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Project managers adapt project management methodologies to the most appropriate management for each type of project, organization, team and client. Guides and standards are recommended references and bring subsets of knowledge in project management. The guides are recognized as good practices (PMBOK) and are strategically analyzed in relation to scope, deadline, cost, quality, stakeholders involved, risks, human resources, communication, among other aspects. 

The adaptation strategy adopted is not trivial. In some cases, a methodology based on stakeholder relationships and value delivery is adopted. In other cases, control combined with partial deliveries is chosen. It is also possible to adopt methodologies adopted in similar projects based on historical data. However, records of historical information or similar projects are not always available. This can make it impossible to analyze which approach to adopt even with the use of artificial intelligence aimed at classifying demands and characteristics of supposedly similar projects. 

In projects that are known to be predictive or predominantly and knowingly agile, the adaptation process can be shortened. However, the opportunity is lost to exploit a robust set of techniques and tools available in both traditional and agile projects, and especially in hybrid approaches. 

In addition to the strategic process of defining and adapting methodologies, there is a clear definition of what is important for both the organization and the customer. In this regard, there has been an intense concern regarding the customer experience and the massive adoption of agile practices. 

By observing all stakeholders, it is important to look at who actually does the work. Both the team and the supplier may be interested not only in delivering and satisfying the customer but also in being truly recognized for their work. Raising customer awareness about the win-win strategy is not always trivial. Additionally, partial deliveries allow those who do the work, depending on the agreements, to receive back part of the cost involved in the effort expended up until that point. 

In addition, there is a financial analysis throughout the project. Any delay in the cycle caused by an unforeseen risk can lead to cash flow problems and also to accumulated profits, for example: lost sales to competitors. The net present value (NPV) method can be used to analyze the economic and financial viability of projects. When the investment is made using only equity, the NPV calculation is performed by discounting the expected cash flows. 

Cash flows correspond to incremental cash inflows. It is recommended to take into account in the cash flow analysis whether the project will be viable regardless of the financing conditions. Incremental cash flow considers the increments, inflows and outflows that are expected as a result of an investment proposal. Its properties are the periods, the useful life of the project, the opportunity cost, the minimum attractiveness rate, and the real and nominal cash flows. The periods refer to the cash flows that are allocated to a point in time following the capitalization convention at the end of the period. The useful life of the project reflects the economic life or obsolescence, and the opportunity cost represents the loss of remuneration for alternative applications of shareholders' resources. 

In general, agile methodologies do not explore these aspects of cash flow, IRR, and other financial aspects. Metrics are adopted in relationship to the project performance​ as burndown charts, work in progress (WIP), Lead Time, Cycle Times, Execution Time (Touch Time), Waiting Time (Waiting Time), Work in Progress (WIP) among others. Metrics can be analyzed in real-time through the length of your feedback cycle, based on how often you are willing to review the metrics and make changes. Very long cycles mean that improvements to your process will take place slowly. Cycles that are too short can cause your process to not have time to stabilize between each change, which can cause loss. 

The challenge is how to obtain a return on the rapid deliveries made by agile teams. Whether through agreements or through payment cycles such as the cadence of kanban deliveries or the duration of Scrum sprints, the acceptance of deliveries can be reflected in the cash flow of the company that develops the solution. Additionally, organizations have payment or invoicing processes. Thinking strategically about how to optimize this flow can mean greater or lesser returns for the organization. 

In this context, some strategies that may be viable depending on the organization and project are presented. Among them, business process flow technology combined with AI, the adoption of integrated systems containing acceptance information and financial data, the use of OKRs aimed at billing and aligned with deliveries, etc. 

Additionally, it allows you to think about deliverables that represent the greatest value to the client, the team and the organization from the beginning of the project. Strategically thinking about deliverables and payments in the shortest time cycle benefits the team, which can even benefit from the impact on the project's cash flow. 

HOPE AND FRASER propose a performance management system based on key performance indicators ( KPIs ) that establish strategic and tactical results desired by companies and relative performance indicators that measure performance against internal and external benchmarks. 

However, the cash flow of the organization that serves the customer will only benefit if the internal payment flow is also agile and structured. In this case, business process modeling can be taken into account to map activities, actors and documents internally and externally. BPM can be an excellent tool to support the payment flow and the cash flow of the project, allowing the analysis of the chain of activities and events [BPM CBOK]. Finally, process measurement and optimization can support organizations in this regard. 

References 

ANDERSON, D. J., CARMICHAEL , A. Essential Kanban Condensed , Blue Hole Press, 2016. 

BPM CBOK. BPM CBOK Version 3.0: Guide to the Business Process Management Common Body Of Knowledge , Createspace Independent Publishing Platform; 3rd edition, 2013. 

BORDEAUX, Ricardo. Economic and financial viability of projects. Rio de Janeiro: Editora FGV, 2013. 

HIGHSMITH, J. Agile Project Management – Creative Innovative Products . The Agile Software Development Series. Second Edition. Addison Wesley, 2010. 

HOPE, J.; FRASER, R.  Beyond Budgeting: How Managers Can Break Free from the Annual Performance Trap , Harvard Business School Press, 2003. 

The PMBOK-PMI - Project Management Institute - Assembly Guide of Knowledge in Project Management. 6 . ed . New Square: Project Management Institute , 201 7 . ISBN 9781628251845. 

SUTHERLAND, JEFF. Scrum - The Art of Doing Double the Job in Half the Time . LEYA HOUSE OF WORD, 201 4. 

OKR Alliance. Available at: http://www.okralliance.org/ . Visited in: Feb 2020. 

About the Author

 Leonardo Grandinetti Chaves, MSc, PMP is a graduate and postgraduate in IT in Fumec and MSC, master's at Computer Science from Universidade Federal de Minas Gerais -UFMG. He is an MBA Professor. He can be contacted at: [email protected]