Project Control

1. Project Control Kathy S. Schwaig

2. What is Project Control? • Project control is the continuous monitoring of the project for deviations from plan (time, cost,or quality) and the execution of corrective action • Project Control involves: • Finding and solving problems • Updating the plan • Tracking actual resource usage and costs • Project control requires a comprehensive and credible (i.e., realistic and up-to-date) plan

3. Two Project Control Approaches • Continuously and immediately correct all deviations from plan • Periodically re-plan remainder of project • Which is the better approach?

4. Some Basic Principles of Effective Project Control • Completion orientation • Near term commitment • Preservation of slack • Mutual accountability

5. Project Control Meetings • Project Control Meetings • Frequency of meetings depends on project duration, complexity, and uncertainty • Provides a forum for activity mangers to report activity status information (actual start date, along with either actual finish date, remaining duration, or estimated finish date) • Communication is key • Problems need to be put on the table for discussion----problems need to be identified and diagnosed • Discussion/evaluation of courses and action

6. Outcome of Project Control Meetings • Select/commit to specific action • Analyze impact on project quality/schedule/budget/resource plan • Revise selected course of action as required • Reconfirm individual responsibilities (who is going to do what) • Project manager prepares updated project plan and report

7. Measures of Activity Progress • Actual start and finish dates • Estimated remaining duration • Estimated completion date • Percent complete • Which one would you choose?

8. Traffic Light Reporting • Team members are asked to estimate the likelihood of meeting the planned target date • One traffic light reporting scheme: • Green signifies “on target” • Yellow signifies “not on target but recoverable” • Red signifies “not on target and recoverable only with difficulty” • Traffic light reporting highlights only the risk of non-achievement; it is not an attempt to estimate work done or to quantify expected delays

9. Monitoring and Controlling Project Costs • Cost monitoring is one aspect of project control • Not only is it important to control project costs • Costs provide an indication of the effort that has gone into (or at least been charged to ) a project • A project might be on schedule but only because more money has been spent on activities than originally budgeted • A cumulative expenditure chart provides a simple way to compare actual vs. planned expenditure

10. Limitations of Looking at Project Costs • By themselves, project costs tell us little about project status • Cost charts become much more useful if we add projected future costs • Calculated by adding the estimated costs of uncompleted work to the costs already incurred

11. Earned Value Analysis • EVA, or budgeted cost of work performed, has become more popular in recent years and represents a refinement of cost monitoring • EVA is based on assigning a value to each task or work package based on the original expenditure forecasts • The assigned value is the original budgeted cost for the item and is known as the baseline budget or budgeted cost of work scheduled (BCWS)

12. Earned Value Analysis • A task that has not yet started is assigned the value of zero • When a task is completed, the project is credited with the value of the task • The total value credited to the project at any point is known as the earned value of budgeted cost of work performed (BCWP) • BCWP can be represented as a value or as a percentage of the budgeted cost of work scheduled (BCWS)

13. Earned Value Analysis: Assigning Values to Tasks • Where tasks have been started but are not yet complete, some consistent method of assigning an earned value must be applied • The most conservative approach is to assign a value of zero until a task is completed, at which point it is assigned 100% of the budgeted value.