Faking it: How accepted practice in project scoping and assessment has conned us

1. Faking it:How accepted practice in project scoping and assessment has conned us John Smyrk Visiting Fellow School of Management, Marketing & International Business ANU College of Business & Economics AIPM Conference Hobart 2007

2. AIPM national conference 2007 John Smyrk: Australian National University 2 Theme Conventional practice ignores target outcomes in projects. Two unsatisfactory consequences: Criteria for gauging project success are flawed. There is no reliable method for solving the scoping problem. Both problems can be addressed with the author�s ITO model.

3. AIPM national conference 2007 John Smyrk: Australian National University 3 The conventional test for project success A project: Is successful if it meets its objectives. Has three objectives: To deliver outputs of agreed quality. To do this on time. To do this within an agreed budget. Is therefore successful if outputs are delivered with agreed quality, on time and within budget. This test is provably flawed.

4. AIPM national conference 2007 John Smyrk: Australian National University 4 Assessing a project Ex ante Assessment is called appraisal. Used to inform the funding decision. Documented in a business case. Ex post Assessment is called evaluation. Used to gauge project success. Documented in a closure report.

5. AIPM national conference 2007 John Smyrk: Australian National University 5 The ultimate test for project success Would the funder have approved the project knowing in detail how it turned out? If yes, the project is successful. If no the project is unsuccessful. A project�s �equation of worth�: Worth = F(benefits, disbenefits, cost) Benefits ~ magnitude & timing Disbenefits ~ magnitude & timing Costs ~ magnitude & timing

6. AIPM national conference 2007 John Smyrk: Australian National University 6 A project�s assessment parameters Ex ante: Target outcomes Expected undesirable outcomes Anticipated cost Anticipated timeframe Risk (a measure of the reliability of these parameters). Ex post: Actual desirable outcomes Actual undesirable outcomes Actual cost Actual timeframe Outputs delivered fit-for-purpose (binary).

7. AIPM national conference 2007 John Smyrk: Australian National University 7 The flaw in conventional evaluation How would a funder view a project in which: Outputs were delivered: Fit-for-purpose. Under budget. Within an agreed timeframe. No desirable outcomes were realised. Undesirable outcomes were unacceptable. Under the previous rule this project would be judged a failure�but conventional wisdom classifies it as successful.

8. AIPM national conference 2007 John Smyrk: Australian National University 8 Project scope Under the conventional view, scope: Has to be set. Is about constraining the work in a project. Determined by the project�s deliverables. I propose the following scoping principle: A project is scoped if and only if its outputs are defined. A project�s outputs are defined when: They are listed. Their fitness-for-purpose features are set.

9. AIPM national conference 2007 John Smyrk: Australian National University 9 The scoping problem A proposed project has a tentative list of outputs: A, B, C & D�but: �Output E� has been proposed for addition to the existing scope. �Output A� has been proposed for removal from the existing scope. How are these issues to be resolved? The conventional wisdom appears to say �Ask someone�!

10. AIPM national conference 2007 John Smyrk: Australian National University 10 The central role of target outcomes The concept of target outcomes is central to: Judging a project (ex ante & ex post). Solving the scoping problem. Target outcomes are: Are the desired end-effects we seek from the project. Effectively the same thing as benefits. Intangible but measurable.

11. AIPM national conference 2007 John Smyrk: Australian National University 11 The IPO model of a project The conventional view of a project is based on an IPO (Input-Process-Output) model: