Herding Cats

Capabilities-Based Planning

Over the years, traditional project management methods in software development have had limited success. These traditional methods rely on a retrospective approach that measures variance against plan rather than providing a performance forecast to guide projects in a chaotic environment.

There are a number of programmatic control issues associated with IT projects that suggest a better approach is needed. 2 Using this linear project planning process – sometimes known as waterfall – but often derived from PMBOK-style planning processes, there is little attention given to the forces that negatively impact the project. These project risks have no means of evaluation other than to acknowledge their presence, define mitigations and track the results. The impact on the business value of the system’s capabilities is not part of the project management process. In this current approach, avoiding or controlling change becomes the primary activity of project management.

In this traditional model, change is undesirable. In the reality of business systems development, change is not only natural but also desirable. Through change, the system can adapt to business needs, which external forces drive. These forces are rarely under the project manager’s control, let alone senior management’s.

One project failure mode occurs when project participants and leaders fail to distinguish between managing in the presence of change and managing change. Managing in the presence of change is a critical success factor in any modern business system development.

Capabilities-Based Planning … involves a functional analysis of operational requirements. Capabilities are identified based on the tasks required to accomplish a mission or fulfill a strategy… Once the required capability inventory is defined, the most cost-effective and efficient options to satisfy the requirements are sought.

What Are Capabilities and Why Are They Better at Describing Maturity?

Measuring project and product maturity as a function of effort and time assures that project management adds value to the business. Simply controlling and measuring the expenditure of resources – scorekeeping – provides little value in the presence of change. Capabilities–based planning provides a defined outcome that is not a final conclusion but lays the groundwork for continued value delivery. Objectives are reached and the operational value delivered when a defined capability is available for use. Features and functions describe a system’s static and dynamic behaviors, but they are not directly connected to business strategy. Milestones indicate that a position in a timeline has been reached, but do not forecast what value will be delivered to the business or how this value is traceable to the needs of the user community. Capabilities answer the following question: to achieve our objectives, what capabilities must we possess?

Capabilities–Based Planning transforms the delivery of features and functions into the delivery of processes and technologies that support the business strategy. Capabilities–based planning plans under uncertainty to provide capabilities suitable for a wide range of business challenges and circumstances, while working within an economic framework. This approach emphasizes flexibility, adaptiveness, and robust capabilities, implying a modular, building–block approach to delivering enterprise applications. Capabilities are not the same as features and functions; they enable demands to be met without explicitly specifying the solution. A capability is the ability to affect an outcome, react to an input, or change an effect. A capability provides an outcome or an effect without an a priori specification. Features and functions require an a priori specification to test their existence or conformance.

Capabilities–based planning can be understood at the execution level, but it needs to be raised to the level of enterprise process analysis: Identify a needed capability in operational terms, using a set of capability options to assess the effectiveness in an operational paradigm, and make choices about requirements and the ways to achieve the capability using an integrated portfolio framework to produce an output set of options based on these operational paradigms.

Putting capabilities–based planning to work requires a change in our approach to planning—a set of business process improvement activities focused on assessing increasing maturity of the capabilities needed to fulfill the strategic objectives. The emphasis is on operational capabilities rather than features and functions. These operational capabilities become the building blocks of change. The emphasis also focuses on evaluating capabilities under uncertainty, which requires deploying robust building blocks that can adapt to change. In both cases, the analysis illuminates the feasibility of alternatives.

Using Scenarios to Define Capabilities

Scenario–Based planning is one approach to defining the objectives in an enterprise application development environment. While scenarios are a popular decision–making process, we must distinguish between two approaches to scenario-based development: 1. Finding alternatives. Evaluating existing alternatives. The first use (finding alternatives) is the most common but has problems. The second use is equivalent to simulation-based acquisition. For example, it assumes that a business strategy can be discovered by studying individual scenarios. This what–if approach to optimal decision making is flawed when some parameters are unknown, as in most IT projects. A capabilities–based view of the world can address issues found in scenario–based planning. Scenarios relate to each other in different contexts; changes to one operational scenario may affect another. Scenario selection must be based on a proper understanding of the relationships and impacts on other scenarios. Capabilities provide a reference point to consolidate scenarios by systematically defining operational concepts and their relationships, with each capability defining the compelling rationale for decisions in a portfolio of projects.

Augmenting Strategy–Making with Capabilities

Strategy–making is the starting point for project management. It asks and answers: Why are we doing this? A capabilities–based planning process can augment strategy-making activities by mapping strategies to maturity-evaluation points for each emerging capability. This approach connects the why of a project with the how. The result is to replace progress measured by the passage of time with progress measured by the delivery of capabilities. Capabilities–based planning focuses on assessing the increasing maturity of functionality defined by the strategy. Planning under uncertainty provides capabilities suitable for a wide range of challenges and circumstances while working within an economic framework that requires choice, focusing on “possible uses” rather than specified features and functions.

For example:

  • What features do we need to achieve a desired capability?
  • How much of each capability do we need at a specific point in time to satisfy our strategy?

If we possessed a capability, how would we apply it to pursue a strategy?

  • With a specific capability, what benefits could our organization gain, and how would we measure them?
  • How can we test our strategies using these measurable benefits?

The difference between a capability and a feature or function is the difference between delivering a pre–specified solution and creating a foundation for responding to uncertain demands. This ability to respond in the presence of uncertainty provides value to the organization. Trying to control this uncertainty through frozen specifications and change control procedures ignores the reality of the business environment – uncertainty is the way of life.

Trying to control uncertainty leads to failure; managing iIn the presence of uncertainty is the basis of success.

A capabilities–based planning process:

  • Focuses on the outcomes rather than on the features and functions of an IT system – what can I do with the system when that capability is available?
  • Focuses on the delivery of the value of the effort that produces these outcomes rather than the consumption of resources – what have you done for me lately?
  • Defines the required maturity and assesses its presence to provide feedback to the business strategy – what capabilities do I need at this point in time to accomplish my mission? Capabilities–based planning replaces the specification of features and functions with the definition of needed business capabilities, traceable to strategy through a portfolio of projects and their program events.

It does so by:

  • Planning the delivery of capabilities rather than features and functions.
  • Identifying the features and functions that are the raw materials of capabilities.
  • Making visible the capabilities that enable strategy delivery.

What’s Next?

With a set of capabilities in mind, you need a plan to deliver them. One approach to building this plan is an Event–Based Integrated Master Schedule. We’ve discussed this before, but the next article will describe how to build such a schedule from the capabilities.

Past Herding Cats Capabilities-Based Planning Posts

References

A Few of My Briefings

Leave a Reply