably adopt none. Better to start simple and implement 5 high-value features until adopted, then gradually add layers of features after that.

  • Invest in Organizational Change Management (OCM)

    Use OCM strategies for long-term success. Even the best tool in the world is not going to succeed if nobody uses it, so look into tools and techniques like Prosci© ADKAR model for managing change and helping users adopt the new system and the processes attached.

Is a PPM worth it?

A PPM tool can undeniably be a worthy investment. Even with costs involved, and some not insignificant, we still advise on having one.

As a former PMO lead for a professional services organization, I implemented a PPM tool and that Organization’s billable utilization improved by more than 20%! The next time I implemented a PPM tool for an organization, we identified and corrected erroneous CAPEX allocation of labor cost which was amounted to 30-40% of all project labor. With another client, we found that 75% of their projects did not align to their strategic objectives. And with another, we managed to save nearly a million dollars’ worth of resource effort through automation and streamlining of processes.

So, based on our personal experience implementing these tools for ourselves – and for our clients – it is definitely worth it.

 

What’s next?

If you are ready to go shopping for PPM tools, or revisit your existing implementation, here are a few next steps:

  • Build Your Stakeholder Coalition

  • Justify the Return on a PPM Investment

  • Identify Your Requirements

  • Document a Proposal for Development and Evaluation

At Kolme Group we care and want to help you get the best out of your PPM Tool. Join Kim Essendrup for a Free, 15-minute consultancy to discuss your
PPM Tool needs and best steps forward