Running the Stoplight

One of the most common tools used in project management today also has the potential to be one of its most aggravating: the Red-Yellow-Green, or Stoplight, status. Ever spent an hour arguing over whether a project is yellow or green, yet all the time wondering why it matters?

Like a lot of project management tools, the concept is sound: assign a basic, easy-to-understand tag to a project for its status. Stakeholders can easily determine whether the project situation needs more discussion, and in a program or portfolio situation, a long list of projects can be scanned to see what requires attention. Who could argue with that?

The implementation of this concept is typically based on the answers to two questions:

1.          What makes a project or task Red, Yellow, or Green?

2.          What actions we do take when a project is no longer in Green?

In many situations, these answers are straight-forward.

For the status designation, organizations establish rules by which a project status is assessed a color. For example, Yellow could mean "on-time delivery at risk", "risks and / or issues identified but mitigation plan in place", or "over budget by 5-10%"; Red could be "risks and / or issues identified, no mitigation plan in place" or "over-budget by more than 10%".

For actions, similar standards dictate what should be done: a non-Green project might need to have a path to green defined (along with a due date for those actions), or it might be escalated to a steering committee for more detailed review.

Just as the concept seems sound, these answers seem pretty solid, too. They're specific, measurable, and standard. So what's the problem?

Issues can come up in a number of ways:

·      The assessment criteria do not line up with the required follow-on actions. For example, a project might be over budget, necessitating a flag of Yellow or Red, but the project management and stakeholders agree that this does not indicate a delivery issue for the project, and feel that it does not need to be escalated (maybe the project is small and funding can be sorted out later); the organization's guidelines, however, require an executive review.

·      Status gets used for other purposes, such as an indication of performance or quality. A project can be Red or Yellow for a lot of reasons, many of those not truly reflective of a team or individual's performance.

·      Like many other processes, the status and review process can take on a life of its own, so its existence becomes more important than what it was supposed to accomplish. Rather than a project manager attending to the core issue and getting the help he/she needs, the process can demand work that takes away from actual issue resolution.

·      Follow-up actions and escalations often feel punitive (extra work needed to document status or issues, unpleasant cross-examination of project status, and so on), driving evasive behavior in setting the status.

·      If the follow-up process isn't sufficiently helpful, a project can languish at Red for ages, to the point where its status is simply ignored.

So, how can you make Red-Yellow-Green reporting work?

Number one, it should be entirely clear to everyone what the purpose of the Stoplight tool is.

Some sample purposes:

·      Status is an escalation indicator: anything but Green means that a stakeholder or steering committee is being asked to intervene for assistance. If you're not actually asking for help, status is Green.

·      Status is an indicator that the project is failing to meet its parameters in the iron triangle (cost, scope, schedule).

·      It's needed as a means of communicating status to management, usually conveying that there are notable risks associated with the project.

As far as options go, I prefer the first. Where the third one also serves a communication purpose, it's procedurally a dead-end. The first option is a communications means that drives an action that can help the project.

The second option is popular, but I'm not a fan for several reasons. First, while it's similar to the first, it's more narrow, and again, not always driving an action. Are you asking for more funding, permission to modify scope, or acceptance of a different delivery date? If you're not - and you anticipate that the project will get back on track with no escalation - then perhaps the project really is in Green.

In addition, rigorous parameters to assess status sometimes miss the fact that a project can be successful, delivering its desired objectives, yet not perfectly satisfy its constraints.

How else can you make Stoplight status work for you?

·      Consider using Red and Green only. Or, set the status to the level of escalation or assistance needed (e.g., Yellow means key stakeholder's intervention is needed, Red means steering committee).

·      However you define the process, it should never discourage or punish honest reporting of status. This especially means that performance metrics should not be based on project status, but it can cover other consequences as well.

·      Think about how to make the assessment more subjective. Strict standards on status may not highlight a concern until it's happening, whereas an experienced project manager or sponsor might anticipate it and ask for assistance earlier. Alternatively, perhaps parameters on cost, schedule, etc., are needed, but they can be made looser, such as in a case where strict budget management is less important.

·      Make sure a project's status ties to its risks and issues. You can't ask for help if you haven't scoped out the problem.

·      Put an expiration date on status. If a project is Red every week for three months, is it really Red? Once a crisis has lasted long enough, it's not a crisis anymore, it's part of the environment.

Going even further, if you find yourself bogged down in arguments over whether some is Yellow, Green, or Green with Yellow polka-dots, think about using a different paradigm. Try a thumbs-up / thumbs-down rating, a 1-10 score, a percentage confidence - the limit is only what you can imagine.

Any of these, or even our old friend, the Red-Yellow-Green Stoplight, can be perfectly adequate if it is properly tied to what you want the process to accomplish.