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It’s safe to say that 2020 has not gone according to anyone’s plan. With a few months remaining, however, there’s a chance to make the best of this year and — most importantly — chart a proper course for next year.
But as we collectively come to terms with what the “new normal” will look like when it comes to project success, how can managers tell if they are on the right trajectory? One solution is to develop key performance indicators based on observable behaviors that can be tracked during the early phase of a project.
The Pareto Principle is the idea that the vast majority (80 percent) of outcomes are produced by just a few (20 percent) of their key causes. Also known as the 80/20 rule, it asserts that by focusing on the 20 percent of work that most matters to your client, you will produce 80 percent of your project’s results. This is a business concept that can be applied to almost anything.
Those of us in the construction industry are probably familiar with the old saying: “Before a project is 20 percent complete, 80 percent of its fate has been determined.”
When it comes to the first 20 percent of plumbing and piping projects, typically there is an operations manager or a project executive who wants to know whether the company’s venture is starting off on the right foot. The dilemma for project managers who run these mechanical projects, both with their staff and in partnership with the foremen and their crews, is that few measurable metrics or KPIs can be monitored at the beginning.
In the early stages of a project, the feedback loop inherently offers little in the way of feedback.
In my March 2020 column (https://bit.ly/3fTnEck), I explained how indicators classified as “lagging” and “leading” are used to measure and manage projects, as well as how these metrics can be leveraged to impact outcomes and enhance overall performance.
To recap, lagging indicators are often related to activities undertaken by workers, which is why they become fascinating and useful in the analysis of human behaviors, such as tracking and assessing if employees are on time or late relative to known milestones
Leading indicators are about trying to predict the future. While they are lagging in form, they provide a much earlier indication of what’s to come. The same can be said of the observed behaviors of people who always seem to perform, only in these instances what’s indicated early are positive outcomes or probable success.
When thought of as KPIs based on observable behaviors, or observable behavior key performance indicators, these OBPKIs can help to bridge the gap between project award and when feedback becomes available from more traditional KPIs in the feedback loop.
While waiting for the more traditional KPIs to offer their feedback during the early phase of a project, project managers of plumbing and piping projects can begin to define standard and expected observable behaviors intended to monitor and anticipate a project’s trajectory in a meaningful and productive way.
Defining behavioral expectations can generate leading indicators of eventual success. To illustrate this, here are some examples I’ve identified through my experience working with and managing employees who have demonstrated an ability to deliver strong results consistently:
In addition to the observable behaviors that reliably lead to success — which tend to be more elusive or challenging to measure and track than traditional KPIs — we also know successful projects carry attributes of these behaviors as well, despite whether the project itself is challenging or not.
Essential to planning the work on any project, these attributes include the development of standard policies, processes and procedures for planning and executing our projects; standard tools, templates and forms to use as necessary; standard business rhythms or cadenced check-ins to inspect what we expect; and standard KPIs to track how we are doing against plans (traditional things such as burn rates, productivity/earned value, cash position, percent complete, etc.).
When managing teams remotely, it can be difficult to gain visibility into team behaviors. When you can’t physically be everywhere (or anywhere) at once, you must set up a network of quality assessment and control to wrestle honestly with whether those behaviors are happening or not.
We established the McKinstry Expectations to provide sales, operations and project managers a script to build awareness around observable behaviors that lead to positive outcomes. It addresses the what, when, who and how in which we first plan the work before we work the plan. Think of it as a framework and adapt it to fit the nuances of your projects.
What: This is a cultural expectation. It is meant to cement the way we work, always making us ask if there is more preparation we can do. Examples could include organized despite imperfect information, calm despite lots of noise and activity, proactive despite time constraints or strategic despite scope, schedule.
When: In general, timing is from project award to 5 percent of total revenue used, and then 6 percent to close out.
When you “plan the work,” it is a sprint with a limited runway that includes a strategy. When a team has spent 5 percent of its total contract amount, it is generally out of runway for planning (e.g., development of build plans, labor plans, submittal and expediting plans, schedule of values, schedules, weekly foremen/staff meetings, etc.).
On the other hand, when you “work the plan,” you are on a journey of endurance and focus that includes process and people. The period typically lasting from 6 percent of contract burned to 100 percent completion, it focuses on the ongoing and disciplined use (and leveraging) of the tools noted previously.
Who: There is a crossing pattern that happens between the two phases where the primary role moves from the sales/estimating/project executive over to the project manager and his or her onsite team. Ownership always remains with the person who sold the job; it is equally shared by the person who is running the job. Put another way, they are partners until completion.
How: The science of the “how” is found in the project execution manual. The art is found by doing the work and surrendering yourself to the idea that others might have something to teach us, and vice versa.
For project managers in our industry who are still wrestling with how to gain visibility into remote teams, the first step is an honest assessment of behaviors among those teams, and the next is to figure out how to call out those observations productively. Accomplishing both has become an especially pressing concern in the context of COVID-19 this year, and it is likely to remain of critical importance in the future.
Using the framework in this column as a springboard, project managers in the plumbing, heating and pipefitting industry can prepare for a more certain 2021 by figuring out how to observe, define and ultimately utilize behavioral concepts that align with excellence. As we approach the 80 percent completion mark of a thus far extremely rough year, the industry must start thinking now about how the last 20 percent can be used to generate significantly improved outcomes from the outset of 2021 and beyond.