There are Five Immutable Principles of Project Success.
Each question requires an answer with sufficient confidence to make decisions about spending other people's money, that increases the probability of project success.
All project work is probabilistic (actually statistical and probabilistic), with reducible and irreducible uncertainties that create reducible and irreducible risks to the success of the project.
Let's look at what estimates are needed to answer each of the Five questions:
| Principle | Estimate Needed To Answer The Question |
| What does DONE look like in units of measure meaningful to the decision makers? |
DONE is always in units of business value. That Business Value has variance and that variance needs to be known to assure that the range of Value is tolerable for those paying. DONE is a delivered Capability that can be (should be) measured in a unit of Effectiveness and Performance. [1] A core principle of Managerial Finance is Value cannot be determined without knowing the Cost to achieve that Value. So we need to know something about both measures - Cost and Value - to decide that what we think is DONE is affordable, arrives at the needed time to fulfill our business needs, and the cost of this Value can be sustained over the Value's delivery lifecycle. Without estimates, the units of measure of DONE have no confidence that they will deliver the needed Value or the Cost to achieve that Value is possible before spending all the money and using all the time. |
| What's our plan to reach DONE as needed for the customer to receive the expected Value from our work? |
A Plan is a Strategy for the success of the project. Strategies are hypotheses. Hypotheses require tests to confirm they represent the reality of the situation. With these hypotheses, we need to answer the question what's our confidence that the plan we have will actually work? There is a bigger and better question though ... what confidence DO WE NEED in the plan for the Plan to be credible? Anyone can construct a Plan. Is it a Credible Plan? Good question. Each requires us to make an estimate of the confidence in the elements of the Plan. In our Software Intensive System of Systems world, this is called Probability of Program Success (PoPS). |
| What resources will we need to satisfy the business goals of the customer? |
For the project to be successful, we need resources. People, Facilities, Money, and Time. How many people, of what skills? What facilities, tools? How much money? How much time? Each of these needs is probabilistic when it comes to fulfilling the need. What range of variability can we tolerate? This requires making estimates and assessing that impact on the probability of success of the project. |
| What impediments will we encounter that will reduce the probability of reaching our business goal as needed for the customer to pay back the cost of delivering the needed Value |
Risk Management is How Adults Manage Projects - Tim Lister. All risk management operates in the presence of uncertainty. Making decisions in the presence of uncertainty requires estimating the outcomes of those decisions, the costs associated with those decisions. You manage projects in the absence of risk management. You can't apply risk management without estimating. No risk management? No adult management. |
| How are we going to measure progress toward DONE, in some unit meaningful to those paying for our work? |
Physical Percent Complete is the best measure of progress to plan. This is the beauty of Agile Development. Working Software is the Measure of Progress. But that working software's arrival rate is statistically distributed. The notion of a burndown chart and the projection of progress to show the completion date ignores the statistical nature of software development and the statistical nature of the past performance. Many examples from NE show wild varainces in the past performance, but not the impact on the confidence of the complete date or cost. To show a confidence range on the completion date from the past performance - the empirical data - we need to estimate the possible ranges of performance in the future from the past performance AND from the possible risks in the future. |
Estimates are needed to apply the Five Immutable Principles of Project Success
[1] System Analysis, Design, and Development: Concepts, Principles, and Practices, Charles S. Wasson, Wiley Series in Systems Engineering and Management, 2006
