At most companies, we have to deliver or lose our paychecks. Yet, we are so focused on results that we sometimes fool ourselves into thinking that, if we just wish hard enough, it will become a reality. This wishful thinking (plus the bad habit of single-point estimation) creates major political stress between project teams, their stakeholders, and those people that orbit around them (a.k.a. customers). Even worse, old school project management tools do us no favors in this regard.
The politics part is something I'm sure most readers will recognize. At the heart of it is a process often led by the same people week in and week out debating if something will take four weeks or five weeks and what change is needed to get people somehow working harder and hitting more of their milestones. It feels like continuous real-estate negotiation where nobody seems to win.
To be fair, the dynamic tension is real. On the one hand, you don't want your people sandbagging and slacking off; on the other hand, you want realistic estimates that you can make commitments against. The good news is that there is a simple cure for much of the politics: stop using single-point estimates. These evil little half-truths cause plans to go sideways all the time. Nothing illustrates this more than the estimation game.
The single-point estimation game with Steve and Bob
Steve is a grizzled hardball stakeholder. Bob, who is not grizzled, is a hard worker and eager to please. They use single-point estimation, which leads to a negotiation cycle that invokes the politics of self-preservation if you play it long enough.Steve: I need you to add an API to the accounts receivable module. Bob: Huh? Steve: Look, the business depends on this. How long will it take? Bob: Ummm, 8 weeks. Steve: That's insane. What's the best case? Bob: Well, if the stars align, maybe 4 weeks. Steve: Great, let's assume 4 weeks in the plan. Bob: No! I can't promise it any earlier than 6 weeks. Steve: Ok, 6 weeks. Bob: #&$^%!
Bob has done stuff like this before, and he's 80% confident he can get it done somewhere between four and eight weeks. Foolishly, he's settled for the midpoint of six weeks as a promise since he wants to please Steve.
Mathematically, there is a 50% chance he'll run late and then take heat for that from Steve. If this game gets played multiple times, he'll quickly start quoting eight weeks to protect his own paycheck. The game itself forces Bob to start sandbagging. How does Bob get Steve to agree to eight weeks? You guessed it —he starts his next negotiation at 12 weeks. Where Bob comes from, that's called a lie, and he feels bad about it, but what's a worker bee to do?
Sandbagging is toxic to plans, especially when you can't see the buffering. Bob's project manager will probably pad things as well by goosing his number by 40% because "developers always underestimate," but I digress.
Fortunately, you don't have to settle for this.
The ranged estimation game with Steve and Liz
Liz is savvier than Bob. She knows single number estimates are a lie. She estimates everything in ranges to capture the realistic uncertainty that exists in predictions.Steve: I need you to add an API to the accounts receivable module. Liz: That's pretty vague, but I feel 80% confident it can be done in 4 to 8 weeks. Steve: Look, the business depends on this. What are the odds of 4 weeks? Liz: 10%, best case. Let's spend this afternoon talking about requirements, and I can narrow that range for you for sure. Steve: Ok. When can I promise the customer? Liz: Right now, 8 weeks if you want a 90% chance of keeping that promise. If you want higher confidence, add a week. Even odds, we'll get it done in 6 weeks. I'm sure our customers appreciate predictability, so you probably should promise 8 or 9 weeks. Steve: Good point. I'll come back after lunch with more info. Liz: Great, I'll look through our past plans to see how long similar projects took.
This game is completely different because it's not a negotiation — it's a dialogue. Liz can stand her ground because she is an expert on the issues that are driving the uncertainty. It's also clear she can't resolve the uncertainty until Steve does his part.
Does Liz worry about her paycheck? No, she has a strong track record of delivering inside the estimate range and managing away the uncertainly via collaboration.
Forcing people to ignore undeniable uncertainty injects mistrust into the social network and invokes the politics of self-preservation, which create a lot of bad mojo for today's organizations. Moving the social dynamic away from negotiation towards collaborative dialogue can have a profound impact on delivering results in a predictable and productive way.
Estimation and negotiation have nothing in common so keep them separate. You can easily achieve this by estimating in realistic ranges instead of using a single number.
Charles Seybold is the CEO and co-founder of LiquidPlanner, a maker of online collaboration software that provides teams the ability to easily capture and manage uncertainty in their project plans.