The concept of managing value as expressed in the Declaration of Interdependence begs the question - how is the value identified, how do we measure it, and in what "units of measure."
Project Management is interested in all three of these questions:
- The easy answer is the customer defines the value. SOX has some things to say about this in public companies, so the agile answer is too narrow. The front pages of the Denver Post annouced today the former CEO of Quest is being indited for fraud. The "value" of the projects he booked as assessts turned out to be bogus.
- Measuring the value assumes there are standards of measure. "How much is this worth?" is a starting question.
- In what "units of measure" are we stating value? Dollars, hours, time?
All these questions need to be answered during the project lifecycle, before "success" can be declared. Although the DoI rightly identifies the need to be focused on "value," the easy part is over. The hard part is actually identifiying and measuring "value" in the project.
Here in aerospace our "value measurement" job is easy. Earned Value measures value in units of hours or dollars. Other business domains may use different approaches. But in the end it's the units of measure that the PM is interested in. So the next time someone mentions "we need to manage value flow," ask the three questions above. It may turn the conversation from theory into practice.
