Transcript
© 2015 Cogentus Consulting Ltd
The human element in prioritizing R&D projects
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People vs. Process
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People vs. Process “Soft” vs. “Hard”
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People vs. Process “Soft” vs. “Hard” Managing contradictions
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People vs. Process “Soft” vs. “Hard” Managing contradictions • A bit about me • The Case Study
• US Department of Energy (DOE) • Prioritization • Process • Issues • Lessons Leaned
• Summary • Questions
Agenda
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Ian Seed
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Ian Seed, CEO Cogentus
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Chemical Engineer
Ian Seed, CEO Cogentus.
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Chemical Engineer MBA
Ian Seed, CEO Cogentus.
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Chemical Engineer MBA Technical, financial and business positions
Ian Seed, CEO Cogentus.
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Chemical Engineer MBA Technical, financial and business positions Heavily involved in OR for most of my career
Ian Seed, CEO Cogentus.
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Case Study
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140 R&D projects
n US DOE, R&D to support nuclear clean up n $120M a year budget, 4 departments n Multi-discipline, complex wide
n Problem: More R&D projects than funding
n Solution: Resource Allocation
About the case study
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n Each R&D project will cost money and will deliver some benefits to DOE.
n We just need to work out the optimum combination of projects that will give DOE the best benefit for their budget.
n Used MCDA – specifically resource allocation n Criteria n Options n Weights n Scores
Methodology
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n Criteria are the factors against which options will be judged
n We develop criteria from the hierarchy of objectives n Line of Sight / Strategic alignment
n DOE has mission & vision so it should be easy to identify criteria
n No it isn’t!
Step 1 - Criteria
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n Some not aware of what has been published
n What do the words really mean?
n How do you measure? n Differences amongst
stakeholders n Inside team n Outside team n Outside DOE
Issue 1 – Leadership Team Knowledge
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n Do not assume that previously published and approved information has been read
n Expect to revisit objectives and success criteria n Strategy development session with Lead Team. n Useful and necessary but not really “prioritization”
n Expect that different stakeholders will have very different views on objectives and success criteria n Use multiple sessions or role play to elicit those
views
Criteria – Lessons Learned
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n Options are the things you want to compare. n In this case, options are the R&D projects that
people want to do. n All they need to do is to explain their proposed
project so it should be easy to identify options. n No it isn’t.
Step 2 - Options
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n Wide variation in “quality”. n Might have a meaningful title if we’re lucky
n Variable descriptions n Technospeak n Vague
n Different stages of maturity of thinking
Issue 2 - Options
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n Standardise quality n Each option (project) should be at the same level of
detail n Template n Technical Support n Peer reviews
n In department n Across departments
n Maturity index
Options – Lessons Learned
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n Yet to meet anyone who knows what weighting actually means.
n Most believe it is “importance” n But all criteria, if aligned to the strategy, are equally
important. n It’s all about equalizing scale lengths.
n Lessons Learned n Expect to have to re-educate everyone what
weighting means!
Step 3 – Weighting
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n Scoring is where the performance of each option is established on each criterion
n Most participants expect a “scoring workshop” n Consensus decision making n Expert knowledge n A good thing right?
n Not particularly!
Step 4 – Scoring
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n Experts aren’t expert on things outside of their expertise n That’s all criteria except one (if we’re lucky)
n Scores are a matter of opinion, not fact n There’s no evidence provided
n Workshops are subject to Groupthink n Groupthink, gaming, influencing
n Impossible to validate scores n Different groups on different days will provide
different scores
Issue 4 – Scoring
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n Collect the evidence beforehand n Datasheets for each option n Performance data for each criterion n Criteria stage will have defined relevant measures
n Peer Review and validate data n Use workshop for experts to investigate the
data on each option, but not to “score” n Datasheets provide the evidence-base
necessary for any future reviews n This gives robustness
Scoring – Lessons Learned
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Step 4 – Results
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Compare portfolios. Can we develop ones that have greater benefit to the Organization for the same, or less budget?
Step 4 – Results
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Balancing. Cash Flow – is the annual budget within required limits?
n Departmental Heads prioritise on benefits only n Cost is secondary n Huge disparity between opinion and “fact”
n People cannot process multiple datasets n Trading off benefits and costs n Actual performance of options against criteria n Lifetime cost vs. annual costs n Balancing across departments n Short terms vs. long term, big vs. small
n That’s why we do multi-criteria!
Issue 5 – Results
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n Need substantial time to analyze n People need to unravel their own perceptions n Why are their favorite projects not more of a priority? n What about projects already started?
n Lewin’s is a good model to use n Unfreeze, Change, Refreeze
Results – Lessons Learned
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Who is the DM?
n The “process” is straightforward. n People make it more difficult.
n More people generally means more difficult. n Every stage has its issues. n Lessons learned to address most of them n Still left with: Who is the DM?
n Challenge is to present and communicate. n Not models, networking and negotiation. n No such thing as “optimal”. n Good enough. Needs to be better than the others!
Summary
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Who is the DM?
Erroll Southers n Counter Terrorism Expert. n FBI Special Agent. n Deputy Director for California
Office of Homeland Security, appointed by Governor Schwarzenegger.
n Nominated by President Obama to lead the Transportation Security Administration.
n "In my 30+ years of experience, Cogentus facilitated the most effective brain-storming session I have attended. It was challenging and produced viable future considerations for a major interdisciplinary initiative. Excellent use of time and expertise!”
People can be very nice!
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Ian Seed
iseed@cogentus.co.uk 0787 282 5027
www.cogentus.co.uk
Ques=ons?
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