All of us have to deal with ambiguity to some extent in our professional lives, but project managers wrestle with it on a daily basis. This is particularly true when an organization is looking to execute a project which will innovate or expand into a new market. As a project manager, you can’t base estimates on empirical or historical methods since they don’t exist. The temptation is there to manage an innovative project with tools and information that we are familiar with, but this will probably lead to failure.

One illustration of this danger is described by Clayton Christensen, the influential Harvard professor, in his excellent book How Will You Measure Your Life?. In the early 1990’s, Disney was planning to build a theme park in Paris. Disney executives based all of the estimates for infrastructure and organizational expenses on the assumption that the average person spends three days at a Disney theme park. After the initial opening in 1992, this project cost Disney billions of dollars in financial loss over just a few years.

What went wrong? The Paris location had less than half of the rides as the usual Disney resort, so attendees could complete all of the rides in one day. At Disney World or Disney Land, park goers completed the 45 rides in about three days. Somewhere along the way, a project manager had neglected to take into account the number of rides as a key factor, and instead focused on the easily available historical projections.

The implications of this case study should be daunting if you are a project manager. One bad assumption caused an enormous financial loss. And even more sobering is the fact that the offending assumption was invisible to the executives reviewing the project estimates!

To raise the probability of success whilst planning a complex, bold new project, Christensen suggests that we should follow the technique of Discovery-driven Planning, an approach first suggested by Rita Gunther McGrath and Ian C. MacMillan in the late 1990’s.

In Discovery-driven Planning, we as project managers should be asking an important question to drive our thinking: “What assumptions must prove true for our projections to be realized?” In other words, we should reverse traditional project management approaches by starting with outcomes, and then working backwards to determine what factors must be in place for those outcomes to come to fruition. 

For the Disney example above, project managers should have asked “What assumptions would have to prove true in order for people to spend three days at our Paris theme park?” This question would have helped them realize that the disparity in the number of rides made the three-day estimate an inaccurate one. 

As you embark on your next project, give Discovery-driven Planning a try. And if you’ve ever been a part of a project where bad assumptions crippled the outcome, share some comments below on your experience!

 

Tell me your thoughts in the comments and let’s open a dialog. I would be excited to hear other opinions on this topic.

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Justin Scoville

Justin Scoville

Contributing Author

Justin Scoville's unique adventures in project management have spanned international volunteer opportunities in Mexico and Israel, complex government grant programs, and more recently education technology implementations in the private sector. Proudly bearing the battle scars of initiatives both small and large, Justin enjoys exploring the frontiers of project management, particularly its intersection with process improvement methodologies, strategic planning, and product management.

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