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January 2013

The Annual Budgeting Process: Insanity is Expecting Different Results from Spreadsheets

Albert Einstein has been credited in saying, "insanity is doing the same thing over and over again and expecting different results."

If you are charged with some element of the fiscal planning process for your organization, such as capital planning, strategic planning, budgeting, and annual allocations, among others; chances are you've been inundated with spreadsheets, tab delimited fields, and pivot tables every January since… forever.

Has Your Expectation of Spreadsheets Changed Over the Years?

According to recent findings, your answer is probably "no." According to the 2012 Benchmark Study: The State of Capital Planning:

49% of companies surveyed indicated that the manual nature of planning and spreadsheet complexity is the top planning pain point.

The predominance of spreadsheet planning and forecasting is at the heart of many challenges long range planning professionals face every year. Coined as a "common pitfall" by Madison Laird in his white paper, 15 Common Pitfalls of Long-Range Planning, the connection between spreadsheets and the lack of productivity and flexibility is supported by many studies and the annual exercise you are likely participating in right now.

Stop the Insanity!

In this short video series, Madison delves deeper into the issues and solutions to the most common pitfalls, including spreadsheet planning.

Some of the solutions he describes tackle spreadsheet planning philosophically and are relatively simple; such as rewarding vision and consensus. Some of the solutions outlined dig deeper into the core of your organization's analytical culture.

As you make progress and conclude your annual planning; now is the best time to consider best-practices of organizations that have eased the intensity and challenges of juggling spreadsheets. Ensuring your next planning cycle is improved upon will not only improve your processes and decision making capabilities: it will also improve your sanity.

For more information watch the videos here or load them into your YouTube playlist.

What is your biggest headache during the annual budgeting process?

Analysts Detail Correlation Between Tech Solutions and Performance for Project-Based Businesses

In mid-2012, two independent research organizations published unique reports about the best practices of top-performing, project-driven organizations. Each had their own focus on the subject matter regarding the emphasis of their research metrics or how differing project-based companies can be collectively considered successful despite a wide variety of nomenclature, product offerings, and organizational structures. Regardless of their intention; however, both came to a remarkably similar conclusion.

Best Practices of Top-Performing (Best-in-Class) Professional Services Organizations

Research Organization

Services Performance Insight

Aberdeen Group


2012 Service Lifecycle Management Maturity, February 2012

Project Management in Professional Services: Managing People for Profits, July 2012

KPIs of Top-Performers

Top 5% in:

  • Annual revenue growth
  • Earnings before interest, taxes, depreciation and amortization (EBITDA)
  • Annual revenue per billable consultant
  • On-time project delivery
  • Percentage of reference-able clients

Top 20% in:

  • % of projects completed on time or early
  • % of projects delivered within budget
  • % of reduction in time-to-decision over the past year
  • % of employees Which exceeded their performance metrics during annual reviews

How Top-Performers are Distinguished

High rankings in maturity level characteristics in:

  • Resource management; visibility from prospect to project to ensure the right resources with the right skills are available when needed
  • Structured or standardized service delivery processes
  • Solid project management; visibility into the schedule, resources, deliverables and risks to ensure projects are delivered on time and on budget
  • Accurate and timely project accounting

Best-in-Class when compared to all others have nearly double:

  • Central visibility to skill sets of available resources
  • Decisions that are consistently made from a single version of data
  • Real-time visibility into all project milestones and schedule status

Key Business and Technology Capabilities

PSA plus:

  • Integrated information systems of ERP and CRM
  • Standardized service delivery processes of sales pipeline, billable utilization and meeting margin targets
  • Resource management; resource/workforce scheduling; skill matching
  • Workflow productivity measurements
  • Project scheduling and change management
  • Knowledge management (KM)

ERP plus:

  • Project scheduling
  • Project costing
  • Time tracking against projects
  • Change management
  • Resource/workforce scheduling
  • Expense tracking against projects
  • Project Portfolio Management (PPM)
  • New request management
  • Post project completion service management
  • Subcontractor management

If PSA is not enough and ERP is not enough…

Juxtaposed against one another, the Aberdeen Group and Services Performance Insight agree that the more typical software offerings are not successful in providing project-driven organizations applicable solution.

Services Resource Planning (SRP) is a solution designed to improve upon ERP with the project-based business solely in mind. Specifically, where PSA, ERP, and CRM all fall short, SRP saves the day by giving project-based service organizations the tools to access:

  • Accurate project data
  • Deep visibility into resources, skill set, individual capability, and scheduling
  • Universal tracking of client issues
  • SRP and ERP integration
  • Broad visibility into all active projects

For more information on how Planview considers Services Resource Planning (SRP) the key solution to the technology gaps discovered by Services Performance Insight and Aberdeen Group, take a look at The Planview Approach to Service Resource Planning.

Did you take one of these surveys conducted between 2011 and 2012? Are these findings reflective of your company's technology requirements? Share by leaving a comment below.

Related posts: SRP and PSA -- There IS a Difference -- Part 1 and Managing Project-Based Businesses in Turbulent Times

Top 7 Most Widely Read PMO Resources of 2012

As we look back on the successes and set goals in 2013, I wanted to share the seven most popular PMO resources of last year for your reference. This compilation of articles, analyst reports, and white papers cover a range of topics including resource planning, building and managing an innovation portfolio, a look at the current PPM landscape, and much more.

  1. PDF: Ten Proven Military Strategies for Better Resource Planning by Jerry Manas
    Nowhere is there a richer source of strategies and tactics for how to apply limited human resources than in military history. In his latest white paper, best-selling business author, Jerry Manas, outlines 10 timeless military strategies that can be effectively applied toward modern day resource planning. Find out how lessons learned from Custer's Last Stand, Napoleon, and the ancient Chinese are as relevant today as they were then.
  2. PDF: Improving Information Technology Across the English Channel with Planview Enterprise
    Find out how the Eurotunnel Group is using Planview's PPM application to enhance the performance of their IT Group to improve business processes, transparency, and to manage costs.
  3. Video / webcast: Building and Managing an Innovation Portfolio
    IT plays a key role in driving innovation in your company's products and services as well as the way it conducts business. Here's an opportunity to hear from a panel of industry experts as they share best practices for supporting innovation and exploiting great ideas to grow and change the business.
  4. PDF: Sustained Innovation Propels the Business Engine
    This timely research report, written by Chip Gliedman, vice president and principal analyst serving CIO professionals at Forrester Research, Inc. follows the innovation portfolio discussion mentioned above. Chip provides his perspective on the role of the CIO in their organization's innovation ecosystem and the key role the CIO plays in building and maintaining a sustainable innovation process.
  5. Article: The Cloud as Data-Center Extension
    Stacy Cenis, IT project manager for Multnomah County, is featured in this recent article that explains the benefits of switching to cloud-hosted versions of critical business applications and the associated benefits including the significant savings of valuable resources, time and money, that come as a result of taking advantage of "platform-as-a-service" solutions.
  6. Video / webcast: The End of the World? 5 Bigger Things Your PMO Should be Worried About
    The world did not end on December 21st as the Mayan calendar may have led you to believe. Instead your PMO could be seeing the beginning of its demise. Did you know that 75% of PMO's are dissolved within the first 3 years of starting? Don't let this happen to your PMO! Listen in to learn the top 5 priorities for the PMO to start the New Year off on the right foot.
  7. PDF: 2012 Gartner Magic Quadrant for Integrated IT Portfolio Analysis Applications
    Access the report to learn why Gartner says, "Integrated visibility across different IT silos or domains can bring their often unique perspectives to the table to enhance capital and strategic IT investment prioritization and decision making for a CIO, an IT steering committee, a governance board or council, or an IT PMO."

Let's Continue the Conversation

Connect with us and other PPM industry professionals that keep the conversation going online everyday:

  • Join the active community of "Project Managers On Twitter" by following the hashtag #pmot and participate in #PMChat , a weekly chat for project managers every Friday at 12 pm EST
  • Stay tuned to Portfolio Perspectives for details and findings of the very first Resource Management and Capacity Planning Benchmark Study scheduled to be published Q1 2013 by Appleseed Partners.

We want to hear from you. What resources did you find beneficial this last year and why? Did you find a particular blog or piece of content valuable that didn't make the list? Tell us what it is by continuing the conversation in the comments section below.