PM Articles > Kent McDonald > Don't Risk Value for the Sake of Schedule

Don't Risk Value for the Sake of Schedule

by Kent McDonald

A common concept in project management is the "iron triangle" of cost, time, and scope. To paraphrase: cost, time, and scope are constraints impacting a project and at least one must be allowed to vary to protect the quality of the project's results. Most discussions surround whether it's "right" or even possible to fix all three of these constraints. That topic has been covered extensively and I suspect practitioners have had enough (often painful) experience trying to fix all three and failing that I don't need to go down that road again. Rather, I'd like to share some recent lessons learned at my own expense regarding the validity wisdom of using these three constraints, primarily schedule, as measures of success for a project.

It started, as all good stories do, on a dark and stormy evening in May. A hailstorm rolled through our neighborhood while we were at an event in town. My wife saw hail on the ground when she got home, but didn't think twice about damage because we couldn't see any. We didn't realize there was anything wrong until a local roofing company stopped by the house a couple of weeks later and said that several other homes in the area had been damaged in the storm and that ours most likely was as well. They got up on the roof and sure enough, there was damage -- at least that's what they indicated. They suggested we contact our insurance company.

I admit I was a little skeptical, so I procrastinated about calling the insurance company for a couple of weeks, despite constant pestering from the roofing company. When I finally made the call and the adjustor came out, he agreed that we did have damage and wrote us a claim for a new roof. It had rained several times since the hailstorm and we hadn't seen any signs of a bad roof, but if an insurance company hands you a check, that's pretty good evidence. They aren't known for going out of the way to pay unnecessary claims.

Along with the check, the insurance company provided a referral to a different roofing company that was part of their Preferred Vendor Network and indicated that working with them would be super easy. I mulled over which roofer to go with and finally decided to go with the one suggested by the insurance company. It seemed like it would be less hassle, and I certainly didn't set out this summer to deal with getting a new roof, and I wasn't in any particular hurry to make it happen either.

So I went with the roofing company (we'll call them Company P) suggested by my insurance company. When I told Company P we wanted them to do the work, I asked when they might do the replacement. I asked merely for information. They said the next week.

That Friday, I got home and there were packages of shingles on my roof. Company P called and said they were going to try and get it done over the weekend or Monday. I commented that would be good, but I wasn't in an all fired hurry and asked if they were sure they wanted to be doing roofing in the rain. There were storms forecasted for the entire weekend and Monday, with the strongest storms expected on Monday.

Monday, June 30 dawned with an 80% chance of severe thunderstorms, and a 100% chance that the roofing crew now crawling around on our roof would be replacing damaged shingles. Predictably, at about 1:30 in the afternoon a wicked storm came through, blowing off the new shingles and causing several leaks in our house.

I called the project manager for my roofing job and asked if it was standard company practice to make boneheaded decisions. The project manager indicated he had been doing this type of work for 15 years and had never seen this happen before. He said that he'd been looking at the weather radar the entire day, that they had some of the best technology, and that when they started this morning it didn't look like the weather was going to hit my particular patch of Madison County. He also vaguely hinted that they were getting substantial schedule pressure.

When I talked to the owner of Company P (not happy with the project manager's response) he also indicated that they were getting extreme schedule pressure from the insurance company but he felt that his project manager made a bad decision in this case. To both of them I pointed out the schedule pressure was not coming from me and I would prefer to not have leaks in my house.

Company P did make it right. They sent another crew out the following day to completely redo the roof; most of the shingles the crew had put on the day before had been blown off in the storm. They also sent out drywallers to fix the ceiling in our living room and basement, and a painter to repaint the ceiling upstairs and downstairs. The company ended up losing a great deal of money on this job as a result of having to make repairs that originally were not necessary.

This was a case of taking unnecessary risks in order to meet a schedule constraint that did not really exist.

This was a case of taking unnecessary risks in order to meet a schedule constraint that did not really exist. Even if the insurance company was pressuring Company P to get the job done, it was a general overall pressure to get all of their jobs done quickly, not specific pressure on my specific job, and I suspect the pressure that Company P mentioned was more of an excuse than an actual factor. Either way, that schedule pressure could not have been great enough to take the extent of the risk that Company P took in deciding to send a crew from two hours a way to reroof a house during potentially nasty storms. Never mind the damage to my house; they were also endangering the lives of the roofing crew. From a financial perspective, Company P lost a great deal of money on the job, and their involvement in the insurance company's Preferred Vendor Network -- a major source of business for them -- was also jeopardized.

This as an example of poor risk management, but I think the lessons go deeper than that. This is what can happen when meeting cost, time, and scope constraints becomes the sole measure of success for a project, rather than the sometimes harder to measure value delivered by the project. In most projects, the ambiguous concept of "value" can be replaced by a concrete need that is satisfied, often a problem that is solved. In my case, the problem I needed solved was some hail-damaged shingles on my roof that had to be replaced. In order to maintain the house's value, it was best to replace all of the shingles so the roof looked good and worked as a system (the main purpose of that system being to protect the inside of the house). The project manager from Company P was overtly focused on schedule (a constraint that they actually set for themselves) seemingly at the expense of cost and customer satisfaction.

Project teams or sponsors become laser focused on meeting a schedule, or keeping to a specific budget, or strictly adhering to a set list of scope items.

I used the fairly simple project example of my roof as an example of this type of behavior with projects, but I've run across to many examples of this thought process on much more complicated and complex projects. Project teams or sponsors become laser focused on meeting a schedule, or keeping to a specific budget, or strictly adhering to a set list of scope items. As a result, they can often lose sight of why they are doing the project in the first place. This can lead to bad decisions that may seem good in the sub-optimized view of a particular constraint but can be disastrous in the grand scheme of things -- decisions like trying to replace roof shingles on a day when severe storms are highly likely.

The way to resolve this? Have the team explicitly discuss and build a shared understanding of what success looks like. Meeting certain constraints isn't the only way to measure success and it shouldn't be the overriding measure. Had that happened in my case, I wouldn't have been living in a construction zone for much of the summer (the repair work didn't get done until the third week of July, and ended up being much more intrusive than it should have been) and Company P wouldn't have lost money on a simple roof replacement.




Comments
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Thanks Kent. I have worked on a project where some of the powerful sponsors frequently brushed aside less powerful sponsors concerns on the "why" of the project and rather put pressure on the PM to deliver on the planned date and budget. The result was that the project had to be reinitiated with a different vendor after it was discovered at the project end date that it did not meet the expected requirements.


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