Project Management Chapter #13

project control steps

1. Setting a baseline plan 2. Measuring progress and performance 3. Comparing plan against actual 4. Taking action

monitoring time performance

A major goal of progress reporting is to catch any negative variances as early as possible to determine if corrective action is needed fortunately, monitoring schedule performance is relatively easy

revised estimated cost at completion

Allows experts in the field to change original baseline durations and costs because new information tells them the original estimates are not accurate.

50/50 rule

Allows for 50% of the value of the work package budget to be earned when it is started and 50% to be earned when the package is completed.

purpose of a baseline (PV)

An anchor point for measuring performance three direct overhead costs are typically included in baselines - labor / equipment / materials A planned cost and expected schedule against which actual cost and schedule are measured A summation of time-phased budgets (cost accounts as summed work packages) along a project timeline

Earned Value Cost/Schedule System

An integrated project management system based on the earned value concept that uses a time-phased budget baseline to compare actual and planned schedule and costs

Time-Phase Baseline Plan

Corrects the failure of most monitoring systems to connect a project's actual performance to its schedule and forecast budget.

percent complete rule

Costs are periodically assigned to a baseline as units of work are completed over the duration of a work package.

Rules for Placing Costs in Baselines

Costs are placed exactly as they are expected to be "earned" in order to track them to their point of origin

percent complete indexes

Indicate how much of the work accomplished represents of the total budgeted (BAC) and actual (AC) dollars to date.

cost variance

Indicates if the work accomplished costs more or less than was planned at any point in the project. is the difference between earned value and actual cost CV = EV - AC

Scheduling Performance Index (SPI) = EV/PV

Measures scheduling efficiency to date.

To Complete Performance Index (TCPI)

Measures the amount of value each remaining dollar in the budget must earn to stay within the budget.

Cost Performance Index (CPI) = EV/AC

Measures the cost efficiency of work accomplished to date. the most accepted and used index

assessing the current status of a project requires three data elements

Planned cost of the work scheduled (PV) Budgeted cost of the work completed (EV) Actual cost of the work completed (AC)

schedule variance

Presents an overall assessment in dollar terms of the progress of all work packages in the project scheduled to date is the difference between earned value and plan value SV = EV - PV

tracking gnatt chart

The Gantt chart is probably the most used tool for communicating project status

control

The process of comparing actual performance against plan to identify deviations, evaluate courses of action, and take appropriate corrective action

forecasting cost at completion

Uses actual costs-to-date plus an efficiency index to project final costs in large projects where the original budget is unreliable.

Percent complete with weighted monitoring gates

Uses subjective estimated percent complete in combination with hard, tangible monitoring points.

0/100 percent rule

assumes 100% of budget credit is earned at once and only when the work is completed

tools for monitoring time performance

baseline / tracking Gantt chart Control chart Milestone schedules

Methods of Variance Analysis

comparing earned value with: the expected schedule value the actual costs

control is one of the most neglected areas of project management

control holds people accountable and helps prevent small problems from turning into big problems

interpretation of indexes

index of 1 = on cost / on schedule index greater than 1 = under cost / ahead of schedule index less than 1 = over cost / behind schedule

milestone schedules

is often used to keep more distant stakeholders informed on the progress of a project

data collected are determined by which metrics will be used for project control

metrics = quantitative assessment used for measurement, comparison, or to track performance or production.

plan value (PV) earned value (EV) actual cost (AC)

plan value - is what you planned to accomplish in the project and reflects the previously completed budget earned value - is the quantification of the "worth" of the work done to date. actual cost - is what has been spent up to the current date

common format for progress reports include

progress since last report current status of project (schedule)(cost)(scope) cumulative trends problems and issues since last reports (actions and resolution of earlier problems) (New variances and problems identified) corrective action planned

setting a baseline plan

provides elements for measuring performance It is derived from the cost and duration information found in the work breakdown structure (WBS)

methods used to revise estimates of future project costs

revised estimated cost at completion forecasting cost at completion

milestones

significant points in the project set to mark major accomplishments

control chart

used to monitor past project schedule performance and current performance and to estimate future schedule trends used to plot the difference between the scheduled time on the critical path at the report date with the actual point on the critical path

Creating a project monitoring system involves determining

what data to collect how, when, and who will collect the data analysis of the data reporting current progress