1. Value is Created, not Earned
John Iverson
2 October, 2018

2. Brainwashing Objectives
By the end of this presentation, I would like most of you to
See yourself as Value Management Professionals and
Know your role in and techniques for creating and managing value

3. Understanding Value
What is the goal of every project? Right Answer: To enact change that creates value

4. Understanding Value
So what is value? Right Answer: What you get for what you give or quality/price

5. What is Quality? Understanding Value
Saying what you’ll do; doing what you said; doing it effectively; doing it efficiently
Degree to which a set of inherent characteristic fulfills requirements
Meeting or exceeding customer expectations
Conformance to requirements
Results of work efforts over total costs
Fitness for use
A subjective term for which each person has his or her own definition. In technical usage, quality can have two meanings:
a. the characteristics of a product or service that bear on its ability to satisfy stated or implied needs;
b. a product or service free of deficiencies.
What the customer says it is
Reduction of variation around the mean
Following established procedures
I’ll know it when I see it!
Number of defects per million opportunities

6. Understanding Value
Quality is defined as the customer perceived difference between realized and expected benefit.
- ASQ Service Quality Body of Knowledge

7. Expectations are set by awareness, experience, and price.
Understanding Value
The customer perceived difference between realized and expected benefit…
Expectations are set by awareness, experience, and price.
This difference can be expressed in units of currency.
The customer’s perception may change over time.
Mature quality perception is heavily driven by “qualities.”
Design Features
Functionality
Experience
Consistency / Reliability
The Project Manager does not get to control this; the perception must be influenced.

8. Understanding Value
Types of Qualities (Kano model)
Must-haves equate to requirements
Comparatives are qualities that are compared on a relative scale
Delighters are unexpected benefits
Customers are most able to articulate comparative attributes
Qualities shift over time

9. Understanding Value
Price includes both product / service price and all hidden prices:
Currency expenditures necessary to obtain or use the product / service
Expended effort to obtain or use the product / service
Time spent waiting to obtain or use the product / service
Opportunity costs

10. Understanding Value
Consumers are generally more aware of hidden prices than producers / providers.

11. Understanding Value
Value can only be perceived relative to what is known, and the perception of value changes as new possibilities are learned.
- Iverson’s much more applicable theory of relativity

12. Understanding Value

13. Planning Value within a Project
The key to creating value in a project is managing a design

14. Planning Value within a Project
Step 1: Know what value is expected from a project
Review the Business Case
Conduct stakeholder interviews, especially with Sponsor
What’s the vision?
What was the source of that vision?
Gain awareness of alternatives (What’s out there?)
Use iterative “shares” to update this understanding

15. Planning Value within a Project
Step 2: Identify the key attributes that convey that value
Put primary focus on comparatives while not neglecting must-haves
Find a way to delight
Identify hidden cost attributes and set targets
Determine a way to measure each and a benchmark if possible

16. Planning Value within a Project
Step 3: Incorporate the key attributes into a preliminary design
This may be the role of an architect versus project manager
Account for all key attributes in the project
Determine how the value will be conveyed
Review the preliminary design with key stakeholders

17. Planning Value within a Project
Step 4: Incorporate design creation and validation within the WBS and iteration plan
Incorporate tasks for design completion, review, and updates
Use iterations to validate design
Assume the design will need updated throughout the project

18. Planning Value within a Project
Story Time!

19. Managing Value within a Project
Step #1: Assign ownership of specific attributes and measures
Apply a performance management approach
Work with the owner to determine natural (or if necessary forced) validation points within the project

20. Managing Value within a Project
Step #2: Align the Quality Plan to the design
Ensure that the Quality Plan is aligned just as much to the design as company standards or anything else.
Include a review of the design against stakeholder inputs and the scope statement within the plan
Include value measures within the metric plan

21. Managing Value within a Project
Step #3: Use iterations to improve the design
Use agile methods the way they were intended
Solicit meaningful feedback in end user reviews
Don’t be afraid to go back to sponsors if the feedback suggests some redesign will create more value

22. Managing Value within a Project
Exorcism

23. In Conclusion
If this brainwashing has been successful, you will remember the following points:
Know what value is and more importantly how your projects create value
Know that the creation of value is more important than project completion
Know alternatives so that you have greater depth of understanding of how value will be assessed
Maintain a design and keep improving it
Make the value of your project speak to stakeholders and be able to measure it
Don’t try to earn value; create it!

24. Thank You!
John Iverson