Copyright: Joe Marasco ©
2015.
Published here October 2015.
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Commentary on the Nomogram
I would like to draw your attention to the following characteristics of the
nomogram.
- Locate the intersection point with the project success axis, indicated by
the vertical arrow near the top of the axes. If you have a "class 3" project,
read off the percentage on that axis. If you have one of the other 4 classes,
navigate horizontally to the band corresponding to your project class and read
off the percentage there. Each step left or right changes the result by 10%.
- You may ask: why are we doing this analysis anyway? If I predict a probability
of success of only 53%, should I decide that the risk is too great, and should
I cancel the project? Well, that would be one option. But if you can find a way
to improve the predicted value by 10%, you go from slightly better than even odds
to being an almost two-to-one favorite; the difference between 50% and 67% is
huge! So, at 53% and a good project plan, you might start to look for ways to
improve PE and TS and have a better shot. You can use the nomogram to do a sensitivity
analysis to see the best way to improve. The initial prediction is but a starting
point for further analysis.
- We provide two examples on the nomogram for your convenience. They illustrate
the interaction of the three variables. In the first example, a class 4 project,
we have a PE of 6 and a TS of 4. This is a moderately structured project using
a somewhat well-adapted and well-executed process, but with a slightly less than
average team.
Referring to the nomogram, we see that since this is a class 4 project, we
use second from the right-most vertical scale to locate the value of TS, 4, and
the left-most vertical scale to locate PE, 6. Drawing a line to connect them,
we find an intersection with the success scale at about 53%. However, this is
a class 4 project, so we must move one colored band to the left, into the band
that has a 4 at the bottom. Reading the value from that colored band, we obtain
a probability of success of about 63%. We would predict that they would be successful
a little less than two times out of three.
- On the other hand, consider our second example, a much harder class 1 project.
We have a stronger team, TS = 6, and an adequate but slightly weaker
process, PE = 5. Using the same methodology, these values yield a success
percentage of 45%, so we would expect a favorable outcome slightly less than half
the time.
- Note two features. First, project classes have an offset of 10% relative to
each other. For a "class 3" project, with a success percentage of 50%, an equivalent
combination of PE and TS will yield 60% for class 4 and 70% for class 5.
Similarly, they will give 40% for class 2 and only 30% for class 1.
In our model, project difficulty has a powerful effect.
Second, PE and TS have different influences depending on class. Note in the example
that for a class 4 project, we raise the success percentage more by raising
PE than by raising TS by the same amount. This is because for moderately structured
projects, process is more important than people, by a factor of two to one. For
class 5, the ratio increases to three to one.
On the other hand, for the class 1 project, the success percentage goes up
more by increasing TS as opposed to PE; for a very creative project, people are
more important than process. For class 3 they have equal effect, for class 2
the ratio is again 2:1, and for class 1, 3:1 as before. Figure 4
summarizes these assumptions.
Class
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Characteristic
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Success
Percentage Offset
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People vs. Process
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Ratio
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1
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Highly Creative
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-20%
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People more important
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3:1
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2
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Moderately Creative
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-10%
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People more important
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2:1
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3
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Routine
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Baseline
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Equal
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1:1
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4
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Moderately Structured
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+10%
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Process more important
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2:1
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5
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Highly Structured
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+20%
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Process more important
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3:1
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Figure 4: Summary of sample assumptions
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