2. Calculating Expected Time Durations s o PERT (Program Evaluation Review Technique) Building on WBS, determine time duration for each task. PERT uses optimistic, pessimistic and realistic time estimates to calculate expected time for a particular task ET = Expected time for completion 0 = optimistic time (minimum) r = realistic time (best guess) p = pessimistic time (maximum) Because ET should be closest to (1), it is weighted x4 more than (o) and (p) times Divide by B to determine the ET Example - Proposal Completion 0+4r+p 6 You are given a course assignment, a nice exercise might be to calculate expected completion time gr.orfze rET=567 The Resulting Culture? Led to extreme intra- and inter-firm competition intensity Employees and groups were often cast into competing positions Survival of the fittest BillG Review's - Could make or break a career Performance was often measured by number of times Gate's yelled profanities For Gates, intense confrontation was something positive and desirable Everyone in Microsoft was expected to be superior No need to coddle employees Commitments and Evaluations Commitments were detailed objectives stated in the form of a contract Set in stone, could not be changed Severe penalties if not delivered Business groups were Fanatically focused on ensuring their groups achieved financial results I missed, mid-year review called \"Correction of Errors\" Open forum, everything dissected by senior executives Stack ranking employee evaluation system Managers ranked their employees from \"number one\" to \"dead last\" M |crosoft took pnde INNOVATION STRATEGY AT MICROSOFT: CLOUDS ON THE HORIZON = 5 Select Financial Information in paying less than ma rket VaIUe For Consolidated Income Statement (in millions of dollars, except per-share amounts) talent. TR T Revenue 60,420 51,122 44,282 Operating expenses: Cost of revenue 11,598 10,693 7.650 Research and development 8,164 7,121 6,584 . Sales and marketing 13,039 11,455 9818 They belleved General and administrative 5127 3,329 3,758 Total operating expenses 37,928 32,598 27810 employees ShOUId be Operating income 22,492 18,524 16,472 Investment income and other 1,322 1,577 1,790 mot]va ted by the Income before income taxes 23,814 20,101 18,262 Provision for income taxes 6,133 6,036 5.663 potentlal Impact 0F Net income 17,681 14,065 12,599 their work. 34 Where do they go from here? Ninety thousand employees and countless large and small businesses all over the world depend on Microsoft. Their way of doing things has resulted in great success over the past 30 years... But is it sustainable? 35 Let's Digest Consider: Discuss the four different methods of innovation pursued by Microsoft (ThinkWeek, Quest, IdeAgency and Innovation Outreach Program) - strengths vs. weaknesses? > Imagine you are Steep going into the meeting. How do you defend these practices from skepticism? Should you defend them? Comment on the innovation culture in Microsoft? Is this sustainable?Example: IKEA Management requested a new Sales Promotion Tracking System (SPTS) Project team given 24 weeks to develop and implement -need to decide on timeline feasibility Project Manager identified following major activities for project: Requirements collection Screen design Report design Database construction User documentation creation Software programming System testing System installation Example: IKEA 2. Screen Design 3. Report Design 4. Database Design 5. User Documentation 6. Programming 7. Testing 8. Installation Example: IKEA Once completed? Determine sequence of activities and precedence relationships Helps you understand how various activities are related Start by determining the order in which activities should take place Example: Screen Design must come after Requirements Collection, and Testing must come after Programming First? Determine time estimates and calculate expected completion time for each activity Useful for developing a Gantt chart 1. Requirements Collection 2. Screen Design 3. Report Design 4, Database Design 5. User Documentation B. Programming 7. Testing B. Installation Develop a network diagram Screen Design User Documentation @ Database @ Installatio Design Requirements Collection Report Design @ bC.D Testing Programming WG Earliest completion time (T) N 3 . . . .. (2) Dotabese (5 ) {8 ) buts Earliest possible time that a particular activity or I e s task within a project can be completed. S A l Crucial in project scheduling. ) _ \\ () e Start at the project's beginning, and work o forward through the network diagram, e considering task duration, and dependencies. e Achieved by summing the period of each activity s i . from left to right. 3 Rt Doy 18 8 ' The earliest completion time for a task is the G ' earliest time it can be finished without delaying the project. NGl sl IS S 0= ST ET A What's the garllest we can Te=1 T.-185 Tg=22 get the project wrapped up? Earliest completion time Te=9 for this project, is 22 weeks. Once we have this in mind, we can see what flexibility we have towards certain activities - and find the critical path! ET= Example: IKEA- Latest Expected Time Iy, Latest expected time (T,) oo ot Refers to time in which an activity can be completed SN\\ without delaying the project. Particularly important to identify tasks that can be delayed, without affecting the project's final deadline. Helps project managers understand the flexibility associated to non-critical tasks in the project schedule. Understanding latest expected time for tasks is crucial for managing project schedules and ensuring that the project is delivered on time. Example: IKEA- Latest Expected Time Te=1i Start at Activity 8, and set T, equal to final T (22 weeks). To find values for each activity's T, start at last activity, and work back right to left and subtract each ET for each activity. | Example: IKEA- Critical Path? Slack Time Te=1 Te=185 Te=22 Equal to difference between = _ latest and earliest expected Tic S TL=22 completion times (T, - T) E- All activities with a slack time T =5 equal to zero are on the 3 critical path Finally, establish critical path Represents the shortest time in ET=5 which a project can be completed Also helps identify the sequence of connected activities that produce the longest overall period ET=6 ET=3 Critical Path * Non-Critical Path 3. Problem Analysis Approaches Problem Analysis Approaches LG Harnessing the energy of the team, clearly defining your challenge, and setting your project up for success. Tools: Kepner-Tregoe Method and Six Serving Men Milestone: A clearly defined challenge, with team buy in. (W Grow Building the foundation for fresh ideas by unearthing unmet customer needs and using them to create opportunity areas for ideation. Growing fresh ideas through collaboration by using stimulus to h people break out of Tools: Tools: Reversal Empathy Mapping Wildest |dea Game Milestone: Milestone: Inspiration for ideation. have been developed. Several impactful ideas Slide 16 of 36 Action and Rankingideas, gathering elp momentum for action and designing next steps. patterned ways of thinking. Tools: Winner's Circle Milestone: Top ideas prioritised and next steps are clear and actioned. Kepner-Tregoe Method - Problem Solving and Solution Building Situation Appraisal - Areas of concern or opportunity? - How complex are they, or what dependencies might they have? - What level of priority do they have? - Where do you start with each one? Know Phase Decision Analysis - Why are you making this decision? - What objectives should you consider? - What are the other alternatives? - What could go wrong with the alternatives? Problem Analysis - Cause of problem? - How would you describe the problem? - Possible causes? _ -What causes are most probable? Potential Problem Analysis - What could go wrong? How can you mitigate? How can you minimize effects? How will you monitor/evaluate outcome? Use \"Six Serving Men\" Based on a poem by Rudyard Kipling: " keep six honest serving men, they taught me all | knew, Their names are What and Why and When and How and Where and Who.\" Example: \"We need to improve innovation!\" What products/services need innovation? ~ Why is innovation needed? How can we successfully measure the i ? When should we aim for developments: effects of innovation? Who is responsible for establishing/driving Where should we focus innovation efforts? ) ) a culture of innovation? Empathy Map Canvas * Often, there is a lack of S input/insights from key stakeholders/customers * This phase involves: - Gathering clues to help broaden teams' perspective on the opportunities for innovation - Using the insights gathered to create opportunity statements to bring forward the grow phase What are the top pain points? What do they THINK and FEEL? PAING GAMNS What do they SEE? What do they HEAR? What do they SAY? What do they DO? Grow Phase - Wildest |dea Game Imagine an Al driven Innovation Catalyst - what would that look like? 22 Slide 21 of 36 The Winner's Circle Revenue Ease of Implementation Potential High High Action Phase - Map potential Time to Short Low Cost of solutions to the Market Implementation Winner's Circle. - Which looks most attractive? High High Customer Needs Met Team Passion 4. Case Study - Microsoft and Sustainability? 24 Meet Michael Steep Chief of Operations for Microsoft Innovation Team. Works with Chief Innovation Officer, Chief Technology Officer and senior executives. Desire to leverage technology to deliver new sources of growth.Innovation at Microsoft: Top-Down, or Bottom Up? Historically, radical innovation at Microsoft depended on the vision and drive of senior leader. Gates - famous for understanding technology and business. Implemented his ideas through a hands-on approach to management. Previous S years, new products accounted for over a third of revenue. - Effort to tap into diverse ideas of all Microsoft employees, and turn those ideas into profitable new businesses Innovation Outreach Think Week Quest IdeAgency Program Web portal - senior I ClO's from 10 of execulives set tech Microsoft's largest challenges accounts Technical papers submitted annually to Gates Invalved most senior and technical fellows Isolated himself for a Tapped into expertise of Every employee could Non-competing industry week senior staff submit ideas in response segments | i | Two day brainstorming conference - five year horizon Cut ko the chase removing thousands of others Make comments/ suggestions as needed Selected projects were incubated Apple Microsoft weren't PP the only ones with Constant innovation stream cash to burn... Worth approx. % of a trillion dollars Steep was Amazon convinced they Pioneers in cloud computing paradigm \\g:\\;%t:ldbtasr:etsi . _ - Worth approx. 800 billion dollars from the inside to retain position as a market leader. 1R | Leader of online information ' Also worth approx. % of a trillion dollars Google Cracks Were Beginning to Emerge... S 25 of 36 Serious discussions about the value of Grassroots innovation began to take place Chief Software Architect believed ThinkWeek and Quest were completely reliant on Gates > |[deAgency was considered a wonderful initiative. On paper. Number of successes after first year of operation. In practice? Several major drawbacks Scaling across divisions Immense amounts of time to facilitate the process A year earlier, they were seen as the way to go. Now they were being questioned. L6 - \\ \\ The Challenge? Expected Growth in Billions (S) Product groups were under tremendous pressure to deliver organic growth of $3-5 billion per year over the next 3-5 years. Ducks fly high. Eagles fly higher. - Microsoft Mantra