2020 European Virtual Conference: How Quality Data Can Transform Your PPM Reporting

November 5, 2020 | By Samantha Varner

You can watch the replay of Daniel Echtle’s full presentation, “PPM Roadmap @ Lonza & Why reporting should come first,” below:

Daniel Echtle of Lonza presented at the Tempus Resource 2020 European Virtual Conference on October 8, 2020.

The story of how Lonza, a global manufacturing partner for healthcare solutions, transformed their PPM reporting, started with some severe pain points. In his presentation at the Tempus Resource 2020 European Virtual Conference, Daniel Echtle recalled taking over as Lonza’s head of IT Portfolio Management in 2019. He noted a lack of transparency about resource availability, project status, and processes, along with poor data quality, too many projects undertaken, and no clear project evaluation or rating criteria, among other challenges. Without clear PPM reporting processes and people willing to follow them, getting projects done always required escalation, but not with collaboration or partnership. To put it simply, “We were too busy to improve,” Echtle explained. “Everyone was utilized at 100%, but nothing was getting delivered.” Moreover, executives couldn’t use data as a robust source for decision making. As such, a change needed to be made to Lonza’s process regarding project portfolio management (PPM).

Now the Global Head of IT Application Services, Echtle shares his experience of significantly increasing Lonza’s data quality and reestablishing trust in planning data by combining Tempus Resource with newly developed capabilities for creating a PPM report.

“Don’t aim for 100% utilization. This will kill your flow. At the end of the day, you’ll have busy people and unfinished projects.”

-Daniel Echtle, Lonza

PPM reporting roadmap and why reporting should come first

Lonza’s portfolio management reporting solution began with a 4-tiered roadmap that focused on Governance; Communication and Business Partnering; Automation & Reporting; and IT Capacity Management. One particular emphasis was to address the individual bottlenecks and thereby provide a way to improve the flow of the entire system. To clarify, Echtle offers a vivid metaphor of traffic. If a particular highway is at 95% capacity, the flow of traffic will be very slow. It follows that if you reduce capacity to 75%, flow will quickly accelerate. “The more we’re utilized, the longer the work takes us,” Echtle concludes. His goal was to create a way to “eliminate busy-ness,” get rid of the jams, and re-establish a flow in order to finish projects on time.

“The Tempus dashboard was really a game changer,” Echtle recalls. It became Lonza’s “system landscape,” serving as a single source of truth for users that could be accessed across all departments and integrated with several other platforms and apps that all flow through Tempus.

Today, project prioritization at Lonza stems from a rating system that scores IT Complexity alongside Business Value. First priority is given to PPM reports with low complexity and high value, while those with low value and high complexity become candidates for cancellation. This concept of canceling projects was new to Lonza, but it was key to actually getting more projects done. Other lessons learned include using project portfolio reporting to enable prioritizing and delivering reports and projects by doing less and keeping it simple, identifying and clearing bottlenecks regarding resources, optimizing data quality, leveraging automation, and gaining management buy-in.

To learn more about how Resource Portfolio Management can help your organization access and leverage leverage quality data and accurate, up-to-date reporting, contact ProSymmetry, makers of Tempus Resource. And be sure to check out all of our speakers from the Tempus Resource 2020 European Virtual Conference.

Transcript: How Quality Data and Reporting Can Transform Your PPM

Welcome also from my side.  So, I have been asked to also present what we have done at Lonza in the area of PPM.  For today’s presentation, let me give you just a quick overview of what is Lonza, then I will do an introduction, tell you where we have been starting, what were the major pain points and, like Marc already mentioned, I will also tell you a little bit about throughput versus utilization.  This was also big learning for myself and where is Herbie.  So, where is Herbie?  This you will find out what I mean with this and then I will show you the PPM roadmap, which we have done in 2019, and last but not least, I think the learning I think that this is really the major key point for today, so I will also come back to the title, “Why Reporting Should Come First,” because for us it was a big learning and I would also like to share this with you.  Maybe you can also take some benefits for your PPM roadmap.

Lonza at a Glance

Just briefly some facts about Lonza, $5.5 billion in sales, maybe the most prominent thing about Lonza currently is we are acting in the life science area, so it’s pharma, it’s also nutrition, it’s also chemical company.  We are producing so we are not selling directly to the end customer, but we are the partner for many companies like Roche Novartis, but also like currently Moderna where we are the partner for the future vaccine production, so if Moderna is now successful with their Phase 3, Lonza will be the producer of all the vaccines for the Moderna Company for the Covid vaccine.

So, really it’s a huge topic which there’s a lot of areas where we help but mainly about pharma services.  It’s about greens and hygiene but also Head and Shoulders is, for instance, Lonza ingredient, Vitamin B3.  Lonza is on all of your iPhones.  We do special chemicals that are used in iPhones, so it’s closer than you think.  This is also a little bit the slogan here.  We are acting in many different areas.  Again, it’s two divisions.  It’s one on the one inside we have the farmer division, and on the other side more the chemical division.  Again, it’s $5.5 billion in sales, around 15,000 people, a global company.

Just briefly about myself, I’ve been with Lonza since 2008.  I’ve had various roles starting in logistics and going over to BI and looking into finance and reporting, and I was actually leading the portfolio management in 2019.  Again, changed jobs already, so I’m now leading one of the application services divisions for LSI, this is the chemical division.  So here I’m leading all the business applications like SAP, sales force, whatever.  We use quite a big range of applications we have to maintain.  I am located in Basel, Switzerland.

Starting Position

Let’s start now with the real presentation.  Where did we start?  When I took over this job in 2019, this was actually stalled this far, this light from our first workshop where we monitored the brainstorming.  The picture says it quite good, too busy to improve.  I think we were doing a lot of firefighting at that time, missing transparency about project status, who is now the right approver, what is our resource availability (I think this was one of the biggest issues), and it was quite manual as well because I think in Lonza we have quite some stakeholders because of the different businesses we have to maintain.  As you can imagine, we have many different views within the company, so it’s not so easy simply to have one portfolio revenue with one business.  You have to have several meetings and then it’s not everything within one.  We have more or less several companies within a big company, so the complexity is quite big.

Long story short, here the main points are really we had no accuracy, we were not close enough to the business and we just got a lot of short-term requests with projects and people were not really willing to follow the PPM process.  There was always escalation required to bring a new project in and get it done.  I think there was also no understanding of the business, what issues we were having from a resource perspective.  It was very difficult for us to argue with resource constraints because simply there was not enough understanding and also it was not a good collaboration, I would say.  I think we were not really business partnering as you should and, therefore, it was very difficult to get if you need to argue that you cannot do a project immediately it was very difficult discussions.  I’m not saying that we have solved all of that now, but I think we have improved a lot.  I will now show you how we got there.

Where is Herbie?

Let me start with this because I think this actually was a big learning for me.  I was reading this book at the time when I started this job.  The goal is actually I can recommend it and, long story short, this guy is operating a plant and he simply can’t deliver.  Everybody’s utilized 100 percent.  By the end of the day nothing gets shipped out.  Then one day he had to go on a boy scout weekend with his son.  They did a hike and there was a big group of around 10 or 12 kids, and there was Herbie.  Herbie was a little bit heavier than the other ones and he had a big backpack and, of course, he was always behind and everybody had to wait all the time.  So, I’ll shortcut this a little bit, by the end of the day they found out that they needed to work on the bottleneck.  They had to improve the bottleneck to make the whole chain go faster.  They then looked at his backpack.  Of course, he had a lot of sweets and stuff in his backpack, so they improved him and they also made sure that they have a constant speed.  So, everybody had to go to the same speed because they also found out that if the guy in front runs away and it stops again it doesn’t help.  We need to go constantly; we have to have a flow.  Actually I have to say that this book was also a big learning for me because we really need to focus to get the flow.  We need to focus on our Herbies.

So, where are the bottlenecks?  I think this is also what I used internally, whereas Herbie, to really push people to make sure data is accurate and that we find the right bottlenecks and then we can early enough in the process fill those gaps in order not to run into a situation where we get stuck and we don’t have the flow.

Sure 100% Utilization is a Good Thing?

And another thing.  So this is maybe something I think stole this slide from actually maybe Marc provided it to me one day.  It’s from Gartner.  It’s a very interesting table here, so here you see the time it takes to deliver something.  So, if it takes one day to deliver something and you have 70 percent utilized, you have this job done in 3.5 days.  If you utilize 95 percent, it takes you to deliver this one day of work, it takes you 28.5 days.  If you utilize 99 percent, it takes you almost 150 days to get this delivered.  This also reminds me a little bit of where we had started because our goal was always people need to be planned, utilized 100 percent.  We need to have I don’t know how many projects in parallel.  This is really the thing.   You need to get the flow and let me go to the next slide here.

Busy People vs. Finished Work

This explains it quite good.  If you compare this with the traffic, if you really have 95 percent utilization, we all know how this ends up.  Traffic jam.  And the only thing you have is busy people if you relate it back to our project world.  If you have 75 percent utilization, you still have flow and you have finished projects and I think this is what we need.  We don’t need just busy people who work on I don’t know how many projects in parallel.  We need to work sequentially and we need to get rid of this traffic jam.  And of course, these two messages were for me the most important.  We need to focus on bottlenecks and we should do less, because if you do less, we deliver more.  These are the two learnings I would like to share and this is really what made the difference for us also.

PPM Roadmap 2019

As I mentioned before, I was only doing, let’s say head of portfolio management for 2019.  Therefore, I will only share what we have more or less been working on in 2019.  We looked at it and we developed this roadmap.  This is a little bit simplified version so, of course, we had much more granular defined what we want to achieve in those different areas, but it was more or less about governance, communication and business partnering, automation and reporting, and of course capacity or resource management.

If we start here with governance it’s clear we developed a new process, we looked at guidelines and governance meeting, project prioritization, which I will talk about in some slides.  For us it was also important here with the governance that we have a process which can be understood, accepted, and of course the main goal for us is with this process, was also we need to involve the business in order to prioritize the project and, as I mentioned in the beginning, we need to have an understanding of the business in order to also get understanding if something cannot be delivered immediately.  Communication was always key.  This is standard, I guess you know.  Always communication first so we did really a road show, we set up the different meetings to share the portfolios, and I think this is of course key that you get closer to the business and also develop this trust.  I think this is for sure the most important component.  For us automation and reporting was a big component because we were, in the past, quite busy with getting all the reports created.  Most of the time was actually spent on operational tasks to prepare slides to get data out of the system because all the data was missing, was not consistent.  We had to always go back to the project managers and ask how is this project going, so it was simply not consistent and we spent a lot of time just running after data.  That’s why we also then implemented this dashboard and I think for us this was the biggest achievement because with this dashboard we have achieved a lot.  I come back at the end.  But for us, this was the big accelerator to have this dashboard because we could also give to people the business access directly to the dashboard.  We had all the teammates seeing the capacity of the people.  We have reports there where we see how good the planning accuracy is of the project managers, so we compared the accuracy and this helped a lot to improve the data.  This dashboard also had components like the monthly tracking.  I will show some pictures in a minute.

So for us, the central component was really this automation and reporting and then, of course, capacity management.  Here in the capacity management, we really had to start.  When I came into this role we had to really start with the base topics, so things like scenario planning we maybe touched at the end but really had to make sure that we looked at the primary roles we had set up, that we had the right granularity of planning, that we agreed on a process for who is doing what, who is checking, do we have the monthly capacity planning in place and stuff like that.  I’m coming more from a business application area; therefore, I have quite some understanding how it works in teams but also in projects.  So I was also very close to the team leads, which was a big advantage for me because they also need to help a lot to make this fly.  And this was here, the capacity management.  I think for 2020 we also go more now in the direction of what-if scenarios and improving further distance planning with Tempus.

IT Project Portfolio Management

Let me show you a little bit of our process.  It’s a busy slide, but I think I will not go to deep here, but just point out some of the steps we are doing.  Of course there are some enterprise architecture steps and also security steps required here but I will really emphasize here on the value assessment.  So we have decided that we rate projects by business value and IT complexity.  Those are our dimensions which we use in order to prioritize projects.  I have a slide separately for this, but I think how it works is that we mostly have monthly an IT project board where the projects can be presented, and at this stage the complete planning needs to be available in Tempus and we also check that.  It needs to be feasible and all conflicts should be resolved at this meeting.  If there is still some discussion, then this will happen in this meeting.  What we also achieved is that we come four times a year to the executive committee where we also have a portfolio review and then we really discuss the more critical topics.  This for us is also an opportunity now to show bottlenecks in the organization.  It was always difficult for IT to get new resources and to argue as to why we need more headcounts.  Now we really have the facts based on the Tempus data and we can use that also to argue with top management and show the exactly the planning and show them exactly in which areas we have need for more people.

IT Project Request Evaluation and Prioritization

I don’t want to bore you with too many details here.  I want you to get something out of it.  This is also for me a good learning and we really discussed a lot how do we prioritize projects.  We agreed at the end of the day on those two axes here so we have on the one side the IT complexity.  This is rated by the IT so based on is it a new technology.  Do we have the people in-house?  How long does the project take?  Is it GMP relevant? How many interfaces, etc.?  So we had criteria which helped us to rate and clearly define how to rate such an IT project.

On the other hand, we had business value.  Business value was not so easy in Lonza because we had different businesses within Lonza.  Not every business has the same objective so we more or less did the business value assessment on a division level, so each division had separate criteria how they rate the project, but at the end of the day we had projects with high value and low complexity.  Of course those need to be Priority A.  These are the really low-hanging fruits, low complexity and high value.  This should be Priority One.

Then, of course, we have higher complexity but still high business value, so we said here’s elective prioritization based on possibility to reduce complexity.  Here we say in general, do it but try to reduce complexity.

Then we have the ones which are easy but also don’t bring so much value.  So we said Priority Three depending whether or not you have resources available you can do that.

The ones which are complex and bring low value, cancel.  The “cancel” was something new.  I think we never did cancel in the past, so these are also the topics so we also needed sometimes needed the executive committee to help us getting such things approved.  But I think with such a graphical bubble drawn, it was better to really show how was this project classified and it was also accepted by the people and everybody understands that this is a good prioritization.  Of course we knew that there is always a tendency to rate always the value too high.  The business cases are getting better and better but I’m not sure how sustainable some of them are, but this is another discussion.

Assessment of Project Requests

This is not a screenshot out of our power BI dashboard.  This is just a PowerPoint mock-up which we did, but this is more or less how we went into the meetings with the business.  Of course, here this is just an example.

PPM Reporting

So, here actually you can see here some of the screenshots I was not allowed actually to show more granular, but it is sometimes too sensitive information, but here maybe you can see those bubbles.  This is just the priority.  Here we see the prioritization with this value and complexity.  Here you see our funnel of projects so people can go in, even the business can go in and select the BTU and look at the projects in their area.  Then we also have some monthly reporting so this is now our capacity by primary role.  This really helps with the team leads to go through the capacity of the people and see where we have issues and also see how things have been reported in the past so we also compare actual versus planned hours because the hour recording is also done in Tempus.  We have really used the dashboard a lot and I will explain at the end what APN helped us with.

Tempus and System Landscape

From a system landscape perspective really made Tempus our one single source of truth, so if a new request we have a SharePoint entry page where people can request new projects so we feed this into Tempus.  We have employee vacation and public holidays coming from our time management.  We then do here of course the resource planning, we have all the attributes which we need for project management, also the reporting is managed in Tempus.  Also, the monthly cost tracking and progress tracking we have enhanced Tempus with additional fields and more or less have everything in Tempus, so it’s our single source of truth.  The actual hours go back to SAP.  We also link here the WBS or the internal order number; we link them as an attribute in Tempus.  This will automatically feed it back into SAP.  What we now did here is we have an hourly extract into a SQL database and then from there we feed our power BI dashboard.  So just for the techies who are interested in how we roughly did this architecture of how we integrated Tempus.

In the beginning we had a lot of especially this tracking was done separately and the reporting was done separately, so we decided that even though we use really Tempus for one single source of truth and this was I think for us an important decision to make here.

Lessons Learned

Coming to the end or let’s say the lessons learned, the first thing I started with was also to prioritize, focus and deliver.  So remember the traffic jam?  You need to do less and in order to do less I think you need to prioritize.  Therefore, our thing was to ensure and focus on the right and most valuable project.  Here I indicated blue where I think reporting helped us.  With those bubbles and with the graphical visualization of those priorities, it really helped us to show the businesses exactly how their projects are rated.

And then look for the Herbies.  I think this is really look for your bottlenecks and manage the bottlenecks.  I think this is the most important thing.  Resolve bottlenecks early and back to the utilization, also don’t aim at 100 percent utilization because this will kill your flow.  At the end of the day you always need to make sure that you have flow of projects and that you don’t lose this flow because then at the end of the day you’d have busy people, but you don’t have finished projects.

Keep it simple, especially with the process.  I mean of course our process is still not simple.  Don’t try to have each and every possibility incorporated into the process.  Rather keep it simple so then you have a better acceptance of this process rather than having it too complex.  For me one important topic is the primary role for those of you who are already using resource in Tempus.  We also said in the beginning that people said here really want to do a more granular primary role, but we at the end of the day decided really okay it’s better to keep this on the level which is manageable rather than making it too complex.  Now we still have we also using skills within Tempus, but the primary role for us is quite granular, but it helps us to see already in which areas we have issues and this helps a lot.  I guess if we now improve and get more professional, we can still play around with this primary role and make it more granular but at this stage and especially from the beginning it was essential that we keep it on a level which everybody understands and can deal with.  If you get it too granular, then it’s also getting difficult to manage.

Communication and training, as usual I think those are the topics you need to do.  You simply cannot change processes and not communicate or do not train.  I think this is really essential.

Single source of truth and data quality, I think this is clear, but I think data quality and why did the reporting help us to improve the data quality.  As I mentioned before I think we had specific reports which showed the planning accuracy.  We still have them, so we really measure also the project managers, how good they are planning.  We see, for instance, if we have an original estimate of 100 days and we see if he has planned 200, then of course something is wrong.  There is deviation so I think this is how we measure it.  We look also if a project is already running, we see we have a percentage complete so we can tell exactly if it’s 50 percent complete, 50 percent of the resources should be planned in the future.  This is the way that we had built reports which really show how much off is the current planning in Tempus and base to the original estimate.  Of course in some cases, the estimate needs to be revised but this is then also something that should be reflected in the tool.  This really helped us a lot to get especially the project managers motivated to have the data up to date because they don’t want to see their names at the bottom of the list when it comes to forecast accuracy.  So, this also helped a lot.

Business involvement, I think this is clear.  Business partnering, I think you need to be close to them and you could even make this point blue because we even give them business access to this dashboard and I think they we were really able to see resource situations and project status within the tool, but maybe here we also need to see if we have the down the road a separate dashboard for the business rather than having more because it sometimes maybe has a little bit too much information for them, but again, business involvement and business partnering are always key.

Transparency, there’s the wrong text in here.  Sorry about that.

Automation, I think this is really automation of the PPM process helped us a lot and also the reporting because again in the beginning we were just busy with creating slides and with this dashboard.  We don’t create slides anymore.  We show the dashboard and show it directly.

Data Quality I’ve had here double but I think this is always key.  If people cannot rely on the data, there’s no trust and people will not use the tool.  This is also something which needs to be key.

And last but not least, management buy-in.  If you really want to make PPM work, you need management to buy in and help you to improve that.

That’s it from my end.  I was short and crisp.

Q&A

Q: What is the difference between slide five and nine.

A:  Here I think it’s probably more I think added than the data quality here later on but I think here was more the single source truth and data quality.  Both are dependent.  For us the data quality in the beginning when I started some people were using Tempus, others not.  At the total level, you could never rely the data is right; there was really no trust.  I think with the dashboard when we then had this accuracy reporting this was a big game changer because then people really, as I mentioned, they don’t want to be at the bottom of the list when it comes to forecast accuracy.  We really could identify easily, which are the projects that are planned the best and planned worst compared to original budgets.

 

 

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