Keep It Simple: Three-Step Hack to Define Your Project’s Health
Create reports to evaluate the project’s health
Project status reports should be created for almost all type of work. These reports should be standardized but in reality, they are dependent upon the person (manager) that receives this report. Every stakeholder and manager will have its own demands about what the content of the status report. They will also need the different shape of the sheets, the dates, and statistics that think is important for them. In many cases, the stakeholder will need to know the number of outstanding defects. Your boss will need to know the current budget vs the projected completion. One factor that should be described in all reports is the indication of the Project health.
Project health definition, in many cases, lacks the form of context. It describes all issues that are wrong while the boss simply wishes to get reported on the number of successful projects. These reports sometimes give very little information, because the reaction to trouble projects leads many Project Managers to try and report good news in order to avoid tough questions. Without proper creation, a project health report can be more of a disservice to the company, than a benefit.
How to compose the Project Health Report
The question is how to compose the report about the project health. The answer has appeared to many Project Managers over the years, but the answer is to define a standard of what the health information means. For simpler approach in this article, we will assume that the report on projects as either green (if everything is well), yellow (if the project is in risk), and red (for projects that are in trouble).
Green: Green color will indicate that everything is fine with the project and that things are going as scheduled. Your milestones will be delivered on time, on budget, and your project is properly resourced.
Yellow: Yellow color indicates that your project has some signs of trouble. There is an issue that could be problematic with the project, but the situation is still stable. The manager or stakeholder might need to get involved to put things on track, and at least – they should be informed.
Red: Red color indicates that the project is in a state where it will be very tough to return it to a green state. This means that aspect of the project is in serious trouble and the stakeholders should be informed that some aspect of their expectations (budget, timeline, or scope) will not be met.
Standardization of this color approach (for the project states) is not enough on its own, as it still has no concrete interpretation. You may admit that you are currently off schedule by a few days, but that isn’t enough to raise a concern from your boss since you will be able to fix it yourself. These types of decisions the standardization should avoid.
For your projects, you should divide the criteria into three fields: resources, budget, and timeline. The timeline and the budget are factors that could be directly measured by the project stakeholders, and resources are usually measured internally, and they could impact the schedule or budget very badly.
Using these 3 colored categories, you can define criteria for what the green, yellow, or red states would be. This will give you a tool to regularly track the project’s health, i.e. its resources, schedule and budget. Once you define these criteria, you can apply them to create the definition of the entire project health. Based on the number of colored states you will define for your project, you can define what would affect the total project health. You can use matrix representation to display the transition states within your project.
Based on the colored states approach, the project could be in a positive (green) state if all factors (time, money, resources) of the project’s health are green. The yellow project status will be an indication that steps need to be taken immediately to prevent a problem from getting worse, rather than the typical reaction (like a relief that the project isn’t red yet). The additional advantage of the matrix representation is that it can show – if all of the project factors (resources, schedule, and budget) are yellow, the project will get red. This could give the project team more reasons to solve the list of issues, and to put their project back to a yellow state.
Even if you are on time and on budget, your client can have a crucial misunderstanding of a specific requirement. You have delivered them what you agreed upon, but they are unhappy with the results. In this case, the project manager should indicate that the project is in a yellow state because the client is not satisfied. This will be a signal to the upper managers or executives – that they could involve themselves and try to improve the client’s behavior. However, the project manager should not report a project as doing better than the agreed upon metrics suggest.