Publication

Understanding a project's size - An important step in improving new product development

There are many reasons why the number of new product introductions and product line extensions has increased including: lower development costs, increased competition and failure to innovate new categories. Regardless of the reason, new product development has increasingly become a more visible and strategic function within most organizations. With the increased visibility and strategic focus has also come a more rigorous project management culture and oftentimes a program management office (PMO).

In PA Consulting Group’s experience, one of the first things a PMO undertakes is to categorize the varied initiatives by size. The benefits of a size metric are that it is easily explained, understood and communicated. Because of these attributes, project size is almost universally used to influence the level of management involvement, how the project is staffed and how long the project is expected to take. While all this is good, in the vast majority of cases a size metric is at best a snapshot of current assumptio  , narrowly defined (ie does not take into account the whole project) and the methodology for calculating the metric itself is either shrouded in secrecy or not well understood in the organization.

PA’s experience shows that the challenges most organizations face when assessing a project’s size is that it is often difficult to calculate a project’s true size in a consistent manner. It is frequently the case that size is calculated by gut feel or else based on inconsistent criteria. As a result, there is often confusion among stakeholders regarding what constitutes a small or large project. This confusion limits the effectiveness of the size metric and means it is not communicating what it can to the organization.