Point Lookout: a free weekly publication of Chaco Canyon Consulting
Volume 1, Issue 7;   February 14, 2001: Quantum Management

Quantum Management

by

When we plan projects, we estimate the duration and cost of something we've never done before. Since projects are inherently risky, our chances of estimating correctly are small. Quantum Management tells us how to think about cost and schedule in new ways.
Allison presenting

Allison stood at the front of the room, next to the LCD, wanting desperately not to be there, as the marketing VP demanded, "Don't give me 'March 15 to April 29.' I want to know when exactly this thing will ship!" Trouble was, she couldn't say exactly — things were too unpredictable, and he just didn't seem to get it. So she caved: "OK, we'll have it by April 29."

"Oh, no you don't," he replied. "We'll take the middle of your range. What's that," he turned to the director beside him, "April 5? April 5. That's it. Next case!"

So that's what they did, and Allison's team finally shipped on April 26, three weeks late. A black eye for Allison, for the team, and for the engineering group. What was going on here?

Problem-solving organizations do two kinds of work — Operations and Projects. Operations work is ongoing effort repeated often — things like manufacturing, "routine" administration, and infrastructure operations. Project work is one-of-a-kind — new product development, relocation, and reorganization. Operations are repeatable and less risky. Projects are unique and riskier. Although we usually manage Projects as if they were Operations, Projects must be managed differently. Quantum Physics can help us understand why.

In Quantum Physics some things are inherently unknowable. For example, the more precisely we know the position of a moving body, the less precisely we can know its velocity, and vice versa. Classical Physics had no such restriction.

You get
to choose:
innovation or
predictability.
Not both.
There is an analogy in management. If we want to know cost and schedule precisely, we must reduce innovation, because innovation creates risk. If we accept risk, we must settle for less predictability of cost and schedule. Quantum Management says that you can't have precision in the context of risk.

Since our management practices originated in operations-oriented organizations, our managers don't like to hear that "we expect completion within 4-6 months." They often demand "drop dead" dates. This is Classical Management, and it's analogous to Classical Physics.

You can move your organization toward Quantum Management. As a manager:

  • Ask not "When will it be ready?" Ask, "When is there a 95% probability that it will be ready?"
  • Reward project managers who make estimates in 95% confidence bands.
  • Require that Corporate Finance manage risk across a portfolio of projects, rather than by demanding precision at the individual project level.

As a project manager:

  • Estimate best and worst case as 95% confidence bands.
  • When people ask you for a drop-dead date, try to educate them in Quantum Management. You might fail — or you might make some progress.

Whenever you're at the front of the room being hammered for a drop-dead date, remember that accepting one doesn't change the laws of Quantum Management. Go to top Top  Next issue: Celebrate!  Next Issue

52 Tips for Leaders of Project-Oriented OrganizationsAre your projects always (or almost always) late and over budget? Are your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around. Read 52 Tips for Leaders of Project-Oriented Organizations, filled with tips and techniques for organizational leaders. Order Now!

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Related articles

More articles on Project Management:

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What makes a great team? What traits do you value in teammates? Project teams can learn a lot from the latest thinking about designing teams for extended space exploration.
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When we schedule a complex project, we balance logical order, resource constraints, and even politics. Here are some techniques for using scheduling to manage risk and reduce costs.
Two colleagues chatting on their morning breakNine Project Management Fallacies: I
Most of what we know about managing projects is useful and effective, but some of what we "know" just isn't so. Identifying the fallacies of project management reduces risk and enhances your ability to complete projects successfully.
Three simple carabinersTeam Risks
Working in teams is necessary in most modern collaborations, but teamwork does carry risks. Here are some risks worth mitigating.
Cargo containers at a port of entryUnresponsive Suppliers: III
When suppliers have a customer orientation, we can usually depend on them. But government suppliers are a special case.

See also Project Management for more related articles.

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Some patterns of workplace society reduce organizational effectiveness in ways that often escape our notice. Here are five examples. Available here and by RSS on October 25.

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Ten Project Management Fallacies: The Power of Avoiding Hazards
Most Ten Project Management Fallaciesof what we know about managing projects is useful and effective, but some of what we know "just ain't so." Identifying the fallacies of project management reduces risk and enhances your ability to complete projects successfully. Even more important, avoiding these traps can demonstrate the value and power of the project management profession in general, and your personal capabilities in particular. In this program we describe ten of these beliefs. There are almost certainly many more, but these ten are a good start. We'll explore the situations where these fallacies are most likely to expose projects to risk, and suggest techniques for avoiding them. Read more about this program. Here's a date for this program:

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52 Tips for Leaders of Project-Oriented OrganizationsAre your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around.
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