Skip navigation
All Places > Clarity PPM > Blog > Authors Kathy Dobson

Clarity PPM

11 Posts authored by: Kathy Dobson Employee

Hi PPM practitioners! In my last blog, I highlighted some of ways we often hinder agility by over-engineering our PPM solutions. In this blog, I’d like to balance that negativity with a few positive reminders about the importance of staying true to the core values that PPM can bring to your organization. This isn’t about tool jockeying or wrench turning, and it isn’t about drowning in tons of meta data. It’s about knowing the value that PPM can bring in linking execution with strategy, helping you achieve your target business outcomes, and eliminating barriers along the way.

 

While value can come in lots of shapes and sizes and can be influenced by lots of internal and external factors within the organization, I’ve highlighted a few of the core PPM values that should be foundational to all. Have the courage to take an honest look at them and ask yourself, “Did we get it right? Are we providing value to the business and making progress toward delivering outcomes in a more responsive way? If not, why not/what are the barriers?”

PPM Core Values

 

Core Value 1 – Portfolio Transparency

At a minimum, portfolio transparency is important because it enables the organization to keep a close pulse on where and how valuable human and financial resources are being invested and whether they are fully aligned to business strategies and priorities.

  • Are we capturing all the work or are there pockets of work that consume valuable resources and go under the radar?
  • Do we have an ideation process in place to responsibly capture, track, and plan new opportunities? Can we realistically plan, prioritize, and deliver them or do they get stuck in the proverbial black hole?
  • Are we working on the right things? Do they align to the organization’s strategies, goals, and financial targets?
  • Do we have the capacity to deliver on our commitments? Are we lacking critical skills?
  • Which initiatives should be outsourced, purchased, or developed in house?
  • Do our initiatives have measurable deliverables and outcomes that are paced and tracked at a cadence that will ensure we don’t miss our window of opportunity for real value?
  • Can we align our initiatives to key corporate assets for a total view of IT cost?
  • Can we model change and if necessary, easily and quickly respond?

 

Core Value 2 – Financial Transparency

Financial transparency ensures that stakeholders have visibility into investment cost. This will have limited value if it isn’t interlocked with portfolio transparency.

  • Can we easily track spend variance to budget at both the portfolio and investment levels?
  • Are we burning funds at a faster pace than we are delivering planned outcomes? More importantly, can we identify and correct before negative impact?
  • Are we categorizing work to enable the organization to incur maximum benefit from capitalization/accounting practices?
  • Are capital and operating funds properly aligned to our portfolio?

 

Core Value 3 – Capacity and Demand Transparency

Capacity and demand transparency isn’t about keeping resources under a microscope. It’s about making sure the organization has the right skills, at the right time, to deliver target outcomes.

  • Are resources working on the right things/aligned to portfolio plan?
  • Do we have the right mix of staff/skills required to deliver planned initiatives?
  • Do we have insight into both opportunities and other inflight/committed staffing requirements?
  • Do we know how much of our staff it takes to keep the lights on vs. other strategic and tactical work?
  • Do we have a sustainable process that makes it easy for DevOps managers to collaborate and staff initiatives in a timely manner?
  • Can we model future capacity?

 

Core Value 4 – Outcome Transparency

Outcome transparency isn’t necessarily about capturing lots of meta data about projects, enhancements, and other keep-the-lights-on activities, building complex stage-gates that often result in execution/delivery bottlenecks, and/or mandating detailed status reports that take days or weeks to prepare, assemble, and distribute (yesterday’s news is old news). It’s more about making sure you can maximize team and work performance in a way that enables the organization to continuously deliver value in the most optimized way.

  • How quickly can we pivot when priorities change, with minimal disruption?
  • Can we track and measure outcomes, whether they are planned, in progress, or delivered?
  • Do outcomes measure up to promised value?
  • Can we easily track risk exposure?
  • Do we make it easy for stakeholders at all levels to gain the necessary insights from work being performed, from ideation through execution/delivery?
  • Do we have simple guidelines in place to know how best to deliver work? That might mean leveraging agile/scrum-type concepts for some work, while taking a waterfall or hybrid approach to others.
  • Are working teams empowered for delivery and do we adapt the right level of governance without creating bottlenecks?
  • Do we gain insight from historical work?

 

These are just a few of the core values of an effective PPM solution—there are many others. I hope they give you a little food for thought and can help keep you from veering off the beaten path. Whether your IT organization’s biggest barrier to delivering value-added outcomes is speed, focus, efficiency, adoption, or something else entirely, I challenge you to use CA PPM to take a step toward getting back on track.

 

Which of these (or other) PPM core values speak to you, and which do you find most challenging? Share your thoughts in the comments.

 

Readers interested in more detail around CA PPM can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners! Unless we’ve been hiding under a rock lately, we all know that businesses across the globe are in various stages of digital transformation, fueled in part by the need for greater agility. We also know that designing to deliver solution outcomes that support business outcomes is an important part of this transformation.

 

Many organizations are struggling to make the paradigm shift from a focus on implementations to one on outcomes and insights. To meet a business requirement, which may not be relevant six months from now, we often over-engineer the solution (instead of asking why and what value it will bring) or we lose sight of the importance of balancing other components like solution maintainability, adaptability, and sustainability.

Overengineering Hinders Agility

 

What is Over-Engineering?

Overengineering

 

Simply put… making a solution more complicated than it needs to be, delivering capabilities that will never get used, or designing for too far in the future.

 

 

 

 

 

What are the Consequences?

When working with customers to implement CA PPM and conducting PPM health or maturity checks, I frequently run into the issue of over-engineered solutions. There are many consequences, but in this blog, I’ll focus on three common ones. Let me emphasize that I’m not implying that the architecture examples below are wrong—just that you need to be sure you’re doing them for the right reasons.

 

1. Reduced Process Agility

Reduced Process Agility

Over-engineered solutions often reduce process agility by making the solution cumbersome to work with and/or adding a lot of non-value work to the user’s day-to-day business process—which generally leads to low adoption. And if the solution isn’t utilized as intended, it certainly can’t provide value to the organization and support the important business outcomes and insights for which they were targeted.

 

Some common examples of this include:

    1. Creating dozens of custom attributes (most of which will never be used in real practice). This often happens when there is a lack of PPM process standardization, and each department wants its own flavor of the same field. The team creates complex partitioning and/or builds dynamic lookups when process standardization may have been the right business decision in the long run. It also frequently happens when transitioning off a legacy system to CA PPM. In this case, the team often tries to replicate every field in the original system without considering its current relevance and value (or whether CA PPM already has an equivalent field). Another common occurrence is when the team tries to automate most of the project document artifacts when a simple attachment attribute or link would suffice. Bottom line, if the field isn’t consistently reported on somewhere, it probably isn’t needed. 
       
    2. Over-loading screen white space—e.g., configuring project/other object properties pages with so many sections and fields that users must infinitely scroll (and don’t populate half the fields). This often happens when lots of custom attributes are defined (per above) or when the team tries to make the project properties page a one-stop shop for everything. CA PPM provides collapsible sections to help simplify page views, but the key is to keep the pages clean—with relevant information that’s simple and easy to understand.

    3. Creating so many custom sub-pages that users forget where information is stored (and justly complain that it takes too many clicks to find something). CA PPM sub-pages are extremely valuable in segmenting information based on authorization to access and/or categorizing information by topic without overloading pages with too many sections/fields. Balance between simple navigation, page content relevance and ease of use is key.

    4. Notification spam, generating so many user notifications that they lose context and value. This often happens when the solution is designed to alert users when an event happens/action is needed/something is due. Alerts are great, but if users will naturally be informed in their routine interaction with the system, they may not want their Outlook inbox filled with dozens of messages every day. Alerts can be good when time-sensitive action needs to be taken or there is a significant time lapse between reviews. Again, balance is key.

    5. Process gridlock often happens when the team develops too many tightly controlled workflows for project governance processes, such as project initiation, approval and stage gating. CA PPM workflows handle this capability well, but the solution is often designed with too many steps and fails to give the project manager a way to handle exceptions or start over when something doesn’t go as planned. PMs get frustrated and look for ways around the system.

 

2. Reduced Organizational and/or Operational Agility

Reduced Org and Op AgilityA solution may be over-engineered if it delivers lots of bells and whistles but fails to deliver significant outcomes aligned to organizational strategic objectives. In this case, organizational and/or operational agility may be reduced; someone likely forgot to ask “Why are we doing this?” and focused on delivering capabilities that have nothing to do with driving value to support business priorities. As in #1, this will generally result in low adoption or the product being shelved.

Here’s a not-so-obvious example:

 

Let’s assume an organization’s top business priority is to restore cost competitiveness, so IT is charged with reducing operational costs by $10 million in the current FY and an additional $20 million in next FY. IT implements CA PPM to provide the financial transparency to properly select, prioritize, and manage investments. The project team quickly focuses on deploying project and schedule management and time tracking. A very common approach… however, it really doesn’t help achieve the target outcome in the current FY. The customer needed a more portfolio-decision centric solution that would enable it to quickly target investments with the best potential to meet the cost reduction goal and apply the appropriate funding to those investments. Schedule management and time tracking were important, but implementation of out-of-the-box portfolio management, demand management, and project management with simple budgeting would have been a good starting point for Release 1 to allow the basic intake, review, and prioritization of investments via the portfolio waterline and dashboards. A roadmap targeted to align PPM capabilities by priority/release to support the organization’s objectives would have been valuable.

 

3. Reduced Technical Agility

Reduced Technical AgilityTo use a popular phrase, “just because you can, doesn’t mean you should.” Deploying lots of complex and/or low-value customizations can also make it very difficult to maintain the product and adapt to new technology or business changes without a lot of intervention, which ultimately leads to low sustainability, which usually leads to product sitting on the shelf, contributing little to no value, and/or doing the proverbial restart.

 

Let’s say an on-premise, heavily customized customer only scheduled an upgrade release every two years due to the length of time it typically took them to remediate and test new releases. The customer could benefit from many of the new features, but doesn’t have the capacity or budget to stay current, or at least -2. Had the solution more closely followed CA’s modification policy when the customizations were designed, it would have been much simpler to deploy upgrades with less remediation needed on a regular and more timely cadence. (See my recent blog on Technical Debt.)

 

How Do We Prevent Over-Engineering?

The best way to prevent over-engineering your PPM solution is by keeping crystal-clear focus on your core business drivers for implementing PPM and the target outcomes and insights you want to achieve. Every business requirement should be closely examined to ensure it fully aligns to one or more business drivers (the why), and that the solution design for that requirement delivers an output (the what) that makes a positive (and measurable) contribution toward achieving the target business outcomes and insights (the value). Whether an agile, waterfall, or hybrid delivery approach is taken, CA Services is highly focused on ensuring that business outcomes are properly identified, prioritized, and mapped to the requirements/user stories that will make up the delivered solution. CA Services and certified partners follow PPM good practices when designing your solution, leveraging decades of experience and hundreds of customer implementations. Our focus is on your success and making sure you not only get your solution implemented properly, but taking the extra step to ensure you get full functionality out of your investment in CA PPM.

Prevent Over Engineering

 

Readers interested in more detail around CA PPM can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners! The concept of technical debt came up recently with a customer and it provoked quite a discussion. So, I thought I’d share a few insights about this fondly (or not-so-fondly) used term.

 

What is Technical Debt?

 

Technical Debt1Let me start by saying that I don’t profess to be an expert in code design, although I have warm memories from days of compiling PL/1 and Cobol code to get the Assembly machine language to look for code inefficiencies. Anyway, the term “technical debt” has been credited to Ward Cunningham, one of the authors of the Agile Manifesto; he used it as an analogy to describe refactoring they did on a financial application. As he said, “Some problems with code are like financial debt. It’s OK to borrow against the future, as long as you pay it off.” See www.agilealliance.org/introduction-to-the-technical-debt-concept/. Great analogy!

 

Organizations have continued to broaden the use of technical debt as a metaphor for anything from temporary code, outdated code and dirty code to design flaws. No wonder my suggestion that my client had incurred technical debt with their use of CA PPM provoked such a negative response. I think Cunningham’s intent was close to my meaning: In the context of CA PPM, I use the term to mean that making customizations to the as-shipped product that deviate from CA recommended and supported practice will eventually incur operational support costs. Such customizations may require future remediation or refactoring after an upgrade or to become compliant if the customer moves to a CA software-as-a-service (SaaS) architecture. An example of this would be performing direct database updates using a gel process or via data manipulation/definition statements. Technical debt does not necessarily imply poor technical design—rather that one should consider that remediation will likely be needed sooner or later.

 

When Does CA PPM Technical Debt Make Sense?

 

Technical Debt2The answer is ultimately up to each customer. From my experience, it’s always best to minimize customizations, but customers running CA PPM on premise will occasionally employ customizations to support a business requirement. In those scenarios, the customer has carefully weighed the pros and cons of supportability / maintainability and has determined that the value gained from meeting the desired business outcome exceeds operational costs of remediation due to an upgrade, feature redesign, or future decision to move to SaaS. Refer to CA’s customization policy for guidelines.

Readers interested in more detail around CA PPM can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Kathy Dobson

PPM Insights: OBS Power

Posted by Kathy Dobson Employee Jun 8, 2017

Hi PPM practitioners! I’m sure many of you will weigh in on this topic. It’s one of the basic elements of implementing CA PPM, but I get a lot of questions from customers on how and when to leverage the CA PPM organizational breakdown structure (aka OBS).

 

OBS Defined

Project Properties ExampleThe OBS is a powerful CA PPM feature that enables a hierarchical representation/categorization of data to be defined and assigned to most studio-created data objects (e.g., resources, ideas, projects, portfolios, etc.), including custom objects. It differs from a lookup-type attribute, which is just that—a data point that you select from a list of values. With an OBS, you select from a list of values but can also do the following:

- Grant security permissions to CA PPM users for specific data instances based on their OBS membership. Example, if you want to implement guidelines that enable PMs to update projects within their department only, or resource managers to book projects for their team members only, using an OBS is a perfect way to do it.

- Categorize data object instances such as resources and projects for portlet and report filtering (e.g., by Organizational OBS, line of business OBS, etc.)

 

Should I Use a Lookup or an OBS?

Portlet Report ClusterMy best advice is to consider carefully how you will use the data. If you will use it as common criteria for filtering data instances to be included in reports or portlets, and/or to govern security permissions, consider OBS. Most out-of-the-box CA PPM portlets and reports (and all object list pages) can be filtered by one or more OBSs.

If a custom lookup is defined, portlets created with an object data provider (instead of a query) can be configured to use the lookup. However, query-based portlets and out-of-the-box reports must be modified to leverage the custom lookup. There’s value in both methods.

For older versions of CA PPM that still leverage the Data Mart, a maximum of five OBSs are supported. The flexibility of Jaspersoft/ Data Warehouse removes this restriction, but most organizations have fewer than five OBSs.

 

OBS Components

An OBS is composed of the following components:

  • OBS name: Think of this as an OBS type to specify how the OBS will be used. Common OBS examples include:
    • Organizational (to model the organization’s team structure)
    • Department (similar to organizational, but it models the financial cost center structure and is used by CA PPM financials). This is a required OBS, but default value can be set up if financials aren’t used.
    • Lines of business (to identify the sponsoring or funding org)
    • Geographic locations (to be optionally leveraged in identifying resource rates for costing and used by CA PPM financials) This is a required OBS, but default value can be set up if financials aren’t used.
    • Project types (to model types of work tracked in the organization)
    • Resource pool (to model where staffing should occur)
    • Other customer-specific OBSs (e.g., product line)

 

  • OBS levels: Specifies the structure depth of the OBS hierarchy. CA PPM supports up to ten levels in a hierarchy. For financial OBSs, it’s common to flatten/summarize the cost center structure to fit within CA PPM’s ten levels (e.g., cost center levels 10 and below would be reflected at level 10). An unlimited number of parallel OBS levels (width) can be created in the OBS.

 

  • OBS units: Specifies a specific node in the hierarchy structure. An OBS unit can be an ancestor or descendant in relation to other OBS units. When you reorganize, or make certain OBS units obsolete, you can move them to another branch/level without losing access to the data.

Basic OBS Model

OBS Association

An OBS must be associated with one or more objects to enable the OBS’s capabilities. For example, once you associate an OBS (such as a resource pool OBS) with a resource object, a resource manager/administrator can assign the specific resource pool OBS unit to a resource. When associating an OBS with an object, you may specify whether the association can be assigned to any OBS level/unit or to only the lowest-level unit.

Financial OBS Framework

Two pre-defined OBSs in CA PPM are mandatory when using financials—department and location. The basic framework for processing financial transactions in CA PPM includes entity, location, and department.

  • Entity represents the distinct legal company (e.g., a corporation). Each entity must be assigned to specific departments and locations by assigning the department and location OBSs to the entity in the Financials Setup section of the CA PPM Administration menu.

 

  • Locations represent the second level of the financial structure. When a location is added to CA PPM through the UI (Financials Setup section of the Administration menu), the location is automatically added to the location OBS structure. CA PPM does not permit adding units directly to the location OBS structure.

 

  • Departments represent the 3rd level of the structure and designate the units in the organizational structure of the company. The units typically represent the organization’s cost centers.   Departments must be tied to a location and may be assigned to one or more locations. When a department is added to CA PPM through the UI, it is automatically added to the department OBS. CA PPM does not permit adding units directly to the department OBS.

Customer-Specific OBS Framework

CA PPM supports the definition of other OBSs not directly associated with the organization’s financial structure. The key difference is that for financial OBSs (department and location), CA PPM manages the hierarchical structure, including addition or removal of units in the OBS as new departments and/or locations are added through the UI. The hierarchical structure setup and addition/removal of units for non-financial OBSs must be done via the CA PPM OBS Administration menu. Assignment of the OBS unit to a specific data instance (such as a specific project or resource) may be done on the application side general properties page for the relevant object. A data instance (e.g., Credit Card Processing Enhancement project) can be assigned to only one OBS unit in a given OBS type. However, it may be assigned to more than one OBS type (e.g., Credit Card Processing Enhancement project may be assigned to both the department OBS and the organizational OBS).

 

OBS Filtering for Portlets and Reports

Portlet Report ClusterAs noted earlier, OBSs are available for filtering CA PPM portlets and reports based on whether they have been associated with the data object. For example, when filtering for resources, all OBSs will be available in a “Show OBS” drop-down list at the top of the “Select OBS Unit” browse window. Once the OBS type has been selected (e.g., department OBS or resource pool OBS), the specific hierarchy and values for that OBS will be displayed for selection.

 

 

 

Share: Let's hear what other PPM practitioners are doing with OBSs!

 

Readers interested in more detail around CA PPM OBSs can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi CA PPM practitioners! Do you have certain types of resources that you always have more demand than capacity to fill? Did you know you can add constrained resource roles to your Portfolio Waterlines view for a quick check and balance against capacity target?

Portfolio Constrained Resources

 

How it Works

Select Roles

Add the critical resource roles to the portfolio Target view. In the example below, our portfolio tracks architect, business analyst, developer, and project manager roles. Note - beginning with 15.1 the number of roles that can be added to a portfolio increased from 25 to 75.

Portfolio Role Targets

Check Capacity

A glance at the portfolio’s Capacity view quickly highlights several issues between April and June (in red) for 4 of the roles.

Portfolio Capacity View

Resolve Constraints

Next, we want to examine these roles in further detail as primary constraints by adding them to the Waterlines view.

  • Click Configure in the upper right corner of the Waterlines view; select the specific roles to be tracked (they will appear in Selection List as “Role: Architect, Role: Project Manager”, etc.); add them to the List column (can be relabeled).

Configure Waterline

The selected role’s total demand per investment will display in the Waterlines list (above), as well as the control gauge section at the bottom of Waterlines view (below).

Control Gauges

At first glance all looks well (green); the role demand is well within the overall target capacity. Based on the Capacity view, however, we know we have an issue during certain periods.

  • In the Aggregate section of Waterline view at top right, select a constrained role (e.g., project manager) to review in further detail.
    Select Aggregate Constraint
  • Click the “123 icon" in the top left section (see above) to display aggregate amounts by investment by period. In the example below, April and June have a significant variance between demand and target capacity for project managers. The portfolio manager may utilize the Plans Tab feature to conduct a what-if analysis and work with the investment and resource managers to determine the best course of action. If you are using the new 15.2 Resource Management UI it's easier now then ever.
    Portfolio Waterline View

 

Readers interested in more detail about CA PPM Portfolio Planning and Resource Management can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners! Welcome back to the last blog in this Financial Planning series (for now, but who am I kidding); hope they have been helpful.

Why Track Investment Spend?

Key business drivers for tracking actual cost against investments are generally in the family of cost control. Every wise PM wants to ensure that delivered outcomes provide value to the organization. Part of delivering that value includes ensuring that the cost of actual work performed is in line with authorized spend (cost and budget plans). Insight into whether actual cost constitutes variance to plan is a critical early warning/risk indicator for leadership and project teams, and is especially important while there’s still time to make course corrections.

Financial Review Report

 

Regardless of delivery mindset (agile, waterfall, hybrid), the consequences of unmanaged cost overruns can force undesirable scope reductions (leading to outcomes that fail to delight the organization) and/or slower time to market (resulting in lower profitability). Early insight into poorly performing investments also enables executives to make better decisions about when to reinvest in a more optimal portfolio.

Portfolio Review

 

Actual Cost Entry Methods

CA PPM supports several methods for capturing actual cost:

  • Timesheets: Actual cost of labor resources automatically derived from posted CA PPM timesheets based on the cost/rate matrix.
  • Transaction Entry: Manually entered transactions for non-timesheet labor and other non-labor expenses by investment/ resource/transaction date/quantity based on the cost/rate matrix or supplied rate.
  • Imported Transactions: Labor and/or non-labor transactions imported from an external source (e.g., Oracle, SAP) leveraging the CA PPM Financial Transactions Adaptor Packaged Work Product (PWP). Check out more info on CA PPM PWPs and this blog by CA architect Janet Ulrich.

 

Dashboards and Reports

CA PPM provides value-added dashboards and reports to track transaction-, investment- and portfolio-level costs based on the needs of PMs, Finance, and other leadership (beauty of CA PPM's end-to-end ideation to deployment integration).

Investment Actual Cost

Investment Cost by Period

 

There's much more, but hopefully you have seen the simplicity of getting started with CA PPM Financial Planning. Go for it.

 

In Case You Missed It

Taking the Mystery out of Financial Planning – Part 1 (The Basics)

Taking the Mystery out of Financial Planning – Part 2 (Financial Framework)

Taking the Mystery out of Financial Planning – Part 3 (Classifications)

Taking the Mystery out of Financial Planning – Part 4 (Managing Rates)

Taking the Mystery out of Financial Planning – Part 5 (Cost and Budget Plans)

 

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners! Welcome to my 5th blog in the series. I hope these are helpful to CA PPM Financial Planning newbies.

Which Investment Types Support Detailed Forecasting?

The good news—all of them (Ideas included 14.3+). The better news—once you know how to create CA PPM cost and budget plans, you can do it for any type of investment. The level of planning detail usually varies based on the type of investment (ideas, projects, applications, etc.), but the steps are the same.

 

Project Financial Forecast

Let’s use project forecasting as our example, since most PPM practitioners have produced a project forecast or budget in Excel. The goal is generally to provide a projection of project cost broken down by expense categories over time.

Excel Forecast ExampleCA PPM cost plans are used to prepare a high-level estimate of investment cost during the intake/initiation phase (leveraging ideas or projects) or a more detailed projection during the planning phase (preparation of business case). They are then used for obtaining funding approval. Once the investment has entered the execution phase, cost plans provide an ongoing forecast of spend and track actuals and variances to approved spend.

 

Cost Plan Structure

The cost plan structure consists of a definition of general properties, along with line item details grouped by investment cost categories, with estimates for each planning period.

Cost Plan Properties

Cost plan properties define the planning period and attributes used to group costs into specific expense categories.

Cost Plan Properties

To ensure reporting and tracking consistency, establish a standard for grouping attributes used to plan investments. Planners can create other cost plans for the investment, grouped by different levels of detail for analysis, but the plan of record for each investment should be standardized as defined by the organization’s business process.

Cost Plan Details

Cost plan details contain line item detail by planning period. In the example below, the forecast is defined by cost type (for breaking out capital vs. operating costs) and transaction class (categories of expense).

Cost Plan Details

 

Populating the Cost Plan

This is one of my favorite features; it demonstrates the power of CA PPM component integration.

Labor Forecast

During initiation or project planning, the project manager identifies staffing requirements by estimating resource roles and level of effort the investment requires. During planning, the PM works with resource manager(s) to target and commit resources.

Two powerful cost plan features are Populate from Investment Team and Populate from Task Assignments. Leveraging the PM’s staffing work, the cost plan can automatically forecast labor cost by using one of the population methods and the cost/rate matrix. The Populate from Investment Team action uses team allocations to forecast cost by category and time period. Populate from Task Assignments uses assignment estimates defined in the project’s work breakdown structure (WBS) to project cost by category and time period. The cost plan can be repopulated to reflect staffing and work revisions. Note: The Populate from Task Assignment action is not available on ideas, applications, assets, products, services and other work investment types, as these do not have a WBS. Populate from Investment Team is available on all investment types.

Other Cost

For other cost (e.g., purchase of equipment or travel), estimates can be manually entered. Repopulating the cost plan doesn’t impact manually entered estimates for non-labor. Care should be taken, however, not to manually update estimates on line items coming directly from the Team or WBS estimates. (One method or the other should be used consistently.)

 

Cost Plan of Record

Since CA PPM supports multiple cost plans, only one may be designated as the plan of record (POR) for communicating planned cost in all CA PPM reports and dashboards.

 

Using Cost Plans for Approved Spending (Budget Plan)

The cost plan is also used to request budget approval in CA PPM, reflecting approved spending for the investment. The PM flags the cost plan POR and uses the submit for approval feature to automatically generate a budget plan. A copy of the submitted cost plan is created as a budget plan and reviewed/updated by the budget approval team. If approved, the budget plan is automatically flagged as the budget plan of record (POR) and becomes view-only. Revisions may be managed by repeating the process. CA PPM retains budget history.

Budget Plan

 

Ongoing Forecast

Forecasted spend may vary during the life of the investment. CA PPM supports reforecasting spend by period without touching the approved budget plan. Revisions may be made directly to the cost plan POR, or the Copy Cost Plan feature may be used to generate a new forecast, retaining the original. Revisions exceeding current approved budget or major reductions may also leverage the Budget Plan submission noted above.

 

Coming Soon

In my last blog for the series, I’ll cover entry of actual cost.

In Case You Missed It

Taking the Mystery out of Financial Planning – Part 1 (The Basics)

Taking the Mystery out of Financial Planning – Part 2 (Financial Framework)

Taking the Mystery out of Financial Planning – Part 3 (Classifications)

Taking the Mystery out of Financial Planning – Part 4 (Managing Rates)

 

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners – welcome back! My last two blogs covered the essentials of CA PPM Financial Planning setup (framework and classifications). In this post, I’ll review the cost/rate matrix and the basics of its role in financial planning.

The cost/rate matrix (referred to by many as the rate card) defines the rate at which resources should be costed in the financial plan and costed/billed in financial transactions. As noted in my blog on basics, this can be as simple as setting up a single blended rate for all resources. It can also be broken out by different rates based on factors such as the role of the resource (business analyst, developer), type of resource (employee, offshore contractor), where the resource is located, standard time vs. overtime, capex/opex, etc. Regardless of the level of granularity, most CA PPM customers use a fully loaded blended rate for employees and actual rates for contractors. (Fully loaded blended rate is accounting language for a rate that includes employee wages and the full burden of other employee costs such as taxes and benefits.)

Rates by CriteriaMatrix Types

CA PPM supports separate matrices for labor, equipment, material, and expense type resource rates, including cost and revenue differences. Unless there is a compelling reason otherwise, most organizations use a single matrix for all resource types, including cost and revenue differences (simplifies maintenance).

Rates

Three rate fields are included in a cost/rate matrix:

Rate: The billing rate used to calculate total revenue in financial plans and chargeback transactions. If revenue/chargeback isn’t used, set as 0 or make it the same as the actual cost rate.

Standard Cost Rate: Not used in CA PPM, but can be used for custom reporting (e.g. compare FY original planned rate vs. current rate).

Actual Cost Rate: The rate used in deriving the planned cost of the resource in CA PPM financial plans and the actual rate applied to financial transactions for the resource (if not provided on the transaction).

Cost/Rate Matching Criteria

The assignment columns in the matrix define the criteria used for matching the correct rate/cost in financial planning and transaction processing. Up to 10 of the following fields may be used in the matrix as matching criteria. (The most two common are in bold.)

Rate Criteria OptionsOther categories frequently used for matching include Resource Class (for breakout by labor type), Input Type Code (for designating standard time vs. overtime or billable vs. non-billable), Cost Type (for differentiating capex vs. opex rates), and Department/Location (for differentiating rates by business unit or region).

Cost/Rate Dates and Order

The first two columns in the matrix define the effective from and to dates for the rate. This enables you to set up new rates in advance without removing or revising current rates (helpful with annual planning in advance!). Note: Changing a rate does not impact financial transactions that have already been processed. CA PPM’s WIP adjustments feature makes provision for recalculating prior posted transactions if needed. Re-populating an investment’s financial plan, on the other hand, always uses the latest rates.

The order of the columns is important. CA PPM evaluates columns from left to right to qualify the correct match. For example, if Role and Investment are used (as per below), the rate for all resources with the role of developer in 2017 is $150/hr., except developers on project PR1005 (an exception project) are $0/hr. In 2018, all developers will be $155/hr. The asterisk (*) serves as a wildcard for all other conditions.

Rate Example

Non-labor type resources (hardware, travel, etc.) can be included in the matrix, but a more common practice is to manually estimate in financial plans for forecasting purposes, and include actual cost at time of financial transaction entry (since such rates are typically not standardized).

For external contractor resources, a common practice is using Resource Class and a general/blended planning rate, with actual rate entered for financial transactions.

Investment Setup

Linking the cost/rate matrix is part of financially enabling investments. If financial transactions are entered without rate and cost, CA PPM looks for the rate/cost in the investment's designated cost/rate matrix. You can default matrices at the investment level, entity level, and/or system level. CA PPM first looks for and applies matrices at the investment level, then at the entity level, and then system level. If financial transactions are entered with a rate/cost, these are used instead of rates in the matrix.

Coming Soon

In my next blog, I’ll cover CA PPM cost and budget plans.

In Case You Missed It

Taking the Mystery out of Financial Planning – Part 1 (The Basics)

Taking the Mystery out of Financial Planning – Part 2 (Financial Framework)

Taking the Mystery out of Financial Planning – Part 3 (Classifications)

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners—welcome back! In my last post, I covered the essential setup of the CA PPM Financial Framework (Entity, Locations, Departments, Fiscal Periods). Here I will define the most common financial classifications needed to support CA PPM Financial Planning.

CA PPM financial classifications enable you to properly categorize resources, investments and financial transactions to meet the needs of the organization’s financial planning process. Most of these may be used to group the line item investment cost detail within cost/budget plans. The descriptions below are not meant to be exhaustive, but represent the most common uses.

Resource Classes

Resource classes are typically used to categorize the organization’s various types of labor (e.g. internal labor, external labor such on-shore contractor, off-shore contractor, etc.) for financial planning purposes. Non-labor resource classes may be defined to support categorization of expense, material, and equipment type resources. CA PPM supports definition of different rates by resource class. If financial tracking is not required at a resource category level, create a default resource class. Resource classes are assigned to resources on financial properties and defaulted on actual cost transaction entries; they may not be overwritten during actual cost transaction entry.

Plan by Resource Class

Transaction Classes

Transaction classes are commonly used to categorize the various types of cost incurred on investments (internal labor, external labor, licenses, hardware, software, travel, etc.) for financial planning and reporting purposes. CA PPM supports definition of different rates by transaction class. If planning is not required at an expense category level, create a default transaction class. Transaction classes are assigned to resources on financial properties and defaulted on actual cost transaction entries; they may not be overwritten during actual cost transaction entry.

Plan by Transaction Class

Charge Code

Charge code is one of the customer-driven fields that may be used in financial planning. In the example below, charge code is used to group cost by category of work coming from the investment’s work breakdown structure (WBS). It is also commonly used for sub-categorization of expenses, designating billable/non-billable expense, or for sub-categorization of CapEx/OpEx beyond Cost Type values of Capital and Operating. CA PPM supports definition of different rates by charge code. Charge codes are required by CA PPM for actual cost transaction entry and may be assigned to the project as a default, at the WBS task level or during cost transaction entry. They may also be entered during time entry. If not used by your financial planning process, create a default value.

Plan by Charge Code

Input Type Code

Input type code is most commonly used to indicate whether a resource is billable or not. Another common use case is delineation between standard time and overtime for a resource. Input type code is assigned to resources and defaults on time sheets and actual cost transaction entries but may be updated. CA PPM supports definition of different rates by input type code (e.g. standard time vs overtime).

Timesheet Use of Input Type Code

Investment Class

Investment class differentiates different types of work across investments as it relates to the treatment of financial processing. For example, using out-of-the-box CA PPM, “Standard” can be used on investments that generate revenue or with inter-department transfer of charges (using CA PPM Chargebacks). “Internal” indicates that the investment generates no revenue (e.g., administration/maintenance). Investment class is assigned to the investment (or company if used). CA PPM supports definition of different rates by investment class.

Company Class

When applicable, company class can be used to differentiate internal from external customers. Company class is assigned to the company (if used). CA PPM supports definition of different rates by company class.

WIP Class

WIP class is most commonly used to differentiate investments for revenue recognition as part of financial reporting. WIP class is assigned to the investment (or company if used). CA PPM supports definition of different rates by WIP class.

Coming Soon

In my next blog, I’ll cover the role of the cost/rate matrix.

In Case You Missed It

Taking the Mystery out of Financial Planning – Part 1 (The Basics)

Taking the Mystery out of Financial Planning – Part 2 (Financial Framework)

 

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners—welcome back! In my first blog in this series, I covered the basics of CA PPM Financial Planning by defining core capabilities. In this post (and next one), I will address essential elements of setting up CA PPM Financial Planning.

We will start with the Financial Framework. To support your financial planning model, you should first define the internal structure for tracking financial information, consisting of an entity and its associated locations and departments.

Entity

An entity represents the highest level of the financial tracking structure and is typically the overall organization’s name. You can define multiple entities if your organization has subsidiaries that keep separate general ledgers. Using multiple entities is also an option for companies supporting financial planning in multiple currencies, but use caution, because information cannot be shared across entities and adds additional administration complexity. For most PPM implementations, a single entity representing the overall company is all you need.

Financial Framework

Locations

Locations typically represent the geographical locations where you conduct business and must be associated to a single entity. When multiple entities are created and a location supports both entities, set up two locations. It’s also possible to set up parent/child locations. Locations that you create are automatically added to the location organizational breakdown structure (OBS). Unless you use PPM Chargebacks for inter-departmental transfers and/or establish a rate matrix model for resources with rates that vary by location/region, you can generally establish a single default location.

Departments

Departments represent the company’s organizational units (cost centers) that perform work on investments and/or receive the services. Departments must be associated to a single entity and may be associated to one or more locations. It’s also possible to set up parent/child departments. This is an area that should be thought through carefully with the financial team and kept as simple as possible. As noted with locations, you may be able to get by with a basic structure that represents the organization at a high level and add more detailed org unit breakouts as the need arises. Start with the minimum departments needed to support financial cost center tracking for investments. Be careful not to mix up the need for modeling the cost center structure with the resource pool structure for staffing resources. If they are the same, you can often use the department OBS for both. If not (financial tracking trumps), consider creating a separate resource pool OBS to support staffing.

Prerequisites

A few prerequisites need to be created before building the financial framework.

  • Currency: CA PPM supports single or multiple currencies. If multiple currencies are used, this decision is typically made and defined during CA PPM installation. One currency may be defined as the system currency (home currency) and must be defined before setup of the financial framework. If multiple currencies are used, foreign exchange rates need to be defined from/to each currency supported before processing financial transactions.
  • Location OBS: A location OBS placeholder needs to be defined before creating the entity. Location OBS units are automatically created as locations are defined.
  • Department OBS: A department OBS placeholder needs to be defined before creating the entity. Department OBS units are automatically created as departments are defined.

Entity Definition

Fiscal Periods

Fiscal time periods (not to be confused with time sheet periods) are created to support use of detailed financial plans or chargeback rules and are defined at the entity level. For example, if your investment cost needs to be planned by month, configure monthly periods (beginning with the earliest planning month) through the longest planning period to be supported on investments. Fiscal periods may be created for the following types: 13 periods, weekly, monthly, semi-monthly, quarterly, and annually. Add additional fiscal periods as needed as part of annual maintenance. Once a fiscal period has been used on an investment plan, you cannot modify the period’s dates or deactivate it.

Note: Beginning with CA PPM 15.2, fiscal periods are required to support the telescoping feature in the new Resource Management user experience.

Coming Soon

In my next blog, I’ll cover the key financial classifications needed to support financial planning setup.

In Case You Missed It

 

Taking the Mystery out of Financial Planning – Part 1 (The Basics)

 

 

 

 

 

 

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.

Hi PPM practitioners! I am an architect in the CA Services PPM practice, and former CA customer. Over the years, I have been amazed that many of my fellow practitioners shy away from implementing financial management, thinking that it is too complicated or that they are not that savvy about financials. That’s why I am writing a series of blogs to take some of the mystery out of CA PPM Financial Planning and unravel the perceived complexity.

In this initial blog, I will define PPM Financial Planning’s core capabilities. This will give you a sense of where to start your journey. In later blogs, we will explore the capabilities in further detail (the good, the bad and the ugly).

The Basics

It will simplify things to break down PPM Financial Planning into 5 basic pillars, along with a supporting setup structure. This will help you figure out which core capabilities are more critical to your organization's desired outcomes and establish a maturity roadmap. In this post, I’ll assume that you are ready to move beyond the general financial cost/budget on the investment’s financial summary page to explore the value-added capabilities of CA PPM Financial Planning.Financial Planning Pillars

Pillar 1 - Investment Cost

Pillar 1 is about planning and tracking the cost of your investments. The major sub-components are forecasting, budgeting, benefit planning, and capturing actual cost. At a minimum, I suggest you plan/forecast  the expected cost of your investments (projects, applications, assets, services, products and other work). Start with projects in which you are already creating Excel-based requests for expenditure - don't try to undertake everything at first - give yourself time to learn and optimize. (My mantra is “Do the basics well and then build out.”) You can forecast (via CA PPM Cost Plan) as a simple breakout by period of basic investment expenses you need to track, such as labor, hardware, software, travel, etc.

CA PPM Cost Plan Details

It is also important to capture an approved budget for tracking spend performance throughout each investment’s lifecycle. Forecasted spend may vary from month to month, but ideally not beyond the approved budget limit. CA PPM supports re-forecasting spend by period without touching the approved budget. During the open planning cycle, or as authorized by your organization’s change control procedure, you can submit a revised budget for the investment(s) for approval while retaining budget history.

CA PPM Budget Plan

As your organization matures, you may also want to forecast expected benefits to be received from investments. This enables leadership to better assess expected return on each investment, a critical element of sound portfolio planning. You want to spend resources (money and people) on the right investments.

CA PPM Benefit Plan

To maximize value from planning investment cost, it is important to track actual cost incurred by each investment (labor and non-labor expenses). Actual cost may come from time entry, manually entered actual cost transactions (via transaction entry) and/or transactions imported from an external source. Actual cost may be viewed from the Cost and Budget Plans as shown above and in other Portlets within CA PPM. Below is example of the investment Hierarchy view showing comparison of actual to planned, budget, and benefit. The second view shows a list of the detailed transactions making up the actuals posted against the investment.

CA PPM Hierachy Actual vs Plan and Budget

 

CA PPM Posted Transactions

Pillar 1’s final element is a period-driven rate matrix (aka rate card) that defines how resources should be costed. This can be as simple as a single fully-loaded blended rate for internal resources or roles, or it can be broken out with different rates by type of resource/role, location, etc. The rate matrix is particularly helpful in automatically monetizing planned resource labor on investments for forecasting purposes, translating time entry into resource cost and/or costing out imported transactions.

CA PPM Rate Matrix

Pillar 2 - Time Tracking

At first glance you may question why time tracking is part of financial planning. I’m glad you asked! Time tracking is the simplest way to capture labor cost on an investment, not to mention foundational to effective schedule management.

CA PPM Timesheets

Pillar 3 - Capitalization

Many organizations need to track capitalized expenditures separate from operating expenses for financial reporting and compliance reasons. CA PPM supports this using the Cost Type feature. While there are various ways to do this, the most basic is to categorize costs as capital or operating by default at the project level (e.g., if the entire project is operational cost), task level (phase/type work varies between capital and operating) or team level, where each resource may specify a flat percentage of capitalization.

CA PPM Gantt View with Cost Type

Pillar 4 - Cost Allocation and Recovery (Chargebacks)

CA PPM supports the ability to inter-transfer (allocate/debit) investment cost back to other departments for their share of the cost, for specific period(s), using the Chargeback functionality. A corresponding recovery (credit) is issued to the departments that performed the work. The debit rule for the inter-transfers may be set up at the system or investment level. Charges may be applied to a single department or spread across multiple departments by percentage and period based on qualifying rules. Credit rules are applied at the system level only.

CA PPM Cost Allocations

Pillar 5 - Financial Reporting

Several out-of-the-box reports provide a great starting point for financial planning and tracking. Some reports enable planning or budgeting vs actual cost analysis, and others support capital/operating expense analysis. One report lists actual cost transactions by investment / resource / date. An exciting element since the Jaspersoft reporting engine was introduced in CA PPM 14, is the ability to easily create other ad hoc reports with the convenience of CA PPM Data Warehouse (DWH), which comes with ready-built domains for reporting and supports inclusion of custom attributes in DWH.

CA PPM Transaction Inquiry Report

Coming Soon

In my next blog, I’ll explain the foundational financial setup, discuss the various classifications and show how they support financial planning.

 

Readers interested in more detail around CA PPM Financial Planning can check out DocOps. I encourage you to participate in the best-in-class CA Communities site, where you have access to your peers, events and support. You can also reach out to CA Services for information about CA PPM and individualized business outcome references and analysis. Feel free to post in the comments section of this blog or contact me directly via email and Twitter @kdobsonppm.